10-Q/A

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Amendment No. 1)

(Mark One)

[X]	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the quarterly period ended January 31, 2015
	or
[  ]	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the transition period from _____________ to _____________

Commission file number: 1-8266

DATARAM CORPORATION
(Exact name of registrant as specified in its charter)
New Jersey	22-1831409
(State or other jurisdiction of	(I.R.S.  Employer Identification No.)
incorporation or organization)
P.O. Box 7528, Princeton, NJ	08543
(Address of principal executive offices)	(Zip Code)
(609) 799-0071
(Registrant's telephone number, including area code)
(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. [X] Yes [ ] No

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and

post such files). [X] Yes [ ] No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer or a non-accelerated filer. See definitions of “accelerated filer and large accelerated filer” in Rule 12b of the Exchange Act. (Check One):

Large accelerated filer [ ]   Accelerated filer [ ]   Non-accelerated filer [ ]   Smaller reporting company [X]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). [ ] Yes [X] No

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date. Common Stock ($1.00 par value): As of March 20, 2015, there were 2,726,012 shares outstanding.

EXPLANATORY NOTE

This Form 10-Q/A amends the Quarterly Report on Form 10-Q of Dataram Corporation for the quarterly period ended January 31, 2015 (the “Form 10-Q”), as filed with the Securities and Exchange Commission (the “SEC”) on March 20, 2015, for the sole purpose of furnishing the Interactive Data Files as Exhibit 101 in accordance with Rule 405 of Regulation S-T. Exhibit 101 provides the financial statements and related notes from the Form 10-Q formatted in XBRL (eXtensible Business Reporting Language).

No other changes have been made to the Form 10-Q. This Form 10-Q/A speaks as of the original filing date of the Form 10-Q, does not reflect events that may have occurred subsequent to the original filing date, and does not modify or update in any way disclosures made in the Form 10-Q.

Item 6. Exhibits.

Exhibit No	Description
31(a)*	Rule 13a-14(a) Certification of David A. Moylan.
31(b)*	Rule 13a-14(a) Certification of  Anthony M. Lougee.
32(a)*	Section 1350 Certification of David A. Moylan (furnished not filed).
32(b)*	Section 1350 Certification of Anthony M. Lougee (furnished not filed).
101.INS	XBRL Instance Document.
101.SCH	XBRL Taxonomy Extension Schema Document
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document
101.LAB	XBRL Taxonomy Extension Label Linkbase Document
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document

* Previously filed

Signatures

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	DATARAM CORPORATION
Date: March 23, 2015	By:	/s/ Anthony M. Lougee
		Controller, Chief Accounting Officer

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Note Receivable (Details Narrative) (USD $)	0 Months Ended	1 Months Ended	3 Months Ended
	Nov. 12, 2014	Jul. 30, 2012	Oct. 31, 2013	Jul. 31, 2013	Feb. 22, 2013	Feb. 19, 2013	Jul. 31, 2012
Notes Receivable (Textual) [Abstract]
Convertible terms, description	The Company closed the sale of its Series A Stock which resulted in the reduction of the conversion price of the Bridge Notes held by the institutional investors to $2.00 from $2.50 to equal the conversion price of the Series A Preferred Stock. In addition, two additional 90-day extensions were provided to the institutional investors, which could extend the final maturity date to July 15, 2015.
Shoreline Memory
Notes Receivable (Textual) [Abstract]
Fully reserved balance of note				$ 275,000
Shoreline Memory | Warrant
Notes Receivable (Textual) [Abstract]
Note receivable maturity period		5 years 2 months
Common stock called by warrants, percentage		30.00%
Shoreline Memory | Convertible Senior Promissory Note
Notes Receivable (Textual) [Abstract]
Amount available to be loaned under Convertible Senior Promissory Note							1,500,000
Note receivable, interest rate description		Prime plus 3.0%
Terms of advance under the note		Each time the Company advanced money under the note, the Company was granted 1% of the outstanding Common Stock of Shoreline for every $100,000 advanced up to a maximum of 15%. This was in addition to the 15% allowable under the conversion of the note and the warrant to acquire 30% of Shoreline Common Stock. The conversion is at the rate of 1% of the outstanding Common Stock for each $100,000 converted up to a maximum of 15%.
Note receivable maturity period		3 years
Note receivable collateral, description		The note is secured by all the assets of Shoreline and Shoreline Capital Management Ltd. ("Shoreline Capital") as guarantor.
Convertible terms, description		Also executed with the note was a warrant to purchase 30% of the outstanding Common Stock of Shoreline at the time of exercise and the warrant expires sixty days after the third anniversary of the closing of the transaction. The warrant prescribed a formula to determine the price per share at the time of exercise. If all the amounts under the note were advanced and converted and the full warrant is exercised, the Company would have owned 60% of the outstanding Common Stock of Shoreline.
Partial repayments of note receivable					200,000	50,000
Shoreline Memory | Convertible Senior Promissory Note
Notes Receivable (Textual) [Abstract]
Amount advanced under the note							375,000
Shoreline Memory | Convertible Senior Promissory Note
Notes Receivable (Textual) [Abstract]
Amount advanced under the note							375,000
Shoreline Memory | Amended and Restated Promissory Note
Notes Receivable (Textual) [Abstract]
Termination agreement, description			On March 27, 2013, the Company reached an agreement to terminate its relationship with Shoreline. At closing, the Company received an additional $225,000 as a partial repayment of the loan in connection with the termination of all agreements with Shoreline.
Interest rate of promissory note			6.00%
Repayment terms			The remaining $275,000 was scheduled to be repaid in accordance with the amended and restated promissory note on July 31, 2013.
Settlement			During the quarter ended October 31, 2013 the Company agreed to settle the amount due on the defaulted note for approximately $162,000. The funds were received in escrow on October 31, 2013 and forwarded to the Company on November 1, 2013.
Proceeds from note receivable settlement			$ 162,000

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Subsequent Events (Details Narrative) (USD $)	1 Months Ended	9 Months Ended	1 Months Ended
	Nov. 17, 2014	Jan. 31, 2014	Feb. 28, 2015	Nov. 12, 2014	Feb. 02, 2015
Subsequent Event [Line Items]
Preferred stock issued				600,000
Proceeds from issuance of private placement	$ 2,697,000
Sale of stock, price per share	$ 5.00
Proceeds from issuance of stock		695,491
Subsequent Event | Series A Stock
Subsequent Event [Line Items]
Preferred stock issued					26,600
Price per share					$ 5.00
Proceeds from issuance of private placement			133,000
Subsequent Event | Common Stock
Subsequent Event [Line Items]
Price per share					$ 2.50
Restricted shares issued			183,000
Sale of stock, price per share					$ 2.00
Warrants issued			183,000
Proceeds from issuance of stock			$ 366,000

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Description of Business and Significant Accounting Policies - Common Stock Repurchases (Details Narrative) (USD $)	12 Months Ended	3 Months Ended
	Apr. 30, 2013	Jul. 31, 2012	Jan. 31, 2015	Apr. 10, 2012	Dec. 04, 2002
Equity, Class of Treasury Stock [Line Items]
Treasury shares canceled	22,944
Common Stock Repurchase Plan
Equity, Class of Treasury Stock [Line Items]
Number of shares authorized to repurchase				138,000	83,333
Number of common shares repurchased		22,944
Cost to repurchase common stock		$ 142,262
Total number of shares authorized for purchase			136,408	166,667

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Future Minimum Lease Payments (Tables)

9 Months Ended

Jan. 31, 2015

Leases [Abstract]

Schedule of Future Minimum Lease Payments for Operating Leases

Year ending April 30:	Non-Related Party		Related Party		Total
2015	$	301,000	$	90,000	$	391,000
2016		293,000		90,000		383,000
2017		68,000		90,000		158,000
2018		—		90,000		90,000
2019		—		45,000		45,000
Thereafter		—		—		—
Total	$	662,000	$	405,000	$	1,067,000

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Financing Agreements - Receivables (Details Narrative) (USD $)	0 Months Ended	1 Months Ended	3 Months Ended
	Nov. 12, 2014	Jul. 30, 2012	Oct. 31, 2013	Jul. 31, 2013	Feb. 22, 2013	Feb. 19, 2013	Jul. 31, 2012
Financing Agreements (Textual) [Abstract]
Convertible terms, description	The Company closed the sale of its Series A Stock which resulted in the reduction of the conversion price of the Bridge Notes held by the institutional investors to $2.00 from $2.50 to equal the conversion price of the Series A Preferred Stock. In addition, two additional 90-day extensions were provided to the institutional investors, which could extend the final maturity date to July 15, 2015.
Shoreline Memory
Financing Agreements (Textual) [Abstract]
Fully reserved balance of note				$ 275,000
Shoreline Memory | Warrant
Financing Agreements (Textual) [Abstract]
Note receivable maturity period		5 years 2 months
Common stock called by warrants, percentage		30.00%
Shoreline Memory | Convertible Senior Promissory Note
Financing Agreements (Textual) [Abstract]
Amount to be lend under Convertible Senior Promissory Note							1,500,000
Note receivable, interest rate description		Prime plus 3.0%
Terms of advance under the note		Each time the Company advanced money under the note, the Company was granted 1% of the outstanding Common Stock of Shoreline for every $100,000 advanced up to a maximum of 15%. This was in addition to the 15% allowable under the conversion of the note and the warrant to acquire 30% of Shoreline Common Stock. The conversion is at the rate of 1% of the outstanding Common Stock for each $100,000 converted up to a maximum of 15%.
Note receivable maturity period		3 years
Note receivable collateral, description		The note is secured by all the assets of Shoreline and Shoreline Capital Management Ltd. ("Shoreline Capital") as guarantor.
Convertible terms, description		Also executed with the note was a warrant to purchase 30% of the outstanding Common Stock of Shoreline at the time of exercise and the warrant expires sixty days after the third anniversary of the closing of the transaction. The warrant prescribed a formula to determine the price per share at the time of exercise. If all the amounts under the note were advanced and converted and the full warrant is exercised, the Company would have owned 60% of the outstanding Common Stock of Shoreline.
Partial repayments of note receivable					200,000	50,000
Shoreline Memory | Convertible Senior Promissory Note
Financing Agreements (Textual) [Abstract]
Amount advanced under the note							375,000
Shoreline Memory | Convertible Senior Promissory Note
Financing Agreements (Textual) [Abstract]
Amount advanced under the note							375,000
Shoreline Memory | Amended and Restated Promissory Note
Financing Agreements (Textual) [Abstract]
Termination agreement, description			On March 27, 2013, the Company reached an agreement to terminate its relationship with Shoreline. At closing, the Company received an additional $225,000 as a partial repayment of the loan in connection with the termination of all agreements with Shoreline.
Interest rate of promissory note			6.00%
Repayment terms			The remaining $275,000 was scheduled to be repaid in accordance with the amended and restated promissory note on July 31, 2013.
Settlement			During the quarter ended October 31, 2013 the Company agreed to settle the amount due on the defaulted note for approximately $162,000. The funds were received in escrow on October 31, 2013 and forwarded to the Company on November 1, 2013.
Proceeds from note receivable			$ 162,000

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Accounts receivable (Details) (USD $)	Jan. 31, 2015	Apr. 30, 2014
Receivables [Abstract]
Trade receivables	$ 2,872,774	$ 3,757,408
Other receivables	132,599	125,490
Allowance for doubtful accounts and sales returns	140,000	220,000
Accounts receivable	$ 2,865,373	$ 3,662,898

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Cash and Cash Equivalents

9 Months Ended

Jan. 31, 2015

Notes to Financial Statements

Cash and Cash Equivalents

(3) Cash and Cash Equivalents

Cash and cash equivalents consist of unrestricted cash and marketable securities, the cash balance at January 31, 2015, was $446,145.

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Sales of Securities (Details Narrative) (USD $)	1 Months Ended	3 Months Ended		9 Months Ended			0 Months Ended	1 Months Ended
	Nov. 17, 2014	Jan. 31, 2015	Jul. 31, 2014	Jan. 31, 2015		Jan. 31, 2014	May 11, 2011	Sep. 18, 2013	Jan. 31, 2015	Nov. 30, 2014	Mar. 31, 2014	Nov. 12, 2014	Mar. 20, 2014
Securities Purchase Agreements (Textual) [Abstract]
Net proceeds from sale of common stock and warrants						$ 695,491
Price per share	$ 5.00
Put/Call exercisable period				3 years 9 months 22 days	[1]
Risk-free interest rate, warrants				1.26%
Expected volatility, warrants				100.00%
Discount on notes payable, warrants		562,000		562,000					562,000
Beneficial conversion feature				1,568,000
Adjustments to additional paid in capital, beneficial conversion feature				188,000
Non-cash interest charge		617,000	133,000
Sale of Series A preferred stock												600,000
Proceeds from issuance of private placement	2,697,000
Preferred Stock, call or exercise features				If current and projected revenue growth does not meet estimates, the Company may call upon the remaining Series A Stock available for sale. The Company has 673,400 Series A Shares available for call by the Company at $5.00 per share.
Preferred stock, conversion terms	The Series A Stock is convertible into shares of the Company’s common stock in an amount initially calculated (subject to adjustment) by dividing the $5.00 stated value of each share of Series A Stock by $2.00. The Preferred Warrants have an initial exercise price of $2.50 per share (subject to adjustment).
Common stock issued for services				182,500
Warrants issued for services				90,000
Securities Purchase Agreement of May 11, 2011
Securities Purchase Agreements (Textual) [Abstract]
Numer of common stock sold							295,833
Number of common stock called by warrants							221,875
Net proceeds from sale of common stock and warrants							2,998,000
Combination of securities offered in Securities Purchase Agreement, description							The common stock and warrants were sold in fixed combinations, with each combination consisting of one share of common stock and 0.75 of one warrant, with each whole warrant exercisable for one share of common stock.
Purchase price per fixed combination							11.28
Description of period for exercisability of warrants							The warrants became exercisable six months and one day following the closing date of the Offering and will remain exercisable for five years thereafter.
Percentage of holding in common stock after which exercisability of warrant may be limited							4.99%
Right to call warrants for cancellation, description							After the one year anniversary of the initial exercise date of the warrants, the Company has the right to call the warrants for cancellation for $.006 per warrant in the event that the volume weighted average price of the Company’s Common Stock for 20 consecutive trading days exceeds $27.12.
Exercise price of warrants							$ 13.56
Securities Purchase Agreement of September 18, 2013
Securities Purchase Agreements (Textual) [Abstract]
Numer of common stock sold								350,931
Proceeds from sale of common stock and warrants, gross								807,000
Net proceeds from sale of common stock and warrants								695,491
Combination of securities offered in Securities Purchase Agreement, description								The common stock and warrants were sold in fixed combinations, with each combination consisting of one share of common stock and one warrant, with each warrant exercisable for one share of common stock.
Purchase price per fixed combination								2.30
Description of period for exercisability of warrants								The exercisability of the warrants may be limited if, upon exercise, the holder or any of its affiliates would beneficially own more that 4.99% of the Common Stock.
Percentage of holding in common stock after which exercisability of warrant may be limited								4.99%
Right to call warrants for cancellation, description								After the one year anniversary of the initial exercise date of the warrants, the Company had the right to call the warrants for cancellation for $.001 per share in the event that the volume weighted average price of the Company’s Common Stock for 20 consecutive trading days exceeds $10.00.
Securities Purchase Agreement of November 17, 2014
Securities Purchase Agreements (Textual) [Abstract]
Price per share	$ 5.00
Sale of Series A preferred stock	600,000
Proceeds from issuance of private placement										2,697,000
Preferred Stock, call or exercise features										At any time from November 17, 2014, and prior to October 20, 2019 (the “Put/Call Exercise Period”), the investors may exercise a right to purchase and require the Company to sell up to an additional 700,000 shares of Series A Stock. If the investors have not exercised this right during the Put/Call Exercise Period, the Company may exercise a right to cause and require the investors to purchase up to an additional 700,000 shares of Series A Stock, for an aggregate purchase price of $3,500,000. Neither party can refuse the put or call. If the maximum additional shares are sold/purchased, the gross proceeds to the Company would be $3,500,000.
Preferred stock, conversion terms										Holders of the Series A Stock shall initially have the right to convert such shares of Series A Stock into the number of authorized but previously unissued shares of the Company’s common stock obtained by dividing the stated value of each share of Series A ($5.00) by $2.00. For each share of Series A Stock, the investors will receive 2.5 Preferred Warrants to purchase the Company’s common stock at an exercise price of $2.50 per share. The Preferred Warrants are exercisable immediately for a period of five years from the date of closing. The exercise price of the Preferred Warrants is subject to adjustments in the case of stock splits, stock dividends, combinations of shares and similar recapitalization transactions. The exercisability of the Preferred Warrants may be limited if upon exercise, the warrant holder or any of its affiliates would beneficially own more than 4.99% of the Company’s Common Stock.
Preferred stock, dividend rate percentage										8.00%
Preferred stock, dividend rate per share amount										$ 0.40
Preferred stock, dividend payment terms									As of January 1, 2015, the Company was in the process of issuing approximately 27,500 shares in settlement of the first dividend payment. The value of these shares is therefore presented on the consolidated balance sheets as Shares to be issued.
Common Stock Purchase Agreement
Securities Purchase Agreements (Textual) [Abstract]
Numer of common stock sold											219,754
Proceeds from sale of common stock and warrants, gross											559,000
Price per share													$ 3.00
Warrants exercised											86,100
Exercise price of warrants													$ 3.50
Proceeds from exercise of warrants											$ 306,350
Common stock issued upon exercise of warrants											86,100
Warrant
Securities Purchase Agreements (Textual) [Abstract]
Exercise price of warrants		$ 2.50		$ 2.50					2.50
Warrant exercisable period				5 years
Risk-free interest rate, warrants				1.64%
Expected volatility, warrants				93.00%
Put and Call
Securities Purchase Agreements (Textual) [Abstract]
Put/Call strike price		5.00		5.00					5.00
Put/Call exercisable period				5 years
Put/Call fair value assumptions, exercise price		$ 5.58		$ 5.58					5.58
Risk-free interest rate, warrants				1.64%
Expected volatility, warrants				93.00%
Expected dividend yield				8.00%

[1] This amount represents the weighted average remaining contractual life of stock options in years.

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Description of Business and Significant Accounting Policies - Advertising (Details Narrative) (USD $)	3 Months Ended		9 Months Ended
	Jan. 31, 2015	Jan. 31, 2014	Jan. 31, 2015	Jan. 31, 2014
Marketing and Advertising Expense
Advertising expense, approximate	$ 23,000	$ 25,000	$ 84,000	$ 115,000

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Description of Business and Significant Accounting Policies - Engineering and Research and Development (Details Narrative) (USD $)	Jan. 31, 2015
Property, Plant and Equipment
Capitalized development costs	$ 365,000

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Future Minimum Lease Payments (Details) (USD $)	Apr. 30, 2014
Operating Leased Assets [Line Items]
2015	$ 391,000
2016	383,000
2017	158,000
2018	90,000
2019	45,000
Thereafter
Total	1,067,000
Non-Related Party
Operating Leased Assets [Line Items]
2015	301,000
2016	293,000
2017	68,000
2018
2019
Thereafter
Total	662,000
Related Party
Operating Leased Assets [Line Items]
2015	90,000
2016	90,000
2017	90,000
2018	90,000
2019	45,000
Thereafter
Total	$ 405,000

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Description of Business and Significant Accounting Policies - Income Taxes (Details Narrative) (USD $)	9 Months Ended
	Jan. 31, 2015
Operating Loss Carryforwards [Line Items]
Federal net operationg loss (NOL) carry-forwards	25,600,000
State net operationg loss (NOL) carry-forwards	24,000,000
Minimum
Operating Loss Carryforwards [Line Items]
Federal NOL expiration dates	Jan. 01, 2023
State NOL expiration dates	Jan. 01, 2016
Maximum
Operating Loss Carryforwards [Line Items]
Federal NOL expiration dates	Dec. 31, 2034
State NOL expiration dates	Dec. 31, 2034

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Description of Business and Significant Accounting Policies - Reconciliation of the numerator and denominator used in computing basic and diluted net loss per share (Details) (USD $)	3 Months Ended		9 Months Ended
	Jan. 31, 2015	Jan. 31, 2014	Jan. 31, 2015	Jan. 31, 2014
Basic net loss per share - net loss and weighted average common shares outstanding
Loss (numerator)	$ (2,296,204)	$ (846,786)	$ (4,562,932)	$ (2,066,608)
Shares (denominator)	2,564,751	2,104,662	2,461,925	1,919,517
Net loss per share, basic	$ (0.90)	$ (0.40)	$ (1.85)	$ (1.08)
Effect of dilutive securities
Effect of dilutive securities - stock options
Effect of dilutive securities - warrants
Diluted net loss per share - net loss, weighted average common shares outstanding and effect of stock options and warrants
Loss (numerator)	$ (2,296,204)	$ (846,786)	$ (4,562,932)	$ (2,066,608)
Shares (denominator)	2,564,751	2,104,662	2,461,925	1,919,517
Net loss per share, diluted	$ (0.90)	$ (0.40)	$ (1.85)	$ (1.08)

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Related Party Transactions

9 Months Ended

Jan. 31, 2015

Notes to Financial Statements

Related Party Transactions

(2) Related Party Transactions

During the three-month periods ended January 31, 2015 and 2014, the Company purchased inventories for resale totaling approximately $228,000 and $872,000, respectively, from Sheerr Memory, LLC (“Sheerr Memory”). During the nine-month periods ended January 31, 2015 and 2014, the Company purchased inventories for resale totaling approximately $1,001,000 and $2,336,000, respectively, from Sheerr Memory. Sheerr Memory’s owner (“Mr. Sheerr”) is employed by the Company as the general manager of its Micro Memory business unit and is an executive officer of the Company. Approximately $6,000 and $271,000 of accounts payable in the Company’s consolidated balance sheets as of January 31, 2015 and April 30, 2014, respectively, is payable to Sheerr Memory. Sheerr Memory offers the Company trade terms of net 30 days and all invoices are settled in the normal course of business. No interest is paid. The Company has made further purchases from Sheerr Memory subsequent to January 31, 2015 and management anticipates that the Company will continue to do so, although the Company has no obligation to do so.

During the three-month periods ended January 31, 2015 and 2014, the Company purchased inventories for resale totaling approximately $276,000 and $432,000, respectively, from Keystone Memory Group (“Keystone Memory”). During the nine-month periods ended January 31, 2015 and 2014, the Company purchased inventories for resale totaling approximately $802,000 and $770,000, respectively, from Keystone Memory. Keystone Memory’s owner is a relative of Mr. Sheerr. Approximately $41,000 and $27,000 of accounts payable in the Company’s consolidated balance sheets as of January 31, 2015 and April 30, 2014 are payable to Keystone Memory. Keystone Memory offers the Company trade terms of net due and all invoices are settled in the normal course of business. No interest is paid. The Company has made further purchases from Keystone Memory subsequent to January 31, 2015 and management anticipates that the Company will continue to do so, although the Company has no obligation to do so.

On December 14, 2011, the Company entered into a Note and Security Agreement with Mr. Sheerr. The agreement provides for secured financing of up to $2,000,000. The Company is obligated to pay monthly, interest equal to 10% per annum calculated on a 360-day year of the outstanding loan balance. Principal is payable in 60 equal monthly installments, beginning on July 15, 2012. The Company may prepay any or all sums due under this agreement at any time without penalty. The Company has borrowed the full $2,000,000 available under this agreement. Principal amounts due under this obligation are $33,333 per month which began on July 15, 2012.

The Company amended and restated its Note and Security Agreement with Mr. Sheerr as of October 31, 2013; The Company sold certain equipment and furniture for a purchase price of $500,000 under a sale leaseback transaction to Mr. Sheerr. The Company used the proceeds of the purchase price received from Mr. Sheerr to reduce the remaining principal amount of the original loan by an amount equal to $500,000. The principal amount was reduced to approximately $966,667 at October 31, 2013. The Company was obligated to pay monthly, interest equal to 10% per annum calculated on a 360 day year of the outstanding loan balance. Principal was payable in 29 equal monthly installments of $33,333, beginning on November 15, 2013 and subsequently on the 15th day of each month thereafter, until paid in full. On April 30, 2014, the note was paid in full.

As of October 31, 2013, the Company also entered into an agreement with Mr. Sheerr to leaseback the aforementioned equipment and furniture that was sold to Mr. Sheerr on October 31, 2013. The lease is for a term of 60 months and the Company is obligated to pay approximately $7,500 per month for the term of the lease. The Company has an option to extend the lease for an additional two year period. The transactions described have been accounted for as a sale-leaseback transaction. Accordingly, the Company recognized a gain on the sale of assets of approximately $139,000, which is the amount of the gain on sale in excess of present value of the future lease payments and will recognize the remaining approximately $322,000 gain on sale in proportion to the related gross rental charged to expense over the term of the lease, 60 months. The current portion of $72,000 deferred gain was reflected in accrued liabilities and the long-term portion of $250,000 is reflected in other liabilities – long-term in the consolidated balance sheet as of April 30, 2014. The current portion of $72,000 deferred gain is reflected in accrued liabilities and the long-term portion of $197,000 is reflected in other liabilities – long-term in the consolidated balance sheet as of January 31, 2015.

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Description of Business and Significant Accounting Policies - Net Loss Per Share (Details Narrative)	3 Months Ended		9 Months Ended
	Jan. 31, 2015	Jan. 31, 2014	Jan. 31, 2015	Jan. 31, 2014
Stock Options
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Anti-dilutive securities not included in diluted net loss per common share computation	256,580	287,746	256,580	287,746
Warrant
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Anti-dilutive securities not included in diluted net loss per common share computation	2,975,775	221,875	2,975,775	221,875
Preferred Shares
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Anti-dilutive securities not included in diluted net loss per common share computation	600,000		600,000

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Goodwill and Intangible Assets (Details Narrative) (USD $)	9 Months Ended
	Jan. 31, 2015	Apr. 30, 2014
Goodwill and Intangible Assets (Textual) [Abstract]
Carrying value of goodwill	$ 1,083,555	$ 1,083,555
Goodwill impairment
Intangible assets, amortization method	Acquired intangibles generally are amortized on a straight-line basis over weighted average lives.

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Consolidated Balance Sheets (USD $)	Jan. 31, 2015	Apr. 30, 2014
Current assets:
Cash and cash equivalents	$ 446,145	$ 257,633
Accounts receivable, less allowance for doubtful accounts and sales returns of $140,000 at January 31, 2015 and $220,000 at April 30, 2014	2,865,373	3,662,898
Inventories	2,268,166	2,291,038
Other current assets	206,862	7,227
Total current assets	5,786,546	6,218,796
Property and equipment, at cost:
Machinery and equipment	479,961	450,961
Leasehold improvements	607,867	607,867
Property and equipment, gross	1,087,828	1,058,828
Less: accumulated depreciation and amortization	927,025	840,026
Net property and equipment	160,803	218,802
Other assets	49,210	51,160
Capitalized software development costs	365,424
Goodwill	1,083,555	1,083,555
Total assets	7,445,538	7,572,313
Current liabilities:
Note payable-revolving credit line	2,461,310	2,969,857
Accounts payable	1,274,190	1,438,748
Accrued liabilities	251,565	927,944
Convertible notes payable, net of discount	600,000
Convertible notes payable related parties, net of discount	150,000
Total current liabilities	4,737,065	5,336,549
Other liabilities related party	197,079	250,826
Total liabilities	4,934,144	5,587,375
Stockholders' equity:
Preferred Stock, 600,000 shares outstanding at January 31, 2015	1,776,903
Common stock, par value $1.00 per share. Authorized 54,000,000 shares; issued and outstanding 2,410,512 at October 31, 2014 and April 30, 2014	2,593,012	2,410,512
Additional paid-in capital	21,678,078	20,236,093
Shares to be issued	60,000
Accumulated deficit	(23,596,599)	(20,661,667)
Total stockholders' equity	2,511,394	1,984,938
Total liabilities and stockholders' equity	$ 7,445,538	$ 7,572,313

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Financial Information by Geographic Location (Details) (USD $)	3 Months Ended		9 Months Ended
	Jan. 31, 2015	Jan. 31, 2014	Jan. 31, 2015	Jan. 31, 2014
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues by geographic location	$ 8,050,557	$ 7,641,079	$ 22,655,310	$ 22,418,038
United States
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues by geographic location	6,913,663	6,246,904	19,243,219	18,562,000
Europe
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues by geographic location	1,017,452	830,553	3,015,695	2,359,604
Other (principally Asia Pacific Region)
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues by geographic location	$ 119,442	$ 563,622	$ 396,396	$ 1,496,434

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Consolidated Statements of Cash Flows (Unaudited) (USD $)	9 Months Ended
	Jan. 31, 2015	Jan. 31, 2014
Cash flows from operating activities:
Net loss	$ (2,934,932)	$ (2,066,608)
Adjustments to reconcile net loss to net cash used in operating activities:
Gain on sale of property and equipment		(120,916)
Amortization of deferred gain on sale leaseback	(53,747)
Depreciation and amortization	86,999	266,400
Bad debt expense	31,678	174,859
Amortization of debt discount	750,000
Stock-based compensation expense	14,148	43,399
Changes in assets and liabilities:
Decrease (increase) in accounts receivable	765,847	326,122
Decrease in inventories	22,872	630,853
Decrease (increase) in other current assets	(199,635)	15,452
Decrease in other assets	1,950	6,532
Increase (decrease) in accounts payable	(164,558)	149,822
Decrease in accrued liabilities	(676,379)	(11,551)
Net cash used in operating activities	(2,355,757)	(585,636)
Cash flows from investing activities:
Additions of property and equipment	(29,000)
Software development costs	(365,424)
Sale of property and equipment		500,000
Net cash provided by (used in) investing activities	(394,424)	500,000
Cash flows from financing activities:
Net borrowings (payments) under revolving credit line	(508,547)	(133,757)
Proceeds from issuance of convertible notes and warrants	750,000
Net proceeds from sale of preferred shares	2,697,240
Payments under related party note payable		(800,000)
Net proceeds from sale of common shares		695,491
Net cash provided by (used in) financing activities	2,938,693	(238,266)
Net increase (decrease) in cash and cash equivalents	188,512	(323,902)
Cash and cash equivalents at beginning of period	257,633	324,235
Cash and cash equivalents at end of period	446,145	333
Supplemental disclosures of cash flow information:
Income taxes	2,850
Interest	194,582	256,665
Supplemental disclosures of non cash flow information:
Debt discount on convertible notes payable	750,000
Non-cash preferred stock dividends	$ 1,628,000

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Description of Business and Significant Accounting Policies - Summary of Option Activity (Details) (USD $)	1 Months Ended	9 Months Ended		12 Months Ended
	Jun. 30, 2008	Jan. 31, 2015		Apr. 30, 2014
Summary of option activity, Shares
Balance April 30, 2014		264,244
Granted	8,333
Expired		(16,000)
Balance January 1, 2015		248,244		264,244
Exercisable January 1, 2015		235,744
Expected to vest January 1, 2015		224,000
Summary of option activity, Weighted average exercise price
Balance April 30, 2014		$ 12.42
Expired		$ 15.42
Balance January 1, 2015		$ 12.23		$ 12.42
Exercisable January 1, 2015		$ 12.75
Expected to vest January 1, 2015		$ 12.23
Summary of option activity, Additional disclosures
Balance, Weighted average remaining contractual life		4 years 0 months 11 days	[1]	4 years 5 months 16 days
Exercisable January 1, 2015, Weighted average remaining contractual life		3 years 9 months 22 days	[1]
Expected to vest January 1, 2015, Weighted average remaining contractual life		3 years 9 months 22 days	[1]
Balance April 30, 2014, Aggregate intrinsic value		$ 14,750
Balance January 1, 2015, Aggregate intrinsic value				14,750
Exercisable January 1, 2015, Aggregate intrinsic value
Expected to vest January 1, 2015, Aggregate intrinsic value

[1] This amount represents the weighted average remaining contractual life of stock options in years.

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Description of Business and Significant Accounting Policies (Tables)

9 Months Ended

Jan. 31, 2015

Accounting Policies [Abstract]

Reconciliation of the numerator and denominator used in computing basic and diluted net loss per share

	Three Months ended January 31, 2015
	Loss			Shares		Per share
	(numerator)			(denominator)		amount
Basic net loss per share – net loss and weighted average common shares outstanding	$	(2,296,204	)		2,564,751	$	(.90	)
Effect of dilutive securities – stock options		—			—		—
Effect of dilutive securities – warrants		—			—		—
Diluted net loss per share – net loss, weighted average common shares outstanding and effect of stock options and warrants	$	(2,296,204	)		2,564,751	$	(.90	)

	Three Months ended January 31, 2014
	Loss			Shares		Per share
	(numerator)			(denominator)		amount
Basic net loss per share – net loss and weighted average common shares outstanding	$	(846,786	)		2,104,662	$	(.40	)
Effect of dilutive securities – stock options		—			—		—
Effect of dilutive securities – warrants		—			—		—
Diluted net loss per share – net loss, weighted average common shares outstanding and effect of stock options and warrants	$	(846,786	)		2,104,662	$	(.40	)

	Nine Months ended January 31, 2015
	Loss			Shares		Per share
	(numerator)			(denominator)		amount
Basic net loss per share – net loss and weighted average common shares outstanding	$	(4,562,932	)		2,461,925	$	(1.85	)
Effect of dilutive securities – stock options		—			—		—
Effect of dilutive securities – warrants		—			—		—
Diluted net loss per share – net loss, weighted average common shares outstanding and effect of stock options and warrants	$	(4,562,932	)		2,461,925	$	(1.85	)

	Nine Months ended January 31, 2014
	Loss			Shares		Per share
	(numerator)			(denominator)		amount
Basic net loss per share – net loss and weighted average common shares outstanding	$	(2,066,608	)		1,919,517	$	(1.08	)
Effect of dilutive securities – stock options		—			—		—
Effect of dilutive securities – warrants		—			—		—
Diluted net loss per share – net loss, weighted average common shares outstanding and effect of stock options	$	(2,066,608	)		1,919,517	$	(1.08	)

Summary of option activity

	Shares			Weighted average exercise price		Weighted average remaining contractual life (1)		Aggregate intrinsic value
Balance April 30, 2014		264,244		$	12.42		4.46	$	14,750
Expired		(16,000	)	$	15.42		—		—
Balance January 31, 2015		248,244		$	12.23		4.03		—
Exercisable January 31, 2015		235,744		$	12.75		3.81		—
Expected to vest January 31, 2015		224,000		$	12.23		3.81		—

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Related Party Transactions (Details Narrative) (USD $)	9 Months Ended		3 Months Ended			0 Months Ended	6 Months Ended
	Jan. 31, 2015	Jan. 31, 2014	Oct. 31, 2013	Jan. 31, 2015	Jan. 31, 2014	Dec. 14, 2011 integer	Apr. 30, 2014	Jan. 30, 2015
Related Party Transactions (Textual) [Abstract]
Repayment of Note		$ 800,000
Gain on the sale of assets	(53,747)
Other liabilities	197,079			197,079			250,826
Leaseback Agreement with Mr. Sheerr
Related Party Transactions (Textual) [Abstract]
Sale-leaseback transaction date			2013-10-31
Leaseback assets			Equipment and furniture was sold to David Sheer on October 31, 2013
Terms of lease			The lease is for a term of 60 months and the Company is obligated to pay approximately $7,500 per month for the term of the lease. The Company has an option to extend the lease for an additional two year period.
Gain on the sale of assets			139,000
Sale leaseback deferred gain, net	72,000		322,000	72,000			72,000
Other liabilities	197,000			197,000			250,000
Sheerr Memory
Related Party Transactions (Textual) [Abstract]
Purchase of inventories for resale	872,000	2,336,000		228,000	1,001,000
Accounts payable	6,000			6,000			271,000
Creditor trade cycle term				30 days
Keystone Memory Group
Related Party Transactions (Textual) [Abstract]
Purchase of inventories for resale	432,000	770,000		276,000	802,000
Accounts payable							27,000	41,000
David Sheerr | Note and Security Agreement
Related Party Transactions (Textual) [Abstract]
Maximum secured financing under agreement						2,000,000
Frequency of periodic payment						Monthly
Interest rate terms						The Company is obligated to pay monthly, interest equal to 10% per annum calculated on a 360-day year of the outstanding loan rbalance.
Number of installments						60
Date of first required payment, principal amount						Jul. 15, 2012
Amount borrowed under agreement						2,000,000
Principal amount due per month						33,333
David Sheerr | Amended and Restated Note and Security Agreement
Related Party Transactions (Textual) [Abstract]
Frequency of periodic payment			Monthly
Interest rate terms			The Company was obligated to pay monthly, interest equal to 10% per annum calculated on a 360 day year of the outstanding loan balance. On April 30, 2014 the note was paid in full.
Number of installments			29
Date of first required payment, principal amount			Nov. 15, 2013
Repayment of Note			500,000				966,667
Reduced note balance			966,667
Principal amount due per month			33,333
Monthly Payment Date			15th day of each month
Sale leaseback transaction			$ 500,000

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Inventories (Tables)

9 Months Ended

Jan. 31, 2015

Inventory Disclosure [Abstract]

Inventories

	January 31, 2015		April 30, 2014
Raw materials	$	1,637,739	$	1,576,238
Work in process		28,432		63,631
Finished goods		601,995		651,169
	$	2,268,166	$	2,291,038

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Liquidity of Business and Significant Accounting Policies

9 Months Ended

Jan. 31, 2015

Accounting Policies [Abstract]

Liquidity of Business and Significant Accounting Policies

(1) Description of Business and Significant Accounting Policies

Since 1967, Dataram Corporation (“Dataram” or the “Company”) has been a leading independent manufacturer of memory products and provider of performance solutions. The Company provides customized memory solutions for original equipment manufacturers (OEMs) and compatible memory for leading brands including Cisco, Dell, Fujitsu, HP, IBM, Lenovo and Oracle as well as a line of memory products for Intel and AMD motherboard based servers.  Dataram manufactures its memory in-house to meet three key criteria - quality, compatibility, and selection - and tests its memory for performance and original equipment manufacturer (OEM) compatibility as part of the production process.  With memory designed for over 50,000 systems and with products that range from energy-efficient DDR4 modules to legacy SDR offerings, Dataram offers one of the most complete portfolios in the industry.   Backed by in-depth quality test programs, nearly fifty years of manufacturing expertise, and a limited lifetime warranty, Dataram memory products are built to last.  The company is a CMTL Premier Participant and ISO 9001 (2008 Certified). Its products are fully compliant with JEDEC Specifications.

Dataram’s customers include an international network of distributors, resellers, retailers, OEM customers and end users.

Dataram competes with several other large independent memory manufacturers and the OEMs noted above.  The primary raw material used in producing memory boards is dynamic random access memory (DRAM) chips. The purchase cost of DRAMs is the largest single component of the total cost of a finished memory board. Consequently, average selling prices for computer memory boards are significantly dependent on the pricing and availability of DRAM chips.

In addition to memory products, Dataram offers solutions that provide our customers significant and quantifiable cost savings (reduction in total cost of ownership) while helping them manage end-of-life transitions.  These include:

· Design and engineering services

· Contract and flexible manufacturing to accommodate special customer needs

· Simulation labs for testing and validation

· Financial programs and trade-in / trade-up programs to allow customers to optimize memory procurements

· Software tools to assess memory needs and optimize memory deployment and application performance

Dataram has four business lines which provide complimentary solutions to the market.  Each has a different customer focus and “go to market” approach.  They are:

· Princeton Memory

· Micro Memory Bank (MMB)

· MemoryStore.com

· 18004Memory.com

The Princeton Memory Business provides innovative new memory products that support enterprise / mission critical need; custom and high end memory solutions for most demanding customers ranging from enterprise and data center segments to power users and gamers; provides solutions to extend the density memory options available to customers.  The business also provides:

• Memory Solutions Services:

– Performance optimization, total cost of computing reduction consulting

– Engineering and design services for embedded applications

– Proof of concept engagements

– Customized consignment programs

– Product on-demand offerings

– Installation services

• Software: products that improve application and computing performance

• Buy-back program:  in conjunction with the MMB business, provides customers with opportunity to “trade-in” existing memory as part of a sale with trade-in credited towards purchase of new memory

The Micro Memory Bank business provides new and refurbished memory products which are not commonly available.  These solutions extend the life of the system where memory is no longer available by the OEM, helping companies avoid the cost of additional hardware expenditures.  The business also provides:

• Brokerage services:  makes opportunistic purchases of excess surplus inventories for less than market price; also buys unknown inventory which is then opened, cataloged, and sometimes refurbished.

• Buy-back program: works with Princeton business to provide customers with opportunity to “trade-in” existing memory as part of a sale with trade-in credited towards purchase of new memory.  Memory traded-in is refurbished and then sold.

• Technology recycling program: provides end of life recycling services to customers across all IT hardware categories including laptops, desktops, workstations, servers, main frames, hubs and switches.

Operating since 1994, 18004Memory.com provides a one-stop source for new and refurbished memory products used in desktops, laptops, notebooks, servers, MAC systems, printers, digital cameras, PDAs, MP3 players, and more.  They provide memory upgrades for all major brands including Compaq, Dell, Apple, Hewlett-Packard, Toshiba, IBM, Gateway, Sony, Fujitsu, Acer.  Products are backed by a limited lifetime warranty on all computer memory and 30-day money back guarantee

The Memorystore.com business provides a one-stop web source for “Dataram Value Memory” products used in desktops, laptops, notebooks, servers, workstations, and MAC systems.  Dataram Value Memory is memory specifically designed and tested to meet industry standards.  It is purchased by customers who know the exact technical specifications of the memory they need. Dataram Value Memory is fully compliant with JEDEC Specifications.  It is 100-percent tested and backed by a limited lifetime warranty.

In fiscal 2009, the Company acquired certain assets of Micro Memory Bank, Inc. ("MMB"), a privately held corporation.  The acquisition expanded the Company's memory product offerings and routes to market.

The Company was incorporated in New Jersey in 1967 and made its initial public offering in 1968.  Its common stock, $1 par value (the "Common Stock"), was listed for trading on the American Stock Exchange in 1981. In 2000 the Company changed its listing to the NASDAQ National Market (now the NASDAQ Stock Market) where its stock trades under the symbol "DRAM." The Company's principal executive office is located at 777 Alexander Park, Princeton, New Jersey 08540, its telephone number is (609) 799-0071, its fax is (609) 799-6734 and its website is located at http://www.dataram.com. Proxy Statements, Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, and all amendments thereto, are available on the Company’s website free of charge.

Liquidity and Basis of Presentation

The information for the three and nine months ended January 31, 2015 and 2014 is unaudited, but includes all adjustments (consisting of normal recurring adjustments) which, in the opinion of management, are necessary to state fairly the financial information set forth therein in accordance with accounting principles generally accepted in the United States of America. The interim results are not necessarily indicative of results to be expected for the full fiscal year. These financial statements should be read in conjunction with the audited financial statements for the year ended April 30, 2014 included in the Company’s 2014 Annual Report on Form 10-K filed with the Securities and Exchange Commission. The April 30, 2014 balance sheet has been derived from these statements.

The Company's financial statements are prepared using the accrual method of accounting in accordance with accounting principles generally accepted in the United States of America and have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities in the normal course of business. For the fiscal years ended April 30, 2014, 2013 and 2012, the Company incurred losses in the amounts of approximately $2,609,000, $4,625,000 and $3,259,000, respectively. Net cash used in operating activities totaled approximately $1,554,000, $3,882,000 and $1,218,000 for the fiscal years ended April 30, 2014, 2013 and 2012, respectively. In the nine months ended January 31, 2015 the Company incurred losses of approximately $2,995,000, and used net cash in operations totaled approximately $2,356,000.

On July 15, 2014, the Company entered into a Subordinated Secured Convertible Bridge Note and Warrant Purchase Agreement (the “Purchase Agreement”) governing the issuance of $750,000 aggregate principal amount of Subordinated Secured Convertible Bridge Notes (the “Bridge Notes”) and Warrants (the “Bridge Warrants”).  The Bridge Notes and Bridge Warrants were issued on July 15, 2014.  The Company issued $600,000 aggregate principal amount of the Bridge Notes to certain institutional investors (the “Institutional Investors”) and $150,000 aggregate principal amount of the Bridge Notes to certain members of management, officers and directors of the Company (collectively, “Management”). The Bridge Notes, the initial maturity date of which was October 15, 2014 (which was subject to a three-month extension at the option of the holders that occurred; see below), are convertible into shares of the Company’s common stock. The initial conversion price for Institutional Investors is $2.50 per share (which was subsequently reduced; see below), and the initial conversion price for Management is equal to the closing price of the Company’s common stock on the closing date of the Purchase Agreement, $2.94. The Bridge Notes are secured obligations of the Company and bear interest at a rate of 8% per year. The Bridge Warrants are exercisable for five years after the closing date of the Purchase Agreement, or July 15, 2019. For each $1,000 of principal amount of Bridge Notes, the holder received 1,200 Bridge Warrants, each exercisable for the purchase of one share of the Company’s common stock. Each holder is entitled to exercise one-third of all Bridge Warrants received at an exercise price of $3.00, one-third of all Bridge Warrants received at an exercise price of $3.50, and one-third of all Bridge Warrants received at an exercise price that is equal to the closing price on the closing date of the Purchase Agreement, $2.94. Pursuant to the terms of the Purchase Agreement, and the waiver and consent agreement signed with the Institutional Investors the Company has agreed to register for re-sale the shares underlying the Bridge Notes and the Bridge Warrants on or before February 15, 2015, which did not occur. The Company intends to file a registration statement in the quarter ending April 30, 2015.

On October 15, 2014, the original maturity date of the Bridge Notes, the Bridge Notes were extended to January 15, 2015 for all holders of the Bridge Notes. On November 17, 2014 the Company closed the sale of 600,000 shares of its Series A Preferred Stock (the “Series A Stock”), which together the waiver and consent agreement, resulted in the reduction of the conversion price of the Bridge Notes held by the Institutional Investors to $2.00 from $2.50 to equal the conversion price of the Series A Preferred Stock (see below). In addition, two additional 90-day extensions were provided to the institutional investors, which could extend the final maturity date to July 15, 2015. The extensions expired on January 15, 2015 and at the quarter ended January 31, 2015 the Bridge Notes were in default. The Company paid off approximately $42,500 of the notes and received extensions from all Bridge note holders except for one holder of an $80,000 Bridge Note, which extend the maturity date to July 15, 2015 from the Bridge Note holders prior to this filing. The Company continues to accrue interest on the Bridges Notes. In the event the Bridge Notes are converted to equity, their incremental fair value will be recognized in the consolidated statement of operations. The Company has also advised Rosenthal and Rosenthal, Inc. of the default on the Bridge Notes which is a default under our finance agreement.

As disclosed above, on November 17, 2014 the Company closed a private placement of 600,000 shares of its Series A Stock, together with immediately exercisable, five-year warrants to purchase shares of its common stock (the “Preferred Warrants”), at a price of $5.00 per share of Series A Stock to certain otherwise unaffiliated Institutional Investors (the “Series A Investors”). The Series A Stock is convertible into shares of the Company’s common stock in an amount initially calculated (subject to adjustment) by dividing the $5.00 stated value of each share of Series A Stock by $2.00. The Preferred Warrants have an initial exercise price of $2.50 per share (subject to adjustment). The net proceeds to the Company from the sale of these securities, after deducting the estimated offering expenses incurred by the Company, were approximately $2,697,000.

At any time from November 17, 2014, and prior to October 20, 2019 (the “Put/Call Exercise Period”), the Series A Investors may exercise a right to purchase and require the Company to sell up to an additional 700,000 shares of Series A Stock on terms identical to the terms for the original sale of the Series A Stock, except that, upon such exercise, no additional Preferred Warrants are granted. If the Series A Investors have not exercised this right in full during the Put/Call Exercise Period, the Company may exercise a right to cause and require the Series A Investors to purchase any or all of such otherwise un-purchased 700,000 shares of Series A Stock on terms identical to the terms for the original sale of the Series A Stock, except that, upon such exercise, no additional Preferred Warrants are granted, in either case for an aggregate purchase price of up to $3,500,000.

If current and projected revenue growth does not meet estimates, the Company may call upon the remaining Series A Stock available for sale. The Company has 673,400 Series A Shares available for call by the Company at $5.00 per share.

Principles of Consolidation

The consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America and include the accounts of the Company and its wholly-owned subsidiaries. All significant intercompany transactions and balances have been eliminated in consolidation.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, including deferred tax asset valuation allowances and certain other reserves and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Estimates and assumptions are reviewed periodically and the effects of revisions are reflected in the consolidated financial statements in the period they are determined to be necessary. Some of the more significant estimates made by management include the allowance for doubtful accounts and sales returns, inventory reserves, the deferred income tax asset valuation allowance and other operating allowances and accruals. Actual results could differ from those estimates.

Engineering and Research and Development

Research and development costs are expensed as incurred, including Company-sponsored research and development and costs of patents and other intellectual property that have no alternative future use when acquired and in which we had an uncertainty in receiving future economic benefits. Development costs of a computer software product to be sold, leased, or otherwise marketed are subject to capitalization beginning when a product’s technological feasibility has been established and ending when a product is available for general release to customers. Technological feasibility of a computer software product is established when all planning, designing, coding and testing activities that are necessary to establish that the product can be produced to meet its design specifications (including functions, features and technical performance requirements) are completed.

The Company has been developing computer software for its storage caching product line. On May 1, 2014, the Company determined that technological feasibility for the product was established, and development costs subsequent to that date totaling approximately $365,000 have been capitalized. In December 2014 the Company suspended development of the software product. Prior to May 1, 2014, the Company expensed all development costs related to this product line.

Advertising

Advertising is expensed as incurred and amounted to approximately $23,000 and $84,000 in the three and nine months periods ended January 31, 2015, respectively compared to approximately $25,000 and $115,000 in the comparable prior year periods.

Income Taxes

The Company utilizes the asset and liability method of accounting for income taxes in accordance with the provisions of the “Expenses – Income Taxes Topic” of the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”). Under the asset and liability method, deferred income tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. A valuation allowance is provided when it is more likely than not that some portion or all of the deferred income tax assets will not be realized. The Company considers certain tax planning strategies in its assessment as to the recoverability of its tax assets. Deferred income tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. The effect on deferred income tax assets and liabilities of a change in tax rates is recognized in earnings in the period that the tax rate changes. The Company recognizes, in its consolidated financial statements, the impact of a tax position, if that position is more likely than not to be sustained on audit, based on technical merits of the position.  There are no material unrecognized tax positions in the financial statements. As of January 31, 2015, the Company had Federal and state net operating loss (“NOL”) carry-forwards of approximately $25,600,000 and $24,000,000, respectively. These can be used to offset future taxable income and expire between 2023 and 2034 for Federal tax purposes and 2016 and 2034 for state tax purposes. The Company’s NOL carry-forwards are a component of its deferred income tax assets which are reported net of a full valuation allowance in the Company’s consolidated financial statements at January 31, 2015 and April 30, 2014.

Net Loss per Share

Basic net loss per share is computed by dividing the net loss by the weighted average number of shares of common stock issued and outstanding during the period. The calculation of diluted loss per share for the three and nine months ended January 31, 2015 and 2014 includes only the weighted average number of shares of common stock outstanding. The denominator excludes the dilutive effect of stock options and warrants outstanding as their effect would be anti-dilutive. The following presents a reconciliation of the numerator and denominator used in computing basic and diluted net loss per share for the three-and nine-month periods ended January 31, 2015 and 2014.

	Three Months ended January 31, 2015
	Loss			Shares		Per share
	(numerator)			(denominator)		amount
Basic net loss per share – net loss and weighted average common shares outstanding	$	(2,296,204	)		2,564,751	$	(.90	)
Effect of dilutive securities – stock options		—			—		—
Effect of dilutive securities – warrants		—			—		—
Diluted net loss per share – net loss, weighted average common shares outstanding and effect of stock options and warrants	$	(2,296,204	)		2,564,751	$	(.90	)

	Three Months ended January 31, 2014
	Loss			Shares		Per share
	(numerator)			(denominator)		amount
Basic net loss per share – net loss and weighted average common shares outstanding	$	(846,786	)		2,104,662	$	(.40	)
Effect of dilutive securities – stock options		—			—		—
Effect of dilutive securities – warrants		—			—		—
Diluted net loss per share – net loss, weighted average common shares outstanding and effect of stock options and warrants	$	(846,786	)		2,104,662	$	(.40	)

	Nine Months ended January 31, 2015
	Loss			Shares		Per share
	(numerator)			(denominator)		amount
Basic net loss per share – net loss and weighted average common shares outstanding	$	(4,562,932	)		2,461,925	$	(1.85	)
Effect of dilutive securities – stock options		—			—		—
Effect of dilutive securities – warrants		—			—		—
Diluted net loss per share – net loss, weighted average common shares outstanding and effect of stock options and warrants	$	(4,562,932	)		2,461,925	$	(1.85	)

	Nine Months ended January 31, 2014
	Loss			Shares		Per share
	(numerator)			(denominator)		amount
Basic net loss per share – net loss and weighted average common shares outstanding	$	(2,066,608	)		1,919,517	$	(1.08	)
Effect of dilutive securities – stock options		—			—		—
Effect of dilutive securities – warrants		—			—		—
Diluted net loss per share – net loss, weighted average common shares outstanding and effect of stock options	$	(2,066,608	)		1,919,517	$	(1.08	)

Diluted net loss per common share for the three and nine month periods ended January 31, 2015 and 2014 do not include the effect of options to purchase 256,580 and 287,746 shares, respectively, of common stock because they are anti-dilutive. Diluted net loss per common share for the three and nine month periods ended January 31, 2015 and 2014 do not include the effect of warrants to purchase 2,975,775 and 221,875 shares of common stock, respectively because they are anti-dilutive. Diluted net loss per common share for the three and nine month periods ended January 31, 2015 does not include 600,000 preferred shares because they are anti-dilutive.

Common Stock Repurchases

On December 4, 2002, the Company announced an open market repurchase plan providing for the repurchase of up to 83,333 shares of the Company’s common stock. On April 10, 2012, the Company announced the additional authorization to repurchase up to 138,000 shares of the Company’s common stock which at that time made the total available for purchase up to 166,667 shares. In the quarter ended July 31, 2012, the Company repurchased 22,944 shares for a total cost of $142,262. The 22,944 shares purchased were cancelled in fiscal 2013. Subsequently, the Company has not repurchased any shares. As of January 31, 2015, the total number of shares authorized for purchase under the program is 136,408 shares.

Stock Option Expense

a. Stock-Based Compensation

The Company has a 2001 incentive and non-statutory stock option plan for the purpose of permitting certain key employees to acquire equity in the Company and to promote the growth and profitability of the Company by attracting and retaining key employees. In general, the plan allows granting of up to 300,000 shares of the Company’s common stock at an option price to be no less than the fair market value of the Company’s common stock on the date such options are granted. Options granted under the plan vest ratably on the annual anniversary date of the grants. Vesting periods for options currently granted under the plan range from one to five years. No further options may be granted under this plan.

The Company also has a 2011 incentive and non-statutory stock option plan for the purpose of permitting certain key employees and consultants to acquire equity in the Company and to promote the growth and profitability of the Company by attracting and retaining key employees. No executive officer or director of the Company is eligible to receive options under the 2011 plan. In general, the plan allows granting of up to 33,333 shares of the Company’s common stock at an option price to be no less than the fair market value of the Company’s common stock on the date such options are granted. Options granted under the plan vest ratably on the annual anniversary date of the grants. Vesting periods for options currently granted under the plan range from one to five years. There have been 25,000 shares granted under this plan.

The Company also has a 2014 equity incentive plan for the purpose of permitting certain key employees to acquire equity in the Company and to promote the growth and profitability of the Company by attracting and retaining key employees. The plan allows granting of up to 250,000 shares of the Company’s common stock at an option price to be no less than the fair market value of the Company’s common stock on the date such options are granted. Options granted under the plan vest ratably on the annual anniversary date of the grants. Vesting periods for options currently granted under the plan range from one to five years. There have not been shares granted under this plan.

The Company periodically grants nonqualified stock options to non-employee directors of the Company. These options are granted for the purpose of retaining the services of directors who are not employees of the Company and to provide additional incentive for such directors to work to further the best interests of the Company and its shareholders. The options granted to these non-employee directors are exercisable at a price representing the fair value at the date of grant and expire either five or ten years after date of grant. Vesting periods for options currently granted range from one to two years.

On September 23, 2010, the Company granted Mr. Sheerr, who is employed by the Company as the General Manager of the acquired Micro Memory Bank, Inc. (“MMB”) business unit described in Note 2 and is an executive officer of the Company, nonqualified stock options to purchase 16,667 shares of the Company’s common stock pursuant to his employment agreement. On September 22, 2011, the Company granted Mr. Sheerr additional nonqualified stock options to purchase 16,667 shares of the Company’s common stock, pursuant to his employment agreement. On July 19, 2012, the Company granted Mr. Sheerr additional nonqualified stock options to purchase 16,667 shares of the Company’s common stock, also pursuant to his employment agreement. The options granted are exercisable at a price representing the fair value at the date of grant and expire five years after date of grant. The options vested in one year.

New shares of the Company's common stock are issued upon exercise of stock options.

As required by the “Compensation - Stock Compensation” Topic of the FASB, the accounting for transactions in which an enterprise receives employee services in exchange for (a) equity instruments of the enterprise or (b) liabilities that are based on the fair value of the enterprise’s equity instruments or that may be settled by the issuance of such equity instruments are accounted for using a fair value-based method with a recognition of an expense for compensation cost related to share-based payment arrangements, including stock options and employee stock purchase plans.

Our consolidated statements of operations for the three and nine month periods ended January 31, 2015 include approximately $5,000 and $14,000 of stock-based compensation expense, respectively. The three-and nine- month periods ended January 31, 2014 include approximately $5,000 and $43,000 of stock-based compensation expense, respectively. These stock option grants have been classified as equity instruments and, as such, a corresponding increase has been reflected in additional paid-in capital in the accompanying consolidated balance sheets. The fair value of each stock option granted is estimated on the date of grant using the Black-Scholes Pricing Model.

A summary of option activity for the nine months ended January 31, 2015 is as follows:

	Shares			Weighted average exercise price		Weighted average remaining contractual life (1)		Aggregate intrinsic value
Balance April 30, 2014		264,244		$	12.42		4.46	$	14,750
Expired		(16,000	)	$	15.42		—		—
Balance January 31, 2015		248,244		$	12.23		4.03		—
Exercisable January 31, 2015		235,744		$	12.75		3.81		—
Expected to vest January 31, 2015		224,000		$	12.23		3.81		—

(1) This amount represents the weighted average remaining contractual life of stock options in years.

b. Other Stock Options

On June 30, 2008, the Company granted options to purchase 8,333 shares of the Company’s common stock to a privately held company in exchange for certain patents and other intellectual property. The options granted are exercisable at a price of $15.60 per share, which was the fair value at the date of grant, were 100% exercisable on the date of grant and expire ten years after the date of grant.

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Consolidated Balance Sheets (Parenthetical) (USD $)	Jan. 31, 2015	Apr. 30, 2014
Statement of Financial Position [Abstract]
Allowance for doubtful accounts and sales returns	$ 140,000	$ 220,000
Preferred stock, outstanding shares	600,000
Common stock, par value	$ 1	$ 1
Common stock, authorized shares	54,000,000	54,000,000
Common stock, issued shares	2,410,512	2,410,512
Common stock, outstanding shares	2,410,512	2,410,512

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Financial Information by Geographic Location

9 Months Ended

Jan. 31, 2015

Segment Reporting [Abstract]

Financial Information by Geographic Location

(11) Financial Information by Geographic Location

The Company currently operates in one business segment which develops, manufactures and markets a variety of memory systems for use with network servers and workstations which are manufactured by various companies. Revenues for the three and nine months ended January 31, 2015 and 2014 by geographic region are as follows:

	Three months ended January 31, 2015		Nine months ended January 31, 2015
United States	$	6,913,663	$	19,243,219
Europe		1,017,452		3,015,695
Other (principally Asia Pacific Region)		119,442		396,396
Consolidated	$	8,050,557	$	22,655,310

	Three months ended January 31, 2014		Nine months ended January 31, 2014
United States	$	6,246,904	$	18,562,000
Europe		830,553		2,359,604
Other (principally Asia Pacific Region)		563,622		1,496,434
Consolidated	$	7,641,079	$	22,418,038

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Document and Entity Information	9 Months Ended
	Jan. 31, 2015	Mar. 20, 2015
Document And Entity Information
Entity Registrant Name	Dataram Corporation
Entity Central Index Key	0000027093
Document Type	10-Q
Document Period End Date	Jan. 31, 2015
Amendment Flag	false
Current Fiscal Year End Date	--04-30
Is Entity a Well-known Seasoned Issuer?	No
Is Entity a Voluntary Filer?	No
Is Entity's Reporting Status Current?	Yes
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		2,726,012
Document Fiscal Period Focus	Q3
Document Fiscal Year Focus	2015

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Recently Adopted Accounting Guidance

9 Months Ended

Jan. 31, 2015

Accounting Changes and Error Corrections [Abstract]

Recently Adopted Accounting Guidance

(12) Recently Adopted Accounting Guidance

In May 2014, the Financial Accounting Standards Board issued Accounting Standards Update (ASU) No. 2014-09, “Revenue from Contracts with Customers”.  The purpose of this new standard is to clarify the principles for recognizing revenue so that it can be applied consistently across various transactions, industries and capital markets.  We have not completed our assessment of ASU No. 2014-09.

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Consolidated Statements of Operations (Unaudited) (USD $)	3 Months Ended		9 Months Ended
	Jan. 31, 2015	Jan. 31, 2014	Jan. 31, 2015	Jan. 31, 2014
Income Statement [Abstract]
Revenues	$ 8,050,557	$ 7,641,079	$ 22,655,310	$ 22,418,038
Costs and expenses:
Cost of sales	6,845,904	6,223,013	19,193,718	17,869,323
Engineering	257,827	303,942	575,116	922,961
Selling, general and administrative	1,537,144	1,910,085	4,848,436	5,580,085
Gain on asset disposal		17,916		120,916
Total costs and expenses	8,640,875	8,419,124	24,617,270	24,251,453
Loss from operations	(590,318)	(778,045)	(1,961,960)	(1,833,415)
Other income (expense):
Interest expense, net	(67,550)	(69,831)	(944,582)	(245,826)
Currency gain (loss), net	(10,336)	1,090	(25,540)	12,633
Total other expense, net	(77,886)	(68,741)	(970,122)	(233,193)
Loss before income taxes	(668,204)	(846,786)	(2,932,082)	(2,066,608)
Income tax expense			2,850
Net loss	(668,204)	(846,786)	(2,934,932)	(2,066,608)
Less preferred stock dividends	1,628,000		1,628,000
Net loss allocated to common shareholders	$ (2,296,204)	$ (846,786)	$ (4,562,932)	$ (2,066,608)
Net loss per share of common stock
Basic	$ (0.90)	$ (0.40)	$ (1.85)	$ (1.08)
Diluted	$ (0.90)	$ (0.40)	$ (1.85)	$ (1.08)

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Note Receivable

9 Months Ended

Jan. 31, 2015

Receivables [Abstract]

Note Receivable

(6) Note Receivable

On July 30, 2012, a Convertible Senior Promissory Note was executed by and between Shoreline Memory, Inc. (“Shoreline”) and the Company whereby the Company could lend up to $1,500,000 to Shoreline in exchange for interest payments at prime plus 3.0% and the right to convert the amount outstanding into common stock of Shoreline on or before its maturity date. Each time the Company advanced money under the note, the Company was granted 1% of the outstanding Common Stock of Shoreline for every $100,000 advanced up to a maximum of 15%. This was in addition to the 15% allowable under the conversion of the note and the warrant to acquire 30% of Shoreline common stock. The conversion is at the rate of 1% of the outstanding common stock for each $100,000 converted up to a maximum of 15%. This note had a maturity date of July 30, 2015 at such time Shoreline would have had to repay the note or the Company would have had to convert the note into Common Stock. The note was secured by all the assets of Shoreline and Shoreline Capital Management Ltd. (“Shoreline Capital”) as guarantor. Also executed with the note was a warrant to purchase up to 30% of the outstanding common stock of Shoreline at the time of exercise, which the warrant expires September 28, 2018. The warrant prescribed a formula to determine the price per share at the time of exercise. If all the amounts under the note were advanced and converted and the full warrant was exercised, the Company would have owned 60% of the outstanding common stock of Shoreline. The note was executed simultaneously with a Master Services Agreement that details the parameters under which the Company and Shoreline would have fulfilled orders from Shoreline’s primary customer. On July 31, 2012, the Company advanced $375,000 under the note and an additional $375,000 on August 1, 2012. The purpose of the loan was to fund startup expenses and to prepay initial orders. On February 19, 2013, the Company received $50,000 from Shoreline and, on February 22, 2013, the Company received an additional $200,000 from Shoreline as a partial repayment of their loan. On March 27, 2013, the Company reached an agreement to terminate its relationship with Shoreline. At closing, the Company received an additional $225,000 as a partial repayment of the loan in connection with the termination of all agreements with Shoreline. The promissory note bears interest at the rate of 6% and is guaranteed by Shoreline Memory, Inc., Shoreline Capital Management Ltd and Trevor Folk. All agreements with Shoreline have been terminated with the exception of the amended and restated promissory note. The remaining $275,000 was scheduled to be repaid in accordance with the amended and restated promissory note on July 31, 2013. Shoreline Memory defaulted on the note. The Company set up an allowance for the total $275,000 balance remaining on the amended and restated promissory note at July 31, 2013. During the quarter ended October 31, 2013 the Company agreed to settle the amount due on the defaulted note for approximately $162,000. The funds were received in escrow on October 31, 2013 and forwarded to the Company on November 1, 2013.

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Inventories

9 Months Ended

Jan. 31, 2015

Inventory Disclosure [Abstract]

Inventories

(5) Inventories

Inventories are valued at the lower of cost or market, with costs determined by the first-in, first-out method. Inventories at January 31, 2015 and April 30, 2014 consist of the following categories:

	January 31, 2015		April 30, 2014
Raw materials	$	1,637,739	$	1,576,238
Work in process		28,432		63,631
Finished goods		601,995		651,169
	$	2,268,166	$	2,291,038

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Accounts Receivable (Tables)

9 Months Ended

Jan. 31, 2015

Receivables [Abstract]

Accounts receivable

	January 31, 2015			April 30, 2014
Trade receivables	$	2,872,774		$	3,757,408
Other receivables		132,599			125,490
Allowance for doubtful accounts and sales returns		(140,000	)		(220,000	)
	$	2,865,373		$	3,662,898

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Concentration of Credit Risk

9 Months Ended

Jan. 31, 2015

Notes to Financial Statements

Concentration of Credit Risk

(13) Concentration of Credit Risk

Financial instruments that potentially subject the Company to concentration of credit risk consist primarily of cash and cash equivalents, trade receivables and note receivable. At January 31, 2015 the Company had one customer that represented approximately 17% of accounts receivable. The Company maintains its cash and cash equivalents in financial institutions and brokerage accounts. To the extent that such deposits exceed the maximum insurance levels, they are uninsured. In regard to trade receivables, the Company performs ongoing evaluations of its customers' financial condition as well as general economic conditions and, generally, requires no collateral from its customers.

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Sales of Securities

9 Months Ended

Jan. 31, 2015

Notes to Financial Statements

Sales of Securities

(9) Sales of Securities

On May 11, 2011, the Company and certain investors entered into a securities purchase agreement in connection with a registered direct offering, pursuant to which the Company agreed to sell an aggregate of 295,833 shares of its Common Stock and warrants to purchase a total of 221,875 shares of its Common Stock to such investors for aggregate net proceeds of approximately $2,998,000. The Common Stock and warrants were sold in fixed combinations, with each combination consisting of one share of Common Stock and 0.75 of one warrant, with each whole warrant exercisable for one share of Common Stock. The purchase price was $11.28 per fixed combination. The warrants became exercisable six months and one day following the closing date of the offering and will remain exercisable for five years thereafter at an exercise price of $13.56 per share. The exercise price of the warrants is subject to adjustment in the case of stock splits, stock dividends, combinations of shares and similar recapitalization transactions. The exercisability of the warrants may be limited if, upon exercise, the holder or any of its affiliates would beneficially own more than 4.99% of the Common Stock. After the one year anniversary of the initial exercise date of the warrants, the Company had the right to call the warrants for cancellation for $.006 per warrant in the event that the volume weighted average price of the Common Stock for 20 consecutive trading days exceeds $27.12.

On September 18, 2013, the Company and certain investors entered into a securities purchase agreement in connection with the offering, pursuant to which the Company agreed to sell an aggregate of 350,931 shares of its common stock and warrants to purchase a total of 350,931 shares of its common stock to such investors for aggregate net proceeds, after deducting fees to the Placement Agent and other estimated offering expenses payable by the Company, of approximately $807,000. The common stock and warrants were sold in fixed combinations, with each combination consisting of one share of common stock and one warrant, with each warrant exercisable for one share of common stock. The purchase price was $2.30 per fixed combination. On September 23, 2013 the offering of 350,000 shares and warrants was closed with net proceeds to the Company of approximately $695,491 after accounting for all expenses of the offering. The exercise price of the warrants is subject to adjustment in the case of stock splits, stock dividends, combinations of shares and similar recapitalization transactions. The exercisability of the warrants may be limited if, upon exercise, the holder or any of its affiliates would beneficially own more than 4.99% of the Common Stock. After the one year anniversary of the initial exercise date of the warrants, the Company had the right to call the warrants for cancellation for $.001 per share in the event that the volume weighted average price of the Common Stock for 20 consecutive trading days exceeds $10.00.

On March 20, 2014, the Company and certain investors entered into a common stock purchase agreement in connection with the offering, pursuant to which the Company agreed to sell an aggregate of 219,754 shares of its common stock to such investors for aggregate proceeds, after deducting fees to the Placement Agent and other estimated offering expenses payable by the Company, of approximately $559,000. The purchase price was $3.00 per share.

On March 20, 2014, holders of warrants issued in connection with the sale of common stock on September 18, 2013, exercised 86,100 of those warrants at the exercise price of $3.50 per share resulting in net proceeds of approximately $306,350. The exercise of these warrants resulted in the issuance of 86,100 shares of the Company’s common stock.

The pricing model the Company used for determining fair values of the warrants is the Black-Scholes Pricing Model. The model uses market-sourced inputs such as interest rates, dividend yields, market prices and volatilities. The risk-free interest rate used of 1.26% is based on the rate of U.S Treasury zero-coupon issues with a remaining term equal to the expected life of the Warrants. Expected dividend yield assumes the current dividend rate of zero. Expected volatility of approximately 100% was calculated using the daily closing price over a five year period of the Company’s Common Stock.

The value of the warrants was derived and used as a basis to allocate the proceeds received between the warrants and bridge notes. The proportionate value ascribed to the warrants amounted to approximately $562,000 and was reflected as a discount on notes payable. Further the Company estimated a value of beneficial conversion feature of approximately $188,000 (limited to the amount of proceeds allocated to the notes payable) and reflected such as an additional discount on the bridge notes. The discount on notes payable is being amortized using the straight line amortization over ninety days. This resulted in a non-cash interest charge of approximately $617,000 in the quarter ended October 31, 2014 and approximately $133,000 in this year’s fiscal first quarter ended July 31, 2014.

On November 17, 2014, the Company completed a private placement of 600,000 shares of its Series A Stock together with the Preferred Warrants to purchase shares of its common stock at a price of $5.00 per share, in accordance with the Series A Preferred Stock Purchase Agreement dated October 20, 2014 (the “Purchase Agreement”). The net proceeds to the Company from the sale of the Series A Stock and Preferred Warrants, after deducting the estimated offering expenses incurred by the Company were approximately $2,697,000.

At any time from November 17, 2014, and prior to October 20, 2019 (the “Put/Call Exercise Period”), the investors may exercise a right to purchase and require the Company to sell up to an additional 700,000 shares of Series A Stock. If the investors have not exercised this right during the Put/Call Exercise Period, the Company may exercise a right to cause and require the investors to purchase up to an additional 700,000 shares of Series A Stock, for an aggregate purchase price of $3,500,000. Neither party can refuse the put or call. If the maximum additional shares are sold/purchased, the gross proceeds to the Company would be $3,500,000.

Holders of the Series A Stock shall initially have the right to convert such shares of Series A Stock into the number of authorized but previously unissued shares of the Company’s common stock obtained by dividing the stated value of each share of Series A ($5.00) by $2.00. For each share of Series A Stock, the investors will receive 2.5 Preferred Warrants to purchase the Company’s common stock at an exercise price of $2.50 per share. The Preferred Warrants are exercisable immediately for a period of five years from the date of closing. The exercise price of the Preferred Warrants is subject to adjustments in the case of stock splits, stock dividends, combinations of shares and similar recapitalization transactions. The exercisability of the Preferred Warrants may be limited if upon exercise, the warrant holder or any of its affiliates would beneficially own more than 4.99% of the Company’s Common Stock.

The Holders of the Series A Stock will receive preferential cumulative dividends at the rate of 8% per annum (equivalent to a fixed annual payment of $0.40 per share). The dividends are payable in shares of common stock and shall be valued at the weighted average price of the Company’s common stock over the ten (10) consecutive trading days ended on the second trading day immediately before the payment date. As of January 1, 2015, the Company was in the process of issuing approximately 27,500 shares in settlement of the first dividend payment. The value of these shares is therefore presented on the consolidated balance sheets as Shares to be issued.

The company also issued 182,500 common shares and 90,000 warrants for common shares in exchange for professional services and fees related to the sale of the Series A Stock. The fair value of the warrants is recorded as a simultaneous increase and decrease to additional paid in capital and is therefore not presented on the consolidated statement of stockholders’ equity. The fair value of the common shares is presented as a charge to APIC, with a corresponding increase to common stock related to the par value of the shares issued. The proceeds from the private placement were allocated between the Series A Stock, warrants and the put/call feature based upon their relative fair values. The fair value of the preferred stock was determined utilizing the ‘as converted’ method as the prominent feature driving the value of the instrument was deemed to be underlying value of the common stock to which the instrument was convertible into.

Fair value of the warrants was determined using the Black-Scholes Pricing Model. The model uses market-sourced inputs such as interest rates, dividend yields, market prices and volatilities. The risk-free interest rate used of 1.64% is based on the rate of U.S Treasury zero-coupon issues with a remaining term equal to the expected life of the Warrants. Expected dividend yield assumes the current dividend rate of zero. Expected volatility of approximately 93% was calculated using the daily closing price over a five year period of the Company’s Common Stock. The warrants have a strike price of $2.50 and are exercisable for a period of 5 years.

Fair value of the put and call was determined using the Black-Scholes Pricing Model. The model uses market-sourced inputs such as interest rates, dividend yields, market prices and volatilities. The risk-free interest rate used of 1.64% is based on the rate of U.S Treasury zero-coupon issues with a remaining term equal to the expected life of the Put/Call. Expected dividend yield assumes the contracted rate of 8%. Expected volatility of approximately 93% was calculated using the daily closing price over a five year period of the Company’s Common Stock. The Put/Call has a strike price of $5.00 and are exercisable for a period of approximately 5 years. The fair value of the underlying preferred shares was based on the as converted value of the underlying common shares which was approximately $5.58 as of the issuance date.

Post allocation of proceeds, the Company evaluated the embedded conversion feature within the Series A stock and determined that based upon its effective conversion rate that a beneficial conversion feature existed and required recognition. Such beneficial conversion feature was measured as the intrinsic value between the market price of the common stock on the commitment date and the effective conversion rate of the instrument and amounted to $1,568,000. Given the Preferred A Stock does not have a stated redemption date, this entire discount was immediately recognized as a non-cash dividend. Such dividend was recognized as a reduction to additional paid in capital due to the retained deficit position of the company. Accordingly, the recognition of the beneficial conversion feature resulted in a simultaneous increase and decrease to APIC for $1,568,000 and is therefore not presented on the consolidated statement of stockholders’ equity.

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Goodwill and Intangible Assets

9 Months Ended

Jan. 31, 2015

Notes to Financial Statements

Goodwill and Intangible Assets

(7) Goodwill and Intangible Assets

Goodwill:

The carrying value of goodwill of approximately $1,084,000 is not amortized, but is tested annually as of March 31, the annual anniversary of the acquisition, as well as whenever events or changes in circumstances indicate that the carrying amount may not be recoverable using a two-step process. In the quarter ended January 31, 2015, and at April 30, 2014 the Company concluded no impairment is required.

Intangible Assets:

The Company estimates that it has no significant residual value related to its intangible assets. Acquired intangibles generally are amortized on a straight-line basis over weighted average lives. The intangible assets were fully amortized in the fiscal year ended April 30, 2014.

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Financing Agreements

9 Months Ended

Jan. 31, 2015

Notes to Financial Statements

Financing Agreements

(8) Financing Agreements

The Company amended and restated its Note and Security Agreement with Mr. Sheerr as of October 31, 2013, The Company sold certain equipment and furniture for a purchase price of $500,000 under a sale leaseback transaction to Mr. Sheerr. The Company used the proceeds of the purchase price received from Mr. Sheerr to reduce the remaining principal amount of the original loan by an amount equal to $500,000. The principal amount was reduced to approximately $966,667 at October 31, 2013. The Company was obligated to pay monthly interest equal to 10% per annum calculated on a 360 day year of the outstanding loan balance. Principal was payable in 29 equal monthly installments of $33,333, beginning on November 15, 2013 and subsequently on the 15th day of each month thereafter, until paid in full. On April 30, 2014 the note was paid in full.

As of October 31, 2013, the Company entered into an agreement with Mr. Sheerr to leaseback the equipment and furniture that was sold by the Company to Mr. Sheerr on October 31, 2013. The lease is for a term of 60 months and the Company is obligated to pay approximately $7,500 per month for the term of the lease. The Company has an option to extend the lease for an additional two year period. The transactions described have been accounted for as a sale-leaseback transaction. Accordingly, the Company recognized a gain on the sale of assets of approximately $139,000, which is the amount of the gain on sale in excess of present value of the future lease payments with the remainder of approximately $322,000 gain on sales to be recognized in proportion to the related gross rental charged to expense over the term of the lease, 60 months. The current portion of $72,000 deferred gain was reflected in accrued liabilities and the long-term portion of $250,000 is reflected in other liabilities – long-term in the consolidated balance sheet as of April 30, 2014. The current portion of $72,000 deferred gain is reflected in accrued liabilities and the long-term portion of $197,000 is reflected in other liabilities – long-term in the consolidated balance sheet as of January 31, 2015.

On July 30, 2012, a Convertible Senior Promissory Note was executed by and between Shoreline Memory, Inc. (“Shoreline”) and the Company whereby the Company could lend up to $1,500,000 to Shoreline in exchange for interest payments at prime plus 3.0% and the right to convert the amount outstanding into common stock of Shoreline on or before its maturity date. Each time the Company advanced money under the note, the Company was granted 1% of the outstanding Common Stock of Shoreline for every $100,000 advanced up to a maximum of 15%. This was in addition to the 15% allowable under the conversion of the note and the warrant to acquire 30% of Shoreline common stock. The conversion is at the rate of 1% of the outstanding common stock for each $100,000 converted up to a maximum of 15%. This note had a maturity date of July 30, 2015. At such time Shoreline would have had to repay the note or the Company would have had to convert the note into Common Stock. The note was secured by all the assets of Shoreline and Shoreline Capital Management Ltd. (“Shoreline Capital”) as guarantor. Also executed with the note was a warrant to purchase up to 30% of the outstanding common stock of Shoreline at the time of exercise, which the warrant expires September 28, 2018. The warrant prescribed a formula to determine the price per share at the time of exercise. If all the amounts under the note were advanced and converted and the full warrant was exercised, the Company would have owned 60% of the outstanding common stock of Shoreline. The note was executed simultaneously with a Master Services Agreement that details the parameters under which the Company and Shoreline would have fulfilled orders from Shoreline’s primary customer. On July 31, 2012, the Company advanced $375,000 under the note and an additional $375,000 on August 1, 2012. The purpose of the loan was to fund startup expenses and to prepay initial orders. On February 19, 2013, the Company received $50,000 from Shoreline and, on February 22, 2013, the Company received an additional $200,000 from Shoreline as a partial repayment of their loan. On March 27, 2013, the Company reached an agreement to terminate its relationship with Shoreline. At closing, the Company received an additional $225,000 as a partial repayment of the loan in connection with the termination of all agreements with Shoreline. The promissory note bears interest at the rate of 6% and is guaranteed by Shoreline Memory, Inc., Shoreline Capital Management Ltd and Trevor Folk. All agreements with Shoreline have been terminated with the exception of the amended and restated promissory note. The remaining $275,000 was scheduled to be repaid in accordance with the amended and restated promissory note on July 31, 2013. Shoreline Memory defaulted on the note. The Company set up an allowance for the total $275,000 balance remaining on the amended and restated promissory note at July 31, 2013. During the quarter ended October 31, 2013 the Company agreed to settle the amount due on the defaulted note for approximately $162,000. The funds were received in escrow on October 31, 2013 and forwarded to the Company on November 1, 2013.

On November 6, 2013, the Company entered into a new financing agreement (the “Financing Agreement”) with Rosenthal & Rosenthal, Inc. to replace an existing loan agreement. The Financing Agreement provides for a revolving loan with a maximum borrowing capacity of $3,500,000. The loans under the Financing Agreement mature on November 30, 2016 unless such Financing Agreement is either earlier terminated or renewed. Loans outstanding under the Financing Agreement bear interest at a rate of the Prime Rate (as defined in the Financing Agreement) plus 3.25% (the “Effective Rate”) or on Over-advances (as defined in the Financing Agreement), if any, at a rate of the Effective Rate plus 3%. The Financing Agreement contains other financial and restrictive covenants, including, among others, covenants limiting our ability to incur indebtedness, guarantee obligations, sell assets, make loans, enter into mergers and acquisition transactions and declare or make dividends. Borrowings under the Financing Agreement are collateralized by substantially all the assets of the Company. On April 29, 2014, the Company entered into an amendment (the "Amendment") to the Financing Agreement. The Amendment provides for advances against inventory balances based on prescribed formulas of raw materials and finished goods. The maximum borrowing capacity remains at $3,500,000. Borrowings at January 31, 2015 totaled approximately $2,461,000 and there was approximately $142,000 of additional availability on that date.

On July 15, 2014, the Company entered into the Purchase Agreement governing the issuance of $750,000 aggregate principal amount of Bridge Notes and Bridge Warrants. The Bridge Notes and Bridge Warrants were issued on July 15, 2014.  The Company issued $600,000 aggregate principal amount of the Bridge Notes to certain Institutional investors and $150,000 aggregate principal amount of the Bridge Notes to certain members of Management. The Bridge Notes, the initial maturity date of which was October 15, 2014 (which was subject to a three-month extension at the option of the holders that occurred; see below), are convertible into shares of the Company’s common stock. The initial conversion price for Institutional Investors is $2.50 per share (which was subsequently reduced; see below), and the initial conversion price for Management is equal to the closing price of the Company’s common stock on the closing date of the Purchase Agreement, $2.94. The Bridge Notes are secured obligations of the Company and bear interest at a rate of 8% per year. The Bridge Warrants are exercisable for five years after the closing date of the Purchase Agreement, or July 15, 2019. For each $1,000 of principal amount of Bridge Notes, the holder received 1,200 Bridge Warrants, each exercisable for the purchase of one share of the Company’s common stock. Each holder is entitled to exercise one-third of all Bridge Warrants received at an exercise price of $3.00, one-third of all Bridge Warrants received at an exercise price of $3.50, and one-third of all Bridge Warrants received at an exercise price that is equal to the closing price on the closing date of the Purchase Agreement, $2.94. Pursuant to the terms of the Purchase Agreement, the Company has agreed to register for re-sale the shares underlying the Bridge Notes and the Bridge Warrants.

On October 15, 2014, the original maturity date of the Bridge Notes, the maturity date of the Bridge Notes was extended to January 15, 2015 for all holders of the Bridge Notes. On November 17, 2014 the Company closed the sale of 600,000 shares of its Series A Stock, which resulted in the reduction of the conversion price of the Bridge Notes held by the institutional investors to $2.00 from $2.50 to equal the conversion price of the Series A Preferred Stock (see below). In addition, two additional 90-day extensions were provided to the institutional investors, which could extend the final maturity date to July 15, 2015. The extensions expired on January 15, 2015 and at the quarter ended January 31, 2015 the Bridge Notes were in default. The Company paid off approximately $42,500 of the notes and received extensions from all Bridge note holders except for one holder of an $80,000 Bridge Note, which extend the maturity date to July 15, 2015 from the Bridge Note holders prior to this filing. The Company continues to accrue interest on the Bridges Notes. In the event the Bridge Notes are converted to equity, their incremental fair value will be recognized in the consolidated statement of operations. The Company has also advised Rosenthal and Rosenthal, Inc. of the default on the Bridge Notes which is a default under our finance agreement.

The pricing model the Company used for determining fair values of the Bridge Warrants is the Black-Scholes Pricing Model. The model uses market-sourced inputs such as interest rates, dividend yields, market prices and volatilities. The risk-free interest rate used of 1.26% is based on the rate of U.S Treasury zero-coupon issues with a remaining term equal to the expected life of the Bridge Warrants. Expected dividend yield assumes the current dividend rate of zero. Expected volatility of approximately 100% was calculated using the daily closing price over a five-year period of the Company’s Common Stock.

The value of the Bridge Warrants was derived and used as a basis to allocate the proceeds received between the Bridge Warrants and Bridge Notes. The proportionate value ascribed to the Bridge Warrants amounted to approximately $562,000 and was reflected as a discount on notes payable. Further the Company estimated a value of beneficial conversion feature of approximately $188,000 (limited to the amount of proceeds allocated to the notes payable) and reflected such as an additional discount on the bridge notes. The discount on notes payable is being amortized using the straight line amortization over ninety days. This resulted in a non-cash interest charge of approximately $617,000 in the quarter ended October 31, 2014 and approximately $133,000 in this year’s fiscal first quarter ended July 31, 2014.

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Future Minimum Lease Payments

9 Months Ended

Jan. 31, 2015

Leases [Abstract]

Future Minimum Lease Payments

(10) Future Minimum lease payments

Future minimum lease payments under non-cancelable operating leases (with initial or remaining lease terms in excess of one year) as of April 30, 2014 are as follows:

Year ending April 30:	Non-Related Party		Related Party		Total
2015	$	301,000	$	90,000	$	391,000
2016		293,000		90,000		383,000
2017		68,000		90,000		158,000
2018		—		90,000		90,000
2019		—		45,000		45,000
Thereafter		—		—		—
Total	$	662,000	$	405,000	$	1,067,000

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Description of Business and Significant Accounting Policies - Stock Option Expense (Details Narrative) (USD $)	1 Months Ended	3 Months Ended		9 Months Ended		1 Months Ended
	Jun. 30, 2008	Jan. 31, 2015	Jan. 31, 2014	Jan. 31, 2015	Jan. 31, 2014	Sep. 23, 2010	Sep. 22, 2011	Jul. 19, 2012	Apr. 30, 2014
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of options outstanding		248,244		248,244					264,244
Number of shares granted	8,333
Options expiration period	Ten years after date of grant.
Compensation expense		$ 5,000	$ 5,000	$ 14,148	$ 43,399
Options granted, exercise price	$ 15.60
Percentage of options exercisable on date of grant	100.00%
Stock options | 2001 Incentive and Non-statutory Stock Option Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares allowed for granting under the plan		300,000		300,000
Stock options | 2001 Incentive and Non-statutory Stock Option Plan | Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting periods for options				1 year
Stock options | 2001 Incentive and Non-statutory Stock Option Plan | Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting periods for options				5 years
Stock options | 2011 Incentive and Non-statutory Stock Option Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares allowed for granting under the plan		33,333		33,333
Number of shares granted				25,000
Stock options | 2011 Incentive and Non-statutory Stock Option Plan | Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting periods for options				1 year
Stock options | 2011 Incentive and Non-statutory Stock Option Plan | Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting periods for options				5 years
Stock options | 2014 Equity Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares allowed for granting under the plan		250,000		250,000
Stock options | 2014 Equity Incentive Plan | Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting periods for options				1 year
Stock options | 2014 Equity Incentive Plan | Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting periods for options				5 years
Nonqualified Stock Options | Director
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Options expiration period				Expire either five or ten years after date of grant.
Nonqualified Stock Options | Minimum | Director
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting periods for options				1 year
Nonqualified Stock Options | Maximum | Director
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting periods for options				2 years
Nonqualified Stock Options 2010-09-23 | David Sheerr
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting periods for options						1 year
Number of shares granted						16,667
Options expiration period						Expire five years after date of grant.
Nonqualified Stock Options 2011-09-22 | David Sheerr
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting periods for options							1 year
Number of shares granted							16,667
Options expiration period							Expire five years after date of grant.
Nonqualified Stock Options 2012-07-19 | David Sheerr
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting periods for options								1 year
Number of shares granted								16,667
Options expiration period								Expire five years after date of grant.

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Description of Business and Significant Accounting Policies (Policies)

9 Months Ended

Jan. 31, 2015

Accounting Policies [Abstract]

Liquidity and Basis of Presentation

Liquidity and Basis of Presentation

The information for the three and nine months ended January 31, 2015 and 2014 is unaudited, but includes all adjustments (consisting of normal recurring adjustments) which, in the opinion of management, are necessary to state fairly the financial information set forth therein in accordance with accounting principles generally accepted in the United States of America. The interim results are not necessarily indicative of results to be expected for the full fiscal year. These financial statements should be read in conjunction with the audited financial statements for the year ended April 30, 2014 included in the Company’s 2014 Annual Report on Form 10-K filed with the Securities and Exchange Commission. The April 30, 2014 balance sheet has been derived from these statements.

The Company's financial statements are prepared using the accrual method of accounting in accordance with accounting principles generally accepted in the United States of America and have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities in the normal course of business. For the fiscal years ended April 30, 2014, 2013 and 2012, the Company incurred losses in the amounts of approximately $2,609,000, $4,625,000 and $3,259,000, respectively. Net cash used in operating activities totaled approximately $1,554,000, $3,882,000 and $1,218,000 for the fiscal years ended April 30, 2014, 2013 and 2012, respectively. In the nine months ended January 31, 2015 the Company incurred losses of approximately $2,995,000, and used net cash in operations totaled approximately $2,356,000.

On July 15, 2014, the Company entered into a Subordinated Secured Convertible Bridge Note and Warrant Purchase Agreement (the “Purchase Agreement”) governing the issuance of $750,000 aggregate principal amount of Subordinated Secured Convertible Bridge Notes (the “Bridge Notes”) and Warrants (the “Bridge Warrants”).  The Bridge Notes and Bridge Warrants were issued on July 15, 2014.  The Company issued $600,000 aggregate principal amount of the Bridge Notes to certain institutional investors (the “Institutional Investors”) and $150,000 aggregate principal amount of the Bridge Notes to certain members of management, officers and directors of the Company (collectively, “Management”). The Bridge Notes, the initial maturity date of which was October 15, 2014 (which was subject to a three-month extension at the option of the holders that occurred; see below), are convertible into shares of the Company’s common stock. The initial conversion price for Institutional Investors is $2.50 per share (which was subsequently reduced; see below), and the initial conversion price for Management is equal to the closing price of the Company’s common stock on the closing date of the Purchase Agreement, $2.94. The Bridge Notes are secured obligations of the Company and bear interest at a rate of 8% per year. The Bridge Warrants are exercisable for five years after the closing date of the Purchase Agreement, or July 15, 2019. For each $1,000 of principal amount of Bridge Notes, the holder received 1,200 Bridge Warrants, each exercisable for the purchase of one share of the Company’s common stock. Each holder is entitled to exercise one-third of all Bridge Warrants received at an exercise price of $3.00, one-third of all Bridge Warrants received at an exercise price of $3.50, and one-third of all Bridge Warrants received at an exercise price that is equal to the closing price on the closing date of the Purchase Agreement, $2.94. Pursuant to the terms of the Purchase Agreement, and the waiver and consent agreement signed with the Institutional Investors the Company has agreed to register for re-sale the shares underlying the Bridge Notes and the Bridge Warrants on or before February 15, 2015, which did not occur. The Company intends to file a registration statement in the quarter ending April 30, 2015.

On October 15, 2014, the original maturity date of the Bridge Notes, the Bridge Notes were extended to January 15, 2015 for all holders of the Bridge Notes. On November 17, 2014 the Company closed the sale of 600,000 shares of its Series A Preferred Stock (the “Series A Stock”), which together the waiver and consent agreement, resulted in the reduction of the conversion price of the Bridge Notes held by the Institutional Investors to $2.00 from $2.50 to equal the conversion price of the Series A Preferred Stock (see below). In addition, two additional 90-day extensions were provided to the institutional investors, which could extend the final maturity date to July 15, 2015. The extensions expired on January 15, 2015 and at the quarter ended January 31, 2015 the Bridge Notes were in default. The Company paid off approximately $42,500 of the notes and received extensions from all Bridge note holders except for one holder of an $80,000 Bridge Note, which extend the maturity date to July 15, 2015 from the Bridge Note holders prior to this filing. The Company continues to accrue interest on the Bridges Notes. In the event the Bridge Notes are converted to equity, their incremental fair value will be recognized in the consolidated statement of operations. The Company has also advised Rosenthal and Rosenthal, Inc. of the default on the Bridge Notes which is a default under our finance agreement.

As disclosed above, on November 17, 2014 the Company closed a private placement of 600,000 shares of its Series A Stock, together with immediately exercisable, five-year warrants to purchase shares of its common stock (the “Preferred Warrants”), at a price of $5.00 per share of Series A Stock to certain otherwise unaffiliated Institutional Investors (the “Series A Investors”). The Series A Stock is convertible into shares of the Company’s common stock in an amount initially calculated (subject to adjustment) by dividing the $5.00 stated value of each share of Series A Stock by $2.00. The Preferred Warrants have an initial exercise price of $2.50 per share (subject to adjustment). The net proceeds to the Company from the sale of these securities, after deducting the estimated offering expenses incurred by the Company, were approximately $2,697,000.

At any time from November 17, 2014, and prior to October 20, 2019 (the “Put/Call Exercise Period”), the Series A Investors may exercise a right to purchase and require the Company to sell up to an additional 700,000 shares of Series A Stock on terms identical to the terms for the original sale of the Series A Stock, except that, upon such exercise, no additional Preferred Warrants are granted. If the Series A Investors have not exercised this right in full during the Put/Call Exercise Period, the Company may exercise a right to cause and require the Series A Investors to purchase any or all of such otherwise un-purchased 700,000 shares of Series A Stock on terms identical to the terms for the original sale of the Series A Stock, except that, upon such exercise, no additional Preferred Warrants are granted, in either case for an aggregate purchase price of up to $3,500,000.

If current and projected revenue growth does not meet estimates, the Company may call upon the remaining Series A Stock available for sale. The Company has 673,400 Series A Shares available for call by the Company at $5.00 per share.

Principles of Consolidation

Principles of Consolidation

The consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America and include the accounts of the Company and its wholly-owned subsidiaries. All significant intercompany transactions and balances have been eliminated in consolidation.

Use of Estimates

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, including deferred tax asset valuation allowances and certain other reserves and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Estimates and assumptions are reviewed periodically and the effects of revisions are reflected in the consolidated financial statements in the period they are determined to be necessary. Some of the more significant estimates made by management include the allowance for doubtful accounts and sales returns, inventory reserves, the deferred income tax asset valuation allowance and other operating allowances and accruals. Actual results could differ from those estimates.

Engineering and Research and Development

Engineering and Research and Development

Research and development costs are expensed as incurred, including Company-sponsored research and development and costs of patents and other intellectual property that have no alternative future use when acquired and in which we had an uncertainty in receiving future economic benefits. Development costs of a computer software product to be sold, leased, or otherwise marketed are subject to capitalization beginning when a product’s technological feasibility has been established and ending when a product is available for general release to customers. Technological feasibility of a computer software product is established when all planning, designing, coding and testing activities that are necessary to establish that the product can be produced to meet its design specifications (including functions, features and technical performance requirements) are completed.

The Company has been developing computer software for its storage caching product line. On May 1, 2014, the Company determined that technological feasibility for the product was established, and development costs subsequent to that date totaling approximately $142,000 have been capitalized. Prior to May 1, 2014, the Company expensed all development costs related to this product line.

Advertising

Advertising

Advertising is expensed as incurred and amounted to approximately $23,000 and $84,000 in the three and nine months periods ended January 31, 2015, respectively compared to approximately $25,000 and $115,000 in the comparable prior year periods.

Income taxes

Income Taxes

The Company utilizes the asset and liability method of accounting for income taxes in accordance with the provisions of the “Expenses – Income Taxes Topic” of the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”). Under the asset and liability method, deferred income tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. A valuation allowance is provided when it is more likely than not that some portion or all of the deferred income tax assets will not be realized. The Company considers certain tax planning strategies in its assessment as to the recoverability of its tax assets. Deferred income tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. The effect on deferred income tax assets and liabilities of a change in tax rates is recognized in earnings in the period that the tax rate changes. The Company recognizes, in its consolidated financial statements, the impact of a tax position, if that position is more likely than not to be sustained on audit, based on technical merits of the position.  There are no material unrecognized tax positions in the financial statements. As of January 31, 2015, the Company had Federal and state net operating loss (“NOL”) carry-forwards of approximately $25,600,000 and $24,000,000, respectively. These can be used to offset future taxable income and expire between 2023 and 2034 for Federal tax purposes and 2016 and 2034 for state tax purposes. The Company’s NOL carry-forwards are a component of its deferred income tax assets which are reported net of a full valuation allowance in the Company’s consolidated financial statements at January 31, 2015 and April 30, 2014.

Net loss per share

Net Loss per Share

Basic net loss per share is computed by dividing the net loss by the weighted average number of shares of common stock issued and outstanding during the period. The calculation of diluted loss per share for the three and nine months ended January 31, 2015 and 2014 includes only the weighted average number of shares of common stock outstanding. The denominator excludes the dilutive effect of stock options and warrants outstanding as their effect would be anti-dilutive. The following presents a reconciliation of the numerator and denominator used in computing basic and diluted net loss per share for the three-and nine-month periods ended January 31, 2015 and 2014.

	Three Months ended January 31, 2015
	Loss			Shares		Per share
	(numerator)			(denominator)		amount
Basic net loss per share – net loss and weighted average common shares outstanding	$	(2,296,204	)		2,564,751	$	(.90	)
Effect of dilutive securities – stock options		—			—		—
Effect of dilutive securities – warrants		—			—		—
Diluted net loss per share – net loss, weighted average common shares outstanding and effect of stock options and warrants	$	(2,296,204	)		2,564,751	$	(.90	)

	Three Months ended January 31, 2014
	Loss			Shares		Per share
	(numerator)			(denominator)		amount
Basic net loss per share – net loss and weighted average common shares outstanding	$	(846,786	)		2,104,662	$	(.40	)
Effect of dilutive securities – stock options		—			—		—
Effect of dilutive securities – warrants		—			—		—
Diluted net loss per share – net loss, weighted average common shares outstanding and effect of stock options and warrants	$	(846,786	)		2,104,662	$	(.40	)

	Nine Months ended January 31, 2015
	Loss			Shares		Per share
	(numerator)			(denominator)		amount
Basic net loss per share – net loss and weighted average common shares outstanding	$	(4,562,932	)		2,461,925	$	(1.85	)
Effect of dilutive securities – stock options		—			—		—
Effect of dilutive securities – warrants		—			—		—
Diluted net loss per share – net loss, weighted average common shares outstanding and effect of stock options and warrants	$	(4,562,932	)		2,461,925	$	(1.85	)

	Nine Months ended January 31, 2014
	Loss			Shares		Per share
	(numerator)			(denominator)		amount
Basic net loss per share – net loss and weighted average common shares outstanding	$	(2,066,608	)		1,919,517	$	(1.08	)
Effect of dilutive securities – stock options		—			—		—
Effect of dilutive securities – warrants		—			—		—
Diluted net loss per share – net loss, weighted average common shares outstanding and effect of stock options	$	(2,066,608	)		1,919,517	$	(1.08	)

Diluted net loss per common share for the three and nine month periods ended January 31, 2015 and 2014 do not include the effect of options to purchase 256,580 and 287,746 shares, respectively, of common stock because they are anti-dilutive. Diluted net loss per common share for the three and nine month periods ended January 31, 2015 and 2014 do not include the effect of warrants to purchase 2,975,775 and 221,875 shares of common stock, respectively because they are anti-dilutive. Diluted net loss per common share for the three and nine month periods ended January 31, 2015 does not include 600,000 preferred shares because they are anti-dilutive.

Common Stock Repurchases

Common Stock Repurchases

On December 4, 2002, the Company announced an open market repurchase plan providing for the repurchase of up to 83,333 shares of the Company’s common stock. On April 10, 2012, the Company announced the additional authorization to repurchase up to 138,000 shares of the Company’s common stock which at that time made the total available for purchase up to 166,667 shares. In the quarter ended July 31, 2012, the Company repurchased 22,944 shares for a total cost of $142,262. The 22,944 shares purchased were cancelled in fiscal 2013. Subsequently, the Company has not repurchased any shares. As of January 31, 2015, the total number of shares authorized for purchase under the program is 136,408 shares.

Stock Option Expense

Stock Option Expense

a. Stock-Based Compensation

The Company has a 2001 incentive and non-statutory stock option plan for the purpose of permitting certain key employees to acquire equity in the Company and to promote the growth and profitability of the Company by attracting and retaining key employees. In general, the plan allows granting of up to 300,000 shares of the Company’s common stock at an option price to be no less than the fair market value of the Company’s common stock on the date such options are granted. Options granted under the plan vest ratably on the annual anniversary date of the grants. Vesting periods for options currently granted under the plan range from one to five years. No further options may be granted under this plan.

The Company also has a 2011 incentive and non-statutory stock option plan for the purpose of permitting certain key employees and consultants to acquire equity in the Company and to promote the growth and profitability of the Company by attracting and retaining key employees. No executive officer or director of the Company is eligible to receive options under the 2011 plan. In general, the plan allows granting of up to 33,333 shares of the Company’s common stock at an option price to be no less than the fair market value of the Company’s common stock on the date such options are granted. Options granted under the plan vest ratably on the annual anniversary date of the grants. Vesting periods for options currently granted under the plan range from one to five years. There have been 25,000 shares granted under this plan.

The Company also has a 2014 equity incentive plan for the purpose of permitting certain key employees to acquire equity in the Company and to promote the growth and profitability of the Company by attracting and retaining key employees. The plan allows granting of up to 250,000 shares of the Company’s common stock at an option price to be no less than the fair market value of the Company’s common stock on the date such options are granted. Options granted under the plan vest ratably on the annual anniversary date of the grants. Vesting periods for options currently granted under the plan range from one to five years. There have not been shares granted under this plan.

The Company periodically grants nonqualified stock options to non-employee directors of the Company. These options are granted for the purpose of retaining the services of directors who are not employees of the Company and to provide additional incentive for such directors to work to further the best interests of the Company and its shareholders. The options granted to these non-employee directors are exercisable at a price representing the fair value at the date of grant and expire either five or ten years after date of grant. Vesting periods for options currently granted range from one to two years.

On September 23, 2010, the Company granted Mr. Sheerr, who is employed by the Company as the General Manager of the acquired Micro Memory Bank, Inc. (“MMB”) business unit described in Note 2 and is an executive officer of the Company, nonqualified stock options to purchase 16,667 shares of the Company’s common stock pursuant to his employment agreement. On September 22, 2011, the Company granted Mr. Sheerr additional nonqualified stock options to purchase 16,667 shares of the Company’s common stock, pursuant to his employment agreement. On July 19, 2012, the Company granted Mr. Sheerr additional nonqualified stock options to purchase 16,667 shares of the Company’s common stock, also pursuant to his employment agreement. The options granted are exercisable at a price representing the fair value at the date of grant and expire five years after date of grant. The options vested in one year.

New shares of the Company's common stock are issued upon exercise of stock options.

As required by the “Compensation - Stock Compensation” Topic of the FASB, the accounting for transactions in which an enterprise receives employee services in exchange for (a) equity instruments of the enterprise or (b) liabilities that are based on the fair value of the enterprise’s equity instruments or that may be settled by the issuance of such equity instruments are accounted for using a fair value-based method with a recognition of an expense for compensation cost related to share-based payment arrangements, including stock options and employee stock purchase plans.

Our consolidated statements of operations for the three and nine month periods ended January 31, 2015 include approximately $5,000 and $14,000 of stock-based compensation expense, respectively. The three-and nine- month periods ended January 31, 2014 include approximately $5,000 and $43,000 of stock-based compensation expense, respectively. These stock option grants have been classified as equity instruments and, as such, a corresponding increase has been reflected in additional paid-in capital in the accompanying consolidated balance sheets. The fair value of each stock option granted is estimated on the date of grant using the Black-Scholes Pricing Model.

A summary of option activity for the nine months ended January 31, 2015 is as follows:

	Shares			Weighted average exercise price		Weighted average remaining contractual life (1)		Aggregate intrinsic value
Balance April 30, 2014		264,244		$	12.42		4.46	$	14,750
Expired		(16,000	)	$	15.42		—		—
Balance January 31, 2015		248,244		$	12.23		4.03		—
Exercisable January 31, 2015		235,744		$	12.75		3.81		—
Expected to vest January 31, 2015		224,000		$	12.23		3.81		—

(1) This amount represents the weighted average remaining contractual life of stock options in years.

b. Other Stock Options

On June 30, 2008, the Company granted options to purchase 8,333 shares of the Company’s common stock to a privately held company in exchange for certain patents and other intellectual property. The options granted are exercisable at a price of $15.60 per share, which was the fair value at the date of grant, were 100% exercisable on the date of grant and expire ten years after the date of grant.

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Financial Information by Geographic Location (Tables)

9 Months Ended

Jan. 31, 2015

Segment Reporting [Abstract]

Revenue by geographic location

	Three months ended January 31, 2015		Nine months ended January 31, 2015
United States	$	6,913,663	$	19,243,219
Europe		1,017,452		3,015,695
Other (principally Asia Pacific Region)		119,442		396,396
Consolidated	$	8,050,557	$	22,655,310

	Three months ended January 31, 2014		Nine months ended January 31, 2014
United States	$	6,246,904	$	18,562,000
Europe		830,553		2,359,604
Other (principally Asia Pacific Region)		563,622		1,496,434
Consolidated	$	7,641,079	$	22,418,038

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Financing Agreements - Payables (Details Narrative) (USD $)	0 Months Ended	3 Months Ended		9 Months Ended		3 Months Ended	6 Months Ended	1 Months Ended
	Nov. 12, 2014	Jan. 31, 2015	Jul. 31, 2014	Jan. 31, 2015	Jan. 31, 2014	Oct. 31, 2013	Apr. 30, 2014	Nov. 30, 2013	Nov. 06, 2013
Financing Agreements (Textual) [Abstract]
Subordinated secured convertible bridge notes		$ 750,000		$ 750,000
Conversion price	$ 2.00
Warrants issued in connection with the bridge notes, exercise terms				The Bridge Warrants are exercisable for five years after the closing date of the Purchase Agreement, or July 15, 2019. For each $1,000 of principal amount of Bridge Notes, the holder received 1,200 Bridge Warrants, each exercisable for the purchase of one share of the Company’s common stock. Each holder is entitled to exercise one-third of all Bridge Warrants received at an exercise price of $3.00, one-third of all Bridge Warrants received at an exercise price of $3.50, and one-third of all Bridge Warrants received at an exercise price that is equal to the closing price on the closing date of the Purchase Agreement, $2.94. Pursuant to the terms of the Purchase Agreement, the Company has agreed to register for re-sale the shares underlying the Bridge Notes and the Bridge Warrants.
Bridge notes, conversion terms	The Company closed the sale of its Series A Stock which resulted in the reduction of the conversion price of the Bridge Notes held by the institutional investors to $2.00 from $2.50 to equal the conversion price of the Series A Preferred Stock. In addition, two additional 90-day extensions were provided to the institutional investors, which could extend the final maturity date to July 15, 2015.
Sale of Series A preferred stock	600,000
Risk-free interest rate, warrants				1.26%
Expected volatility, warrants				100.00%
Discount on notes payable, warrants		562,000		562,000
Beneficial conversion feature				1,568,000
Non-cash interest charge		617,000	133,000
Repayment of Note					800,000
Repayment of debt				42,500
Bridge note holder, non-extended description				The Company paid off approximately $42,500 of the notes and received extensions from all Bridge note holders except for one holder of $80,000 Bridge Note, which extends the maturity date to July 15, 2015.
Sale-leaseback agreement
Sale leaseback transaction, gain recognized				(53,747)
Other liabilities		197,079		197,079			250,826
Leaseback Agreement with Mr. Sheerr
Sale-leaseback agreement
Sale-leaseback transaction date						2013-10-31
Leaseback assets						Equipment and furniture was sold to David Sheer on October 31, 2013
Terms of lease						The lease is for a term of 60 months and the Company is obligated to pay approximately $7,500 per month for the term of the lease. The Company has an option to extend the lease for an additional two year period.
Sale leaseback transaction, gain recognized						139,000
Other liabilities		197,000		197,000			250,000
Sale leaseback transaction, gain yet to be recognized		72,000		72,000		322,000	72,000
Amended and Restated Note and Security Agreement | David Sheerr
Financing Agreements (Textual) [Abstract]
Interest rate terms						The Company was obligated to pay monthly, interest equal to 10% per annum calculated on a 360 day year of the outstanding loan balance. On April 30, 2014 the note was paid in full.
Frequency of periodic principal payment						Monthly
Number of installments						29
Date of first required payment, principal amount						Nov. 15, 2013
Repayment of Note						500,000	966,667
Reduced note balance						966,667
Principal amount due per month						33,333
Sale-leaseback agreement
Sale leaseback transaction						500,000
Secured Debt Financing Agreement Amended and Restated
Financing Agreements (Textual) [Abstract]
Formula-based secured debt financing capacity									3,500,000
Line of credit facility, maturity date								Nov. 30, 2016
Current borrowings		2,461,000		2,461,000
Borrowings, collateral, description								Borrowings are collateralized by substantially all assets.
Credit facility, interest rate								Prime plus 3.25% or on Over-advances at a rate of the Effective Rate plus 3%
Additional financing available under the terms of the agreement		142,000		142,000
Institutional Investor
Financing Agreements (Textual) [Abstract]
Interest rate		8.00%		8.00%
Subordinated secured convertible bridge notes		600,000		600,000
Conversion price		$ 2.50		$ 2.50
Bridge notes, maturity date				Jul. 15, 2015
Management
Financing Agreements (Textual) [Abstract]
Interest rate		8.00%		8.00%
Subordinated secured convertible bridge notes		$ 150,000		$ 150,000
Conversion price		$ 2.94		$ 2.94
Bridge notes, maturity date				Jul. 15, 2015

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Consolidated Statements of Stockholders' Equity (Unaudited) (USD $)	Common Stock	Additional Paid-In Capital	Preferred Stock	Shares to be Issued	Accumulated Deficit	Total
Beginning balance at Apr. 30, 2014	$ 2,410,512	$ 20,236,093			$ (20,661,667)	$ 1,984,938
Net loss					(2,934,932)	(2,934,932)
Stock based compensation expense		14,148				14,148
Fair value of detachable warrants		562,000				562,000
Beneficial conversion feature of convertible notes payable		188,000				188,000
Common shares issued in connection with sales of preferred stock	182,500	(182,500)				0
Preferred shares issued		920,337	1,776,903			2,697,240
Non-cash preferred stock dividend		(60,000)		60,000		0
Ending balance at Jan. 31, 2015	$ 2,593,012	$ 21,678,078	$ 1,776,903	$ 60,000	$ (23,596,599)	$ 2,511,394

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Accounts Receivable

9 Months Ended

Jan. 31, 2015

Receivables [Abstract]

Accounts Receivable

(4) Accounts Receivable

Accounts receivable consists of the following categories:

	January 31, 2015			April 30, 2014
Trade receivables	$	2,872,774		$	3,757,408
Other receivables		132,599			125,490
Allowance for doubtful accounts and sales returns		(140,000	)		(220,000	)
	$	2,865,373		$	3,662,898

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Description of Business and Significant Accounting Policies - Liquidity and Basis of Presentation (Details Narrative) (USD $)	1 Months Ended	3 Months Ended		9 Months Ended		12 Months Ended
	Nov. 17, 2014	Jan. 31, 2015	Jan. 31, 2014	Jan. 31, 2015	Jan. 31, 2014	Apr. 30, 2014	Apr. 30, 2013	Apr. 30, 2012	Nov. 12, 2014
Accounting Policies [Abstract]
Net loss		$ (668,204)	$ (846,786)	$ (2,934,932)	$ (2,066,608)	$ (2,609,000)	$ (4,625,000)	$ (3,259,000)
Net cash used in operating activities				(2,355,757)	(585,636)	(1,554,000)	(3,882,000)	(1,218,000)
Private placement of Series A Stock (shares)									600,000
Price per share of Series A Stock	$ 5.00
Conversion of Series A Stock	The Series A Stock is convertible into shares of the Company’s common stock in an amount initially calculated (subject to adjustment) by dividing the $5.00 stated value of each share of Series A Stock by $2.00. The Preferred Warrants have an initial exercise price of $2.50 per share (subject to adjustment).
Proceeds from issuance of private placement	$ 2,697,000
Series A shares available for call features				If current and projected revenue growth does not meet estimates, the Company may call upon the remaining Series A Stock available for sale. The Company has 673,400 Series A Shares available for call by the Company at $5.00 per share.

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Inventories (Details) (USD $)	Jan. 31, 2015	Apr. 30, 2014
Inventory Disclosure [Abstract]
Raw materials	$ 1,637,739	$ 1,576,238
Work in process	28,432	63,631
Finished goods	601,995	651,169
Inventories	$ 2,268,166	$ 2,291,038

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Subsequent Events

9 Months Ended

Jan. 31, 2015

Subsequent Events [Abstract]

Subsequent Events

(14) Subsequent Events

On February 2, 2015, the Company completed a private placement of 26,600 shares of its Series A Stock (“Series together with Preferred Warrants to purchase shares of its common stock at a price of $5.00 per share, in accordance with the Series A Preferred Stock Purchase Agreement dated October 20, 2014 (the “Purchase Agreement”). The net proceeds to the Company from the sale of the Series A Stock and Preferred Warrant were approximately $133,000.

On February 2, 2015, the Company issued and sold an aggregate of 183,000 restricted shares of its common stock at a price of $2.00 per share and five-year warrants to purchase and additional 183,000 shares with an exercise price of $2.50 per share, of which 50,000 shares were purchased by David A Moylan the Company’s CEO. The net proceeds to the Company from the sale of the restricted common stock and warrants (exclusive of any exercise thereof) were approximately $366,000.

On February 4, 2015, Dataram Corporation (the “Company” or “we”) received a letter dated February 4, 2015, from the Listing Qualifications Department of The NASDAQ Stock Market LLC (“NASDAQ”) notifying us that we no longer comply with NASDAQ’s audit committee requirements as set forth in listing Rule 5605. Such Rule requires that our Audit Committee have a minimum of three members, each of whom is an independent director.  Concurrently with our appointment of David A. Moylan as interim President and CEO, he resigned his position as a member of our Audit Committee. As a result, our Audit Committee currently has two members, each of whom is an independent director – Michael E. Markulec and Richard D. Butler Jr.