Annual report pursuant to Section 13 and 15(d)

STOCKHOLDERS' EQUITY (Tables)

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STOCKHOLDERS' EQUITY (Tables)
 12 Months Ended
Jun. 30, 2012
Warrant Activity and Related Balances Outstanding

Warrant activity during the fiscal year ended June 30, 2012 and related balances outstanding as of that date are reflected below:

 

    Number     Average Purchase
Price Per Share		  
Shares purchasable under outstanding warrants at July 1, 2010     —     $ —  
Shares purchasable under outstanding warrants at June 30, 2011     —     $ —  
Stock purchase warrants issued     2,400,328     $ 0.41  
Stock purchase warrants exercised     —     $   
Shares purchasable under outstanding warrants at June 30, 2012   2,400,328     $ 0.41  
Stock Option Activity

Stock option activity during the fiscal year ended June 30, 2012 and 2011 and related balances outstanding as of that date are reflected below:

 

    Number of
Shares		     Weighted Average
Exercise Price		     Weighted Average
Remaining Contract
Term (# years)		  
Outstanding at July 1 ,2010, as adjusted*     2,097,841     $ 0.04          
Outstanding at June 30, 2011, as adjusted*     2,097,841     $ 0.04          
Granted     2,734,578       0.25          
Exercised     -       -          
Forfeited and cancelled     (295,470 )     0.04          
                         
Outstanding at June 30, 2012     4,536,949     $ 0.17       7.61  
                         
Exercisable at June 30, 2012     1,916,712     $ 0.04       5.54  

 

(*based on a ratio of 2.9547039- See Note 1)
Stock Options by Price Range

The following table summarizes by price range the number, weighted average exercise price and weighted average life (in years) of options outstanding and the number and weighted average exercise price of exercisable options as of June 30, 2012.

 

Price Range   Total Outstanding     Total Exercisable  
    Number
of
Shares		     Weighted
Average		     Number
of
Shares		     Weighted
Average
Exercise
Price		  
          Exercise
Price		     Life              
$0.04 – $0.410     4,536,949     $ 0.17       7.61       1,916,712     $ 0.04  
                                         
Total     4,536,949     $ 0.17       7.61       1,916,712     $ 0.04  
Assumptions Used to Measure Fair Value of Stock Options

The Company uses the Black-Scholes valuation model to calculate the fair value of stock options. The fair value of stock options was measured at the grant date using the assumptions (annualized percentages) in the table below:

 

    2012     2011  
Expected volatility     100%     100%
Risk free interest rate     0.8% to 3.0%       3.0%
Forfeiture rate     5%     5%
Dividend yield     0%     0%
Expected term     5-10 years       10 years