10. WARRANTS

12 Months Ended

Jun. 30, 2013

Notes to Financial Statements

WARRANTS

At June 30, 2013, the following warrants to purchase the Company’s common stock were outstanding and exercisable:

·   75,000 warrants as partial payment for services exercisable at $0.42 per share which expire in July 2015.

·   2,895,303 warrants in connection with the Underwriting Agreement entered into with MDB Capital Group, LLC as part of underwriting compensation which provided for the sale of $12 million of common stock as described in Note 11 on June 19, 2012 exercisable at $0.475 per share and which expire in June 2017.

·   2,558,019 warrants in connection with Securities Purchase Agreements entered into with certain investors providing for the sale of a total of $2,465,000 of Zero Coupon Convertible Subordinated Notes as described in Note 8 on May 1, 2012 exercisable at $0.53 per share and which expire in May 2017.

·   60,500 warrants as partial payment for services exercisable at $1.00 per share which expire March 2015 through July 2015.

·   40,000 warrants to an equipment supplier in January 2011 exercisable at $0.56 per share and which expire in January 2014.  The fair value of the warrants was $11,834 and was included in the cost of the equipment.

·   1,121,875 warrants acquired by certain purchasers of Company shares in March 2010 exercisable at $1.04 per share and which expire in September 2015.

·   358,333 warrants acquired by certain purchasers of Company shares in August 2009 exercisable at $1.33 per share and which expire in August 2015.

·   50,000 warrants acquired by Empire Financial Group, Ltd. as part of the underwriting compensation in connection with our United States public offering which were exercisable at $7.20 per share expired during June 2012.

·   48,950 warrants issued and outstanding to Strategic Growth International in connection with capital raising activities in 2007, with an exercise price of $7.20 per share expired during June 2012.

·   120,023 warrants acquired by Empire Financial Group, Ltd. in 2006 exercisable at $3.23 per share expired during September 2011.

During the year ended June 30, 2012, 4,132,553 warrants were exercised in connection with the Socius agreement (see Note 11).

For the year ended June 30, 2013, the Company recognized approximately $15,000 of expense related to warrants.

The table below summarizes warrant balances:

	Number of Warrants			Weighted-Average Exercise Price Per Share
Balance at July 1, 2011		1,886,031		$	1.73
Warrants granted		9,614,875			0.60
Warrants expired		(365,823	)		4.54
Warrants exercised		(4,132,553	)		0.72
Balance at June 30, 2012		7,002,530			0.63
Warrants granted		106,500			0.59
Warrants expired		-			-
Warrants exercised		-			-
Balance at June 30, 2013		7,109,030			0.63