f10k2012_attitudedrink.htm

Note 11 –

Stockholders’ Deficit

(a) Series A Preferred Stock:

The Company’s articles of incorporation authorize the issuance of 20,000,000 shares of preferred stock which the Company has designated as Series A Preferred (“Series A”), $.001 par value. Each share of Series A is convertible into six shares of the Company’s common stock for a period of five years from the date of issue. The conversion basis is not adjusted for any stock split or combination of the common stock. The Company must at all times have sufficient common shares reserved to effect the conversion of all outstanding Series A Preferred. The holders of the Series A Preferred shall be entitled to receive common stock dividends when, as, if and in the amount declared by the directors of the Company to be in cash or in market value of the Company’s common stock. The Company is restricted from paying dividends or making distributions on its common stock without the approval of a majority of the Series A holders. The Series A shall be senior to the Common Stock and any other series or class of the Company’s Preferred Stock. The Series A has liquidation rights in the event of any liquidation, dissolution, or winding up of the Company, whether voluntary or involuntary, the holders of the Series A then outstanding shall be entitled to be paid out of the assets of the Company available for distribution to its shareholders, before any payment or declaration and setting apart for payment of any amount shall be made in respect of any outstanding capital stock of the Company, an amount equal to $.001 per share, The Company, at the option of its directors, may at any time or from time to time redeem the whole or any part of the outstanding Series A. Upon redemption, the Company shall pay for each share redeemed the amount of $2.00 per share, payable in cash, plus a premium to compensate the original purchaser(s) for the investment risk and cost of capital equal to the greater of (a) $2.00 per shares, or (b) an amount per share equal to fifty percent (50%) of the market capitalization of the Company on the date of notice of such redemption divided by 2,000,000. We have evaluated our Series A Preferred Stock and determined these shares required equity classification because the number of shares convertible into common stock is fixed and reserved. Redemption of these preferred shares cannot be effected because of the Company’s stockholders’ deficit.

F-34

Note 11 –

Stockholders’ Deficit (continued):

(a) Series A Preferred Stock (continued):

During the quarter ended September 30, 2009, 9,000,000 shares of Series A Preferred were granted to Roy Warren. We recorded a non-cash expense for $1,620,000 which is based on the then market price of $0.03 per common share times the convertible stock equivalents (9,000,000 preferred shares x 6 = 54,000,000 common stock equivalents). These shares have specific voting power in that Roy Warren has voting rights for the 54,000,000 common stock equivalents. The Board of Directors on September 4, 2009 approved an amendment whereas Section 2(A) of the Certificate of Designation is hereby declared in its entirety, and the following shall be substituted in lieu thereof-Rights, Powers and Preferences: The Series A shall have the voting powers, preferences and relative, participating, optional and other special rights, qualifications, limitations and restrictions as follows: Designation and Amount – Out of the Twenty Million (20,000,000) shares of the $0.001 par value authorized preferred stock, all Twenty Million (20,000,000) shares shall be designated as shares of “Series A.”

(b) Common Stock Warrants

As of March 31, 2012, the Company had the following outstanding warrants:

		Expiration	Warrants		Exericse
Issued Class A Warrants	Grant Date	Date	Granted		Price

October, 2007 Convertible Notes Financing	10/23/2007	7/15/2015	908,806	$	0.02
October, 2007 Due Diligence	10/23/2007	10/22/2012	50,000	$	0.02
January, 2008 Investment Banker Agreement	1/1/2008	12/31/2012	6,250	$	10.00
February, 2008 Convertible Note Financing	2/15/2008	7/15/2015	757,304	$	0.02
April, 2008 Supply Agreement	4/16/2008	4/15/2013	5,000	$	15.00
Aprl, 2008 Finder's Fees	4/14/2008	4/13/2013	3,125	$	10.00
May, 2008 Finder's Fees	5/19/2008	5/18/2013	1,875	$	10.00
June, 2008 Convertible Note Financing	6/26/2008	6/25/2013	151,502	$	0.02
January, 2009 Convertible Note Financing	1/27/2009	7/15/2015	120,000	$	0.02
January, 2009 Debt Extensions	1/27/2009	1/26/2014	26,800	$	1.00
February, 2009 Convertible Note Financing	1/27/2009	1/26/2014	60,000	$	0.02
March, 2009 Convertible Note Financing	3/30/2009	7/15/2015	416,666	$	0.02
July, 2009 Convertible Note Financing	7/15/2009	7/15/2015	335,648	$	0.02
January, 2010 Convertible Note Financing	1/28/2010	7/15/2015	104,166	$	0.02
February, 2010 Convertible Note Financing	2/19/2010	7/15/2015	104,167	$	0.02
March, 2010 Convertible Note Financing	3/26/2010	7/15/2015	286,458	$	0.02
May, 2010 Convertible Note Financing	5/13/2010	7/15/2015	114,583	$	0.02
July, 2010 Convertible Notes Financinbg	7/15/2010	7/14/2015	56,666,666	$	0.02
September, 2010 Debt Extension	9/9/2010	9/9/2013	51,000	$	0.05
January, 2011 Debt Extension	1/11/2011	1/10/2014	12,000	$	0.05
January, 2011 Financing	1/21/2011	1/20/2016	14,578,005	$	0.02
March, 2011 Financing	3/17/2011	3/16/2016	37,423,842	$	0.02
March, 2011 Financing Finder's Fees	3/17/2011	3/16/2016	3,973,510	$	0.02
June, 2011 Debt Exchange Agreement	6/30/2011	6/29/2016	20,000,000	$	0.02
July, 2011 Financing	7/15/2011	7/14/2016	25,000,000	$	0.02
July, 2011 Financing Finder's Fees	7/15/2011	7/14/2016	2,500,000	$	0.02
February, 2012 Financing	2/22/2012	2/21/2017	50,000,000	$	0.02

Total issued Class A warrants			213,657,373

F-35

Note 11 –

Stockholders’ Deficit (continued):

(b) Common Stock Warrants (continued)

Unissued Class B warrants (a):

October, 2007 Convertible Notes Financing			140,910
January, 2008 Investment Banker Agreement			6,250
February, 2008 Convertible Notes Financing			75,756
April, 2008 Finder's Fees			3,125
May, 2008 Finder's Fees			1,875
June, 2008 Convert8ible Note Financing			15,152

Total unissued Class B Warrants			243,068

Total Warrants			213,900,441

(a) When certain Class A warrants are exercised, holders of these warrants will receive an equal number of Class B warrants with an exercise price of $15.00.

				Average
	Shares			Price

Activity for our common stock warrants is presented below:

Total warrants outstanding March 31, 2010		3,704,840		$	1.60

New warrants granted		130,283,548			0.02
Additional warrants due to modification letters to extend due dates		8,995			0.05
Cashless exercise of warrants		(17,526,942	)		(0.02	)

Total warrants outstanding March 31, 2011		116,470,441			0.06

New warrants granted		97,500,000			0.02
Warrants that expired		(70,000	)		-

Total warrants outstanding March 31, 2012		213,900,441		$	0.04

Cashless exercises of 17,526,942 warrants were made for the fiscal year ended March 31, 2011. No warrants were exercised for the fiscal year ended March 31, 2012.

F-36

Note 11 –

Stockholders’ Deficit (continued):

At March 31, 2012, we had issued and outstanding 854,047,952 shares of common stock of which 5,125,562 shares are owned by our two officers. Holders of shares of common stock are entitled to one vote for each share on all matters to be voted on by the shareholders. Holders of common stock have no cumulative voting rights. In the event of liquidation, dissolution or winding down of the Company, the holders of shares of common stock are entitled to share, pro rata, all assets remaining after payment in full of all liabilities. Holders of common stock have no preemptive rights to purchase our common stock. There are no conversion rights or redemption or sinking fund provisions with respect to the common stock. All of the outstanding shares of common stock are validly issued, fully paid and non-assessable.

Common Stock Issued for the Year Ended March 31, 2012:

On April 1, 2011, we issued a total of 351,000 shares of common stock pursuant to two conversions of October, 2007 convertible notes (later assigned to new debt holders in July, 2010) for $4,065 and $1,200 (total of $5,265) at a conversion price of $.015.

On April 6, 2011, we issued 260,000 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $3,822 at a conversion price of $.0147.

On April 14, 2011, we issued 89,660 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $1,816 at a conversion price of $.02025.

On May 2, 2011, we issued 1,000 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $12 at a conversion price of $.01225.

On May 5, 2011, certain employees converted a total $327,248 of past due salaries into 22,261,770 shares of common stock at a conversion price of $.0147.

On May 5, 2011, we issued 2,000,000 shares of common stock to an investor relations firm for services rendered at a conversion price of $.0157 valued at $31,400.

On May 6, 2011, we issued 6,000,000 shares of common stock for the conversion of the original April 9, 2008 short-term bridge loan with principal balance of $120,000 at a conversion price of $.02.

Also on May 6, 2011, we issued 2,952,958 shares of common stock pursuant to a conversion of certain March 2009 convertible notes for $37,001 at a conversion price of $.01253.

On May 12, 2011, we issued 100,000 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $1,150 at a conversion price of $.0115.

On May 13, 2011, we issued 86,136 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $991 at a conversion price of $.0115.

On May 17, 2011, we issued 67,500 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $768 at a conversion price of $.011375.

On May 18, 2011, we issued 70,000 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $718 at a conversion price of $.01025.

On May 23, 2011, we issued 211,200 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $1,785 at a conversion price of $.0085.

On May 25, 2011, we issued 321,000 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $2,688 at a conversion price of $.008375.

On June 1, 2011, we issued 192,800 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $1,591 at a conversion price of $.00825.

F-37

Note 11 –

Stockholders’ Deficit (continued):

On June 7, 2011, we issued 139,000 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $938 at a conversion price of $.00675.

On June 13, 2011, we issued 175,700 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $1,120 at a conversion price of $.006375.

On June 14, 2011, we issued 207,000 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $1,320 at a conversion price of $.006375.

On June 15, 2011, we issued 156,600 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $979 at a conversion price of $.00625.

On June 20, 2011, we issued 400,000 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $2,500 at a conversion price of $.00625.

On June 22, 2011, we issued 400,000 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $2,560 at a conversion price of $.0064.

On June 30, 2011, we issued 500,000 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $3,213 at a conversion price of $.006425.

On July 20, 2011, we issued 3,079,286 shares of common stock pursuant to a conversion of certain March, 2009 convertible notes for $21,555 at a conversion price of $.007.

On July 21, 2011, we issued 1,500,000 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $10,688 at a conversion price of $.007125.

On July 25, 2011, we issued 5,000,000 shares of common stock pursuant to a conversion of January, 2008 convertible notes for $33,484 and another $1,356 for the original October, 2007 convertible notes for a total of $34,840 at a conversion price of $.006968.

On July 27, 2011, we issued 500,000 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $3,188 at a conversion price of $.006375.

On August 3, 2011, we issued 500,000 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $3,188 at a conversion price of $.00436.

On August 11, 2011, we issued 5,376,344 shares of common stock pursuant to a conversion of certain March, 2009 convertible notes for $25,000 at a conversion price of $.00465.

On August 11, 2011, we issued 200,000 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $872 at a conversion price of $.00436.

On August 31, 2011, we issued 3,000,000 shares of restricted common stock to outside legal counsel for past due services at a conversion price of $.002 with a recorded value of $6,000.

On September 1, 2011, we issued 1,338,678 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $2,470 at a conversion price of $.001845.

On September 13, 2011, we issued 4,513,899 shares of common stock pursuant to a conversion of January, 2011 convertible notes for $5,530 at a conversion price of $.001225.

On September 27, 2011, we issued 2,800,000 shares of common stock pursuant to a conversion of January, 2011 convertible notes for $2,800 at a conversion price of $.001.

F-38

Note 11 –

Stockholders’ Deficit (continued):

On October 4, 2011, we issued 6,000,263 shares of common stock pursuant to a conversion of accrued interest associated with February, 2008 convertible notes in the amount of $5,712 at a conversion price of $.000952.

On October 12, 2011, we issued 701,064 shares of common stock pursuant to a conversion of January, 2011 convertible notes for $526 at a conversion price of $.00075.

On November 1, 2011, we issued 1,295,609 shares of common stock pursuant to a conversion of January, 2011 convertible notes for $1,095 at a conversion price of $.000845.

On November 3, 2011, we issued 9,300,000 shares of common stock pursuant to conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for two conversions totaling $8,580 at a conversion price of $.000923.

On November 3, 2011, we issued 5,517,402 shares of common stock pursuant to conversion of January, 2011 convertible notes for three conversions totaling $5,091 at a conversion price of $.000923.

On November 8, 2011, we issued 5,437,815 shares of common stock pursuant to conversion of January, 2011 convertible notes for three conversions totaling $5,955 at a conversion price of $.001095.

On November 8, 2011, we issued 4,000,000 shares of common stock pursuant to a conversion of October, 2007 convertible notes for $4,672 at a conversion price of $.001168.

On November 8, 2011, we issued 6,900,000 shares of common stock pursuant to a conversion of March, 2011 convertible notes for $7,556 at a conversion price of $.001095.

On November 10, 2011, we issued 5,600,000 shares of common stock pursuant to conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for two conversions totaling $6,748 at a conversion price of $.001205.

On November 10, 2011, we issued 2,440,987 shares of common stock pursuant to conversion of January, 2011 convertible notes for three conversions totaling $2,941 at a conversion price of $.001205.

On November 14, 2011, we issued 6,000,000 shares of common stock pursuant to a conversion of March, 2011 convertible notes for $8,070 at a conversion price of $.001345.

On November 17, 2011, we issued 1,400,000 shares of common stock pursuant to a conversion of March, 2011 convertible notes for $2,275 at a conversion price of $.001625.

On November 17, 2011, we issued 586,373 shares of common stock pursuant to a conversion of January, 2011 convertible notes for $953 at a conversion price of $.001625.

On November 23, 2011, we issued 2,304,694 shares of common stock pursuant to conversion of January, 2011 convertible notes for two conversions totaling $3,914 at a conversion price of $.001518.

On November 23, 2011, we issued 2,000,000 shares of common stock pursuant to a conversion of March, 2011 convertible notes for $3,035 at a conversion price of $.001518.

On November 28, 2011, we issued 3,309,051 shares of common stock pursuant to conversion of March, 2011 convertible notes for two conversions totaling $4,194 at a conversion price of $.001268.

On November 29, 2011, we issued 9,000,000 shares of common stock pursuant to a conversion of October, 2007 convertible notes for $11,880 at a conversion price of $.00132.

On December 7, 2011, we issued 3,748,592 shares of common stock pursuant to conversion of March, 2011 convertible notes for two conversions totaling $3,490 plus $1,205 for one of the conversions at a conversion price of $.001253 to $.001268.

F-39

Note 11 –

Stockholders’ Deficit (continued):

On December 7, 2011, we issued 501,236 shares of common stock pursuant to a conversion of January, 2011 convertible notes for $628 at a conversion price range of $.001253.

On December 20, 2011, we issued 703,619 shares of common stock pursuant to a conversion of January, 2011 convertible notes for $825 at a conversion price of $.001173.

On December 20, 2011, we issued 5,000,000 shares of common stock pursuant to conversion of March, 2011 convertible notes for two conversions totaling $5,863 at a conversion price of $.001173.

On December 30, 2011, company employees returned 27,918,336 shares of common stock previously granted to them earlier in the year for past due services in exchange for a similar number of employee stock options at an exercise price of $.02. These shares were cancelled and reduced the total outstanding number of common shares.

On December 31, 2011, we issued 3,134,422 shares of common stock pursuant to a conversion of June, 2011 convertible notes for $2,701 at a conversion price of $.000863.

On January 10, 2012, we issued 7,000,000 shares of common stock pursuant to a conversion of October, 2011 convertible notes for $6,300 at a conversion price of $.0009.

On January 10, 2012, we issued 7,000,000 shares of common stock pursuant to a conversion of March, 2011 convertible notes for $5,933 at a conversion price of $.000848.

On January 10, 2012, we issued 1,142,700 shares of common stock pursuant to a conversion of January, 2011 convertible notes for $968 at a conversion price of $.000848.

On January 10, 2012, we issued 4,000,000 shares of common stock pursuant to a conversion of June, 2011 convertible notes for $3,390 at a conversion price of $.000848.

On January 12, 2012, we issued 8,928,571 shares of common stock pursuant to a conversion of accrued interest from March, 2009 convertible notes for $8,000 at a conversion price of $.000896.

On January 20, 2012, we issued 2,000,000 shares of common stock pursuant to a conversion of January, 2011 convertible notes for $1,630 at a conversion price of $.000815.

On January 20, 2012, we issued 4,541,178 shares of common stock pursuant to a conversion of March, 2011 convertible notes for $3,701 at a conversion price of $.000815.

On January 20, 2012, we issued 4,000,000 shares of common stock pursuant to a conversion of June, 2011 convertible notes for $3,260 at a conversion price of $.000815.

On January 23, 2012, we issued 1,355,000 shares of common stock pursuant to a conversion of March, 2011 convertible notes for $1,104 at a conversion price of $.000815.

On January 23, 2012 and January 25, 2012, we issued 11,500,000 shares of common stock pursuant to conversion of October, 2007 convertible notes for two conversions totaling $9,994 at a conversion price of $.000869.

On January 25, 2012, we issued 11,150,000 shares of common stock pursuant to a conversion of $9,689 accrued interest for March, 2009 convertible notes at a conversion price of $.000869.

On January 25, 2012 and January 26, 2012, we issued 12,000,000 shares of common stock pursuant to conversion of March, 2011 convertible notes for four conversions totaling $9,780 at a conversion price of $.000815.

On January 25, 2012 and January 26, 2012, we issued 7,000,000 shares of common stock pursuant to conversion of July, 2010 convertible notes for two conversions totaling $5,705 at a conversion price of $.000815.

F-40

Note 11 –

Stockholders’ Deficit (continued):

On January 25, 2012, we issued 11,000,000 shares of common stock pursuant to a conversion of January, 2008 convertible notes for $9,559 at a conversion price of $.000869.

On January 25, 2012, we issued 3,000,000 shares of common stock pursuant to a conversion of July, 2010 convertible notes for $2,445 at a conversion price of $.000815.

On January 25, 2012, we issued 3,500,000 shares of common stock pursuant to conversion of January, 2011 convertible notes for two conversions totaling $2,853 at a conversion price of $.000815.

On January 26, 2012, we issued 4,000,000 shares of common stock pursuant to a conversion of July, 2010 convertible notes for $3,260 at a conversion price of $.000815.

On January 26, 2012, we issued 4,000,000 shares of common stock pursuant to a conversion of June, 2011 convertible notes for $3,260 at a conversion price of $.000815.

On January 26, 2012, we issued 10,000,000 shares of common stock pursuant to conversion of January, 2011 convertible notes for three conversions totaling $2,935 at a conversion price of $.000815.

On January 27, 2012, we issued 2,410,414 shares of common stock pursuant to a conversion of accrued interest for March, 2009 convertible notes for $2,095 at a conversion price of $.000869.

On January 27, 2012, we issued 12,267,120 shares of common stock pursuant to conversion of January, 2011 convertible notes for three conversions totaling $9,998 at a conversion price of $.000815.

On January 27, 2012, we issued 13,000,000 shares of common stock pursuant to conversion of March, 2011 convertible notes for two conversions totaling $10,595 at a conversion price of $.000815.

On January 27, 2012, we issued 2,800,000 shares of common stock pursuant to a conversion of January, 2011 convertible notes for $2,282 at a conversion price of $.000815.

On January 27, 2012, we issued 8,000,000 shares of common stock pursuant to a conversion of July, 2010 convertible notes for $6,520 at a conversion price of $.000815.

On January 27, 2012, we issued 3,000,000 shares of common stock pursuant to a conversion of July, 2010 convertible notes for $2,445 at a conversion price of $.000815.

On January 27, 2012, we issued 8,000,000 shares of common stock pursuant to a conversion of June, 2011 convertible notes for $4,075 at a conversion price of $.000815.

On January 27, 2012, we issued 16,000,000 shares of common stock pursuant to conversion of October, 2007 convertible notes for two conversions totaling $13,904 at a conversion price of $.000869.

On January 27, 2012, we issued 11,507,479 shares of common stock pursuant to a conversion of accrued interest for the January, 2009 convertible notes for $10,000 at a conversion price of $.000869.

On January 30, 2012, we issued 7,000,000 shares of common stock pursuant to a conversion of October, 2007 convertible notes for $2,083 at a conversion price of $.000869.

On January 30, 2012, we issued 3,000,000 shares of common stock pursuant to a conversion of January, 2011 convertible notes for $2,445 at a conversion price of $.000815.

On January 30, 2012 and January 31, 2012, we issued 21,000,000 shares of common stock pursuant to conversion of March, 2011 convertible notes for four conversions totaling $17,115 at a conversion price of $.000815.

F-41

Note 11 –

Stockholders’ Deficit (continued):

On January 30, 2012, we issued 3,000,000 shares of common stock pursuant to a conversion of June, 2011 convertible notes for $2,445 at a conversion price of $.001087.

On January 31, 2012, we issued 2,000,000 shares of common stock pursuant to a conversion of January, 2011 convertible notes for $1,630 at a conversion price of $.000815.

On February 2, 2012, we issued 2,442,666 shares of common stock pursuant to a conversion of January, 2011 convertible notes for $2,601 at a conversion price of $.001065.

On February 2, 2012, we issued 3,000,000 shares of common stock pursuant to a conversion of July, 2010 convertible notes for $3,195 at a conversion price of $.001065.

On February 2, 2012, we issued 8,000,000 shares of common stock pursuant to a conversion of March, 2011 convertible notes for $2,601 at a conversion price of $.001065.

On February 3, 2012, we issued 8,000,000 shares of common stock pursuant to conversion of January, 2011 convertible notes for three conversions totaling $13,261 at a conversion price of $.0010658.

On February 3, 2012, we issued 5,427,772 shares of common stock pursuant to conversion of March, 2011 convertible notes for two conversions totaling $13,565 at a conversion price of $.002315.

On February 6, 2012, we issued 5,743,130 shares of common stock pursuant to a conversion of July, 2010 convertible notes for $18,234 at a conversion price of $.003175.

On February 8, 2012, we issued 1,000,000 shares of common stock pursuant to a conversion of January, 2011 convertible notes for $3,175 at a conversion price of $.003175.

On February 9, 2012, we issued 1,500,000 shares of common stock pursuant to a conversion of January, 2011 convertible notes for $4,763 at a conversion price of $.003175.

On February 9, 2012, we issued 6,000,000 shares of common stock pursuant to a conversion of March, 2011 convertible notes for $19,050 at a conversion price of $.003175.

On February 9, 2012, we issued 6,500,000 shares of common stock pursuant to a conversion of July, 2010 convertible notes for $20,638 at a conversion price of $.003175.

On February 10, 2012, we issued 3,359,033 shares of common stock pursuant to a conversion of January 2008 convertible notes for $2,919 at a conversion price of $.000869.

On February 13, 2012, we issued 4,000,000 shares of common stock pursuant to a conversion of March, 2011 convertible notes for $12,820 at a conversion price of $.003205.

On February 13, 2012, we issued 5,000,000 shares of common stock pursuant to a conversion of July, 2010 convertible notes for $16.025 at a conversion price of $.003205.

On February 13, 2012, we issued 1,000,000 shares of common stock pursuant to a conversion of March, 2011 convertible notes for $3,205 at a conversion price of $.003205.

On February 13, 2012, we issued 533,550 shares of common stock pursuant to a conversion of March, 2011 convertible notes for $1,710 at a conversion price of $.003205.

On February 14, 2012, we issued 4,7000,000 shares of common stock pursuant to a conversion of January, 2011 convertible notes for $15,064 at a conversion price of $.003205.

F-42

Note 11 –

Stockholders’ Deficit (continued):

On February 15, 2012, we issued 12,500,000 shares of common stock pursuant to a conversion of January, 2009 convertible notes for $12,500 at a conversion price of $.001.

On February 14, 2012, we issued 12,000,000 shares of common stock pursuant to a conversion of October 2007 convertible notes for $10,428 at a conversion price of $.000869.

On February 16, 2012, we issued 1,600,000 shares of common stock pursuant to a conversion of January, 2011 convertible notes for $10,428 at a conversion price of $.002923.

On February 17, 2012, we issued 3,000,000 shares of common stock pursuant to two conversions of March, 2011 convertible notes totaling $8,768 at a conversion price of $.002923.

On February 17, 2012, we issued 1,000,000 shares of common stock pursuant to a conversion of January, 2011 convertible notes for $2,923 at a conversion price of $.002923.

On February 17, 2012, we issued 5,000,000 shares of common stock pursuant to a conversion of July, 2010 convertible notes for $10,428 at a conversion price of $.002923.

On February 21, 2012, we issued 13,000,000 shares of common stock pursuant to a conversion of October 2007 convertible notes for $30,576at a conversion price of $.002352.

On February 21, 2012, we issued 12,755,102 shares of common stock pursuant to a conversion of January, 2009 convertible notes for $30,000 at a conversion price of $.002352.

On February 21, 2012, we issued 8,939,822 shares of common stock pursuant to a conversion of July, 2010 convertible notes for $26,131 at a conversion price of $.002923.

On February 21, 2012, we issued 9,600,000 shares of common stock pursuant to a conversion of March, 2011 convertible notes for $28,061 at a conversion price of $.002923.

On February 21, 2012, we issued 5,460,178 shares of common stock pursuant to a conversion of January, 2011 convertible notes for $9,873 and accrued interest for $6,087 at a conversion price of $.002923.

On February 22, 2012, we issued 3,000,000 shares of common stock pursuant to a conversion of March, 2011 convertible notes for $9,000 at a conversion price of $.003.

On February 22, 2012, we issued 1,813,317 shares of common stock pursuant to two conversions of March, 2011 convertible notes totaling 5,440 at a conversion price of $.003.

On February 22, 2012, we issued 3,000,000 shares of common stock pursuant to a conversion of July, 2010 convertible notes for 1,939 and accrued interest for $7,061 at a conversion price of $.003.

On February 22, 2012, we issued 5,000,000 shares of common stock as a finder’s fee for the February, 2012 financing. This amount represents 10% of the total 50,000,000 warrants that were issued in connection with this financing. We recorded $13,177 in financing fees expense for these shares.

On February 23, 2012, we issued 14,000,000 shares of common stock pursuant to a conversion of October, 2007 convertible notes for $43,400 at a conversion price of $.0031.

On February 24, 2012, we issued 13,797,419 shares of common stock pursuant to a conversion of January, 2009 convertible notes for $22,500 and accrued interest for 20,272 at a conversion price of $.0031.

On February 27, 2012, we issued 13,054,175 shares of common stock pursuant to a conversion of June, 2011 convertible notes for $39,554 at a conversion price of $.00303.

F-43

Note 11 –

Stockholders’ Deficit (continued):

On February 28, 2012, we issued 1,458,139 shares of common stock pursuant to a conversion of January, 2011 convertible notes for $4,418 at a conversion price of $.00303.

On February 28, 2012, we issued 9,000,000 shares of common stock pursuant to a conversion of July 2010 convertible notes for $27,270 at a conversion price of $.00303.

On February 29, 2012, we issued 1,005,600 shares of common stock pursuant to a conversion of March, 2011 convertible notes for $3,017 at a conversion price of $.003.

On March 1, 2012, we issued 5,000,000 shares of common stock pursuant to a conversion of July, 2010 convertible notes for $15,700 at a conversion price of $.00314.

On March 1, 2012, we issued 5,000,000 shares of common stock pursuant to a conversion of June, 2011 convertible notes for $15,700 at a conversion price of $.00314.

On March 1, 2012, we issued 1,000,000 shares of common stock pursuant to a conversion of January, 2011 convertible notes for $3,140 at a conversion price of $.00314.

On March 2, 2012, we issued 18,000,000 shares of common stock pursuant to a conversion of October, 2007 convertible notes for $56,106 at a conversion price of $.003117.

On March 2, 2012, we issued 1,500,000 shares of common stock pursuant to a conversion of January, 2011 convertible notes for $5,070 at a conversion price of $.00338.

On March 2, 2012, we issued 6,000,000 shares of common stock pursuant to a conversion of June, 2011 convertible notes for $20,280 at a conversion price of $.00338.

On March 2, 2012, we issued 7,000,000 shares of common stock pursuant to a conversion of July, 2010 convertible notes for $23,660 at a conversion price of $.00338.

On March 2, 2012, we issued 20,476,742 shares of common stock pursuant to a conversion of December, 2009 convertible notes for $50,000 and accrued interest for $13,450 at a conversion price of $.0031.

On March 6, 2012, we issued 7,000,000 shares of common stock pursuant to a conversion of October, 2007 convertible notes for $22,176 at a conversion price of $.003168.

On March 6, 2012, we issued 3,419,737 shares of common stock pursuant to a conversion of June, 2011 convertible notes for $11,559 at a conversion price of $.00338.

On March 6, 2012, we issued 1,857,263 shares of common stock pursuant to a conversion of January, 2011 convertible notes for $3,462 and accrued interest for $2,816 at a conversion price of $.00338.

On March 12, 2012, we issued 35,000,000 shares of common stock pursuant to a conversion of October, 2007 convertible notes for $3,125 and $105,970 accrued interest at a conversion price of $.003117.

On March 13, 2012, we issued 3,000,000 shares of common stock pursuant to a conversion of March, 2011 convertible notes for $9,510 at a conversion price of $.00317.

On March 13, 2012, we issued 706,463 shares of common stock pursuant to a conversion of January, 2011 convertible notes for $2,239 at a conversion price of $.00317.

On March 13, 2012, we issued 7,000,000 shares of common stock pursuant to two conversions of July, 2010 convertible notes totaling $22,190 at a conversion price of $.00317.

F-44

Note 11 –

Stockholders’ Deficit (continued):

On March 16, 2012, we issued 4,856,750 shares of common stock pursuant to two conversions of January. 2011 convertible notes totaling $14,085 at a conversion price of $.0029.

On March 19, 2012, we issued 25,862,069 shares of common stock pursuant to a conversion of July, 2010 convertible notes for $75,000 at a conversion price of $.0029.

On March 21, 2012, we issued 6,500,000 shares of common stock pursuant to a conversion of July, 2010 convertible notes for $18,850 at a conversion price of $.0029.

On March 21, 2012, we issued 1,652,480 shares of common stock pursuant to a conversion of January, 2011 convertible notes for $4,792 at a conversion price of $.0029.

On March 21, 2012, we issued 7,000,000 shares of common stock pursuant to a conversion of June, 2011 convertible notes for $20,300 at a conversion price of $.0029.

On March 23, 2012, we issued 10,000,000 shares of common stock pursuant to a conversion of February, 2008 convertible notes for $28,850at a conversion price of $.002885.

On March 27, 2012, we issued 2,500,000 shares of common stock pursuant to a conversion of March, 2011 convertible notes for $5,793 at a conversion price of $.002317.

On March 27, 2012, we issued 600,000 shares of common stock pursuant to a conversion of January, 2011 convertible notes for $1,390 at a conversion price of $.002317.

On March 27, 2012, we issued 3,000,000 shares of common stock pursuant to a conversion of July, 2010 convertible notes for $6,951 at a conversion price of $.002317.

On March 28, 2012, we issued 3,523,979 shares of common stock pursuant to a conversion of June, 2011 convertible notes for $7,823 at a conversion price of $.00222.

On March 29, 2012, we issued 1,400,000 shares of common stock pursuant to a conversion of July, 2010 convertible notes for $1,609 and accrued interest for $1,499 at a conversion price of $.00222.

Common Stock Issued for the Year Ended March 31, 2011:

On April 5, 2010, we issued 64,813 shares of common stock pursuant to a conversion of August, 2008 convertible notes of $10,000 and accrued interest payable of $370 at a conversion price of $0.16.

On April 6, 2010, we issued 125,000 shares of common stock pursuant to a conversion of October, 2007 convertible notes of $20,000 at a conversion price of $0.16.

On April 12, 2010, we issued 155,423 shares of common stock pursuant to a conversion of $24,868 in convertible notes payable at a conversion price of $0.16.

On April 29, 2010, we issued 5,000 shares of common stock pursuant to a conversion of January, 2008 convertible notes of $800 at a conversion price of $0.16.

On May 4, 2010, we issued 100,000 shares of common stock pursuant to a conversion of January, 2008 convertible notes of $16,000 at a conversion price of $0.16.

On May 14, 2010, we issued 100,000 shares of common stock pursuant to a conversion of October, 2007 convertible notes of $16,000 at a conversion price of $.16.

On June 2, 2010, the Board of Directors approved the issuance of 138,889 (valued at $25,000) and 150,000 (valued at $30,000) for a total of 288,889 shares for payment of past due services. These shares were issued from the Company’s 2010 Stock

F-45

Note 11 –

Stockholders’ Deficit (continued):

Compensation Plan which was registered on a Form S-8 registration statement filed and declared effective on May 25, 2010.

On June 30, 2010, we issued 12,000 shares of common stock for the extension of the due date for certain April, 2008 short term notes payable to December 31, 2010.

On July 21, 2010, we issued 8,333,333 shares of common stock to Roy Warren, CEO, for payment of past due salary for $125,000 at a conversion price of $.015.

On July 28, 2010, we issued 40,000 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $880 at a conversion price of $.022.

On August 5, 2010, we issued 500,000 shares of common stock pursuant to a conversion of June, 2008 convertible notes for $20,000 at a conversion price of $.04.

On August 9, 2010, we issued 25,550 shares of common stock pursuant to a conversion of October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $956 at a conversion price of $.0374.

On August 23, 2010, we issued 50,000 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $1,725 at a conversion price of $.0345.

On September 20, 2010, we issued 12,000 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $360 at a conversion price of $.04.

On September 28, 2010, we issued 25,000 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $681 at a conversion price of $.02725.

On October 11, 2010, we issued 614,672 shares of common stock pursuant to a conversion of $14,852 in accrued interest payable

for certain March, 2009 convertible notes payable.

On October 14, 2010, we issued 30,000 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $675 at a conversion price of $.0225.

On October 28, 2010, we issued 20,000 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $375 at a conversion price of $.01875.

On October 28, 2010, we issued 30,375 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $570 at a conversion price of $.01875.

On October 29, 2010, we issued 30,000 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $563 at a conversion price of $.01875.

On November 11, 2010, we issued 11,800 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $221 at a conversion price of $.01875.

On December 1, 2010, we issued 10,000 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $165 at a conversion price of $.01675.

On December 23, 2010, we issued 20,000 shares of common stock pursuant to a conversion of original October, 007 convertible notes (later assigned to a new debt holder in July, 2010) for $225 at a conversion price of $.01125.

On January 3, 2011, we issued 50,000 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $563 at a conversion price of $.01125.

On January 4, 2011, we issued 40,000 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $451 at a conversion price of $.01125.

F-46

Note 11 –

Stockholders’ Deficit (continued):

On January 5, 2011, we issued 30,000 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $345 at a conversion price of $.0115.

On January 6, 2011, we issued 38,000 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $447 at a conversion price of $.01175.

On January 7, 2011, we issued 440,000 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $5,280 at a conversion price of $.012.

On January 9, 2011, we issued 60,000 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $720 at a conversion price of $.012.

On January 10, 2011, we issued 1,290,789 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $15,659 at a conversion price of $.01213.

On January 10, 2011, we issued 742,534 shares of common stock pursuant to a conversion of convertible notes for $1,963 and $6,948 of accrued interest as part of the March, 2009 convertible notes at a conversion price of $.012.

On January 10, 2011, we issued 1,466,666 shares of common stock pursuant to a conversion of convertible notes for $17,835 as part of the June, 2008 convertible notes at a conversion price of $.01216.

On January 11, 2011, we issued 1,496,586 shares of common stock pursuant to a conversion of convertible notes for $17,939 as part of the March, 2009 convertible notes at a conversion price of $.012.

On January 11, 2011, we issued 212,500 shares of common stock pursuant to a conversion of original October, 2007 convertible

notes (later assigned to a new debt holder in July, 2010) for $2,630 at a conversion price of $.012375.

On January 12, 2011, we issued 317,500 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $4,247 at a conversion price of $.013375.

On January 12, 2011, we issued 1,000,000 shares of common stock pursuant to a conversion of January, 2008 convertible notes of $12,000 at a conversion price of $.012.

On January 13, 2011, we issued 1,000,000 shares of common stock pursuant to a conversion of January, 2008 convertible notes of $12,000 at a conversion price of $.012.

On January 13, 2011, we issued 180,000 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $2,700 at a conversion price of $.015.

On January 18, 2011, we issued 113,000 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $1,960 at a conversion price of $.01742.

On January 19, 2011, we issued 574,293 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $10,007 at a conversion price of $.017425.

On January 19, 2011, we issued 1,466,666 shares of common stock pursuant to a conversion of convertible notes for $11,665 and accrued interest payable for $5,788 as part of the June, 2008 convertible notes at a conversion price of $.01232.

On January 19, 2011, we issued 476,190 shares of common stock pursuant to a conversion of convertible notes for $5,714 as part of the January, 2008 convertible notes at a conversion price of $.012.

On January 20, 2011, we issued 200,000 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $3,660 at a conversion price of $.0183.

F-47

Note 11 –

Stockholders’ Deficit (continued):

On January 21, 2011, we issued 100,000 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $1,955 at a conversion price of $.01955.

On January 24, 2011, we issued 50,000 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $1,050 at a conversion price of $.021.

On January 24 2011, we issued 1,124,613 shares of common stock pursuant to a conversion of convertible notes for $14,545 as part of the March, 2009 convertible notes at a conversion price of $.012933.

On January 25, 2011, we issued 22,000 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $451 at a conversion price of $.0205.

On January 28, 2011, we issued 500,000 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $10,125 at a conversion price of $.02025.

On January 31, 2011, we issued 83,100 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $1,683 at a conversion price of $.02025.

On February 1, 2011, we issued 1,000,000 shares of common stock pursuant to a conversion of January, 2008 convertible notes of $19,390 at a conversion price of $.01939.

On February 1, 2011, we issued 500,000 shares of common stock pursuant to a conversion as part of the January, 2008 notes for $9,290 at a conversion price of $.01858.

On February 1, 2011, we issued 438,980 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $8,890 at a conversion price of $.02025.

On February 2 and 3, 2011 collectively, we issued 272,500 shares of common stock pursuant to a conversion of original 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $5,519 at a conversion price of $.02025.

On February 2, 2011, we issued 1,345,243 shares of common stock pursuant to a conversion as part of the March, 2009 notes for $25,000 at a conversion price of $.018584.

On February 2, 2011, we issued 50,000 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $1,013 at a conversion price of $.02025.

On February 3, 2011, we issued 160,500 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $3,250 at a conversion price of $.02025.

On February 4, 2011, we issued 161,415 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $3,269 at a conversion price of $.02025.

On February 10, 2011, we issued 84,393 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $1,597 at a conversion price of $.01892.

On February 14, 2011, we issued 51,000 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $874 at a conversion price of $.01713.

On February 17, 2011, we issued 105,000 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $1,628 at a conversion price of $.0155.

On February 18, 2011, we issued 335,003 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $5,026 at a conversion price of $.015.

F-48

Note 11 –

Stockholders’ Deficit (continued):

On February 18, 2011, we issued 1,625,000 shares of common stock pursuant to a conversion of original March, 2009 convertible notes for $26,000 at a conversion price of $.016.

On February 22, 2011, we issued 209,000 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $3,109 at a conversion price of $.014875.

On February 23, 2011, we issued 1,431,522 shares of common stock pursuant to a conversion of original March, 2009 convertible notes for $14,534 and accrued interest for $7,798 at a conversion price of $.0156.

On February 24, 2011, we issued 3,000,000 freely tradable shares of common stock from the Company’s 2/24/11 Form S-8 and 4,156,566 restricted shares for payment of past due payroll and professional services.

On February 23, 2011, we issued 100,000 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $1,463 at a conversion price of $.014625.

On February 24, 2011, we issued 90,000 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $1,294 at a conversion price of $.014375.

On February 25, 2011, we issued 81,200 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $1,167 at a conversion price of $.014375.

On February 28, 2011, we issued 80,000 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $1,120 at a conversion price of $.014.

On March 4, 2011, we issued 100,000 restricted shares of common stock to extend the due date to March 31, 2011 for a certain April, 2008 short-term bridge.

On March 2, 2011, we issued 54,000 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $749 at a conversion price of $.013875.

On March 3, 2011, we issued 200,000 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $2,750 at a conversion price of $.01375.

On March 4, 2011, we issued 39,000 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $531 at a conversion price of $.013625.

On March 7, 2011, we issued 1,485,253 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $19,754 at a conversion price of $.0133.

On March 7, 2011, we issued 2,046,035 restricted shares of common stock as a placement fee for the January, 2011 convertible note financing at a recorded cost of $31,921.

On March 7, 2011, we issued 1,692,047 shares of common stock pursuant to a conversion of original March, 2009 convertible notes for $24,000 at a conversion price of $.014184.

On March 7, 2011, we issued 3,523,510 shares of common stock pursuant to a conversion of original January, 2008 convertible notes for $50,000 at a conversion price of $.014184.

On March 8, 2011, we issued 592,500 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $7,880 at a conversion price of $.0133.

On March 10, 2011, we issued 2,185,561 shares of common stock pursuant to a conversion of original March, 2009 convertible notes for $31,000 at a conversion price of $.014184.

F-49

Note 11 –

Stockholders’ Deficit (continued):

On March 11, 2011, we issued 555,392 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $7.386 at a conversion price of $.0133.

On March 14, 2011, we issued 120,357 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $1,616 at a conversion price of $.013425.

On March 15, 2011, we issued 130,000 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $1,745 at a conversion price of $.013425.

On March 15, 2011, we issued 2,326,565 shares of common stock pursuant to a conversion of original March, 2009 convertible notes for $33,000 at a conversion price of $.014184.

On March 16, 2011, we issued 219,600 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $2,948 at a conversion price of $.013425.

On March 17, 2011, we issued 80,000 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $1,204 at a conversion price of $.01505.

From March 18, 2011 through March 21, 2011, a total of 17,526,942 Class A warrants were exercised via a cashless exercise option into 6,363,287 at a non cash expense of $75,371.

On March 23, 2011, we issued 259.000 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $4,144 at a conversion price of $.016.

On March 24, 2011, we issued 180,000 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $2,745 at a conversion price of $.01525.

On March 25, 2011, we issued 56,000 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $840 at a conversion price of $.015.

On March 28, 2011, we issued 174,000 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $2,610 at a conversion price of $.015.

On March 29, 2011, we issued 183,100 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $2,747 at a conversion price of $.015.

On March 30, 2011, we issued 224,100 shares of common stock pursuant to a conversion of original October, 2007 convertible notes (later assigned to a new debt holder in July, 2010) for $3,362 at a conversion price of $.015.

(d) Compensation and Incentive Plan:

On October 31, 2007, management approved the Company’s 2007 Stock Compensation and Incentive Plan and reserved 50,000 shares of the Company’s common stock for future issuance under the Plan to employees, directors and other persons associated with Attitude. These shares were included in a Form S-8 that was filed with the Securities Exchange Commission on May 16, 2008 to register the underlying shares. We have issued 49,877 shares from this plan leaving an available 124 shares to be issued in the future.

On August 1, 2008, we issued 17,500 Non-Qualified Stock Options to Nutraceutical Discoveries at the exercise price of $13.00 per option for a licensing agreement to use certain intellectual property and “Innutria®” formulation. These options are immediately vested and will expire in five (5) years on July 31, 2013. Due to the immediate vesting, we recognized the full cost of $163,240 in August, 2008 by using the Black-Scholes-Merton (BSM) option-pricing formula. See table below for additional information that was used in this computation.

F-50

Note 11 –

Stockholders’ Deficit (continued):

(d) Compensation and Incentive Plan (continued):

Although our Board of Directors approved the creation of the March, 2009 Stock Option, Compensation and Incentive Plan in which 1,000,000 shares of our $.001 par value common stock will be reserved for future issuance under this plan, the plan was not filed with the Securities Exchange Commission. As such, any issuance will be subject to restrictions and Rule 144 holding periods. During March 30, 2009, we issued 884,569 non-qualified stock options at the exercise price of $1.00 to employees and certain consultants. The stock options vest immediately and will expire in five (5) years on March 31, 2014. No other employee stock options have been granted prior to this transaction. We recorded the full compensation cost of $159,348 for these employee stock options in March, 2009. None of these stock options have been exercised.

On March 10, 2010, our Board of Directors approved the issuance of 50,000 stock options to our Scientific Advisory Board at an exercise price of $0.60 that will expire in five (5) years on March 11, 2015. We recorded the full compensation cost of $41,100 for these options in March, 2010. None of these stock options have been exercised. In addition and on the same date, we issued 75,000 stock options as a retainer for future services from our outside legal counsel at an exercise price of $1.00 in which the options will expire in five (5) years on March 11, 2015. We recorded the full compensation cost of $57,450 for these options in March, 2010. None of these options have been exercised.

On May 25, 2010, a registration that covers the offering of an aggregated 3,750,000 shares of the Company’s common stock was approved by the Company’s Board of Directors. As such, the 2010 Stock Compensation and Incentive Plan was created for employees, directors, consultants and other persons associated with the Company in which awards of common stock and/or non-qualified stock options may be granted. During the fiscal year ended March 31, 2011, we issued 3,288,889 shares of common stock for a total of $161,000 for past due professional services and payroll in which 1,500,000 shares were returned back to the plan, leaving an available 1,961,111 shares to be issued in the future

On December 21, 2011, the Company’s Board of Directors approved the issuance of 27,102,009 non-qualified stock options to certain employees for the return of previously issued shares of common stock that were issued for payment of past due expenses to be effective at December 31, 2011. The stock options have an exercise price of $.02, full vesting rights and a life of five years. The Board of Directors intends to approve a registration to cover an offering to include these stock options once the increase in authorized shares has been approved, (increase approved May 1, 2012). We recognized the full compensation expense of $12,656 at December 31, 2011 by using the Black-Scholes valuation model (27,102,009 x $.000467).

As required by the FASB Accounting Standards Codification, we would normally estimate forfeitures of employee stock option and recognize the compensation cost over the requisite service period for the entire award in accordance with the provisions. As all stock options were fully vested, no estimate of forfeitures was required, and compensation cost is fully recognized at the time of grant and full vesting. We estimated the fair value of these stock options on the date of grant using a Black-Scholes-Merton (BSM) option-pricing formula, applying the following assumptions:

Year Ended 3/31/09

	17,500 options			884,569 options
Expected Term (in years)		3.33			5
Risk-free rate		3.23	%		1.72	%
Volatility (based on peer group)		107	%		78.02	%
Dividends		-			-

Year Ended 3/31/10

	50,000 options			75,000 options
Expected Term (in years)		5			5
Risk-free rate		2.42	%		2.42	%
Volatility (based on peer group)		103	%		103	%
Dividends		-			-

F-51

Note 11 –

Stockholders’ Deficit (continued):

(d) Compensation and Incentive Plan (continued):

Year Ended 3/31/12

	27,102,009 options
Expected Term (in years)		5
Risk-free rate		.83	%
Volatility (based on peer group)		115	%
Dividends		-

Expected Term: The expected term represents the period over which the share-based awards are expected to be outstanding.

Risk-Free Interest Rate: We based the risk-free interest rate used in its assumptions on the implied yield currently available on U.S. Treasury zero-coupon issues with a remaining term equivalent to the stock option award’s expected term.

Expected Volatility: Due to a limited trading history of our common stock, the volatility factor used in our

assumptions is based on weighted average “peer group” historical stock prices of three different companies that are similar in nature to our company over the most recent period commensurate with the expected term of the stock option award.

Expected Dividend Yield: We do not intend to pay dividends on our common stock for the foreseeable future. Accordingly, we used a dividend yield of zero in our assumptions.

A summary of option activity under these stock option plans for the year ended March 31, 2012 is presented below:

					Weighted-Average
			Weighted-		Remaining
			Average		Contractual		Aggregate
			Exercise		Term		Intrinsic
Options	Shares		Price		(in years)		Value


Outstanding at 3/31/10		1,027,068	$	1.20		4.11		-
Granted		-		-
Exercised		-		-
Forfeited		-		-
Expired		-		-

Outstanding at 3/31/11		1,027,068	$	1.20		3.11		-
Granted		27,102,009	$	0.02
Exercised		-		-
Forfeited		-		-
Expired		-		-

Outstanding at 3/31/12		28,129,077	$	0.06		4.66		-

Note that all of the stock options are outstanding, fully vested and exercisable for the year ended March 31, 2012. As such, all compensation expense for the above options has been recognized, and there is no unrecognized compensation expense to be recorded in the future.

F-52

Note 12 –

Income Taxes:

The Company has recorded no income tax benefit for its taxable losses during the period ending March 31, 2012 because there is no certainty that the Company will realize those benefits. The components of the Company's deferred tax assets and liabilities as of March 31, 2012 and 2011 are as follows:

	2012			2011
Net operating loss carryforwards	$	4,805,496		$	4,012,749
Compensatory stock and warrants		56,123			66,300
Accrued expenses that are deductible in future periods		26,630			26,820
Depreciation method differences		1,623			96
		4,889,872			4,105,965
Valuation allowances		(4,889,872	)		(4,105,965	)

Net deferred tax assets	$	-		$	-

As of March 31, 2012 the Company has a net tax operating loss of $14,134,000 that will be available to offset future taxable income, if any. The use of net operating loss carryforwards to reduce future income tax liabilities is subject to limitations, and these amounts will begin to expire in 2028.

The following table illustrates the reconciliation of the tax benefit at the federal statutory rate to the Company's effective rate for the period ending March 31, 2012 and 2011:

	2012			2011
Benefit at federal statutory rate		-34.00	%		-34.00	%
Benefit at state rate, net of federal deficit		2.31	%		-1.03	%
Fair value adjustment of convertible debt		51.54	%		97.88	%
Non-deductible derivative loss		6.45	%		20.83	%
Loss on extinguishment of debt		0.00	%		-0.03	%
Non-deductible travel expenses		0.07	%		-0.02	%
Benefit at the Company's effective rate		-26.37	%		-83.63	%
Less valuation allowance effective tax rate		0.00	%		0.00	%

Note 13 –

Commitments and Contingencies:

Lease of office

In December 2007, the Company entered into a five year agreement for office space in Palm Beach Gardens, Florida with a commencement date of June 1, 2008. The minimum starting monthly base rent was $7,415 and currently is $8,340 per month. The lease provides for annual 4% increases throughout its term.

Future minimum rental payments for the new office lease, based on the current adjusted minimum monthly amount of $8,020 and excluding variable common area maintenance charges, as of March 31, 2012, are as follows:

Years ending March 31,	Amount

2013	$	103,422
2014		17,348

	$	120,770

Rental expense, which also includes maintenance and parking fees, for the period ended March 31, 2012 was $130,587. We plan to enter into a first amendment of the lease in late July 2012 to reduce the size of the premises by 2,750 square feet to from 5,561 square feet to 2,811 square feet.

F-53

Note 13 –

Commitments and Contingencies (continued):

Production and Supply Agreements

On December 16, 2008, we signed a manufacturing agreement with O-AT-KA Milk Products Cooperative, Inc. for the production of future new products that are in the development stage. The manufacturer shall manufacture, package and ship such products. All products shall be purchased F.O.B., the facility by the company.

Litigation

On May 18, 2009, F&M Merchant Group, LLC commenced a lawsuit in the state of Texas to recover the balance owed by us under a Sales Agent Agreement entered by the parties on November 1, 2008. This agreement requires us to pay $5,000 per month and a 5% commission on all net sales. On September 3, 2009, a final judgment by default was approved by the district court in Denton County, Texas for a total sum of $22,347. This claim has been recorded on the Company’s records. Due to the lack of adequate capital financing, we have not been able to make any payments. We expect to resolve this matter as soon as practical.

On June 5, 2009, Tuttle Motor Sports, Inc. commenced a lawsuit in the state of Florida to recover the balance owed by us under a Letter of Agreement to sponsor a Top Fuel Dragster for the 2008 NHRA racing season in the amount of $803,750. Out of this total amount, only $300,000 is required to be paid in cash with the remainder to be paid in shares of common stock. This amount had already been recorded in our records. During May, 2010, Tuttle Motor Sports, Inc. dismissed the lawsuit without prejudice. Prior to that time, the parties went through mediation but were unable to settle. The likelihood of an unfavorable outcome cannot be evaluated as another lawsuit possibly could be filed against the Company.

On August 21, 2009, CH Fulfillment Services, LLC commenced a lawsuit in the state of Alabama to recover past due amounts owed by us under a contract to provide shipping and fulfillment services. The claim is for $2,106 plus interest and legal costs. This amount was already recorded on our records as well as projected interest costs of $682 and estimated court costs of $307 for a total of $3,095. This amount was recorded on our records. A process of garnishment by the district court in Mobile County, Alabama was approved on September 25, 2009 for the total amount of $3,095. On October 26, 2009, the same court authorized a garnishment process to pay $657 which was done as part payment of the total due amount. Current outstanding balance due is $2,438. No other payments have been paid.

On April 20, 2012, Arena Advertising and Sports Marketing Inc commenced a lawsuit in the state of Florida to recover past due amounts owed by us in the amount of $15,000 plus interest since January 16, 2012. The $15,000 was already recorded in our records. We expect to resolve this matter as soon as practical.

Note 14 –

Subsequent Events

On April 3, 2012, we issued 6,000,000 shares of common stock pursuant to two conversions of January, 2011 convertible notes totaling $10,443 and $2,877 accrued interest at a conversion price of $.00222.

On April 4, 2012, we issued 663,800 shares of common stock pursuant to a conversion of July, 2010 convertible notes for $1,444 at a conversion price of $.002175.

On April 5, 2012, we issued 62,332 shares of common stock pursuant to a conversion of March, 2011 convertible notes for $132 at a conversion price of $.002123.

On April 5, 2012, we issued 2,843,146 shares of common stock pursuant to a conversion of January, 2011 convertible notes for $873 and accrued interest for $5,163 at a conversion price of $.002123.

On April 10, 2012, we issued 23,809,524 shares of common stock pursuant to a conversion of July, 2010 convertible notes for $50,000 at a conversion price of $.0021.

On April 10, 2012, we issued 3,225,000 shares of common stock pursuant to a conversion of January, 2011 convertible notes for $6,702 at a conversion price of $.002078.

On April 10, 2012, we issued 3,225,000 shares of common stock pursuant to a conversion of March, 2011 convertible notes for $6,702 at a conversion price of $.002078.

F-54

Note 14 –

Subsequent Events (continued)

On April 11, 2012, we issued 3,250,000 shares of common stock pursuant to a conversion of March, 2011 convertible notes for $6,347 at a conversion price of $.001953.

On April 16, 2012, we issued 1,900,000 shares of common stock pursuant to a conversion of June, 2011 convertible notes for $3,178 at a conversion price of $.0016725.

On April 26, 2012, we issued 5,800,000 shares of common stock pursuant to a conversion of June, 2011 convertible notes for $7.076 at a conversion price of $.00122.

On April 27, 2012, we held a Special Meeti8ng of Stockholders for increasing the authorized shares from one billion to five billion common shares. The shareholders voted in favor by 52.6% of the voting power to approve the increase to five billion authorized shares.

On May 1, 2012, the State of Delaware filed the Certificate of Amendment to Certificate of Incorporation to increase the authorized shares of the common stock from one billion (1,000,000,000) to five billion (5,000,000,000) shares.

On May 15, 2012, we issued 2,000,000 shares of common stock pursuant to a conversion of June, 2011 convertible notes for $2,536 at a conversion price of $.001268.

On May 17, 2012, we issued 6,500,000 shares of common stock pursuant to a conversion of accrued interest for July, 2010 convertible notes for $8,242 at a conversion price of $.001268.

On May 17, 2012, we issued 60,000,000 shares of common stock pursuant to a conversion of February, 2008 convertible notes for $76,140 at a conversion price of $.001269.

On May 17, 2012, we issued 44,970,414 shares of common stock pursuant to a conversion of accrued interest for July, 2010 convertible notes for $57,000 at a conversion price of $.0012675.

On May 25, 2012, we issued 3,000,000 shares of common stock pursuant to a conversion of March, 2011 convertible notes for $3,285 at a conversion price of $.001095.

On May 29, 2012, we issued 46,728,972 shares of common stock pursuant to a conversion of November, 2011convertible notes for $50,000 at a conversion price of $.00107.

On May 31, 2012, we issued 2,500,000 shares of common stock pursuant to a conversion of March, 2011 convertible notes for $2,588 at a conversion price of $.001035.

On May 25, 2012, we issued 3,000,000 shares of common stock pursuant to a conversion of March, 2011 convertible notes for $3,285 at a conversion price of $.001095.

On June 4, 2012, we issued 363,056 shares of common stock pursuant to a cashless exercise of 1,000,000 warrants from the March, 2011 financing.

On June 5, 2012, we issued 5,100,000 shares of common stock pursuant to a conversion of June, 2011 convertible notes for $4,549 and accrued interest of $806 at a conversion price of $.00105.

On June 11, 2012, we issued 4,900,000 shares of common stock pursuant to a conversion of June, 2011 convertible notes for $5,145 at a conversion price of $.00105.

On June 19, 2012, we issued 40,000,000 shares of common stock pursuant to a conversion of February, 2008 convertible notes for $40,000 at a conversion price of $.001.

On June 23, 2012, we issued 6,900,000 shares of common stock pursuant to a conversion of July, 2011 note of accrued interest for $8,211 at a conversion price of $.00119.

F-55

Note 14 –

Subsequent Events (continued)

On June 25, 2012, we issued 5,000,000 shares of common stock pursuant to a conversion of March, 2011 convertible notes for $4,000 at a conversion price of $.001067.

On June 14 2012, we entered into two promissory notes for $100,000 and $40,000, respectively, with two current accredited investors. These notes are subject to an interest rate of ten percent (10%) and are due the sooner of (i) October 14, 2012 or (ii) from the proceeds of the next funding. We received the $100,000 payment on June 27, 2012 and the $40,000 payment on July 9, 2012.

On June 26, 2012, we entered into a promissory note of $110,000 with a current accredited investor. We agreed to pay a finder’s fee of $10,000 as we received the net payment of $100,000 on June 28, 2012. The note is subject to an interest rate of ten percent (10%) and is due the sooner of (i) October 14, 2012 or (ii) from the proceeds of the next funding.

Delaware		65-0109088
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification No.)

Securities registered under Section 12(b) of the Exchange Act:	None

Securities registered under Section 12(g) of the Exchange Act	Common Stock, $.001 par value (Title of class)

Large accelerated filer	o	Accelerated filer	o
Non-accelerated filer	o	Smaller reporting company	x

		Page
PART I

ITEM 1	Description of Business	3
ITEM 2	Description of Property	6
ITEM 3	Legal Proceedings	7
ITEM 4	[Reserved]	7

ITEM 5	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	7
ITEM 6	Selected Financial Data	9
ITEM 7	Management’s Discussion and Analysis of Financial Condition and Results of Operations	9
ITEM 8	Financial Statements	32
ITEM 9	Changes In and Disagreements With Accountants on Accounting and Financial Disclosure	32
ITEM 9A	Controls and Procedures	32
ITEM 9B	Other Information	34

ITEM 10	Directors and Executive Officers of the Registrant	34
ITEM 11	Executive Compensation	36
ITEM 12	Security Ownership of Certain Beneficial Owners and Management	38
ITEM 13	Certain Relationships and Related Transactions and Director Independence	39
ITEM 14	Principal Accountant Fees and Services	40

QUARTER	HIGH BID PRICE		LOW BID PRICE

Fiscal year – 2010/2011

First Quarter	$	1.10	$	0.05
Second Quarter	$	0.15	$	0.01
Third Quarter	$	0.045	$	0.015
Fourth Quarter	$	0.067	$	0.017

Fiscal year – 2011/2012

First Quarter	$	0.022	$	0.008
Second Quarter	$	0.015	$	0.001
Third Quarter	$	0.0046	$	0.0008
Fourth Quarter	$	0.0093	$	0.001

							Number of securitiesremaining available for futureissuance under equitycompensation plans, excluding securities reflected in column
	Number of securitiesissued upon exercise ofoutstanding options, warrants and rights
				Weighted average exerciseprice of outstanding options, warrants and rights

Plan Category
							(a)
	(a)			(b)			(c)
Equity compensation plans
approved by stockholders		-			-			-
Equity compensation plans
not approved by stockholders		1,838,765	(1)(2)		0.06	(3)		1,961,235
Total		1,838,765		$	0.06			1,961,235

		(c) Available to issue in future
(1) 2007 Stock Compensation and Incentive Plan for a total of	50,000		124
(Filed on April 11, 2008 as an exhibit to Form S-1/A and filed on May 16, 2008 as an exhibit to Form S-8)
(2) 2010 Stock Compensation and Incentive Plan for a total of	3,750,000		1,961,111
(Filed on May 25, 2010 as an exhibit to Form S-8)
	3,800,000		1,961,235
(3) Based on 28,129,077 outstanding stock options.

Consolidated Revenues
	For The Years Ended March 31,
	2012			2011			$ Change			% Change
Revenues	$	406,315		$	61,327		$	344,988			562.5	%
Less slotting expense		-			-			-			-
Less discounts		(29,878	)		(10,967	)		(18,911	)		172.4	%
Net Revenues	$	376,437		$	50,360		$	326,077			647.5	%

Consolidated Product and Shipping Costs	For The Years Ended March 31
	2012		2011		$ Change		% Change
Product costs	$	278,300	$	42,613	$	235,687		553.1	%
Shipping costs		38,300		9,346		28,954		309.8	%
Inventory Obsolescence		2,137		-		2,137		N/A
Total costs	$	318,737	$	51,959	$	266,778		513.4	%

Operating Expenses	For The Years Ended March 31
	2012		2011			$ Change			% Change
Salaries, taxes and employee benefit costs	$	535,690	$	311,471		$	224,219			72.0	%
Marketing and promotion		461,272		265,358			195,914			73,8	%
Consulting fees		82,645		40,329			42,316			104.9	%
Professional and legal fees		228,799		260,951			(32,152	)		-12.3	%
Travel and entertainment		47,308		(427	)		47,735			-11179.2	%
Product development costs		2,074		7,900			(5,826	)		-73.7	%
Stock compensation expense		165,068		195,000			(29,932	)		-15.3	%
Other overhead expenses		374,902		468,441			(93,539	)		-20.0	%
Total operating expenses	$	1,897,758	$	1,549,023		$	348,735			22.5	%

	3/31/2012		3/31/2011		Variance

Salaries	$	535,690	$	311,471	$	224,219
Stock compensation expense for employees		-		195,000		(195,000	)
Net variance	$	535,690	$	506,471	$	29,219

		Inception
		through
		March 31, 2012
Our financing arrangements giving rise to derivative
instruments and the income effects:
Day-on derivative losses:
$ 600,000	Original Face Value Convertible Note Financing	$	(2,534,178	)
$ 500,000	Original Face Value Convertible Note Financing		(899,305	)
$ 100,000	Original Face Value Convertible Note Financing		(1,285,570	)
$ 55,000	Original Face Value Short Term Bridge Loan Financing		(12,700	)
$ 120,000	Original Face Value Convertible Note Financing		(72,251	)
$ 60,000	Original Face Value Convertible Note Financing		(38,542	)
$ 200,000	Original Face Value Convertible Note Financing		(119,136	)
$ 27,778	Original Face Value Convertible Note Financing		(6,378	)
$ 161,111	Original Face Value Convertible Note Financing		(45,846	)
$ 111,112	Original Face Value Convertible Note Financing		(185,657	)
$ 50,000	Original Face Value Convertible Note Financing		(182,843	)
$ 55,000	Original Face Value Convertible Note Financing		(80,135	)
$ 137,500	Original Face Value Convertible Note Financing		(1,023,463	)
$ 55,000	Original Face Value Convertible Note Financing		(55,641	)
$ 400,000	Original Face Value Convertible Note Financing		(730,079	)
$ 600,000	Original Face Value Convertible Note Financing		(1,420,653	)
$ 221,937	Original Face Value Convertible Note Financing		(295,144	)
$ 500,000	Original Face Value Convertible Note Financing		(288,718	)
$ 1,000,000	Original Face Value Convertible Note Financing		(1,215,164	)
Total day-one derivative losses		$	(10,491,403	)

		Twelve Months			Twelve Months
Our financing arrangements giving rise to		Ended			Ended
derivated financial instruments and the income effects:		March 31, 2012			March 31, 2011
Derivative income (expense):
$ 600,000	Original Face Value Convertible Note Financing	$	18,337		$	1,809,873
$ 500,000	Original Face Value Convertible Note Financing		13,891			1,371,024
$ 100,000	Original Face Value Convertible Note Financing		2,779			274,272
$ 120,000	Original Face Value Short Term Bridge Loan Financing		101			36,521
$ 120,000	Original Face Value Short Term Bridge Loan Financing		101			36,521
$ 60,000	Original Face Value Short Term Bridge Loan Financing		50			18,260
$ 33,000	Original Face Value Short Term Bridge Loan Financing		28			10,043
$ 55,000	Original Face Value Short Term Bridge Loan Financing		6			17,991
$ 120,000	Original Face Value Convertible Note Financing		1,186			102,972
$ 60,000	Original Face Value Convertible Note Financing		593			51,486
$ 200,000	Original Face Value Convertible Note Financing		4,119			357,544
$ 161,111	Original Face Value Convertible Note Financing		3,318			288,022
$ 50,000	Original Face Value Convertible Note Financing		1,030			89,386
$ 55,000	Original Face Value Convertible Note Financing		1,030			89,386
$ 137,500	Original Face Value Convertible Note Financing		2,832			245,812
$ 55,000	Original Face Value Convertible Note Financing		1,133			1,169
$ 900,000	Original Face Value Convertible Note Financing		560,148			(608,758	)
$ 400,000	Original Face Value Convertible Note Financing		157,071			129,342
$ 600,000	Original Face Value Convertible Note Financing		456,044			257,011
$ 221,937	Original Face Value Convertible Note Financing		77,766			-
$ 500,000	Original Face Value Convertible Note Financing		64,723			-
$ 1,000,000	Original Face Value Convertible Note Financing		36,229			-
Total derivative income (expense) arising from fair value adjustments			1,402,515			4,577,877
Day-one derivative losses			(1,799,027	)		(2,206,373	)
Total derivative income (expense)		$	(396,512	)	$	2,371,504

	For The Year Ended
	March 31,			March 31,
	2012			2011
Cash provided by (used in):

Operating activities	$	(1,585,215	)	$	(1,732,422	)

Investing activities	$	(16,002	)	$	(4,102	)

Financing activities	$	1,500,000		$	1,931,250

	●	sales of new products could adversely impact sales of existing products;
	●	we may incur higher cost of goods sold and selling, general and administrative expenses in the periods when we introduce new products due to increased costs associated with the introduction and marketing of new products, most of which are expensed as incurred; and
	●	when we introduce new platforms and bottle sizes, we may experience increased freight and logistics costs as our co-packers adjust their facilities for the new products.

	●	if any of those co-packers were to terminate our co-packing arrangement or have difficulties in producing beverages for us, our ability to produce our beverages would be adversely affected until we were able to make alternative arrangements; and
	●	our business reputation would be adversely affected if any of the co-packers were to produce inferior quality products.

	●	price and volume fluctuations in the stock markets;
	●	changes in our revenues and earnings or other variations in operating results;
	●	any shortfall in revenue or increase in losses from levels expected by us or securities analysts;
	●	changes in regulatory policies or law;
	●	operating performance of companies comparable to us; and
	●	general economic trends and other external factors.

		Three Months			Three Months
Our financing arrangements giving rise to		Ended			Ended
derivated financial instrumentsand the income effects:		March 31, 2012			March 31, 2011
Derivative income (expense):
$ 600,000	Original Face Value Convertible Note Financing	$	(2,654	)	$	(15,227	)
$ 500,000	Original Face Value Convertible Note Financing		(2,010	)		(11,535	)
$ 100,000	Original Face Value Convertible Note Financing		(402	)		(2,308	)
$ 120,000	Original Face Value Short Term Bridge Loan Financing		(8	)		18
$ 120,000	Original Face Value Short Term Bridge Loan Financing		(8	)		-
$ 60,000	Original Face Value Short Term Bridge Loan Financing		(4	)		-
$ 33,000	Original Face Value Short Term Bridge Loan Financing		(3	)		-
$ 55,000	Original Face Value Short Term Bridge Loan Financing		-			(5	)
$ 120,000	Original Face Value Convertible Note Financing		(159	)		(845	)
$ 60,000	Original Face Value Convertible Note Financing		(80	)		(423	)
$ 200,000	Original Face Value Convertible Note Financing		(554	)		(2,936	)
$ 161,111	Original Face Value Convertible Note Financing		(446	)		(2,365	)
$ 50,000	Original Face Value Convertible Note Financing		(138	)		(734	)
$ 55,000	Original Face Value Convertible Note Financing		(138	)		(734	)
$ 137,500	Original Face Value Convertible Note Financing		(380	)		(2,019	)
$ 55,000	Original Face Value Convertible Note Financing		(152	)		(808	)
$ 900,000	Original Face Value Convertible Note Financing		(75,283	)		(460,459	)
$ 400,000	Original Face Value Convertible Note Financing		(20,340	)		129,342
$ 600,000	Original Face Value Convertible Note Financing		(58,471	)		257,011
$ 221,937	Original Face Value Convertible Note Financing		(28,859	)		-
$ 500,000	Original Face Value Convertible Note Financing		(37,896	)		-
$ 1,000,000	Original Face Value Convertible Note Financing		36,230			-
Total derivative income (expense) arising from fair value adjustments			(191,755	)		(114,027	)
Day-one derivative loss			(1,215,165	)		(2,150,631	)
		$	(1,406,920	)	$	(2,264,658	)


Original Note	Issue		Default	$ Amount		Interest			Default Interest			Accrued Default
Amount	Date	Due Date	Yes/No	Past Due		Rate			Rate			Interest

CONVERTIBLE NOTES

$ 600,000	October, 2007	3/31/2014	No		-		10	%		15	%		-
$ 312,000	January, 2008	3/31/2014	No		-	None-discount note				15	%		-
$ 500,000	February, 2008	3/31/2014	No		-		10	%		15	%		-
$ 100,000	June, 2008	3/31/2014	No		-		10	%		15	%		-
$ 263,333	September, 2008	3/31/2014	No		-	None-discount note				15	%		-
$ 60,833	December, 2008	3/31/2014	No		-	None-discount note				15	%		-
$ 200,834	January, 2009	3/31/2014	No		-		15	%		15	%		-
$ 60,000	February, 2009	3/31/2014	No		-		15	%		15	%		-
$ 361,112	March, 2009	3/31/2014	No		-		12	%		20	%		-
$ 27,778	October, 2009	3/31/2014	No		-		12	%		20	%		-
$ 618,612	November, 2009	3/31/2014	No		-		12	%		20	%		-
$ 150,000	January, 2010	3/31/2014	No		-		12	%		20	%		-
$ 192,500	March, 2010	3/31/2014	No		-		12	%		20	%		-
$ 55,000	May, 2010	3/31/2014	No		-		10	%		20	%		-
$ 900,000	July, 2011	7/15/2012	No		-		10	%		20	%		-
$ 400,000	January, 2011	7/15/2012	No		-		10	%		20	%		-
$ 600,000	March, 2011	9/17/2012	No		-		10	%		20	%		-
$ 221,937	June, 2011	9/17/2012	No		-		10	%		20	%		-
$ 500,000	July, 2011	1/15/2013	No		-		10	%		20	%		-
$ 59,359	November, 2011	5/5/2012	No		-		5	%	NONE				-
$ 1,000,000	February, 2012	8/22/2013	No		-		10	%		20	%		-
$ 172,211	March, 2012	3/31/2014	No		-		12	%		20	%		-
$ 7,355,509

SHORT-TERM BRIDGE LOANS

$ 60,000	April 14, 2008	Past due	Yes (a)	$	60,000					15	%	$	25,883
$ 55,000	August 5, 2008	Past due	Yes (a)	$	55,000					15	%	$	40,349
$ 115,000	Total amount past due			$	115,000							$	66,232

Name of Officer and Age		Position with the Company	Year Appointed
Roy Warren	56	Chairman, Chief Executive Officer and President	2007
Michael Edwards	52	Director	2007
H. John Buckman	66	Director	2007
Tommy Kee	63	Chief Financial Officer	2007 2010*

													Change in
													Pension Value
													Value &
											Non-equity		Nonqualified
			Earned						(e)		Incentive		Deferred		(g)
	Principal		Salary /				Stock		Option		Plan Comp.		Comp.		All Other
Name	Position	Year	Consulting $		Bonus $		Awards $		Awards $			$	Earnings $		Comp. $		Total $
Roy Warren(f)	CEO	2012 (a)	$	162,000	$	-	$	-	$	-	$	-	$	-	$	19,308	$	181,308
Roy Warren (f)	CEO	2011 (b)	$	295,077	$	-	$	-	$	-	$	-	$	-	$	19,577	$	314,654

Tommy Kee (f)	CFO	2012 (c)	$	84,000	$	-	$	-	$	2,642	$	-	$	-	$	12,042	$	98,684
Tommy Kee (f)	CFO	2011 (d)	$	143,500	$	-	$	-	$	-	$	-	$	-	$	12,344	$	155,844

(a) All 447,483 stock options were granted during March , 2009.
(b) Stock optioms were granted as follows: 68,876 options during March, 2009, and 5,656,566 stock options were granted In December, 2011.

		(a)
		Fees								Nonqualified
		Earned or						Non-equity		Deferred
		Paid In		Stock		Option		Incentive		Comp.		All Other
Name	Year	Cash $		Awards $		Awards $		Plan Comp. $		Earnings $		Comp. $		Total $
H.John Buckman (b )	2012	$	12,000	$	-	$	-	$	-	$	-	$	-	$	12,000
	2011	$	12,000	$	-	$	-	$	-	$	-	$	-	$	12,000
Mike Edwards	2012	$	12,000	$	-	$	-	$	-	$	-	$	-	$	12,000
	2011	$	12,000	$	-	$	-	$	-	$	-	$	-	$	12,000

Title of Class	Name and Address of Beneficial Owner (1)	Amount and Nature of Beneficial Ownership		Percent of Class (2)
Common	Alpha Capital Anstalt (3) Pradafant 7 9490 Furstentums Vaduz, Lichtenstein		106,040,111		9.99	%
Common	Whalehaven Capital Fund Ltd. (3) 14 Par-La-Ville Road 3rd Floor Hamilton, Bermuda HM08		98,690,891		9.99	%
Common	Roy Warren (4) 10415 Riverside Drive # 101 Palm Beach Gardens, Florida 33410		59,576,291		6.52	%
Common	Schlomo & Rochel Rifkind (3) Givat Shoshanna 12/3 Tzfut Israel		58,704,749		6.43	%

Title of Class	Name and Address of Management Owner	Amount and Nature of Ownership (1)			Percent of Class (2)

Common	Roy Warren 10415 Riverside Dr. Palm Beach Gardens, FL		59,576,291	(3)		6.52	%
Common	Tommy Kee 10415 Riverside Dr. Palm Beach Gardens, Fl.		5,726,192	(4)	Less than 1		%
Common	H. John Buckman 174 Patterson Avenue Shrewsbury, N.J.		167,700	(5)	Less than 1		%
Common	Mike Edwards 1615 S.E. Decker Avenue Stuart, Fl.		1,200	(6)	Less than 1		%
Common	Executive officers and directors as a group		65,471,383			7.12	%

Exhibit No.	Document Description	Incorporated by Reference	Filed Herewith
(2)(1)	Agreement and Plan of Merger dated September 14, 2007	(1)
(3)(1)(i)	Restated Certificate of Incorporation	(1)
(3)(1)(ii)	Certificate of Amendment to Certificate of Incorporation	(8)
(3)(1)(iii)	Certificate of Amendment to Certificate of Incorporation	(9)
(3)(1)(iv)	Certificate of Amendment to the Certificate of Incorporation		X
(3)(2)	Amended and Restated Bylaws	(1)
(4)(1)	Certificate of Designation of the Series A Convertible Preferred	(1)
(4)(2)	Form of Common Stock Certificate	(1)
(4)(3)	Form of Class A and B Common Stock Purchase Warrant with Schedule of other documents omitted- Exhibit B in Exhibit (10)(1)-(a)	(1)
(4)(4)	Form of 10% Convertible Note with Schedule of other documents omitted Exhibit A in Exhibit (10)(1) – (a)	(1)
(4)(5)	Form of Secured Convertible Note with Schedule of other documents omitted	(1)
(4)(6)	Certificate of Amendment to the certificate of Designation of the Series A Convertible Preferred Stock	(5)
(4)(7)	Form of Note dated January 8, 2008 –Exhibit A in Exhibit (10)(8) – (b)	(11)
(10)(1)	Subscription Agreement for Securities dated October 23, 2007	(11)
(10)(2)	2007 Stock Compensation and Incentive Plan	(1)
(10)(3)	Escrow Agreement dated October 23, 2007 – Exhibit C in Exhibit (10)(1) –(a)	(1)
(10)(4)	Security Agreement dated October 23, 2007 – Exhibit D in Exhibit (10)(1) –(a)	(1)
(10)(5)	Subsidiary Guaranty dated October 23, 2007 – Exhibit E in Exhibit (10)(1) – (a)	(1)
(10)(6)	Collateral Agent Agreement dated October 23, 2007-Exhibit F in Exhibit (10)(1) – (a)	(1)
(10)(7)	Office Lease Agreement dated December 15, 2007	(2)
(10)(8)	Subscription Agreement for Securities dated January 8, 2008	(11)
(10)(9)	Funds Escrow Agreement dated January 8, 2008 – Exhibit B in Exhibit (10)(8) –(b)	(1)
(10)(10)	Waiver and Consent dated January 8, 2008	(1)
(10)(11)	Notice of Waiver of Certain Conditions effective February 15, 2008	(1)
(10)(12)	Notice of Waiver effective February 15, 2008	(1)
(10)(13)	Notice of Waiver of Conditions effective April 8, 2008	(1)
(10)(14)	Modification and Waiver Agreement, dated June 30, 2008	(11)
(10)(15)	Asset Purchase Agreement, and Secured Convertible Promissory Note, August 2008	(11)
(10)(16)	Sublicense Agreement, Termination Agreement, Promissory Note With Nutraceutical Discoveries, Inc. – August, 2008 and February 2010	(11)

(10)(17)	Form of Modification, Waiver and Consent Agreement, September 2008	(3)
(10)(18)	Subscription Agreement Securities September 2008	(11)
(10)(19)	Funds Escrow Agreement September 2008 –Exhibit C in Exhibit (10)(19) –(c)	(11)
(10)(20)	Form of Note, September 2008- Exhibit A in Exhibit (10)(19) –(c)	(3)
(10)(21)	Form of Class A and Class B Warrant, September 2008 – Exhibit B in Exhibit (10)(19) – (c)	(3)
(10)(22)	Manufacturing Agreement dated December 16, 2008 with O-AT-KA Milk Products Cooperative, Inc.	(4)
(10)(23)	Form of Note and Warrant and Modification, Waiver and Consent Agreement, December 2008	(11)
(10)(24)	Subscription Agreement, Form of Note and Warrant, Funds Escrow Agreement, Form of Legal Opinion, and Second Modification, Waiver And Consent Agreement, January 2009 (d)	(11)
(10)(25)	Amendment, Waiver and Consent Agreement, Form of Allonge No.1 to January 09 Notes, Form of Warrant, February 2009	(11)
(10)(26)	Subscription Agreement, Funds Escrow Agreement, Form of Note and Warrant and Legal Opinion, March 2009	(11)
(10)(27)	Third Modification, Waiver and Consent Agreement, Form of Allonge No. 1 to March 09 Notes, Form of Warrant, July 2009	(11)
(10)(28)	Form of Note, November 2009	(11)
(10)(29)	Modification and Amendment Letters, Form of Warrant, January 2010	(11)
(10)(30)	2010 Stock Compensation and Incentive Plan	(7)
(10)(31)	Warrant and Allonge to March 2009 Note, dated May 13, 2010	(15)
(10)(32)	Promissory Note, dated June 17, 2010	(15)
(10)(33)	Warrants to extend short-term bridge loan June 30, 2010	(15)
(10)(34)	Subscription Agreement dated July 15, 2010 (Exhibits A-B (Form of Note and Warrant) filed with Form 8-K dated July 21, 2010, Exhibit C (Escrow Agreement) filed as Exhibit 10.38 to Form 10-Q as amended for quarter ended September 30, 2010 filed June 1 2011))	(14)
(10)(35)	Form of Convertible Promissory Note dated July 15, 2010	(10)
(10)(36)	Form of Class A Warrant dated July 15, 2010	(10)
(10)(37)	First Amendment and Consent Agreement dated July 15, 2010	(10)
(10)(38)	Escrow Agreement dated July 15, 2010	(14)
(10)(39)	Placement Agent Agreement for July 2010 financing	(14)
(10)(40)	Promissory Note dated December 21, 2010	(15)
(10)(41)	Placement Agent Agreement dated December 21, 2010 for January 2011 Financing	(15)
(10)(42)	Form of Bridge Loan Extension Letter and Form of Warrant dated January 11, 2011	(12)
(10)(43)	Subscription Agreement dated January 21, 2011 to include cap table, all exhibits (forms of note and warrant, escrow agreement, forms of legal opinion and lockup agreements) and other schedules	(16)
(10)(44)	Second Amendment and Consent Agreement dated January 21, 2011	(16)
(10)(45)	Form of Note with Landlord dated January 26, 2011	(12)
(10)(46)	Subscription Agreement dated February 1, 2011 to include cap table, all exhibits (forms of note and warrant, escrow agreement, forms of legal opinion and lockup agreements) and other schedules	(16)
(10)(47)	Placement Agent Agreement dated March 8, 2011	(13)
(10)(48)	Subscription Agreement dated March 17, 2011to include cap table, all exhibits (forms of note and warrant, escrow agreement, forms of legal opinion and lockup agreements) and other schedules	(16)
(10)(49)	Third Amendment and Consent Agreement dated March 17, 2011	(16)
(10)(50)	Form of Promissory Note dated June 3, 2011	(18)
(10)(51)	Form of Promissory Note dated June 30, 2011	(18)
(10)(52)	Placement Agent Agreement dated June 22, 2011	(17)
(10)(53)	Form of Debt Exchange Agreement dated June 30, 2011	(18)
(10)(54)	Subscription Agreement dated July 15, 2011 to include cap table, all Exhibits (forms of note and warrant, escrow agreement, form of legal opinion) and other schedules	(17)
(10)(55)	Form of Promissory Note dated October 7, 2011 (Alpha)	(19)

(10)(56)	Form of Promissory Note dated October 7, 2011 (Centaurian)	(19)
(10((57)	Form of Promissory Note with conversion rights November 3, 2011	(19)
(10)(58)	Form of Promissory Note dated December 1, 2011 (Centaurian)	(20)
(10)(59)	Form of Promissory Note dated December 1, 2011 (Alpha)	(20)
(10)(60)	Form of Note dated December 28, 2011 (Alpha)	(20)
(10)(61)	Cause Marketing Endorsement Partnership Agreement dated October 13, 2011	(20)
(10)(62)	Commission Agreement dated June 29, 2011	(20)
(10)(63)	Form of Approval of Grant of Stock Options at December 21, 2011	(20)
(10)(64)	Subscription Agreement dated February 22, 2012 to include cap table, all Exhibits (forms of note and warrant, escrow agreement, form of legal Option) and other schedules	(21)
(10)(65)	Fifth Amendment and Consent Agreement dated February 22, 2012	(21)
(10)(66)	Placement Agent Agreement dated February 6, 2012	(21)
(10)(67)	Extension Agreement and Form of Note dated March 31, 2012	(22)
(10)(68)	Personal Services Agreement		X
(10)(69)	Promissory Notes		X
(14)	Code of Ethics	(6)
(21)	Subsidiaries of Registrant	(1)
(31)(i)	Certification of Chief Executive Officer pursuant to Rule 13a-14 (a)/ 15d-14 (a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002		X
(31)(ii)	Certification of Chief Financial Officer pursuant to Rule 13a-14 (a)/ 15d-14 (a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002		X
(32)(1)	Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002		X

ATTITUDE DRINKS INCORPORATED
(Registrant)

		ATTITUDE DRINKS INCORPORATED

Date: July 13, 2012	By:	/s/ Roy G. Warren
		Roy G. Warren
		President and Chief Executive Officer

Signature		Title

/s/ Roy G. Warren		President and Chief Executive Officer
Roy G. Warren
Name

/s/ Tommy E. Kee		Chief Financial Officer and Principal Accounting Officer
Tommy E. Kee
Name

/s/ H. John Buckman		Director
H. John Buckman
Name

/s/ Mike Edwards		Director
Mike Edwards
Name

Report of Independent Registered Public Accounting Firm	F-2

Consolidated Balance Sheets	F-3

Consolidated Statement of Operations	F-4

Consolidated Statement of Stockholders’ Deficit	F-5

Consolidated Statement of Cash Flows	F-6

Notes to Consolidated Financial Statements	F-7 to F-56

	March 31, 2012			March 31, 2011

ASSETS

CURRENT ASSETS:
Cash and cash equivalents	$	132,120		$	233,337
Accounts receivable less allowance for doubtful accounts of $817 and $0 for March 31, 2012 and 2011, respectively		43,895			37,258
Inventories		258,496			80,195
Prepaid expenses		53,385			171,106
TOTAL CURRENT ASSETS		487,896			521,896

FIXED ASSETS, NET		24,653			27,930

OTHER ASSETS:
Trademarks, net		25,280			27,177
Deposits and other		20,996			20,996
TOTAL OTHER ASSETS		46,276			48,173

TOTAL ASSETS	$	558,825		$	597,999

LIABILITIES AND STOCKHOLDERS' (DEFICIT)

CURRENT LIABILITIES:
Accounts payable	$	1,685,120		$	1,369,354
Accrued liabilities		4,165,800			3,497,215
Derivative liabilities		423,262			1,468,988
Short-term bridge loans payable		115,000			388,000
Convertible notes payable		2,726,657			5,533,537
Non-convertible notes payable		86,012			86,012
Deferred revenue		7,661			18,935
Loans payable to related parties		21,463			21,463
TOTAL CURRENT LIABILITIES		9,230,975			12,383,504

CONVERTIBLE NOTES PAYABLE - NET OF CURRENT PORTION		5,346,744			2,429,754


STOCKHOLDERS' (DEFICIT):
Series A convertible preferred stock par value $0.001 per share,
20,000,000 shares authorized, 9,000,000 shares issued and outstanding
at March 31, 2012 and March 31, 2011, respectively		9,000			9,000
Common stock, par value $0.001, 1,000,000,000 shares authorized
854,047,952 and 65,956,004 shares issued and outstanding at March
31, 2012 and March 31, 2011, respectively		854,048			65,956
Additional paid-in capital		13,634,608			8,076,992
Deficit accumulated		(28,516,550	)		(22,367,207	)
TOTAL STOCKHOLDERS' (DEFICIT)		(14,018,894	)		(14,215,259	)

TOTAL LIABILITIES AND STOCKHOLDERS' (DEFICIT)	$	558,825		$	597,999

	Preferred				Common						Additional			Stock
	Stock				Stock						Paid In			Subscription			Accumulated
	Shares		Amount		Shares			Amount			Capital			Receivable			Deficit			Total

Balance, March 31, 2010		9,000,000	$	9,000		4,306,437		$	4,306		$	5,959,687		$	(59,400	)	$	(33,750,839	)	$	(27,837,246	)

Issuance of common stock
for debt modification		-		-		112,000			112			2,490			-			-			2,602
Conversions of debt to
common stock		-		-		43,758,097			43,759			1,814,674			-			-			1,858,433
Issuance of common
stock for services		-		-		15,778,935			15,779			270,220			-			-			285,999
Finders' fees for financing		-		-		2,046,035			2,046			29,875			-			-			31,921
Stock subscription
receivable		-		-		-			-			-			59,400			-			59,400
Cancellation of shares		-		-		(45,500	)		(46	)		46			-			-			-
Net loss		-		-		-			-			-			-			11,383,632			11,383,632
Balance, March 31, 2011		9,000,000	$	9,000		65,956,004		$	65,956		$	8,076,992		$	-		$	(22,367,207	)	$	(14,215,259	)

Conversions of debt to
common stock		-		-		783,777,763			783,778			5,568,698			-			-			6,352,476
Issuance of common
stock for services		-		-		(685,815	)		(686	)		(31,915	)		-			-			(32,601	)
Issuance of stock options		-		-		-			-			12,656			-			-			12,656
Finders' fees for financing		-		-		5,000,000			5,000			8,177			-			-			13,177
Net loss		-		-		-			-			-			-			(6,149,343	)		(6,149,343	)
Balance, March 31, 2012		9,000,000	$	9,000		854,047,952		$	854,048		$	13,634,608		$	-		$	(28,516,550	)	$	(14,018,894	)

	March 31, 2012		March 31, 2011

Finished goods	$	252,413	$	66,638
Finished goods on consignment		6,083		13,557
Total inventories	$	258,496	$	80,195

	March 31, 2012			March 31, 2011

Trademark costs	$	31,570		$	31,570
Less accumulated depreciation		(6,290	)		(4,393	)
Total Intangible Assets	$	25,280		$	27,177

	2012			2011

Equipment	$	19,669		$	40,330
Furniture and fixtures		12,837			12,837
Leasehold improvements		3,954			3,954
Vehicle		13,481			-
Purchased software		827			1,022
		50,768			58,143
Less: accumulated depreciation		(26,115	)		(30,213	)
Total Fixed Assets	$	24,653		$	27,930