x QUARTERLY REPORT UNDER SECTION 13 0R 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended: June 30, 2013
|
¨ TRANSITION REPORT UNDER SECTION 13 0R 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
SIONIX CORPORATION
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(Exact name of registrant as specified in its charter)
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Nevada
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87-0428526
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(State or other jurisdiction of
incorporation or organization)
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(I.R.S. Employer
Identification No.)
|
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2010 N Loop Freeway W, Suite 110
Houston, Texas
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77018
|
|
(Address of principal executive offices)
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(Zip Code)
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(Former name, former address and former fiscal year, if changed since last report)
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Large accelerated filer
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o |
Accelerated filer
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o |
Non-accelerated filer
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o |
Smaller reporting company
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x |
(Do not check if a smaller reporting company)
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3
|
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3
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3
|
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4
|
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5
|
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6
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7
|
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19
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23
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23
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Part II – Other Information
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23
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23
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23
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24
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24
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24
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24
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25
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26
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As of June 30,
2013
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As of September 30,
2012
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|||||||
(Unaudited) | ||||||||
ASSETS
|
||||||||
Current assets:
|
||||||||
Cash and cash equivalents
|
$ | 100,962 | $ | 1,348,069 | ||||
Other receivable
|
27,854 | |||||||
Inventory
|
790,000 | 1,311,349 | ||||||
Other current assets
|
103,550 | 91,529 | ||||||
Total current assets
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994,512 | 2,778,801 | ||||||
Non-current assets:
|
||||||||
Property and equipment, net
|
49,994 | 128,119 | ||||||
Total assets
|
$ | 1,044,506 | $ | 2,906,920 | ||||
LIABILITIES AND STOCKHOLDERS' DEFICIT
|
||||||||
Current liabilities:
|
||||||||
Accounts payable
|
$ | 342,896 | $ | 155,547 | ||||
Accrued Expenses
|
1,310,972 | 907,728 | ||||||
Notes payable - related parties
|
45,000 | 25,000 | ||||||
Convertible notes, net of debt discount
|
1,184,136 | 1,444,737 | ||||||
Secured promissory notes
|
225,681 | |||||||
Deferred Revenue
|
10,000 | |||||||
Derivative liability
|
668,226 | 396,129 | ||||||
Unregistered shares shortfall
|
1,913,279 | 2,180,220 | ||||||
Shares to be issued
|
1,125,000 | 165,880 | ||||||
Total current liabilities
|
6,589,509 | 5,510,921 | ||||||
Long-Term Debt, net of discount | 1,039,207 | |||||||
Total Liabilities
|
7,628,715 | 5,510,921 | ||||||
Stockholders' Deficit
|
||||||||
Stockholders' Deficit Attributable to Sionix Corporation:
|
||||||||
Preferred stock, $0.001 par value, 10,000,000 shares authorized at June 30, 2013 and September 30, 2012
|
||||||||
Common stock, $0.001 par value (600,000,000 shares authorized; 473,834,579 shares issued and outstanding at June 30, 2013; 387,968,434 shares issued and outstanding at September 30, 2012)
|
473,835 | 387,968 | ||||||
Additional paid-in capital
|
34,889,826
|
33,078,094
|
||||||
Accumulated deficit
|
(41,947,870
|
) |
(37,317,951
|
) | ||||
Total stockholders' deficit attributable to Sionix Corporation
|
(6,584,209 | ) | (3,851,889 | ) | ||||
Deficit attributable to noncontrolling interest | 1,247,888 | |||||||
Total stockholders' deficit
|
(6,584,209 | ) | (2,604,001 | ) | ||||
Total liabilities and stockholders' deficit
|
$ | 1,044,506 | $ | 2,906,920 |
Three Months Ended
June 30,
|
Nine Months Ended
June 30,
|
|||||||||||||||
2013
|
2012
|
2013
|
2012
|
|||||||||||||
Net Revenue
|
$ | 22,500 | $ | 50,000 | ||||||||||||
Cost of revenues | 4,558 | |||||||||||||||
Gross profit
|
22,500 | 45,442 | ||||||||||||||
Operating expenses
|
||||||||||||||||
General and administrative
|
208,457 | 796,135 |
1,407,277
|
2,168,923 | ||||||||||||
Sales and marketing
|
5,112 | 62,020 | 58,924 | 210,327 | ||||||||||||
Research and development
|
198,626 | 285,056 | 1,336,015 | 599,929 | ||||||||||||
Depreciation
|
6,472 | 8,607 | 23,848 | 16,055 | ||||||||||||
Total operating expenses
|
418,667 | 1,151,818 |
2,826,065
|
2,995,234 | ||||||||||||
Loss from operations
|
(396,167 | ) | (1,151,818 | ) |
(2,780,622
|
) | (2,995,234 | ) | ||||||||
Other income (expense)
|
||||||||||||||||
Interest expense and financing costs
|
(489,671 | ) | (251,831 | ) |
(1,198,216
|
) | (714,456 | ) | ||||||||
Gain (loss) on change in fair value of derivative liability
|
(241,520 | ) | 36,911 |
(272,097
|
) | 35,538 | ||||||||||
Other income (expense)
|
6,908 | 6,908 | ||||||||||||||
Change in fair value of unregistered shares shortfall
|
1,783,000 | 266,941 | ||||||||||||||
Loss on asset disposition
|
(4,326 | ) | (8,854 | ) | ||||||||||||
Loss on Legal settlements
|
(15,000 | ) | (15,000 | ) | ||||||||||||
Loss on settlement of debt
|
(342,219 | ) | (351,608 | ) |
(527,521
|
) | (548,501 | ) | ||||||||
Total other income (expense)
|
690,264 | (559,620 | ) |
(1,849,291
|
) | (1,220,511 | ) | |||||||||
Income (loss) before income taxes
|
294,097 | (1,711,438 | ) |
(4,629,919
|
) | (4,215,745 | ) | |||||||||
Income taxes | ||||||||||||||||
Net Income (loss)
|
294,097 | (1,711,438 | ) |
(4,629,919
|
) | (4,215,745 | ) | |||||||||
Less: Net income attributable to the noncontrolling interest | 122,566 | 125,153 | ||||||||||||||
Net Income (loss) attributable to Sionix Corporation
|
$ | 294,097 | $ | (1,588,872 | ) | $ |
(4,629,919
|
) | $ | (4,090,592 | ) | |||||
Amounts attributable to Sionix Corporation:
|
||||||||||||||||
Basic income (loss) per share
|
$ | 0.00 | $ | (0.01 | ) | $ | (0.01 | ) | $ | (0.01 | ) | |||||
Diluted income (loss) per share
|
$ | 0.00 | $ | (0.01 | ) | $ | (0.01 | ) | $ | (0.01 | ) | |||||
Basic weighted average number of shares of common stock outstanding
|
440,415,881 | 339,671,367 | 419,966,351 | 322,945,023 | ||||||||||||
Diluted weighted average number of shares of common stock outstanding
|
499,475,366 | 339,671,367 | 419,966,351 | 322,945,023 |
Common Stock
|
Additional
|
Non-
|
Total
|
|||||||||||||||||||||
Number
|
Paid-in
|
Accumulated
|
Controlling
|
Stockholders'
|
||||||||||||||||||||
of Shares
|
Amount
|
Capital
|
Deficit
|
Interest
|
Deficit
|
|||||||||||||||||||
Balances at September 30, 2012
|
387,968,434 | $ | 387,968 | $ |
33,078,094
|
$ |
(37,317,951
|
) | $ | 1,247,888 | $ | (2,604,001 | ) | |||||||||||
WBI Settlement - cash
|
(569,647 | ) | (569,647 | ) | ||||||||||||||||||||
WBI Settlement - notes payable
|
(450,000 | ) | (450,000 | ) | ||||||||||||||||||||
WBI Settlement - loss
|
228,241 | (228,241 | ) | |||||||||||||||||||||
Conversion of notes payable into common stock
|
55,642,330 | 55,643 | 985,011 | 1,040,654 | ||||||||||||||||||||
Common stock issued for services
|
6,680,529 | 6,681 | 195,721 | 202,402 | ||||||||||||||||||||
Common stock issued for cash
|
7,800,000 | 7,800 | 187,200 | 195,000 | ||||||||||||||||||||
123R Expense
|
14,671 | 14,671 | ||||||||||||||||||||||
Common stock issued for financing costs
|
15,743,286 | 15,743 | 158,207 | 173,950 | ||||||||||||||||||||
Liability for contractual obligation to issue common stock
|
42,681 | 42,681 | ||||||||||||||||||||||
Net loss
|
(4,629,919
|
) | (4,629,919 | ) | ||||||||||||||||||||
Balances at June 30, 2013
|
473,834,579 | $ | 473,835 | $ |
34,889,826
|
$ |
(41,947,870
|
) | $ | - | $ |
(6,584,209
|
) |
Nine Months Ended
June 30,
|
||||||||
2013
|
2012
|
|||||||
Cash flows from operating activities
|
||||||||
Net loss
|
$ |
(4,629,919
|
) | $ | (4,215,745 | ) | ||
Adjustments to reconcile net loss to net cash used by operating activities:
|
||||||||
Depreciation
|
23,849 | 16,055 | ||||||
Amortization of debt discounts
|
1,359,226 | 366,985 | ||||||
Share based payments
|
(53,513 | ) | 203,766 | |||||
Common stock issued for services
|
355,175
|
1,220,341 | ||||||
(Gain) loss on change in fair value of derivative liability
|
272,097 | (35,538 | ) | |||||
Loss on sale of property and equipment
|
(21,103 | ) | ||||||
(Gain) loss on change in fair value of unregistered shares shortfall
|
(266,941 | ) | ||||||
(Gain) Loss on settlement of debt
|
(10,117 | ) | 548,501 | |||||
Changes in operating assets and liabilities:
|
||||||||
Other Receivables
|
27,854 | |||||||
Inventory
|
521,349 | (149,627 | ) | |||||
Other current assets
|
(132,230 | ) | (322,809 | ) | ||||
Accounts payable
|
99,767 | (59,565 | ) | |||||
Accrued expenses
|
602,737
|
380,399 | ||||||
Deferred revenue | (10,000 | ) | ||||||
Net cash used by operating activities
|
(1,861,769 | ) | (2,047,237 | ) | ||||
Cash flows from investing activities:
|
||||||||
Proceeds from sale of property and equipment, net
|
81,127 | |||||||
Purchase of property and equipment
|
(5,748 | ) | (124,434 | ) | ||||
Net cash provided (used) by investing activities
|
75,379 | (124,434 | ) | |||||
Cash flows from financing activities:
|
||||||||
Borrowings, net
|
944,000 | 975,000 | ||||||
Common stock issued for cash
|
195,000 | 400,200 | ||||||
Noncontrolling interests in subsidiary issued for cash
|
(569,647 | ) | 1,600,000 | |||||
Note payments for cash | (30,070 | ) | ||||||
Net cash (used) provided by financing activities
|
539,283 | 2,975,200 | ||||||
Net increase (decrease) in cash and cash equivalents
|
(1,247,107 | ) | 803,529 | |||||
Cash and cash equivalents, beginning of period
|
1,348,069 | 685 | ||||||
Cash and cash equivalents, end of period
|
$ | 100,962 | $ | 804,214 | ||||
SUPPLEMENTARY CASH FLOW INFORMATION:
|
||||||||
Income taxes paid
|
$ | $ | 599 | |||||
SUPPLEMENTARY DISCLOSURE OF NONCASH FINANCING ACTIVITIES: | ||||||||
Debt issued for WBI | $ |
450,000
|
$ | |||||
Notes & accrued interest converted
|
$ |
1,485,526
|
$ | |||||
Shares to be issued
|
$ | 1,125,000 | $ |
Potentially dilutive shares for the nine months ended,
|
June 30,
2012
|
|||
Potentially dilutive convertible instruments
|
59,059,485
|
As of September 30, 2012
|
||||||||||||
As Originally
|
||||||||||||
Balance sheets:
|
Reported
|
Adjustment
|
As Restated
|
|||||||||
Convertible notes, net of debt discount
|
1,895,378 |
(450,641
|
) |
1,444,737
|
||||||||
Derivative liability
|
638,178 | (242,049 | ) | 396,129 | ||||||||
Unregistered shares shortfall
|
- | 2,180,220 | 2,180,220 | |||||||||
Additional Paid In Capital
|
34,807,672 | (1,729,578 | ) |
33,078,094
|
||||||||
Accumulated Deficits
|
(37,560,000 | ) | 242,049 |
(37,317,951
|
) |
As of December 31, 2012
|
||||||||||||
As Originally
Reported
|
Adjustment
|
As Restated
|
||||||||||
Convertible notes, net of debt discount
|
1,983,358 | (300,428 | ) |
1,996,957
|
||||||||
Derivative liability
|
420,028 | (89,801 | ) | 330,227 | ||||||||
Unregistered shares shortfall
|
- | 1,104,867 | 1,104,867 | |||||||||
Additional Paid In Capital
|
35,681,588 | (1,405,295 | ) |
34,276,293
|
||||||||
Accumulated Deficits
|
(38,617,909 | ) |
1,014,942
|
(37,602,967
|
) |
As of March 31, 2013
|
||||||||||||
As Originally
Reported
|
Adjustment
|
As Restated
|
||||||||||
Convertible notes, net of debt discount
|
2,005,146 | (150,214 | ) |
2,312,959
|
||||||||
Derivative liability
|
4,478,105 | (4,051,399 | ) | 426,706 | ||||||||
Unregistered shares shortfall
|
- | 3,696,279 | 3,696,279 | |||||||||
Additional Paid In Capital
|
36,089,172 | (3,846,493 | ) |
32,242,679
|
||||||||
Accumulated Deficits
|
(44,479,875 | ) |
2,234,914
|
(42,244,961
|
) |
For the year ended September 30, 2012
|
||||||||||||
As Originally
|
||||||||||||
Statements of operations
|
Reported
|
Adjustment
|
As Restated
|
|||||||||
Gain (loss) on change in FV of derivative liability
|
233,186 | 242,049 | 475,235 | |||||||||
Net income (loss)
|
(5,792,619 | ) | 242,049 |
(5,520,570
|
) | |||||||
Basic income (loss) per share
|
(0.02 | ) | 0.00 | (0.02 | ) | |||||||
For the three months ended December 31, 2012
|
||||||||||||
As Originally
Reported
|
Adjustment
|
As Restated
|
||||||||||
Interest expense
|
(296,410 | ) |
(146,181
|
) |
(442,591
|
) | ||||||
Gain (loss) on change in FV of derivative liability
|
78,191 | (12,289 | ) | 65,902 | ||||||||
Change in FV of unregistered shares shortfall
|
- | 1,075,353 | 1,075,353 | |||||||||
Gain (loss) on settlement of debts
|
4,031
|
(143,992
|
) |
(139,961
|
) | |||||||
Net income (loss)
|
(1,057,909 | ) |
772,893
|
(285,016
|
) | |||||||
Basic income (loss) per share
|
(0.00 | ) | (0.00 | ) |
(0.00
|
) |
For the six months ended March 31, 2013
|
For the three months ended March 31, 2013
|
|||||||||||||||||||||||
As Originally
|
As Originally
|
|||||||||||||||||||||||
Reported
|
Adjustment
|
As Restated
|
Reported
|
Adjustment
|
As Restated
|
|||||||||||||||||||
Interest expense
|
(500,890 | ) | (300,428 | ) |
(708,540
|
) | (204,480 | ) |
(61,469
|
) |
(265,949
|
) | ||||||||||||
Gain (loss) on change in FV of derivative liability
|
(4,107,185 | ) | 4,076,608 | (30,577 | ) | (4,185,376 | ) | 4,088,897 | (96,479 | ) | ||||||||||||||
Change in FV of unregistered shares shortfall
|
- | (1,516,058 | ) |
(1,516,058
|
) | - | (2,591,411 | ) |
(2,591,411
|
) | ||||||||||||||
Gain (loss) on settlement of debts |
(174,734
|
) |
(10,568
|
) |
(185,302
|
) |
170,703
|
(216,045
|
) |
(45,342
|
) | |||||||||||||
Net income (loss)
|
(6,916,876 | ) |
1,992,864
|
(4,924,012
|
) | (5,858,967 | ) |
1,219,972
|
(4,638,995
|
) | ||||||||||||||
Basic income (loss) per share
|
(0.02 | ) | 0.01 | (0.001 | ) | (0.01 | ) | 0.01 | 0.00 |
June 30,
2013
|
September 30,
2012
|
|||||||
Machinery and equipment
|
$ | 90,780 | $ | 166,159 | ||||
Less accumulated depreciation
|
(40,786 | ) | (38,040 | ) | ||||
Property and equipment, net
|
$ | 49,994 | $ | 128,119 |
June 30,
2013
|
September 30,
2012 |
|||||||
Accrued salaries
|
$ | 710,768 | $ | 306,055 | ||||
Interest payable
|
524,121 | 364,567 | ||||||
Other accrued expenses
|
76,083 | 237,106 | ||||||
Total accrued expenses
|
$ | 1,310,972 | $ | 907,728 |
June 30, 2013
|
September 30, 2012
|
|||||||||||||||
Indexed to
Shares
|
Fair Value
|
Indexed to
shares
|
Fair Value
|
|||||||||||||
Derivative liability
|
35,715,905 | $ | 668,226 | 4,534,632 | $ | 396,129 |
Nine Months
Ended June 30,
2013
|
Nine Months
Ended June 30,
2012
|
|||||||
Derivative liability
|
$ | 272,097 | $ | 35,538 |
Three Months
|
Three Months
|
|||||||
Ended June 30,
|
Ended June
|
|||||||
2013
|
30, 2012 | |||||||
Derivative liability
|
$ | 241,520 | $ | 36,911 |
June 30, 2013
|
Level 1
|
Level 2
|
Level 3
|
Total
|
||||||||||||
Liabilities:
|
||||||||||||||||
Derivative liability - BCF
|
$ | $ | $ | 668,226 | $ | 668,226 | ||||||||||
Unregistered shares shortfall - Warrants
|
$ | 1,913,279 | $ | 1,913,279 | ||||||||||||
$ | $ | $ | 2,581,505 | $ | 2,581,505 | |||||||||||
September 30, 2012
|
Level 1
|
Level 2
|
Level 3
|
Total
|
||||||||||||
Liabilities:
|
||||||||||||||||
Derivative liability - BCF
|
$ | $ | $ | 396,129 | $ | 396,129 | ||||||||||
Unregistered shares shortfall - Warrants
|
$ | 2,180,220 | $ | 2,180,220 | ||||||||||||
$ | $ | $ | 2,576,349 | $ | 2,576,349 |
BCF
|
Warrants
|
|||||||
Exercise price
|
0.012 | 0.11 | ||||||
Risk free rate of return
|
0.150 | % | 0.72 | % | ||||
Volatility
|
335 | % | 171 | % | ||||
Dividend yield
|
0 | 0 | % | |||||
Expected term
|
1 | 5 |
ECF
|
Warrants
|
|||||||
Exercise price
|
0.040 | 0.14 | ||||||
Risk free rate of return
|
0.210 | % | 0.72 | % | ||||
Volatility
|
179 | % | 171 | % | ||||
Dividend yield
|
0 | 0 | % | |||||
Expected term
|
1 | 5 |
Balance as of September 30, 2012:
|
$ | 2,576,349 | ||
Gain (loss) on derivative liabilities
|
(5,156 | ) | ||
Balance as of June 30, 2013:
|
$ | 2,581,505 |
Aggregate
|
Weighted Average
|
|||||||||||||||
Number of
|
Weighted Average
|
Intrinsic
|
Remaining
|
|||||||||||||
Warrants
|
Exercise Price
|
Value
|
Contractual Life
|
|||||||||||||
Outstanding at October 1, 2012
|
43,716,316 | $ | 0.12 | $ | - | 3.01 | ||||||||||
Granted
|
500,000 | 0.15 | - | 4.75 | ||||||||||||
Expired
|
(3,933,526 | ) | 0.21 | - | - | |||||||||||
Forfeited
|
(500,000 | ) | - | - | - | |||||||||||
Exercised
|
- | - | - | - | ||||||||||||
Outstanding at June 30, 2013
|
39,782,790 | 0.11 | - | 1.73 | ||||||||||||
Exercisable at June 30, 2013
|
39,782,790 | $ | 0.11 | $ | - | 1.73 |
Exercise Price
|
Warrants Outstanding
|
Contractual Life
|
Weighted Average
Remaining
Options
Exercisable
|
Weighted Average
Remaining
Contractual Life
|
||||||||||||||
$ | 0.06 | 7,415,000 | 2.19 | 7,415,000 | 2.19 | |||||||||||||
$ | 0.07 | 2,000,000 | 2.50 | 2,000,000 | 2.50 | |||||||||||||
$ | 0.09 | 2,000,000 | 2.50 | 2,000,000 | 2.50 | |||||||||||||
$ | 0.10 | 8,416,850 | 1.27 | 8,416,850 | 1.27 | |||||||||||||
$ | 0.12 | 8,450,940 | 0.78 | 8,450,940 | 0.78 | |||||||||||||
$ | 0.14 | 500,000 | 2.92 | 500,000 | 2.92 | |||||||||||||
$ | 0.15 | 11,000,000 | 2.19 | 11,000,000 | 2.19 | |||||||||||||
39,782,790 | 1.73 | 39,782,790 | 1.73 |
Number of
|
Weighted Average
|
|||||||
Warrants
|
Exercise Price
|
|||||||
Outstanding at October 1, 2012
|
$ | 114,460,085 | 0.12 | |||||
Granted
|
3,725,000 | 0.02 | ||||||
Expired
|
(6,045,037 | ) | 0.22 | |||||
Forfeited
|
- | - | ||||||
Exercised
|
- | - | ||||||
Outstanding as of June 30, 2013
|
$ | 112,140,048 | 0.11 | |||||
Exercisable as of June 30, 2013
|
$ | 112,140,048 | 0.11 |
Exercise
|
Warrants
|
Warrants
|
Weighted
Average
Remaining
Contractual
|
Weighted Average
Exercise Price
|
||||||||||||||||||
Price
|
Outstanding
|
Exercisable
|
Life
|
Outstanding
|
Exercisable
|
|||||||||||||||||
$ | 0.02 | 3,100,000 | 3,100,000 | 4.81 | $ | 0.02 | $ | 0.02 | ||||||||||||||
$ | 0.06 | 11,262,500 | 11,262,500 | 2.92 | $ | 0.06 | $ | 0.06 | ||||||||||||||
$ | 0.07 | 22,833,333 | 22,833,333 | 0.79 | $ | 0.07 | $ | 0.07 | ||||||||||||||
$ | 0.08 | 25,425,000 | 25,425,000 | 3.87 | $ | 0.08 | $ | 0.08 | ||||||||||||||
$ | 0.10 | 5,754,722 | 5,754,722 | 3.06 | $ | 0.10 | $ | 0.10 | ||||||||||||||
$ | 0.12 | 6,226,000 | 6,226,000 | 0.44 | $ | 0.12 | $ | 0.12 | ||||||||||||||
$ | 0.14 | 5,000,000 | 5,000,000 | 2.31 | $ | 0.14 | $ | 0.14 | ||||||||||||||
$ | 0.15 | 2,107,667 | 2,107,667 | 1.58 | $ | 0.15 | $ | 0.15 | ||||||||||||||
$ | 0.17 | 24,230,825 | 24,230,825 | 2.61 | $ | 0.17 | $ | 0.17 | ||||||||||||||
$ | 0.25 | 3,700,000 | 3,700,000 | 0.82 | $ | 0.25 | $ | 0.25 | ||||||||||||||
$ | 0.30 | 2,500,000 | 2,500,000 | 0.08 | $ | 0.30 | $ | 0.30 | ||||||||||||||
112,140,048 | 112,140,048 | 2.37 |
●
|
our inability to obtain the financing we need to continue our operations;
|
●
|
changes in regulatory requirements that adversely affect our business;
|
●
|
loss of our key personnel; and
|
●
|
risks over which we have no control, such as the general global downturn in the economy which may adversely affect spending by private and government agencies.
|
During the three months ended June 30, 2013, we: | ||
●
|
Issued 15,421,969 shares of common stock for conversion of debt in the amount of $327,812 (including interest).
|
|
●
|
Issued 7,800,000 shares of common stock for cash in the amount of $195,000.
The Company used, or will use, the net proceeds for general working capital purposes.
We relied on Section 3(a)(9) of the Securities Act as providing an exemption from registering the issuance of these shares of common stock inasmuch as the conversion was made with our existing security holders exclusively and no commission or other remuneration was paid or given directly or indirectly for soliciting the exchange.
The issuance of shares of common stock for cash were exempt from registration under section 4(2) of the Securities Act of 1933 because they were issued in a privately negotiated transaction with persons with whom we had prior material business relations and were restricted from resale or other applicable exemptions from registration.
|
Exhibit
No.
|
Description of Exhibit
|
|
3.1
|
Articles of Incorporation (1)
|
|
3.1.1
|
Amendment to Articles of Incorporation (2)
|
|
3.2
|
Bylaws (1)
|
|
31.1
|
Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002*
|
|
31.2
|
Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002*
|
|
32.1
|
Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002*
|
|
32.2
|
Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002*
|
|
101.INS
|
XBRL INSTANCE DOCUMENT
|
|
101.SCH
|
XBRL TAXONOMY EXTENSION SCHEMA DOCUMENT
|
|
101.CAL
|
XBRL TAXONOMY CALCULATION LINKBASE DOCUMENT
|
|
101.DEF
|
XBRL TAXONOMY DEFINITION LINKBASE DOCUMENT
|
|
101.LAB
|
XBRL TAXONOMY LABEL LINKBASE DOCUMENT
|
|
101.PRE
|
XBRL TAXONOMY PRESENTATION LINKBASE DOCUMENT
|
(1)
|
Incorporated by reference from our Current Report on Form 8-K filed with the Securities and Exchange Commission on July 15, 2003 as file number 002-95626-D.
|
(2)
|
Incorporated by reference from Annex 1 to our definitive proxy statement filed with the Securities and Exchange Commission on February 7, 2010 as file number 002-95626-D.
|
SIONIX CORPORATION
|
|
/s/ Henry W. Sullivan
|
|
Henry W. Sullivan
|
|
Chief Executive Officer (Principal Executive Officer)
|
|
/s/ Joseph W. Autem
|
|
Joseph W. Autem
|
|
Chief Financial Officer, Secretary/Treasurer, and
Principal Financial and Accounting Officer
|
Date: Auguts 27, 2013
|
/s/ Henry W. Sullivan
Henry W. Sullivan
Principal Executive Officer
|
Date: August 27, 2013
|
/s/ Joseph W. Autem
Joseph W. Autem
Principal Financial Officer
|
/s/ Henry W. Sullivan
|
|
Henry W. Sullivan
Principal Executive Officer
Auguts 27, 2013
|
/s/ Joseph W. Autem
|
|
Joseph W. Autem
Principal Financial Officer
August 27, 2013
|
Fair Value Consideration
|
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2013
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Consideration | Note 11 – Fair Value Consideration
GAAP establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. As presented in the tables below, this hierarchy consists of three broad levels:
Level 1 valuations: Quoted prices in active markets for identical assets and liabilities.
Level 2 valuations: Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; and model-derived valuations whose inputs or significant value drivers are observable. Level 3 valuations: Significant inputs to valuation model are unobservable.
We follow the provisions of ASC 820, Fair Value Measurements and Disclosures, with respect to our financial instruments. As required by ASC 820, assets and liabilities measured at fair value are classified in their entirety based on the lowest level of input that is significant to their fair value measurement. Our derivative financial instruments which are required to be measured at fair value on a recurring basis under of ASC 815 are all measured at fair value using Level 3 inputs. Level 3 inputs are unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.
The following table presents information about the Company’s liabilities measured at fair value as of June 30, 2013 and September 30, 2012:
Both the derivative liability and unregistered shares shortfall were valued using a black scholes valuation model. The black scholes valuation technique was utilized because it embodies all of the requisite assumptions (including the underlying price, exercise price, term, volatility, and risk-free interest-rate) that are necessary to fair value these instruments. Estimating fair values of derivative financial instruments requires the development of significant and subjective estimates that may, and are likely to, change over the duration of the instrument with related changes in internal and external market factors. In addition, option-based techniques are highly
volatile and sensitive to changes in the trading market price of our common stock. Because derivative financial instruments are initially and subsequently carried at fair values, our income will reflect the volatility in these estimate and assumption changes.
Significant assumptions in valuing the beneficial conversion feature (“BCF”) and unregistered shares shortfalls - warrants were as follows as of June 30, 2013:
Significant assumptions in valuing the beneficial conversion feature (“BCF”) and unregistered shares shortfalls - warrants were as follows as of September 30, 2012:
The following table sets forth a reconciliation of changes in the fair value of financial liabilities classified as Level 3 in the fair value hierarchy:
|
Condensed Consolidated Statement of Operations (Unaudited) (USD $)
|
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2013
|
Jun. 30, 2012
|
Jun. 30, 2013
|
Jun. 30, 2012
|
|
Statement Of Operations [Abstract] | ||||
Net Revenue | $ 22,500 | $ 50,000 | ||
Cost of revenues | 4,558 | |||
Gross profit | 22,500 | 45,442 | ||
Operating expenses | ||||
General and administrative | 208,457 | 796,135 | 1,407,277 | 2,168,923 |
Sales and marketing | 5,112 | 62,020 | 58,924 | 210,327 |
Research and development | 198,626 | 285,056 | 1,336,015 | 599,929 |
Depreciation | 6,472 | 8,607 | 23,849 | 16,055 |
Total operating expenses | 418,667 | 1,151,818 | 2,826,065 | 2,995,234 |
Loss from operations | (396,167) | (1,151,818) | (2,780,622) | (2,995,234) |
Other income (expense) | ||||
Interest expense and financing costs | (489,671) | (251,831) | (1,198,216) | (714,456) |
Gain (loss) on change in fair value of derivative liability | (241,520) | 36,911 | (272,097) | 35,538 |
Other income (expense) | 6,908 | 6,908 | ||
Change in fair value of unregistered shares shortfall | 1,783,000 | 266,941 | ||
Loss on asset disposition | (4,326) | (8,854) | ||
Loss on Legal settlements | (15,000) | (15,000) | ||
Loss on settlement of debt | 527,521 | (548,501) | ||
Total other income (expense) | 690,264 | (559,620) | (1,849,291) | (1,220,511) |
Income (loss) before income taxes | 294,097 | (1,711,438) | (4,629,919) | (4,215,745) |
Income taxes | ||||
Net Income (loss) | 294,097 | (1,711,438) | (4,629,919) | (4,215,745) |
Less: Net income attributable to the noncontrolling interest | 122,566 | 125,153 | ||
Net Income (loss) attributable to Sionix Corporation | $ 294,097 | $ (1,588,872) | $ (4,629,919) | $ (4,090,592) |
Amounts attributable to Sionix Corporation: | ||||
Basic income (loss) per share | $ 0.00 | $ (0.01) | $ (0.01) | $ (0.01) |
Diluted income (loss) per share | $ 0.00 | $ (0.01) | $ (0.01) | $ (0.01) |
Basic weighted average number of shares of common stock outstanding | 440,415,881 | 339,671,367 | 419,966,351 | 322,945,023 |
Diluted weighted average number of shares of common stock outstanding | 499,475,366 | 339,671,367 | 419,966,351 | 322,945,023 |
Property and Equipment
|
9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2013
|
||||||||||||||||||||||||||||||||||||||||||||||
Property and Equipment [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||
Property and Equipment | Note 4 – Property and Equipment Property and equipment consisted of the following at:
Depreciation expense for the three months ended June 30, 2013 and 2012 was $6,472 and $8,607, respectively. For the nine months ended June 30, 2013 and 2012, depreciation expense was $23,848 and $16,055, respectively. |
Derivative Financial Instruments (Tables)
|
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2013
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Financial Instruments [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Components of embedded derivative liability reflected in condensed consolidated balance sheets |
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summay of effects on gain (loss) associated with changes in fair values of derivative financial instruments |
|
Income Taxes
|
9 Months Ended |
---|---|
Jun. 30, 2013
|
|
Income Taxes [Abstract] | |
Income Taxes | Note 12 – Income Taxes For the nine months ended June 30, 2013 and 2012, the accompanying Condensed Consolidated Statements of Operations and Condensed Consolidated Balance Sheets as of June 30, 2013 and September 30, 2012, contain no provision for income taxes and no liability for income taxes as the Company has accumulated net operating loss carry forwards in excess of any income generated by the Company. |
Stockholders' Equity (Details 2) (Stock Warrants [Member], USD $)
|
9 Months Ended |
---|---|
Jun. 30, 2013
|
|
Stock Warrants [Member]
|
|
Summary of the Company's activity for employee stock options/ stock warrants | |
Outstanding warrant, Beginning balance | 114,460,085 |
Granted warrants | 3,725,000 |
Expired warrants | (6,045,037) |
Forfeited warrants | |
Exercised warrants | |
Outstanding warrants, Ending balance | 112,140,048 |
Outstanding warrants exercisable | 112,140,048 |
Outstanding, Weighted Average Exercise Price, Beginning balance | $ 0.12 |
Granted, Weighted Average Exercise Price | $ 0.02 |
Expired, Weighted Average Exercise Price | $ 0.22 |
Forfeited, Weighted Average Exercise Price | |
Exercised, Weighted Average Exercise Price | |
Outstanding warrants exercisable, Weighted Average Exercise Price | $ 0.11 |
Outstanding warrants, Weighted Average Exercise Price, Ending balance | $ 0.11 |
Convertible Notes (Details) (USD $)
|
9 Months Ended | 1 Months Ended | 0 Months Ended | 0 Months Ended | 1 Months Ended | 0 Months Ended | 9 Months Ended | 9 Months Ended | |||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2013
|
Sep. 30, 2012
|
Jan. 25, 2013
January Convertible Notes [Member]
|
Mar. 13, 2013
March Convertible Notes [Member]
Investors
|
Sep. 21, 2012
6% Convertible Redeemable Note
|
Nov. 23, 2011
6% Convertible Redeemable Note
|
Jun. 30, 2013
6% Convertible Redeemable Note
September 21, 2012 [Member]
|
Sep. 29, 2012
10% Convertible Debentures
|
Jun. 24, 2013
10% Convertible Debentures
|
Jun. 27, 2013
Additional 10% Convertible Debentures [Member]
|
Apr. 11, 2013
Additional 10% Convertible Debentures [Member]
|
Jun. 30, 2013
Minimum [Member]
|
Jan. 25, 2013
Minimum [Member]
January Convertible Notes [Member]
|
Sep. 29, 2012
Minimum [Member]
10% Convertible Debentures
|
Jun. 27, 2013
Minimum [Member]
Additional 10% Convertible Debentures [Member]
|
Apr. 11, 2013
Minimum [Member]
Additional 10% Convertible Debentures [Member]
|
Jun. 30, 2013
Maximum [Member]
|
Jan. 25, 2013
Maximum [Member]
January Convertible Notes [Member]
|
Sep. 29, 2012
Maximum [Member]
10% Convertible Debentures
|
Jun. 27, 2013
Maximum [Member]
Additional 10% Convertible Debentures [Member]
|
Apr. 11, 2013
Maximum [Member]
Additional 10% Convertible Debentures [Member]
|
|
Convertible Notes (Textual) | |||||||||||||||||||||
Convertible notes payable | $ 1,184,136 | $ 1,319,737 | $ 400,000 | ||||||||||||||||||
Discount on convertible note payable | 124,226 | 383,659 | |||||||||||||||||||
Interest rate on convertible note | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 6.00% | 12.00% | ||||||||||||||
Per share price of conversion of debt into common stock | $ 0.02 | $ 0.15 | |||||||||||||||||||
Interest rate on convertible redeemable note | 6.00% | 6.00% | |||||||||||||||||||
Convertible debentures issued, amount | 700,000 | ||||||||||||||||||||
Unsecured convertible, carrying amount of equity component | 0 | ||||||||||||||||||||
Conversion of notes payable into common stock | 170,000 | ||||||||||||||||||||
Conversion of notes payable into common stock, shares | 19,544,356 | 15,000,000 | 15,000,000 | ||||||||||||||||||
Convertible redeemable note, face amount | 100,000 | 100,000 | 100,000 | 100,000 | |||||||||||||||||
Convertible notes maturity date | Mar. 31, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 21, 2013 | Nov. 23, 2012 | Dec. 31, 2014 | Dec. 31, 2014 | ||||||||||||||
Convertible instrument, maturity, start date | Sep. 25, 2012 | ||||||||||||||||||||
Convertible instrument, maturity, end date | Jun. 25, 2013 | ||||||||||||||||||||
Convertible notes, fee amount | 6,000 | 45,000 | |||||||||||||||||||
Debt outstanding amount | 83,268 | ||||||||||||||||||||
Convertible redeemable note subject to redemption, settlement terms, description | The January 2013 Notes are convertible at any time at the option of the January Holders (subject to an increase in the Company's authorized Common Stock, or a reverse split of its existing outstanding Common Stock with no change to its authorized Common Stock). The Company may redeem the January 2013 Notes at any time prior to maturity with twenty (20) days' prior notice to the January Holders and payment of a premium of 20% on the unpaid principal amount. | The Company may redeem the March 2013 Notes at any time prior to maturity with twenty (20) days' prior notice to the March Holders and payment of a premium of 20% on the unpaid principal amount. | An optional right of redemption prior to maturity upon a five-day notice and payment of a 50% premium on the unpaid principal amount of the loan. | The Notes may be redeemed by the Company at any time prior to maturity with ten days' prior notice to the Holders, and payment of a premium of 25% on the unpaid principal amount of the Notes. | The Company gave notice of early redemption to the Holders on June 24, 2013. The Notes were redeemed for a premium of 25%, in accordance with the provisions of the Notes | ||||||||||||||||
Convertible debt, convertible, terms of conversion feature | At a conversion price equal to 80% of the average of the three (3) lowest closing prices for the Common Stock during the ten (10) consecutive trading days immediately preceding the conversion request, however the conversion price may not exceed $0.04 and may not be lower than $0.02 per share. | The conversion price for each share of common stock will be equal to 70% of the lowest closing bid price of the common stock for a period of five trading days, but no lower than $0.001 per share. | The conversion price for each share of common stock will be equal to 70% of the lowest closing bid price of the common stock for a period of five trading days, but no lower than $0.001 per share. | The Notes are convertible at any time at the option of the Holders into the Company's common stock at a conversion price based on 80% of the average of the three lowest closing prices for the common stock during the ten consecutive trading days immediately preceding the conversion request. | The notes are convertible at any time at the option of the holders into shares of our common stock at a conversion price based on 80% of the average of the three lowest closing prices for the common stock during the ten consecutive trading days immediately preceding the conversion request, however the conversion price may not exceed $0.04, and may not be lower than $0.02 per share | The notes are convertible at any time at the option of the holders into shares of our common stock at a conversion price based on 80% of the average of the three lowest closing prices for the common stock during the ten consecutive trading days immediately preceding the conversion request, however the conversion price may not exceed $0.04, and may not be lower than $0.02 per share | |||||||||||||||
Maximum period to file registration statement | 30 days | ||||||||||||||||||||
Description for obligations in failure of filling registration statement | If the Company fails to file a registration statement with the SEC covering such shares within thirty (30) days from the date of the January Notes, the Company shall pay to the January Holders an amount in cash, as partial liquidated damages, equal to 2% of the aggregate purchase price paid by the January Holders pursuant to the January SPAs until the first anniversary of the issue date and 1% of the same per month thereafter, not to exceed 10% of the principal amount in the aggregate. | If the Company fails to file a registration statement within this 30 day period, or to have it declared effective within 90 days after the date of the registration rights agreement, or to maintain its effectiveness (in addition to other events described in the full text of the registration rights agreement), the Company will be obligated to pay the investors liquidated damages equal to 2% of the principal amount of the Notes per month until the event is cured, for up to one year, and 1% per month thereafter if the event continues uncured. | |||||||||||||||||||
Convertible notes, additional funding provided by lender to the company in the form of a promissory note | 300,000 | 300,000 | 150,000 | 150,000 | |||||||||||||||||
Description of convertible notes additional borrowing | Sionix with funding of an additional $300,000, $100,000 of which will become available on each of July 1, 2013, August 15, 2013 and October 1, 2013. | Company with funding of up to an additional $300,000 beginning on June 1, 2012, at which time $100,000 became available, on each of June 1, 2012, July 1, 2012 and August 1, 2012. | |||||||||||||||||||
Convertible notes conversion price | $ 0.02 | $ 0.02 | $ 0.02 | $ 0.02 | $ 0.02 | $ 0.02 | $ 0.02 | $ 0.04 | $ 0.04 | $ 0.04 | $ 0.04 | ||||||||||
Sale of convertible debt to accredited investor | 140,000 | 60,000 | 1,025,000 | ||||||||||||||||||
Number of accredited investors in security purchase agreements | 5 | ||||||||||||||||||||
Common stock, par value | $ 0.001 | $ 0.001 | $ 0.001 | ||||||||||||||||||
Debt instrument maturity period | 9 months | ||||||||||||||||||||
Number of shares to be purchased from issuance of warrants | 23,125,000 | ||||||||||||||||||||
Warrant vesting period | 5 years | ||||||||||||||||||||
Warrants, exercise price | $ 0.08 | ||||||||||||||||||||
Cash fee paid to the placement agent | $ 87,535 | ||||||||||||||||||||
Percentage of gross proceeds of primary debentures paid as placement fee to agent | 8.54% |
Stockholders' Equity (Tables)
|
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2013
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Employee Warrants [Member]
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Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of the Company's activity for employee warrants/ stock warrants |
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Schedule of warrants outstanding and exercisable |
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Stock Warrants [Member]
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Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of the Company's activity for employee warrants/ stock warrants |
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Schedule of warrants outstanding and exercisable |
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Accrued Expenses (Tables)
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9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2013
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Accrued Expenses [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Components of accrued expenses |
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Property and Equipment (Details Textual) (USD $)
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3 Months Ended | 9 Months Ended | ||
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Jun. 30, 2013
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Jun. 30, 2012
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Jun. 30, 2013
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Jun. 30, 2012
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Property and Equipment (Textual) | ||||
Depreciation expense | $ 6,472 | $ 8,607 | $ 23,849 | $ 16,055 |
Long Term Debt (Details) (USD $)
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0 Months Ended | 9 Months Ended | 0 Months Ended | 0 Months Ended | 9 Months Ended | |||
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Nov. 26, 2012
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Jun. 30, 2013
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Sep. 30, 2012
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Nov. 26, 2012
10% Convertible Debt (WBI) [Member]
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Mar. 01, 2013
10% Convertible Debt (WBI) [Member]
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Jan. 02, 2013
10% Convertible Debt (WBI) [Member]
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Apr. 19, 2013
10% Convertible Promissory Note [Member]
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Jun. 30, 2013
10% Convertible Promissory Note [Member]
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Long Tem Debt (Textual) | ||||||||
Description of consideration offered by company for repurchase of outstanding membership interest in WBI | We offered the members the option of receiving a pro-rata share of the remaining capital invested into WBI, or they could assign their rights to their remaining capital to Sionix in return for a convertible note issued by Sionix equal to 100% of their original investment. | The Company offered the members the option of receiving a pro-rata share of the remaining capital invested into WBI, or they could assign their rights to their remaining capital to Sionix in return for a convertible note issued by Sionix equal to 100% of their original investment. | ||||||
Amount of cash available for cash distribution | $ 854,046 | |||||||
Percentage of distribution on original investment | 63.30% | |||||||
Amount of original investment | 1,350,000 | |||||||
Amount of original investment returned | 569,649 | |||||||
Decreased amount of original investment | 900,000 | |||||||
Convertible notes payable | 1,184,136 | 1,319,737 | 450,000 | |||||
Remaining capital of original investment | 284,397 | |||||||
Additional capital received from issuance of additional notes | 250,000 | |||||||
Amount of additional note issued | 394,000 | 200,000 | 200,000 | |||||
Debt discount | 144,000 | |||||||
Convertible notes maturity date | Mar. 31, 2014 | Sep. 30, 2014 | Aug. 19, 2014 | |||||
Interest rate on convertible note | 10.00% | |||||||
Convertible notes conversion price | $ 0.04 | $ 0.03 | ||||||
Payment of placement agent fees | 45,000 | |||||||
Convertible promissory note principal amount | 1,039,207 | 155,000 | ||||||
Common Stock Warrant Exercise Period | 5 years | |||||||
Number of warrants to purchase common stock | 62,000 | |||||||
Common stock warrant exercise price | 0.06 | |||||||
Loan processing fees paid | 5,000 | |||||||
Convertible note prepayment terms | The Company has the optional right to prepay any portion of the Principal Amount upon providing five (5) days' notice of such prepayment, provided that the Company must pay the lender 135% of the amount of the Principal Amount it elects to prepay. | Beginning on a date that is 180 days after the date of issuance of the LT Note, the Company shall pay, on a monthly basis | ||||||
Precentage wise profit given if prepayment of debt made | 135.00% | |||||||
Interest rate on long term debt | 8.00% | |||||||
Increase in interest rate | 18,000 | |||||||
Debt conversion, description | In the event of a Company Conversion the number of shares of Common Stock due to the lender will be based on a conversion price that is equal to the lower of i) the Conversion Price and ii) 70% of the three (3) lowest closing volume-weighted average prices ("VWAPs") of the Company's Common Stock for a period of twenty (20) trading days, provided, however, that if the arithmetic average of the three (3) lowest VWAPs of the shares of Common Stock during any twenty (20) consecutive trading day period is less than $0.01, then the conversion described above will be based on 65% of the VWAPs | |||||||
Repayments of convertible debt on monthly basis | $ 15,500 |
Correction of Errors (Details) (USD $)
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Jun. 30, 2013
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Mar. 31, 2013
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Dec. 31, 2012
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Sep. 30, 2012
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Convertible notes, net of debt discount | $ 1,184,136 | $ 2,312,959 | $ 1,996,957 | $ 1,444,737 |
Derivative liability | 668,226 | 426,706 | 330,227 | 396,129 |
Unregistered shares shortfall | 1,913,279 | 3,696,279 | 1,104,867 | 2,180,220 |
Additional paid-in capital | 34,889,826 | 34,359,599 | 33,621,660 | 33,078,094 |
Accumulated deficit | (41,947,870) | (42,244,961) | (37,317,951) | (37,317,951) |
As Originally Reported [Member]
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Convertible notes, net of debt discount | 2,005,146 | 1,983,358 | 1,895,378 | |
Derivative liability | 4,478,105 | 420,028 | 638,178 | |
Unregistered shares shortfall | ||||
Additional paid-in capital | 36,089,172 | 35,681,588 | 34,807,672 | |
Accumulated deficit | (44,479,875) | (38,617,909) | (37,560,000) | |
Adjustment [Member]
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Convertible notes, net of debt discount | (150,214) | (300,428) | (450,641) | |
Derivative liability | (4,051,399) | (89,801) | (242,049) | |
Unregistered shares shortfall | 3,696,279 | 1,104,867 | 2,180,220 | |
Additional paid-in capital | (3,846,493) | (1,405,295) | (1,729,578) | |
Accumulated deficit | $ 2,234,914 | $ 1,014,942 | $ 242,049 |
Fair Value Consideration (Details) (USD $)
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Jun. 30, 2013
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Mar. 31, 2013
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Dec. 31, 2012
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Sep. 30, 2012
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Liabilities: | ||||
Derivative liability - BCF | $ 668,226 | $ 426,706 | $ 330,227 | $ 396,129 |
Unregistered shares shortfall - Warrants | 1,913,279 | 3,696,279 | 1,104,867 | 2,180,220 |
Liabilities, Total | 2,581,505 | 2,576,349 | ||
Level 1 [Member]
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Liabilities: | ||||
Derivative liability - BCF | ||||
Unregistered shares shortfall - Warrants | ||||
Liabilities, Total | ||||
Level 2 [Member]
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Liabilities: | ||||
Derivative liability - BCF | ||||
Unregistered shares shortfall - Warrants | ||||
Liabilities, Total | ||||
Level 3 [Member]
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Liabilities: | ||||
Derivative liability - BCF | 668,226 | 396,129 | ||
Unregistered shares shortfall - Warrants | 1,913,279 | 2,180,220 | ||
Liabilities, Total | $ 2,581,505 | $ 2,576,349 |
Fair Value Consideration (Tables)
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Jun. 30, 2013
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Fair Value Disclosures [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of liabilities measured at fair value |
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Schedule of significant assumptions in valuing conversion feature and unregistered shares shortfalls |
Significant assumptions in valuing the beneficial conversion feature (“BCF”) and unregistered shares shortfalls - warrants were as follows as of September 30, 2012:
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Schedule of reconciliation of changes in fair value of financial liabilities |
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Basis of Presentation and Summary of Significant Accounting Policies
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9 Months Ended | |||||||||
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Jun. 30, 2013
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Basis Of Presentation and Summary Of Significant Accounting Policies [Abstract] | ||||||||||
Basis of Presentation and Summary of Significant Accounting Policies | Note 2 – Basis of Presentation and Summary of Significant Accounting Policies
In the opinion of management, the accompanying condensed consolidated balance sheets and related condensed consolidated statements of operations, changes in stockholders deficit and cash flows include all adjustments, consisting only of normal recurring items, necessary for their fair presentation in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Interim results are not necessarily indicative of results for a full year. The information included in this Form 10-Q should be read in conjunction with information included in the Company’s annual report on Form 10-K for the fiscal year ended September 30, 2012 filed with the U.S. Securities and Exchange Commission (the “Commission”) on December 31, 2012.
Use of Estimates
The preparation of financial statements in conformity with U.S. GAAP requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates include collectability of accounts receivable, accounts payable, sales returns, and recoverability of long-term assets.
Consolidation
The financial statements include the accounts of the Company and its subsidiary, Williston Basin I, LLC (“WBI”), who was a 60% owned subsidiary of the Company as of September 30, 2012 and wholly owned subsidiary as of June 30, 2013. All significant intercompany accounts and balances have been eliminated in consolidation. Participation of other unit holders in the net assets and net earnings of consolidated subsidiaries is included in the captions ‘equity attributable to noncontrolling interest’ and ‘net loss attributable to the noncontrolling interest’ in the accompanying condensed consolidated balance sheet and condensed consolidated statement of operations, respectively.
Fair Value of Financial Instruments
The fair value of the Company’s assets and liabilities, which qualify as financial instruments under Financial Accounting Standards Board (FASB) guidance regarding disclosures about fair value of financial instruments, approximate the carrying amounts presented in the accompanying condensed consolidated balance sheets.
Computation of Earnings (Loss) Per Share
A basic earnings (loss) per share is calculated by dividing the earnings (loss) by the weighted average number of common shares outstanding during the period. A diluted earnings (loss) per share is calculated by dividing the earnings (loss) by the weighted average number of common shares and potentially dilutive securities outstanding during the period. Potentially dilutive common shares consist of incremental common shares issuable upon exercise of stock options, warrants and shares issuable upon the conversion of convertible notes. The dilutive effect of the convertible notes and warrants is calculated under the if-converted method. The dilutive effect of outstanding shares is reflected in diluted earnings per share by application of the treasury stock method. This method includes consideration of the amounts to be paid by the employees, the amount of excess tax benefits that would be recognized in equity if the instruments were exercised and the amount of unrecognized stock-based compensation related to future services. Warrants and convertible notes with exercise prices that exceed the average market price of the Company’s common stock during the periods will be excluded because the inclusion of these securities would be anti-dilutive to the diluted earnings per share. No potential dilutive common shares are included in the computation of any diluted per share amount when a loss is reported. Accordingly, we did not include 206,021,985 of potentially dilutive warrants and convertible debt instruments at June 30, 2012.
Recently Issued Accounting Pronouncements
In December 2011, the FASB issued disclosure guidance related to the offsetting of assets and liabilities. The guidance requires an entity to disclose information about offsetting and related arrangements for recognized financial and derivative instruments to enable users of its financial statements to understand the effect of those arrangements on its financial position. The amended guidance is effective for us on a retrospective basis commencing in the first quarter of 2014. We are currently evaluating the impact of this new guidance on our consolidated financial statements.
In September 2011, the FASB issued ASU No. 2011-08, “Intangibles – Goodwill and Other (Topic 350): Testing Goodwill for Impairment.” ASU No. 2011-08 provides companies an option to perform a qualitative assessment to determine whether further goodwill impairment testing is necessary. If, as a result of the qualitative assessment, it is determined that it is more likely than not that a reporting unit’s fair value is less than its carrying amount, the two-step quantitative impairment test is required. Otherwise, no further testing is required. ASU No. 2011-08 will be effective for the Company for goodwill impairment tests performed in the fiscal year ending September 30, 2013, with early adoption permitted. The adoption of this guidance is expected to have no impact on the Company’s consolidated financial condition and results of operations.
In June 2011, the FASB issued ASU No. 2011-05, “Comprehensive Income (Topic 220): Presentation of Comprehensive Income.” ASU No. 2011-05 eliminates the option to present components of other comprehensive income as part of the statement of shareholders’ equity. All non-owner changes in shareholders’ equity instead must be presented either in a single continuous statement of comprehensive income or in two separate but consecutive statements. Also, reclassification adjustments for items that are reclassified from other comprehensive income to net income must be presented on the face of the financial statements. ASU No. 2011-05 was effective for the Company for the quarter ended December 31, 2012. The adoption of this guidance had no impact on the Company’s financial condition and results of operations.
In May 2011, the FASB issued ASU No. 2011-04, “Fair Value Measurement (Topic 820): Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRSs.” ASU No. 2011-04 clarifies and changes the application of various fair value measurement principles and disclosure requirements, and was effective for the Company in the second quarter of fiscal 2012 (January 1, 2012). The adoption of this guidance had no impact on the Company’s consolidated financial condition and results of operations. |
Accrued Expenses
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Jun. 30, 2013
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Accrued Expenses [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accrued Expenses | Note 5 – Accrued Expenses Accrued expenses consisted of the following at:
During the nine months ended June 30, 2013, $15,693 of accrued interest was included in the conversion of notes payable into common stock described in Note 6. |
Correction of Errors
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Jun. 30, 2013
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Correction Of Errors [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Correction Of Errors | Note 3 – Correction of Errors
During quarter ended June 30, 2013, management of the Company identified and corrected certain errors in recording of debt discount, unregistered shares shortfall and additional paid-in capital in its previously filed financial statements for the year ended September 30, 2012 and in recording debt discount, derivative liability, unregistered shares shortfall, interest expense, and gain (loss) on change in fair value of derivative liability in its previous financial statements for the quarters ended December 31, 2012 and March 31, 2013. Specifically, debt discount should have been recorded when detachable warrants issued with convertible notes and accreted into interest expense over the term of the note. Additionally, the total potential shares upon exercise of warrants outstanding exceeded the total common stock authorized and unissued during the year ended September 30, 2012, hence the Company would need to reclassify the fair value of these equity instruments to liability and the change of the fair value of these liability would need to be reported as earnings (loss) subsequently. Moreover, the conversion feature of certain convertible notes was incorrectly included in calculation of derivative liabilities of the derivative conversion feature. The Company assessed the impact of the corrections of the errors on previously reported numbers and concluded that such correction is material to the previous financial statements. Moreover, in reaching this conclusion, management of the Company considered both the quantitative and qualitative characteristics of the adjustment. The following table presents the nature and extent of such corrections to the previous interim quarterly financial statements:
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Derivative Financial Instruments (Details) (USD $)
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Jun. 30, 2013
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Mar. 31, 2013
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Dec. 31, 2012
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Sep. 30, 2012
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Derivative Financial Instruments [Abstract] | ||||
Derivative liability, Indexed to Shares | 35,715,905 | 4,534,632 | ||
Derivative liability, Fair Value | $ 668,226 | $ 426,706 | $ 330,227 | $ 396,129 |
Organization and Description of Business (Details) (USD $)
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0 Months Ended | 1 Months Ended | ||
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Nov. 26, 2012
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Sep. 30, 2012
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Mar. 31, 2012
Water Treatment Agreement
Membership
Investors
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Feb. 28, 2012
Water Treatment Agreement
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Organization And Description Of Business Textual [Abstract] | ||||
Agreement initial term | 5 years | |||
Accredited Investors | 19 | |||
Equity method investment, ownership percentage | 60.00% | 60.00% | ||
Percentage of net profit and distributable assets | 60.00% | |||
Description of consideration offered by company for repurchase of outstanding membership interest in WBI | We offered the members the option of receiving a pro-rata share of the remaining capital invested into WBI, or they could assign their rights to their remaining capital to Sionix in return for a convertible note issued by Sionix equal to 100% of their original investment. | |||
Membership units sold | 4,000 | |||
Capital Units, Cost to Investors | $ 1,350,000 |
Correction of Errors (Details 1) (USD $)
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3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | ||||
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Jun. 30, 2013
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Mar. 31, 2013
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Dec. 31, 2012
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Jun. 30, 2012
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Mar. 31, 2013
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Jun. 30, 2013
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Jun. 30, 2012
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Sep. 30, 2012
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Interest expense | $ 489,671 | $ (265,949) | $ (442,591) | $ 251,831 | $ (708,540) | $ 1,198,216 | $ 714,456 | |
Gain (loss) on change in fair value of derivative liability | (241,520) | (96,479) | 65,902 | 36,911 | (30,577) | (272,097) | 35,538 | 475,235 |
Change in fair value of unregistered shares shortfall | 1,783,000 | 2,591,411 | 1,075,353 | 1,516,059 | 266,941 | |||
Gain (loss) on settlement of debts | (45,342) | (139,961) | (185,302) | 527,521 | (548,501) | |||
Net income (loss) | 294,097 | (4,638,995) | (285,016) | (1,711,438) | (4,924,012) | (4,629,919) | (4,215,745) | (5,520,570) |
Basic income (loss) per share | $ 0.00 | $ 0.00 | $ 0.00 | $ (0.01) | $ (0.001) | $ (0.01) | $ (0.01) | $ (0.02) |
As Originally Reported [Member]
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Interest expense | (204,480) | (296,410) | (500,890) | |||||
Gain (loss) on change in fair value of derivative liability | (4,185,376) | 78,191 | (4,107,185) | 233,186 | ||||
Change in fair value of unregistered shares shortfall | ||||||||
Gain (loss) on settlement of debts | 170,703 | 4,031 | (174,734) | |||||
Net income (loss) | (5,858,967) | (1,057,909) | (6,916,876) | (5,792,619) | ||||
Basic income (loss) per share | $ (0.01) | $ 0.00 | $ (0.02) | $ (0.02) | ||||
Adjustment [Member]
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Interest expense | (61,469) | (146,181) | (300,428) | |||||
Gain (loss) on change in fair value of derivative liability | 4,088,897 | (12,289) | 4,076,608 | 242,049 | ||||
Change in fair value of unregistered shares shortfall | 2,591,411 | 1,075,353 | 1,516,058 | |||||
Gain (loss) on settlement of debts | (216,045) | (143,992) | (10,568) | |||||
Net income (loss) | $ 1,219,972 | $ 772,893 | $ 1,992,864 | $ 242,049 | ||||
Basic income (loss) per share | $ 0.01 | $ 0.00 | $ 0.01 | $ 0.00 |
Notes Payable - Related Parties (Details) (USD $)
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3 Months Ended | 9 Months Ended | |||
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Jun. 30, 2013
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Jun. 30, 2012
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Jun. 30, 2013
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Jun. 30, 2012
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Sep. 30, 2012
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Notes Payable - Related Parties (Textual) | |||||
Maximum interest rate of notes | 10.00% | ||||
Notes payable - related parties | $ 45,000 | $ 45,000 | $ 25,000 | ||
Accrued interest on notes | 22,218 | 22,218 | 17,717 | ||
Interest expense | $ 1,138 | $ 632 | $ 2,501 | $ 2,194 |