Document And Entity Information
Document And Entity Information - USD ($) | 12 Months Ended | |
Jun. 30, 2015 | Dec. 15, 2015 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | Moller International Inc | |
Document Type | 10-K | |
Current Fiscal Year End Date | --06-30 | |
Entity Common Stock, Shares Outstanding | 118,487,284 | |
Entity Public Float | $ 4,093,589 | |
Amendment Flag | false | |
Entity Central Index Key | 871,344 | |
Entity Current Reporting Status | Yes | |
Entity Voluntary Filers | No | |
Entity Filer Category | Smaller Reporting Company | |
Entity Well-known Seasoned Issuer | No | |
Document Period End Date | Jun. 30, 2015 | |
Document Fiscal Year Focus | 2,015 | |
Document Fiscal Period Focus | FY |
BALANCE SHEETS
BALANCE SHEETS - USD ($) | Jun. 30, 2015 | Jun. 30, 2014 |
CURRENT ASSETS | ||
Cash | $ 10,047 | $ 97,846 |
Prepaid and other current assets | 5,482 | 3,613 |
Total current assets | 15,529 | 101,459 |
PROPERTY AND EQUIPMENT, net | 7,969 | 7,076 |
Total assets | 23,498 | 108,535 |
CURRENT LIABILITIES | ||
Accounts payable, trade | 612,888 | 643,090 |
Accrued liabilities | 765,292 | 935,966 |
Current Portion of Judgment Liability | 42,846 | |
Accrued liabilities-majority shareholder | 7,353,989 | 6,615,469 |
Accrued liabilities-related parties | 665,955 | 0 |
Notes payable-other | 1,258,182 | 1,383,682 |
Note payable - majority shareholder | 1,792,904 | 2,188,947 |
Convertible notes payable, net of discount of $81,049 and $123,640 | 352,975 | 213,240 |
Notes payable - minority shareholders | 859,834 | 208,068 |
Derivative Liability | 719,792 | 281,251 |
Deferred wages – employees | 376,278 | 1,035,335 |
Deferred other income | 24,598 | 24,598 |
Customer deposits | 384,767 | 384,767 |
Total current liabilities | 15,210,300 | 13,914,413 |
LONG TERM LIABILITIES | ||
Deferred wages and interest-majority shareholder | 1,533,230 | 1,328,830 |
Non-current Portion of Judgment Liability | 234,695 | |
Total liabilities | 16,978,225 | 15,243,243 |
STOCKHOLDERS' DEFICIT | ||
Common stock, authorized, 150,000,000 shares, no par value 99,620,472 and 54,876,990 issued and outstanding respectively | 40,328,642 | 39,082,892 |
Accumulated deficit | (57,283,369) | (54,217,600) |
Total stockholders' deficit | (16,954,727) | (15,134,708) |
$ 23,498 | $ 108,535 |
BALANCE SHEETS (Parentheticals)
BALANCE SHEETS (Parentheticals) - USD ($) | Jun. 30, 2015 | Jun. 30, 2014 |
Convertible Notes Payable, Discount (in Dollars) | $ 81,049 | $ 123,640 |
Common stock, shares authorized | 150,000,000 | 150,000,000 |
Common stock, shares outstanding | 99,620,472 | 54,876,990 |
Common stock, shares issued | 99,620,472 | 54,876,990 |
Common stock, no par value (in Dollars per share) | $ 0 | $ 0 |
STATEMENTS OF OPERATIONS
STATEMENTS OF OPERATIONS - USD ($) | 12 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2014 | |
REVENUE | ||
Other revenue | $ 0 | $ 0 |
OPERATING EXPENSES | ||
Selling, general and administrative | 542,662 | 413,179 |
Rent expense to majority shareholder | 501,233 | 385,304 |
Depreciation and amortization | 229 | 770 |
Total expenses | 1,044,124 | 799,253 |
Operating Loss | (1,044,124) | (799,253) |
OTHER INCOME (EXPENSE) | ||
Interest expense | (877,478) | (432,428) |
Other income | 17,419 | 0 |
Interest expense- majority shareholder | (307,313) | (301,373) |
Derivative loss | (854,273) | (202,299) |
Total other income (expense) | (2,021,645) | (936,100) |
NET LOSS | $ (3,065,769) | $ (1,735,353) |
Loss per common share - Basic and diluted (in Dollars per share) | $ (0.04) | $ (0.03) |
Weighted average common shares outstanding - Basic and diluted (in Shares) | 70,428,453 | 51,542,291 |
STATEMENTS OF STOCKHOLDERS' EQU
STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT) - USD ($) | Common Stock [Member] | Retained Earnings [Member] | Total |
Balance at Jun. 30, 2013 | $ 38,039,975 | $ (52,482,247) | $ (14,442,272) |
Balance (in Shares) at Jun. 30, 2013 | 49,094,675 | ||
Shares issued for services | $ 34,275 | $ 34,275 | |
Shares issued for services (in Shares) | 288,207 | 288,207 | |
Shares issued for settlement of accounts payable | $ 67,280 | $ 67,280 | |
Shares issued for settlement of accounts payable (in Shares) | 305,818 | ||
Reclassification of derivative liability to common stock | $ 666,009 | 666,009 | |
Shares issued in conversion of notes payable and accrued interest | $ 275,353 | 275,353 | |
Shares issued in conversion of notes payable and accrued interest (in Shares) | 5,188,290 | ||
Net loss | (1,735,353) | (1,735,353) | |
Balance at Jun. 30, 2014 | $ 39,082,892 | (54,217,600) | $ (15,134,708) |
Balance (in Shares) at Jun. 30, 2014 | 54,876,990 | 54,876,990 | |
Shares issued for services | $ 7,793 | $ 7,793 | |
Shares issued for services (in Shares) | 97,940 | 97,940 | |
Reclassification of derivative liability to common stock | $ 775,156 | $ 775,156 | |
Shares issued in conversion of notes payable and accrued interest | $ 462,801 | $ 462,801 | |
Shares issued in conversion of notes payable and accrued interest (in Shares) | 44,645,542 | 44,645,542 | |
Net loss | (3,065,769) | $ (3,065,769) | |
Balance at Jun. 30, 2015 | $ 40,328,642 | $ (57,283,369) | $ (16,954,727) |
Balance (in Shares) at Jun. 30, 2015 | 99,620,472 | 99,620,472 |
STATEMENTS OF CASH FLOWS
STATEMENTS OF CASH FLOWS - USD ($) | 12 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2014 | |
Cash Flows From Operating Activities | ||
Net loss | $ (3,065,769) | $ (1,735,353) |
Adjustments to reconcile net loss to net cash Provided by (used in) operating activities: | ||
Depreciation expense | 229 | 770 |
Derivative loss | 854,273 | 202,299 |
Amortization of debt discount | 37,976 | 0 |
Stock based compensation | 7,793 | 34,275 |
Debt discount amortization | 402,015 | 175,435 |
Change in assets and liabilities: | ||
Prepaid expenses and other current assets | 3,413 | (2,575) |
Accounts payable | (30,202) | 8,572 |
Accrued liabilities - majority shareholder | 942,920 | 1,011,028 |
Deferred other income | 0 | 24,598 |
Accrued liabilities and deferred wages | 206,676 | 306,740 |
Net Cash Provided By (Used in) Operating Activities | (640,676) | 25,789 |
Cash Flows From Investing Activities | ||
Cash paid for purchase of fixed assets | (1,122) | 0 |
Net Cash Provided By (Used in) Investing Activities | (1,122) | 0 |
Cash Flows Provided from Financing Activities | ||
Principal borrowings on convertible notes payable | 580,655 | 375,000 |
Payments on convertible notes payable | (156,757) | (20,000) |
Deferred financing costs | (43,258) | 0 |
Advances from related party | 597,955 | 0 |
Payments on note payable- majority shareholder | (396,043) | (287,958) |
Borrowings on note payable - other | 535 | 0 |
Payments on note payable- other | (29,088) | 0 |
Net Cash Used in Financing Activities | 553,999 | 67,042 |
Net Increase (Decrease) In Cash | (87,799) | 92,831 |
Cash, Beginning of Year | 97,846 | 5,015 |
Cash, End of Year | 10,047 | 97,846 |
Supplemental Cash Flow Information: | ||
Interest paid | 30,573 | 1,715 |
Income taxes paid | 0 | 0 |
Supplemental Disclosure of Non-Cash Financing Activities: | ||
Discount on convertible notes payable from derivative liability | 359,424 | 252,500 |
Accounts payable settled with common shares | 0 | 67,280 |
derivative liability write off to common stock due to debt conversion | 775,156 | 666,009 |
Conversion of convertible notes payable and accrued interest to common stock | 462,801 | 275,353 |
Debt Assigned to Freedom Motors | 68,000 | 0 |
Accrued Liabilities transferred to debt | $ 680,319 | $ 0 |
NOTE A - ORGANIZATION AND SIGNI
NOTE A - ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Jun. 30, 2015 | |
Accounting Policies [Abstract] | |
Organization, Consolidation and Presentation of Financial Statements Disclosure and Significant Accounting Policies [Text Block] | NOTE A – ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES Since incorporation in 1983, Moller International, Inc. (“we”, “our”, “MI”, or “the Company”) has devoted most of its efforts to the design and development of a Vertical Takeoff and Landing (VTOL) vehicle known as the Skycar. One of the enabling technologies for the Skycar is the Rotapower® rotary engine, which has been the focus of our attention for over ten years. The Company is now attempting to attract a suitable manufacturer for its engine technology, although there is no assurance at this stage that the Company will be successful in these efforts. Dr. Paul S. Moller is the majority shareholder of MI. Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenditures/expenses during the reporting periods. Actual results could differ from those estimates. Cash and cash equivalents For the purposes of the statements of cash flows, cash equivalents include all highly liquid investments with original maturities of three months or less. Property and Equipment Property and equipment is stated at cost net of accumulated depreciation. Depreciation is recorded utilizing the straight-line method over the estimated useful lives, ranging from five to fifteen years. Expenditures for major renewals and betterments that extend the useful lives of property and equipment are capitalized. Expenditures for maintenance and repairs are charged to expense as incurred. Long-Lived Assets In accordance with the guidance in FASB ASC 360-10, Property, Plant and Equipment, Fair Value of Financial Instruments Financial instruments are recorded at fair value in accordance with the standard for “Fair Value Measurements codified within ASC 820”, which defines fair values, establishes a three level valuation hierarchy for disclosures of fair value measurement and enhances disclosure requirements for fair value measurements: • Level 1 – inputs to the valuation methodology are quoted prices (unadjusted) for identical asset or liabilities in active markets. • Level 2 – inputs to the valuation methodology include closing prices for similar assets and liabilities in active markets, and inputs that are observable for the assets and liabilities, either directly, for substantially the full term of the financial instruments. • Level 3 – inputs to the valuation methodology are observable and significant to the fair value. The following table sets forth the Company’s financial assets and liabilities measured at fair value by level within the fair value hierarchy as of June 30, 2015 and June 30, 2014. Assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. June 30, 2015 Total Level 1 Level 2 Level 3 Derivative Liabilities $ 719,792 - - $ 719,792 June 30, 2014 Total Level 1 Level 2 Level 3 Derivative Liabilities $ 281,251 - - $ 281,251 The carrying value of short-term financial instruments, including cash, accounts receivables, accounts payable and accrued expenses and notes payable approximate fair value due to the relatively short period to maturity for these instruments. Revenue Recognition We recognize revenue when persuasive evidence of an arrangement exists, services have been rendered, the sales price is fixed or determinable, and collectability is reasonably assured. Pursuant to the 1998 Technology Development and License Agreement, the Company bills for services provided to Freedom Motors, an affiliated entity and former subsidiary, which shares common ownership with some of the existing shareholders of MI. Under this agreement, we provide engineering services related to the scientific and engineering technical support for the rotary engine. Specifically, we provide personnel and facilities as required to adapt the Rotapower engine to applications where the potential exists for high volume production. In addition, we also provide bookkeeping and other administrative services. Delivery is considered complete when a specific defined task or milestone is completed, as demonstrated by the issuance of engineering documents (procedures, drawings, models, prototypes, etc.) and provided to Freedom Motors or its assigns. The date the information or material is provided to Freedom Motors is considered the delivery date. Because it is an affiliated entity, we offset our operating expense by the amounts invoiced to Freedom Motors. In addition, because Freedom Motors is a startup company, and has not been in a position to pay our invoices in the normal course of business, collection is not reasonably assured until Freedom Motors actually makes the payment. As a result, the final criterion is met when we receive the payment for services. At that point, we record a reduction in expense equal to the collections. Until collection is received we maintain a full allowance against any outstanding invoices. For years ended June 30, 2015 and 2014, total collections from Freedom Motors, which offset our operating expenses, amounted to $0 and $225,021, respectively. The Company initiated a crowd funding campaign during the year ended June 30, 2014. The proceeds from the campaign were $24,598. Because some of the Company’s deliverables, including participation in a Skycar test flight, have not yet been delivered, the proceeds are classified as Deferred other income at June 30, 2015. Other revenue derived from the sale of memorabilia, information packets and other items is recognized at the time of sale, which is when the merchandise is delivered. Stock-based Compensation We recognize stock-based compensation issued to employees in accordance with guidance on share-based payments which require measurement of all stock-based awards at fair value on the date of grant and recognition of compensation over the requisite service period, usually the vesting period, using the straight-line method. Share-based awards issued to non-employees are valued using the closing price of common stock at the performance commitment date or when services are complete when there is not a significant disincentive for nonperformance. Embedded conversion features The Company evaluates embedded conversion features within convertible debt and convertible preferred stock under ASC 815 “Derivatives and Hedging” to determine whether the embedded conversion feature should be bifurcated from the host instrument and accounted for as a derivative at fair value with changes in fair value recorded in earnings. If the conversion feature does not require derivative treatment under ASC 815, the instrument is evaluated under ASC 470-20 “Debt with Conversion and Other Options” for consideration of any beneficial conversion feature. Income Taxes We recognize deferred tax liabilities and assets for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred tax liabilities and assets are determined based on the difference between the financial statement carrying amounts and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. Valuation allowances are established when necessary to reduce deferred tax assets to the amount more likely than not to be realized. We also recognize tax benefits only for tax positions that are more likely than not to be sustained upon examination by tax authorities. The amount recognized is measured as the largest amount of benefit that is greater than 50 percent likely to be realized upon settlement. A liability for “unrecognized tax benefits” is recorded for any tax benefits claimed in our tax returns that do not meet these recognition and measurement standards. To date, we do not have any unrecognized tax benefits. Loss Per Share (LPS) Basic LPS excludes dilution and is computed by dividing the loss attributable to common stockholders by the weighted average number of common shares outstanding for the period. Diluted LPS reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that shared in the earnings of the entity. Diluted LPS is the same as basic LPS for all periods presented because all potentially dilutive securities have an anti-dilutive effect on LPS due to the net losses incurred. At June 30, 2015, the total number of shares of common stock relating to outstanding stock options and other potentially dilutive securities that have been excluded from the LPS calculation because their effect would be anti-dilutive approximated 38,824,813. Recent Accounting Pronouncements We do not expect the adoption of any recently issued accounting pronouncements to have a significant impact on our results of operations, financial position or cash flows. |
NOTE B - GOING CONCERN
NOTE B - GOING CONCERN | 12 Months Ended |
Jun. 30, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Substantial Doubt about Going Concern [Text Block] | NOTE B – GOING CONCERN As shown in the accompanying financial statements, we have incurred net losses $3,065,769 and $1,735,353 for the years ended June 30, 2015 and 2014, respectively. In addition, at June 30, 2015, we have an accumulated deficit of $57,283,369 and a working capital deficit of $15,194,771. Furthermore, MI is currently in the development stage of the Skycar and Rotapower engine programs, and has no revenue producing products. Successful completion of product development activities for either or both of these programs will require significant additional sources of capital. Historically, funding was provided by certain creditors and shareholders, including the majority shareholder, in the form of short-term notes payable. In addition, the majority shareholder granted us a deferral on the payment of rent for our building. There is no assurance that we will continue to receive funding from shareholders, particularly our major shareholder given he has filed for protection under the federal Chapter 11 reorganization provisions of the federal bankruptcy law. Consequently, we are evaluating several alternatives to raise the additional capital through debt or equity transactions. There is no guarantee that our efforts will be successful, however, and the financial statements do not include any adjustments that might be necessary if we are unable to continue as a going concern. |
NOTE C - Property and Equipment
NOTE C - Property and Equipment | 12 Months Ended |
Jun. 30, 2015 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment Disclosure [Text Block] | NOTE C - Property and Equipment Property and equipment consist of: June 30, 2015 June 30, 2014 Production and R&D Equipment $ 317,496 $ 317,496 Computer equipment and software 401,106 399,985 Furniture and fixtures 74,976 75,650 Total property and equipment 793,578 793,131 Less accumulated depreciation (785,609 ) (786,055 ) Total property and equipment, net $ 7,969 $ 7,076 |
NOTE D - CUSTOMER DEPOSITS
NOTE D - CUSTOMER DEPOSITS | 12 Months Ended |
Jun. 30, 2015 | |
Other Liabilities and Financial Instruments Subject to Mandatory Redemption [Abstract] | |
Other Liabilities Disclosure [Text Block] | NOTE D – CUSTOMER DEPOSITS From time to time, we received advances from customers related to our Skycars product for the purpose of reserving specific delivery positions for Skycars when they become available for sale to the public. Deposits are refundable at any time upon request. At June 30, 2015 and 2014, we have received aggregate customer deposits of $384,767 and $384,767, respectively. |
NOTE E - DEFERRED WAGES
NOTE E - DEFERRED WAGES | 12 Months Ended |
Jun. 30, 2015 | |
Compensation Related Costs [Abstract] | |
Compensation Related Costs, General [Text Block] | NOTE E – DEFERRED WAGES Due to our cash flow constraints, the President, members of management and other employees have agreed to defer all or a portion of their annual salaries. At June 30, 2015 and 2014, members of management and other employees have deferred $179,017 and $732,626, respectively, of wages along with accrued interest of $197,261 and $302,709 respectively. These outstanding debts are unsecured, carry an interest rate of 10%, and are due on demand. These amounts are reflected as deferred wages, which is reported as a component of current liabilities. In the year ended June 30, 2015 deferred wages, in the amount of $ 680,319 However, the President’s annual salary of $125,000 is being deferred until we reach a consistent level of profitability, which is not expected to occur during the next twelve months. As a result, deferred wages related to the President’s salary is recorded as a component of long-term liabilities. As of June 30, 2015 and 2014, a liability of $887,500 and $762,500, respectively, along with the accrued interest of $645,730 and $566,330, respectively, were recorded as a component of non-current liabilities. |
NOTE F - NOTES PAYABLE AND DERI
NOTE F - NOTES PAYABLE AND DERIVATIVE LIABILITIES | 12 Months Ended |
Jun. 30, 2015 | |
Debt Disclosure [Abstract] | |
Debt Disclosure [Text Block] | NOTE F – NOTES PAYABLE AND DERIVATIVE LIABILITIES Majority Shareholder At June 30, 2015 and 2014, the outstanding debt owed to our majority shareholder totaled $1,792,904 and $2,188,947 respectively. This debt is evidenced by one non-interest bearing note. During the 12 months ended June 30, 2015, the Company repaid $396,043 of majority shareholder notes. During the 12 months ended June 30, 2014, the Company repaid $287,958 of majority shareholder notes. The borrowings are unsecured, are non-interest bearing, and are payable upon demand. Minority Shareholder As of June 30, 2015 and 2014, the outstanding debt owed to minority shareholders totaled $859,834 and $208,068, respectively. The Company borrowed $535 repaid $29,088 of these notes during fiscal year June 30, 2015. This debt is unsecured, payable upon demand and bears an annual interest rate of 10%. Aggregate accrued interest on these notes was $146,694 and $125,522 at June 30, 2015 and 2014, respectively. In the year ended June 30, 2015 deferred wages, in the amount of $ 680,319 Due to Related Party The liability, Accrued Liabilities - Related Parties, is a due on demand promissory note from Freedom Motors, Inc. a corporation that Paul Moller, the majority shareholder of owns the majority of the outstanding common stock. During the year ended June 30, 2015 MI received $597,955 in advances from Freedom Motors, Inc. and the company has assigned total $68,000 debt from various third parties to Freedom Motors. As of June 30, 2015, the outstanding debt owed to Freedom Motors was $665,955. Judgment Liability The liability, Judgment Liability, is related to a legal settlement that was recorded as a note payable in the year ended June 30, 2015. The estimated liability related to this judgment was previously included, in the amount of $345,000, in accrued liabilities in prior quarters. MI agreed to pay the judgment principal ($300,000) in monthly installments of ($5,000), plus interest. During the year ended June 30, 2015 the Company made repayments of $22,459. As of June 30, 2015 the note payable has a balance of $277,541, including $42,846 due within a year. Non Convertible Third Party Notes Payable At June 30, 2015 and 2014, the outstanding debt owed to other parties totaled $1,258,182 and $1,383,682, respectively. These outstanding debts are unsecured, carry an interest rate of 6% to 10%, and are due on demand. Convertible Notes Payable and Derivative Liability At June 30, 2015 and 2014, the Company owes $352,975 and $213,240, respectively, related to convertible notes payable, net of unamortized debt discount of $81,049 and $123,640, respectively. During the 12 months ended June 30, 2015 and 2014, the Company borrowed $580,655 and $375,000, respectively with convertible notes payable. The debts borrowed during the years are summarized below: Conversion Terms Conversion Prices 2015 2014 Convertible 180 days from the issuance date at 53% of the lowest three trading price in the last 10 days prior to conversion $ 106,000 $ 129,000 Convertible 180 days from the issuance date at 55% of the lowest closing trade price in the last 20 days prior to conversion 35,000 32,500 Convertible 180 days from the issuance date 60% of the lowest trading price in the last 25 trading days prior to conversion 166,750 - Convertible 90 days from the issuance date at the lesser of $0.125/share or 60% of the lowest trading price in the last 25 trading days prior to conversion 25,000 - Convertible on the date of issuance at 55% of the lowest closing trade price in the last 20 days prior to conversion. 52,500 28,500 Convertible on the issuance date at the lesser of $0.125/share or 60% of the lowest trading price in the last 25 trading days prior to conversion - 25,000 Convertible on the issuance date at the lesser of $0.24/share or 60% of the lowest trading price in the last 25 trading days prior to conversion 98,655 160,000 Convertible on the issuance date at 45% of the lowest closing trade price in the last 20 days prior to conversion 96,750 - Total Borrowing during the year $ 580,655 $ 375,000 A debt discount of $359,424 and $252,500 was recorded as a result of this convertible note during the fiscal year end June 30, 2015 and 2014, respectively. During the year ended June 30, 2015 and 2014, the Company amortized $402,015 and $175,435, respectively, of this discount to interest expense. The Company analyzed the conversion options for derivative accounting consideration under ASC 815-15 “Derivatives and Hedging” and determined that the embedded conversion features should be classified as liabilities due to their being no explicit limit to the number of shares to be delivered upon settlement of the above conversion options. The embedded conversion features were measured at fair value at inception with the change in fair value recorded to earnings. Additionally, because there is no explicit limit to the number of shares to be issued upon conversion of the above instruments, the Company cannot determine if it will have sufficient authorized shares to settle all other share-settable instruments, including the warrants granted above. As a result, all other share-settable instruments have also been classified as liabilities. Derivative Liabilities June 30, 2013 $ 492,461 Addition of new conversion option derivative 252,500 Reclassification of derivative to common stock due to conversion of convertible note payable (666,009 ) Loss on change in fair value in derivative 202,299 June 30, 2014 $ 281,251 Addition of new conversion option derivative 359,424 Reclassification of derivative to common stock due to conversion of convertible note payable (775,156 ) Loss on change of fair value in derivative 854,273 June 30, 2015 $ 719,792 The fair value of the stock options granted during fiscal year June 30, 2015 were estimated using the Black Scholes method based on assumptions including (1) risk-free interest rates ranging from 0.01% to 0.79% (2) exercise prices ranging from $0.0023 to $0.24, (3) an estimated expected term ranging from 0.27 to 2.4 years, (4) no dividend rate and (5) computed volatility rates ranging from 165.32% to 362.85% on the underlying stock. The fair value of the stock options granted fiscal year June 30, 2014 were estimated using the Black Scholes method based on assumptions including (1) risk-free interest rates ranging from 0.02% to 0.91% (2) exercise prices ranging from $0.012 to $0.25, (3) an estimated expected term ranging from 0.1 to 4 years, (4) no dividend rate and (5) computed volatility rates ranging from 101.94% to 268.85% on the underlying stock. |
NOTE G - STOCK BASED COMPENSATI
NOTE G - STOCK BASED COMPENSATION | 12 Months Ended |
Jun. 30, 2015 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Disclosure of Compensation Related Costs, Share-based Payments [Text Block] | NOTE G – STOCK BASED COMPENSATION Shares of stock During the year ended June 30, 2015, the Company issued 97,940 shares of common stock valued at $7,793 for services. In addition during the year ended June 30, 2015, the Company issued 44,645,542 shares of common stock in settlement of convertible promissory notes and accrued interest of $462,801. During the year ended June 30, 2014, the Company issued 288,207 shares of common stock valued at $34,275 for services. Stock options On February 26, 2009, MI adopted its 2009 Stock Option and Restricted Stock Benefit Plan. The total shares available for grant under the plan aggregate 7,500,000. Non-employee directors are entitled to standardized stock option grants on the first day of a directorship year, which begins on the date of election to the board. It is pro-rated for a new director appointed after a board year has begun. Non-employee directors receive a grant of 5,000 options to purchase common stock at an exercise price equal to the closing price on the date of appointment. During the years ended June 30, 2015 and 2014, we issued the following stock options: Fiscal year 2015 · The Company did not grant options during the fiscal year ended June 30, 2015. No options expired during the year ended June 30, 2015 and were forfeited. Fiscal year 2014 · The Company did not grant options during the fiscal year ended June 30, 2014. 7,097,740 options expired during the year ended June 30, 2014 and were forfeited. Compensation expense of $0 and $0 was recognized during the years ended June 30, 2015 and 2014, respectively. There were no unamortized compensation amounts at June 30, 2015 and 2014. Option activity for the years ended June 30, 2015 and 2014 is as follows: Weighted Options Range of Exercise Price Total Vested Average Exercise Price Balance at June 30, 2013 32,197,740 32,197,740 $ 0.13 Granted - - - - Exercised - - - - Forfeited (7,097,740 ) $ 0.23 (7,097,740 ) $ 0.23 Balance at June 30, 2014 25,100,000 25,100,00 $ 0.10 Granted - - - - Exercised - - - - Forfeited - - - - Balance at June 30, 2015 25,100,000 25,100,00 $ 0.10 Additional option information for the year ended June 30, 2015, is as follows: Weighted Average Weighted Remaining Exercise Average Life in Price Range Outstanding Exercise Price Years Exercisable $ 0.10 25,000,000 $ 0.10 0.96 25,000,000 $ 0.085 100,000 $ 0.085 2.42 100,000 25,100,000 $ 0.10 25,100,000 Additional option information for the year ended June 30, 2014, is as follows: Weighted Average Weighted Remaining Exercise Average Life in Price Range Outstanding Exercise Price Years Exercisable $ 0.10 25,000,000 $ 0.10 1.96 25,000,000 $ 0.085 100,000 $ 0.085 3.42 100,000 25,100,000 $ 0.10 25,100,000 The outstanding options have a $0 and $500 intrinsic value at June 30, 2015 and 2014, respectively. Warrants The Company did not grant warrants during the fiscal year June 30, 2015 and 2014. 20,000 and 20,000 warrants expired during the fiscal year June 30, 2015 and 2014, respectively, and were forfeited. Warrant activity for the years ended June 30, 2015 and 2014 is as follows: Weighted Average Warrants Ex Price Remaining Life Balance at June 30, 2013 497,760 $ 0.13 2.78 Granted - - - Exercised - Forfeited (20,000 ) $ 0.15 Balance at June 30, 2014 477,760 $ 0.13 1. 87 Granted - - - Exercised - - - Forfeited (20,000 ) $ 0.22 - Balance at June 30, 2015 457,760 $ 0.13 0.91 The outstanding warrants have a $0 and $1,560 intrinsic value at June 30, 2015 and 2014, respectively. |
NOTE H - INCOME TAXES
NOTE H - INCOME TAXES | 12 Months Ended |
Jun. 30, 2015 | |
Income Tax Disclosure [Abstract] | |
Income Tax Disclosure [Text Block] | NOTE H – INCOME TAXES At June 30, 2015, MI had $23,681,940 in federal net operating loss (NOL) carryforwards to offset future taxable income, resulting in a deferred tax asset of $8,288,679. MI also had $18,454,173 in state net operating loss (NOL) carryforwards to offset future state taxable income, resulting in a deferred tax asset of $1,631,349. The combined federal and state deferred tax asset is $9,920,028. In view of the uncertainty over MI’s ability to generate sufficient taxable income in future years to utilize the NOLs, a full valuation allowance of $9,920,028 has been recorded to offset the deferred tax asset, resulting in no net deferred tax asset or liability. Due to the change in ownership provisions of the Tax Reform Act of 1986, net operating loss carryforwards for Federal income tax reporting purposes are subject to annual limitations The valuation allowance also results in a difference between the statutory rate of 35% and the effective rate of 0%. The cumulative federal and state net operating losses are scheduled to expire through 2034. |
NOTE I - COMMITMENTS AND CONTIN
NOTE I - COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Jun. 30, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies Disclosure [Text Block] | NOTE I – COMMITMENTS AND CONTINGENCIES Lease commitment MI’s operations were housed in one 34,500 square foot building, which was leased from Dr. Moller. The current lease, is a month to month lease that requires monthly payments of $3,500 per month. The amount of space that MI is leasing from their new landlord, Sierra Railroad Company is dramatically reduced from the amount of space rented previously from Paul Moller. As of June 30, 2015 and 2014, unpaid rent for the prior lease, including related interest, amounted to $7,353,989 and $6,615,469, respectively. Rent expense charged to operations under the prior lease aggregated $501,233 and $496,800 for fiscal 2015 and 2014, respectively. Moller International receives reimbursements for rent from Freedom Motors. Total reimbursements received for the years ended June 30, 2015 and 2014 amounted to $0 and $111,496, respectively. Contingencies J.F. Wilson & Associates Ltd. v. Estate of Percy Symens, et a Moller International (MI) is named was a defendant in a lawsuit in Yolo County, California Superior Court - J.F. Wilson & Associates Ltd. v. Estate of Percy Symens, et al. The complaint, filed in April 2005, alleged that MI unlawfully discharged solvents into the environment while doing business at 203 J Street and 920 Third Street in Davis, California during 1968 to 1980. The Company denied these allegations in its Answer. A number of the claims and cross-claims filed in this lawsuit have been settled, while for the remaining claims and cross-claims the parties have reached settlement and are in the process of finalizing the settlement agreement documents. In a related administrative proceeding initiated on September 26, 2006, the California Central Valley Regional Water Quality Control Board (RWQCB) issued a draft Cleanup and Abatement Order (CAO) in connection with the property at 920 Third Street. The draft CAO has not been finalized, and the property owner is proceeding with work to investigate, characterize and remediate the soil and groundwater contamination at this property, with RWQCB oversight. MI’s loss was estimated at $345,000 at June 30, 2014. This case resulted in a judgement for MI to pay principal ($300,000) in monthly installments of ($5,000), plus interest. The judgement liability as of June 30, 2015 was $277,541. |
NOTE J - SUBSEQUENT EVENTS
NOTE J - SUBSEQUENT EVENTS | 12 Months Ended |
Jun. 30, 2015 | |
Subsequent Events [Abstract] | |
Subsequent Events [Text Block] | NOTE J – SUBSEQUENT EVENTS Subsequent to June 30, 2015, the Company had issued aggregate 18,866,812 shares for debt converted. |
Accounting Policies, by Policy
Accounting Policies, by Policy (Policies) | 12 Months Ended |
Jun. 30, 2015 | |
Accounting Policies [Abstract] | |
Use of Estimates, Policy [Policy Text Block] | Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenditures/expenses during the reporting periods. Actual results could differ from those estimates |
Cash and Cash Equivalents, Policy [Policy Text Block] | Cash and cash equivalents For the purposes of the statements of cash flows, cash equivalents include all highly liquid investments with original maturities of three months or less. |
Property, Plant and Equipment, Policy [Policy Text Block] | Property and Equipment Property and equipment is stated at cost net of accumulated depreciation. Depreciation is recorded utilizing the straight-line method over the estimated useful lives, ranging from five to fifteen years. Expenditures for major renewals and betterments that extend the useful lives of property and equipment are capitalized. Expenditures for maintenance and repairs are charged to expense as incurred. |
Impairment or Disposal of Long-Lived Assets, Policy [Policy Text Block] | Long-Lived Assets In accordance with the guidance in FASB ASC 360-10, Property, Plant and Equipment, |
Fair Value of Financial Instruments, Policy [Policy Text Block] | Fair Value of Financial Instruments Financial instruments are recorded at fair value in accordance with the standard for “Fair Value Measurements codified within ASC 820”, which defines fair values, establishes a three level valuation hierarchy for disclosures of fair value measurement and enhances disclosure requirements for fair value measurements: • Level 1 – inputs to the valuation methodology are quoted prices (unadjusted) for identical asset or liabilities in active markets. • Level 2 – inputs to the valuation methodology include closing prices for similar assets and liabilities in active markets, and inputs that are observable for the assets and liabilities, either directly, for substantially the full term of the financial instruments. • Level 3 – inputs to the valuation methodology are observable and significant to the fair value. The following table sets forth the Company’s financial assets and liabilities measured at fair value by level within the fair value hierarchy as of June 30, 2015 and June 30, 2014. Assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. June 30, 2015 Total Level 1 Level 2 Level 3 Derivative Liabilities $ 719,792 - - $ 719,792 June 30, 2014 Total Level 1 Level 2 Level 3 Derivative Liabilities $ 281,251 - - $ 281,251 The carrying value of short-term financial instruments, including cash, accounts receivables, accounts payable and accrued expenses and notes payable approximate fair value due to the relatively short period to maturity for these instruments. |
Revenue Recognition, Policy [Policy Text Block] | Revenue Recognition We recognize revenue when persuasive evidence of an arrangement exists, services have been rendered, the sales price is fixed or determinable, and collectability is reasonably assured. Pursuant to the 1998 Technology Development and License Agreement, the Company bills for services provided to Freedom Motors, an affiliated entity and former subsidiary, which shares common ownership with some of the existing shareholders of MI. Under this agreement, we provide engineering services related to the scientific and engineering technical support for the rotary engine. Specifically, we provide personnel and facilities as required to adapt the Rotapower engine to applications where the potential exists for high volume production. In addition, we also provide bookkeeping and other administrative services. Delivery is considered complete when a specific defined task or milestone is completed, as demonstrated by the issuance of engineering documents (procedures, drawings, models, prototypes, etc.) and provided to Freedom Motors or its assigns. The date the information or material is provided to Freedom Motors is considered the delivery date. Because it is an affiliated entity, we offset our operating expense by the amounts invoiced to Freedom Motors. In addition, because Freedom Motors is a startup company, and has not been in a position to pay our invoices in the normal course of business, collection is not reasonably assured until Freedom Motors actually makes the payment. As a result, the final criterion is met when we receive the payment for services. At that point, we record a reduction in expense equal to the collections. Until collection is received we maintain a full allowance against any outstanding invoices. For years ended June 30, 2015 and 2014, total collections from Freedom Motors, which offset our operating expenses, amounted to $0 and $225,021, respectively. The Company initiated a crowd funding campaign during the year ended June 30, 2014. The proceeds from the campaign were $24,598. Because some of the Company’s deliverables, including participation in a Skycar test flight, have not yet been delivered, the proceeds are classified as Deferred other income at June 30, 2015. Other revenue derived from the sale of memorabilia, information packets and other items is recognized at the time of sale, which is when the merchandise is delivered. |
Share-based Compensation, Option and Incentive Plans Policy [Policy Text Block] | Stock-based Compensation We recognize stock-based compensation issued to employees in accordance with guidance on share-based payments which require measurement of all stock-based awards at fair value on the date of grant and recognition of compensation over the requisite service period, usually the vesting period, using the straight-line method. Share-based awards issued to non-employees are valued using the closing price of common stock at the performance commitment date or when services are complete when there is not a significant disincentive for nonperformance. |
Derivatives, Embedded Derivatives [Policy Text Block] | Embedded conversion features The Company evaluates embedded conversion features within convertible debt and convertible preferred stock under ASC 815 “Derivatives and Hedging” to determine whether the embedded conversion feature should be bifurcated from the host instrument and accounted for as a derivative at fair value with changes in fair value recorded in earnings. If the conversion feature does not require derivative treatment under ASC 815, the instrument is evaluated under ASC 470-20 “Debt with Conversion and Other Options” for consideration of any beneficial conversion feature. |
Income Tax, Policy [Policy Text Block] | Income Taxes We recognize deferred tax liabilities and assets for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred tax liabilities and assets are determined based on the difference between the financial statement carrying amounts and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. Valuation allowances are established when necessary to reduce deferred tax assets to the amount more likely than not to be realized. We also recognize tax benefits only for tax positions that are more likely than not to be sustained upon examination by tax authorities. The amount recognized is measured as the largest amount of benefit that is greater than 50 percent likely to be realized upon settlement. A liability for “unrecognized tax benefits” is recorded for any tax benefits claimed in our tax returns that do not meet these recognition and measurement standards. To date, we do not have any unrecognized tax benefits. |
Earnings Per Share, Policy [Policy Text Block] | Loss Per Share (LPS) Basic LPS excludes dilution and is computed by dividing the loss attributable to common stockholders by the weighted average number of common shares outstanding for the period. Diluted LPS reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that shared in the earnings of the entity. Diluted LPS is the same as basic LPS for all periods presented because all potentially dilutive securities have an anti-dilutive effect on LPS due to the net losses incurred. At June 30, 2015, the total number of shares of common stock relating to outstanding stock options and other potentially dilutive securities that have been excluded from the LPS calculation because their effect would be anti-dilutive approximated 38,824,813. |
New Accounting Pronouncements, Policy [Policy Text Block] | Recent Accounting Pronouncements We do not expect the adoption of any recently issued accounting pronouncements to have a significant impact on our results of operations, financial position or cash flows. |
NOTE A - ORGANIZATION AND SIG18
NOTE A - ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Jun. 30, 2015 | |
Accounting Policies [Abstract] | |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Table Text Block] | The following table sets forth the Company’s financial assets and liabilities measured at fair value by level within the fair value hierarchy as of June 30, 2015 and June 30, 2014. Assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. Total Level 1 Level 2 Level 3 Derivative Liabilities $ 719,792 - - $ 719,792 Total Level 1 Level 2 Level 3 Derivative Liabilities $ 281,251 - - $ 281,251 |
NOTE C - Property and Equipme19
NOTE C - Property and Equipment (Tables) | 12 Months Ended |
Jun. 30, 2015 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment [Table Text Block] | Property and equipment consist of: June 30, 2015 June 30, 2014 Production and R&D Equipment $ 317,496 $ 317,496 Computer equipment and software 401,106 399,985 Furniture and fixtures 74,976 75,650 Total property and equipment 793,578 793,131 Less accumulated depreciation (785,609 ) (786,055 ) Total property and equipment, net $ 7,969 $ 7,076 |
NOTE F - NOTES PAYABLE AND DE20
NOTE F - NOTES PAYABLE AND DERIVATIVE LIABILITIES (Tables) | 12 Months Ended |
Jun. 30, 2015 | |
Debt Disclosure [Abstract] | |
Convertible Debt [Table Text Block] | The debts borrowed during the years are summarized below: Conversion Terms Conversion Prices 2015 2014 Convertible 180 days from the issuance date at 53% of the lowest three trading price in the last 10 days prior to conversion $ 106,000 $ 129,000 Convertible 180 days from the issuance date at 55% of the lowest closing trade price in the last 20 days prior to conversion 35,000 32,500 Convertible 180 days from the issuance date 60% of the lowest trading price in the last 25 trading days prior to conversion 166,750 - Convertible 90 days from the issuance date at the lesser of $0.125/share or 60% of the lowest trading price in the last 25 trading days prior to conversion 25,000 - Convertible on the date of issuance at 55% of the lowest closing trade price in the last 20 days prior to conversion. 52,500 28,500 Convertible on the issuance date at the lesser of $0.125/share or 60% of the lowest trading price in the last 25 trading days prior to conversion - 25,000 Convertible on the issuance date at the lesser of $0.24/share or 60% of the lowest trading price in the last 25 trading days prior to conversion 98,655 160,000 Convertible on the issuance date at 45% of the lowest closing trade price in the last 20 days prior to conversion 96,750 - Total Borrowing during the year $ 580,655 $ 375,000 |
Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Input Reconciliation [Table Text Block] | Derivative Liabilities June 30, 2013 $ 492,461 Addition of new conversion option derivative 252,500 Reclassification of derivative to common stock due to conversion of convertible note payable (666,009 ) Loss on change in fair value in derivative 202,299 June 30, 2014 $ 281,251 Addition of new conversion option derivative 359,424 Reclassification of derivative to common stock due to conversion of convertible note payable (775,156 ) Loss on change of fair value in derivative 854,273 June 30, 2015 $ 719,792 |
NOTE G - STOCK BASED COMPENSA21
NOTE G - STOCK BASED COMPENSATION (Tables) | 12 Months Ended |
Jun. 30, 2015 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of Share-based Compensation, Stock Options, Activity [Table Text Block] | Option activity for the years ended June 30, 2015 and 2014 is as follows: Weighted Options Range of Exercise Price Total Vested Average Exercise Price Balance at June 30, 2013 32,197,740 32,197,740 $ 0.13 Granted - - - - Exercised - - - - Forfeited (7,097,740 ) $ 0.23 (7,097,740 ) $ 0.23 Balance at June 30, 2014 25,100,000 25,100,00 $ 0.10 Granted - - - - Exercised - - - - Forfeited - - - - Balance at June 30, 2015 25,100,000 25,100,00 $ 0.10 |
Schedule of Share-based Compensation, Shares Authorized under Stock Option Plans, by Exercise Price Range [Table Text Block] | Weighted Average Weighted Remaining Exercise Average Life in Price Range Outstanding Exercise Price Years Exercisable $ 0.10 25,000,000 $ 0.10 0.96 25,000,000 $ 0.085 100,000 $ 0.085 2.42 100,000 25,100,000 $ 0.10 25,100,000 Weighted Average Weighted Remaining Exercise Average Life in Price Range Outstanding Exercise Price Years Exercisable $ 0.10 25,000,000 $ 0.10 1.96 25,000,000 $ 0.085 100,000 $ 0.085 3.42 100,000 25,100,000 $ 0.10 25,100,000 |
Schedule of Stockholders' Equity Note, Warrants or Rights [Table Text Block] | Warrant activity for the years ended June 30, 2015 and 2014 is as follows: Weighted Average Warrants Ex Price Remaining Life Balance at June 30, 2013 497,760 $ 0.13 2.78 Granted - - - Exercised - Forfeited (20,000 ) $ 0.15 Balance at June 30, 2014 477,760 $ 0.13 1. 87 Granted - - - Exercised - - - Forfeited (20,000 ) $ 0.22 - Balance at June 30, 2015 457,760 $ 0.13 0.91 |
NOTE A - ORGANIZATION AND SIG22
NOTE A - ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($) | 12 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2014 | |
NOTE A - ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES (Details) [Line Items] | ||
Related Party Transaction, Amounts of Transaction | $ 0 | $ 225,021 |
Other Deferred Credits, Current | $ 24,598 | $ 24,598 |
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount (in Shares) | 38,824,813 | |
Minimum [Member] | ||
NOTE A - ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES (Details) [Line Items] | ||
Property, Plant and Equipment, Useful Life | 5 years | |
Maximum [Member] | ||
NOTE A - ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES (Details) [Line Items] | ||
Property, Plant and Equipment, Useful Life | 15 years |
NOTE A - ORGANIZATION AND SIG23
NOTE A - ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES (Details) - Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis - USD ($) | Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 |
NOTE A - ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES (Details) - Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | |||
Derivative Liabilities | $ 719,792 | $ 281,251 | $ 492,461 |
Fair Value, Inputs, Level 1 [Member] | |||
NOTE A - ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES (Details) - Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | |||
Derivative Liabilities | 0 | 0 | |
Fair Value, Inputs, Level 2 [Member] | |||
NOTE A - ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES (Details) - Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | |||
Derivative Liabilities | 0 | 0 | |
Fair Value, Inputs, Level 3 [Member] | |||
NOTE A - ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES (Details) - Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | |||
Derivative Liabilities | $ 719,792 | $ 281,251 |
NOTE B - GOING CONCERN (Details
NOTE B - GOING CONCERN (Details) - USD ($) | 12 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2014 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Net Income (Loss) Attributable to Parent | $ (3,065,769) | $ (1,735,353) |
Retained Earnings (Accumulated Deficit) | (57,283,369) | $ (54,217,600) |
Working Capital Deficit | $ (15,194,771) |
NOTE C - Property and Equipme25
NOTE C - Property and Equipment (Details) - Schedule of Property, Plant and Equipment - USD ($) | Jun. 30, 2015 | Jun. 30, 2014 |
Schedule of Property, Plant and Equipment [Abstract] | ||
Production and R&D Equipment | $ 317,496 | $ 317,496 |
Computer equipment and software | 401,106 | 399,985 |
Furniture and fixtures | 74,976 | 75,650 |
Total property and equipment | 793,578 | 793,131 |
Less accumulated depreciation | (785,609) | (786,055) |
Total property and equipment, net | $ 7,969 | $ 7,076 |
NOTE D - CUSTOMER DEPOSITS (Det
NOTE D - CUSTOMER DEPOSITS (Details) - USD ($) | Jun. 30, 2015 | Jun. 30, 2014 |
Other Liabilities and Financial Instruments Subject to Mandatory Redemption [Abstract] | ||
Customer Deposits, Current | $ 384,767 | $ 384,767 |
NOTE E - DEFERRED WAGES (Detail
NOTE E - DEFERRED WAGES (Details) - USD ($) | Jun. 30, 2015 | Jun. 30, 2014 |
NOTE E - DEFERRED WAGES (Details) [Line Items] | ||
Deferred Compensation Liability, Current | $ 179,017 | $ 732,626 |
Other Deferred Compensation Arrangements, Liability, Current | $ 197,261 | 302,709 |
Deferred Compensation [Member] | ||
NOTE E - DEFERRED WAGES (Details) [Line Items] | ||
Debt Instrument, Interest Rate, Stated Percentage | 10.00% | |
Former Employee [Member] | Convertible Debt [Member] | ||
NOTE E - DEFERRED WAGES (Details) [Line Items] | ||
Deferred Compensation Liability, Current | $ 680,319 | |
Debt Instrument, Interest Rate, Stated Percentage | 3.25% | |
President [Member] | ||
NOTE E - DEFERRED WAGES (Details) [Line Items] | ||
Deferred Compensation Liability, Current | $ 887,500 | 762,500 |
Other Deferred Compensation Arrangements, Liability, Current | 645,730 | $ 566,330 |
President [Member] | Annual Salary [Member] | ||
NOTE E - DEFERRED WAGES (Details) [Line Items] | ||
Deferred Compensation Liability, Current | $ 125,000 |
NOTE F - NOTES PAYABLE AND DE28
NOTE F - NOTES PAYABLE AND DERIVATIVE LIABILITIES (Details) - USD ($) | 12 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2014 | |
NOTE F - NOTES PAYABLE AND DERIVATIVE LIABILITIES (Details) [Line Items] | ||
Notes Payable, Related Parties, Current | $ 1,792,904 | $ 2,188,947 |
Repayments of Related Party Debt | 396,043 | 287,958 |
Due to Other Related Parties, Classified, Current | 859,834 | 208,068 |
Proceeds from Other Debt | 535 | 0 |
Repayments of Other Debt | 29,088 | 0 |
Debt Instrument, Face Amount | 580,655 | 375,000 |
Proceeds from Related Party Debt | 597,955 | 0 |
Notes Assumed | 68,000 | 0 |
Due to Related Parties, Current | 665,955 | 0 |
Other Notes Payable, Current | 1,258,182 | 1,383,682 |
Convertible Notes Payable, Current | 352,975 | 213,240 |
Debt Instrument, Unamortized Discount | 81,049 | 123,640 |
Proceeds from Convertible Debt | 580,655 | 375,000 |
Amortization of Debt Discount (Premium) | $ 402,015 | $ 175,435 |
Equity Option [Member] | ||
NOTE F - NOTES PAYABLE AND DERIVATIVE LIABILITIES (Details) [Line Items] | ||
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Risk Free Interest Rate, Minimum | 0.01% | 0.02% |
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Risk Free Interest Rate, Maximum | 0.79% | 0.91% |
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Volatility Rate, Minimum | 165.32% | 101.94% |
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Volatility Rate, Maximum | 362.85% | 268.85% |
Notes Payable, Other Payables [Member] | ||
NOTE F - NOTES PAYABLE AND DERIVATIVE LIABILITIES (Details) [Line Items] | ||
Interest Payable, Current | $ 146,694 | $ 125,522 |
Convertible Notes Payable [Member] | ||
NOTE F - NOTES PAYABLE AND DERIVATIVE LIABILITIES (Details) [Line Items] | ||
Debt Instrument, Unamortized Discount (Premium), Net | $ 359,424 | 252,500 |
Minority Shareholder Notes Payable [Member] | Notes Payable, Other Payables [Member] | ||
NOTE F - NOTES PAYABLE AND DERIVATIVE LIABILITIES (Details) [Line Items] | ||
Debt Instrument, Interest Rate, Stated Percentage | 10.00% | |
Judgement Liability [Member] | ||
NOTE F - NOTES PAYABLE AND DERIVATIVE LIABILITIES (Details) [Line Items] | ||
Debt Instrument, Face Amount | 300,000 | |
Loss Contingency, Accrual, Current | $ 277,541 | 345,000 |
Debt Instrument, Periodic Payment | $ 5,000 | |
Payments for Legal Settlements | 22,459 | |
Long-term Debt, Maturities, Repayments of Principal in Next Twelve Months | $ 42,846 | |
Former Employee [Member] | Convertible Notes Payable [Member] | ||
NOTE F - NOTES PAYABLE AND DERIVATIVE LIABILITIES (Details) [Line Items] | ||
Debt Instrument, Interest Rate, Stated Percentage | 3.25% | |
Debt Instrument, Face Amount | $ 680,319 | |
Notes Payable, Current | $ 651,231 | |
Minimum [Member] | Equity Option [Member] | ||
NOTE F - NOTES PAYABLE AND DERIVATIVE LIABILITIES (Details) [Line Items] | ||
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Exercise Price (in Dollars per share) | $ 0.0023 | $ 0.012 |
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Term | 98 days | 36 days |
Minimum [Member] | Third Party Notes Payable [Member] | Notes Payable, Other Payables [Member] | ||
NOTE F - NOTES PAYABLE AND DERIVATIVE LIABILITIES (Details) [Line Items] | ||
Debt Instrument, Interest Rate, Stated Percentage | 6.00% | |
Maximum [Member] | Equity Option [Member] | ||
NOTE F - NOTES PAYABLE AND DERIVATIVE LIABILITIES (Details) [Line Items] | ||
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Exercise Price (in Dollars per share) | $ 0.24 | $ 0.25 |
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Term | 2 years 146 days | 4 years |
Maximum [Member] | Third Party Notes Payable [Member] | Notes Payable, Other Payables [Member] | ||
NOTE F - NOTES PAYABLE AND DERIVATIVE LIABILITIES (Details) [Line Items] | ||
Debt Instrument, Interest Rate, Stated Percentage | 10.00% |
NOTE F - NOTES PAYABLE AND DE29
NOTE F - NOTES PAYABLE AND DERIVATIVE LIABILITIES (Details) - Schedule of Convertible Debt - USD ($) | 12 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2014 | |
NOTE F - NOTES PAYABLE AND DERIVATIVE LIABILITIES (Details) - Schedule of Convertible Debt [Line Items] | ||
Convertible Debt, Conversion Terms | Total Borrowing during the year | |
Convertible Debt | $ 580,655 | $ 375,000 |
Convertible Notes Payable #1 [Member] | Convertible Debt [Member] | ||
NOTE F - NOTES PAYABLE AND DERIVATIVE LIABILITIES (Details) - Schedule of Convertible Debt [Line Items] | ||
Convertible Debt, Conversion Terms | Convertible 180 days from the issuance date | |
Convertible Debt, Conversion Prices | at 53% of the lowest three trading price in the last 10 days prior to conversion | |
Convertible Debt | $ 106,000 | 129,000 |
Convertible Notes Payable #2 [Member] | Convertible Debt [Member] | ||
NOTE F - NOTES PAYABLE AND DERIVATIVE LIABILITIES (Details) - Schedule of Convertible Debt [Line Items] | ||
Convertible Debt, Conversion Terms | Convertible 180 days from the issuance date | |
Convertible Debt, Conversion Prices | at 55% of the lowest closing trade price in the last 20 days prior to conversion | |
Convertible Debt | $ 35,000 | 32,500 |
Convertible Notes Payable #3 [Member] | Convertible Debt [Member] | ||
NOTE F - NOTES PAYABLE AND DERIVATIVE LIABILITIES (Details) - Schedule of Convertible Debt [Line Items] | ||
Convertible Debt, Conversion Terms | Convertible 180 days from the issuance date | |
Convertible Debt, Conversion Prices | 60% of the lowest trading price in the last 25 trading days prior to conversion | |
Convertible Debt | $ 166,750 | 0 |
Convertible Notes Payable #4 [Member] | Convertible Debt [Member] | ||
NOTE F - NOTES PAYABLE AND DERIVATIVE LIABILITIES (Details) - Schedule of Convertible Debt [Line Items] | ||
Convertible Debt, Conversion Terms | Convertible 90 days from the issuance date | |
Convertible Debt, Conversion Prices | at the lesser of $0.125/share or 60% of the lowest trading price in the last 25 trading days prior to conversion | |
Convertible Debt | $ 25,000 | 0 |
Convertible Notes Payable #5 [Member] | Convertible Debt [Member] | ||
NOTE F - NOTES PAYABLE AND DERIVATIVE LIABILITIES (Details) - Schedule of Convertible Debt [Line Items] | ||
Convertible Debt, Conversion Terms | Convertible on the date of issuance | |
Convertible Debt, Conversion Prices | at 55% of the lowest closing trade price in the last 20 days prior to conversion. | |
Convertible Debt | $ 52,500 | 28,500 |
Convertible Notes Payable #6 [Member] | Convertible Debt [Member] | ||
NOTE F - NOTES PAYABLE AND DERIVATIVE LIABILITIES (Details) - Schedule of Convertible Debt [Line Items] | ||
Convertible Debt, Conversion Terms | Convertible on the issuance date | |
Convertible Debt, Conversion Prices | at the lesser of $0.125/share or 60% of the lowest trading price in the last 25 trading days prior to conversion | |
Convertible Debt | $ 0 | 25,000 |
Convertible Notes Payable #7 [Member] | Convertible Debt [Member] | ||
NOTE F - NOTES PAYABLE AND DERIVATIVE LIABILITIES (Details) - Schedule of Convertible Debt [Line Items] | ||
Convertible Debt, Conversion Terms | Convertible on the issuance date | |
Convertible Debt, Conversion Prices | at the lesser of $0.24/share or 60% of the lowest trading price in the last 25 trading days prior to conversion | |
Convertible Debt | $ 98,655 | 160,000 |
Convertible Notes Payable #8 [Member] | Convertible Debt [Member] | ||
NOTE F - NOTES PAYABLE AND DERIVATIVE LIABILITIES (Details) - Schedule of Convertible Debt [Line Items] | ||
Convertible Debt, Conversion Terms | Convertible on the issuance date | |
Convertible Debt, Conversion Prices | at 45% of the lowest closing trade price in the last 20 days prior to conversion | |
Convertible Debt | $ 96,750 | $ 0 |
NOTE F - NOTES PAYABLE AND DE30
NOTE F - NOTES PAYABLE AND DERIVATIVE LIABILITIES (Details) - Derivative Liability Measured on Recurring Basis, Unobservable Input Reconciliation - USD ($) | 12 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2014 | |
Derivative Liabilities | ||
Derivative Liabilities | $ 281,251 | $ 492,461 |
Addition of new conversion option derivative | 359,424 | 252,500 |
Reclassification of derivative to common stock due to conversion of convertible note payable | (775,156) | (666,009) |
Loss on change in fair value in derivative | 854,273 | 202,299 |
Derivative Liabilities | $ 719,792 | $ 281,251 |
NOTE G - STOCK BASED COMPENSA31
NOTE G - STOCK BASED COMPENSATION (Details) - USD ($) | Feb. 26, 2009 | Jun. 30, 2015 | Jun. 30, 2014 |
NOTE G - STOCK BASED COMPENSATION (Details) [Line Items] | |||
Stock Issued During Period, Shares, Issued for Services | 97,940 | 288,207 | |
Stock Issued During Period, Value, Issued for Services | $ 7,793 | $ 34,275 | |
Stock Issued During Period, Shares, Conversion of Convertible Securities | 44,645,542 | ||
Stock Issued During Period, Value, Conversion of Convertible Securities | $ 462,801 | $ 275,353 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 0 | 0 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Expirations in Period | 0 | 7,097,740 | |
Share-based Compensation | $ 7,793 | $ 34,275 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Intrinsic Value | $ 0 | $ 500 | |
Class of Warrant or Rights, Expired | 20,000 | 20,000 | |
Class of Warrant or Rights, Outstanding Intrinsic Value | $ 0 | $ 1,560 | |
2009 Stock Option and Restricted Stock Benefit Plan [Member] | |||
NOTE G - STOCK BASED COMPENSATION (Details) [Line Items] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized | 7,500,000 | ||
Employee Stock Option [Member] | |||
NOTE G - STOCK BASED COMPENSATION (Details) [Line Items] | |||
Share-based Compensation | $ 0 | $ 0 | |
Director [Member] | 2009 Stock Option and Restricted Stock Benefit Plan [Member] | |||
NOTE G - STOCK BASED COMPENSATION (Details) [Line Items] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 5,000 |
NOTE G - STOCK BASED COMPENSA32
NOTE G - STOCK BASED COMPENSATION (Details) - Schedule of Option Activity - $ / shares | 12 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 | |
Schedule of Option Activity [Abstract] | |||
Options Outstanding | 25,100,000 | 25,100,000 | 32,197,740 |
Options Outstanding, Total Vested | 2,510,000 | 2,510,000 | 32,197,740 |
Options Outstanding, Weighted Average Exercise Price (in Dollars per share) | $ 0.10 | $ 0.10 | $ 0.13 |
Options Granted | 0 | 0 | |
Options Granted, Weighted Average Exercise Price (in Dollars per share) | $ 0 | $ 0 | |
Options Exercised | 0 | 0 | |
Options Exercised, Weighted Average Exercise Price (in Dollars per share) | $ 0 | $ 0 | |
Options Forfeited | 0 | (7,097,740) | |
Options Forfeited, Range of Exercise Price (in Dollars per share) | $ 0.23 | ||
Options Forfeited, Total Vested | (7,097,740) | ||
Options Forfeited, Weighted Average Exercise Price (in Dollars per share) | $ 0 | $ 0.23 |
NOTE G - STOCK BASED COMPENSA33
NOTE G - STOCK BASED COMPENSATION (Details) - Schedule of Share-based Compensation, Shares Authorized under Stock Option Plans, by Exercise Price Range - $ / shares | 12 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2014 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||
Options, Shares Outstanding | 25,100,000 | 25,100,000 |
Options, Weighted Average Exercise Price (in Dollars per share) | $ 0.10 | $ 0.10 |
Options, Exercisable | 25,100,000 | 25,100,000 |
Options, Exercise Price Range at $0.10 [Member] | ||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||
Options, Exercise Price Range (in Dollars per share) | $ 0.10 | $ 0.10 |
Options, Shares Outstanding | 25,000,000 | 25,000,000 |
Options, Weighted Average Exercise Price (in Dollars per share) | $ 0.10 | $ 0.10 |
Options, Weighted Average Remaining Life | 350 days | 1 year 350 days |
Options, Exercisable | 25,000,000 | 25,000,000 |
Options, Exercise Price Range at $0.085 [Member] | ||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||
Options, Exercise Price Range (in Dollars per share) | $ 0.085 | $ 0.085 |
Options, Shares Outstanding | 100,000 | 100,000 |
Options, Weighted Average Exercise Price (in Dollars per share) | $ 0.085 | $ 0.085 |
Options, Weighted Average Remaining Life | 2 years 153 days | 3 years 153 days |
Options, Exercisable | 100,000 | 100,000 |
NOTE G - STOCK BASED COMPENSA34
NOTE G - STOCK BASED COMPENSATION (Details) - Schedule of Warrant Activity - $ / shares | 12 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 | |
Schedule of Warrant Activity [Abstract] | |||
Warrants Outstanding | 457,760 | 477,760 | 497,760 |
Warrants Outstanding, Weighted Average Exercise Price | $ 0.13 | $ 0.13 | $ 0.13 |
Warrants Outstanding, Weighted Average Remaining Life | 332 days | 1 year 317 days | 2 years 284 days |
Warrants Granted | 0 | 0 | |
Warrants Granted, Weighted Average Exercise Price | $ 0 | $ 0 | |
Warrants Exercised | 0 | 0 | |
Warrants Exercised, Weighted Average Exercise Price | $ 0 | $ 0 | |
Warrants Forfeited | (20,000) | (20,000) | |
Warrants Forfeited, Weighted Average Exercise Price | $ 0.22 | $ 0.15 |
NOTE H - INCOME TAXES (Details)
NOTE H - INCOME TAXES (Details) | 12 Months Ended |
Jun. 30, 2015USD ($) | |
NOTE H - INCOME TAXES (Details) [Line Items] | |
Deferred Tax Assets, Gross | $ 9,920,028 |
Deferred Tax Assets, Valuation Allowance | $ 9,920,028 |
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 35.00% |
Effective Income Tax Rate Reconciliation, Percent | 0.00% |
Operating Loss Carryforward, Expiration Date | 2,034 |
Domestic Tax Authority [Member] | |
NOTE H - INCOME TAXES (Details) [Line Items] | |
Operating Loss Carryforwards | $ 23,681,940 |
Deferred Tax Assets, Gross | 8,288,679 |
State and Local Jurisdiction [Member] | |
NOTE H - INCOME TAXES (Details) [Line Items] | |
Operating Loss Carryforwards | 18,454,173 |
Deferred Tax Assets, Gross | $ 1,631,349 |
NOTE I - COMMITMENTS AND CONT36
NOTE I - COMMITMENTS AND CONTINGENCIES (Details) | 12 Months Ended | |
Jun. 30, 2015USD ($)ft² | Jun. 30, 2014USD ($) | |
NOTE I - COMMITMENTS AND CONTINGENCIES (Details) [Line Items] | ||
Area of Real Estate Property (in Square Feet) | ft² | 34,500 | |
Description of Lessee Leasing Arrangements, Operating Leases | month to month | |
Operating Leases, Rent Expense, Minimum Rentals | $ 3,500 | |
Deferred Rent Credit, Current | 7,353,989 | $ 6,615,469 |
Operating Leases, Rent Expense | 501,233 | 385,304 |
Reimbursement Revenue | 0 | 111,496 |
Loss Contingency Accrual | 277,541 | 345,000 |
Loss Contingency, Damages Awarded, Value | 300,000 | |
Loss Contingency, Monthly Installments [Member] | ||
NOTE I - COMMITMENTS AND CONTINGENCIES (Details) [Line Items] | ||
Loss Contingency, Damages Awarded, Value | 5,000 | |
Chief Executive Officer [Member] | ||
NOTE I - COMMITMENTS AND CONTINGENCIES (Details) [Line Items] | ||
Operating Leases, Rent Expense | $ 501,233 | $ 496,800 |
NOTE J - SUBSEQUENT EVENTS (Det
NOTE J - SUBSEQUENT EVENTS (Details) | 5 Months Ended |
Nov. 23, 2015shares | |
Subsequent Event [Member] | |
NOTE J - SUBSEQUENT EVENTS (Details) [Line Items] | |
Debt Conversion, Converted Instrument, Shares Issued | 18,866,812 |