Annual report pursuant to section 13 and 15(d)

Consolidated Statements of Cash Flows

v2.4.0.6
Consolidated Statements of Cash Flows (USD $)
12 Months Ended 54 Months Ended
Jul. 31, 2012
Jul. 31, 2011
Jul. 31, 2012
Operating activities      
Net income (loss) $ (2,364,852) $ (3,758,817) $ (6,200,728)
Adjustments to reconcile net income (loss) to net cash used in operating activities:      
Depreciation and amortization 717,450 250,821 968,270
Write-down of supplies inventory   38,000 38,000
Write-down of web development costs     9,000
Fair value of derivative liabilities in excess of proceeds   808,590 808,590
Loss on extinguishment of debt 761,492   761,492
(Gain) loss on adjustment to fair value of derivative liabilities (4,192,781) 1,041,795 (3,150,986)
Non-cash interest expense 266,567   266,567
Share-based compensation 332,778   332,778
Amortization of common stock issued for services 249,000 83,000 332,000
Changes in operating assets and liabilities:      
(Increase) decrease in prepaid expenses (164,220) (178,961) (343,180)
(Increase) decrease in other current assets 7,572 (15,939) (8,367)
(Decrease) increase in accounts payable and accrued liabilities 15,146 353,246 384,321
(Decrease) increase in accrued compensation 151,075 67,774 218,849
(Decrease) Increase in accrued income taxes 1,600 1,600 3,200
Net cash (used in) provided by operating activities (4,219,173) (1,308,891) (5,580,194)
Investing activities      
Purchases of property and equipment (54,511) (61,286) (124,797)
Investment in intangible assets   (250,000) (250,000)
Net cash (used in) provided by investing activities (54,511) (311,286) (374,797)
Financing activities      
Proceeds from issuance of common stock and warrants 7,750,000 4,092,000 11,889,000
Payment of financing and offering costs (542,500)   (542,500)
Payment of amounts due under acquisition obligation (250,000)   (250,000)
Proceeds from amounts due to stockholder   139,500 153,867
Repayment of amounts due to stockholder   (153,867) (153,867)
Net cash (used in) provided by financing activities 6,957,500 4,077,633 11,096,500
Net increase (decrease) in cash 2,683,816 2,457,456 5,141,509
Cash and cash equivalents, at beginning of period 2,457,693 237  
Cash and cash equivalents, at end of period 5,141,509 2,457,693 5,141,509
Cash paid during the period for:      
Interest   1,357 1,357
Income taxes 800   800
Noncash investing and financing transaction:      
Fair value of placement agent warrants issued in the public offering 276,980   276,980
Acquisition obligation of asset purchase agreement   2,750,000 2,750,000
Acquisition obligation discounts - imputed interest and fair value of warrants $ 402,355   $ 402,355