| Delaware                          | 95-4106894                           |
|-----------------------------------|--------------------------------------|
| (State or other jurisdiction      | (I.R.S. Employer Identification No.) |
| of incorporation or organization) |                                 |

| Large Accelerated Filer  |   | Accelerated Filer  |
|----------------------------------|--------|----------------------------|
| Non-accelerated filer    |   | Smaller Reporting Companyx |

| Class                                     |   | Outstanding June 30, 2011 |
|-------------------------------------------|--------|---------------------------|
|                                      |   |                      |
| Common Stock, par value $0.0001 per share |   | 64,614,937 shares         |

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|  Index |                          |                                                                                                     | Page No. |
|-------------|-------------------------------|----------------------------------------------------------------------------------------------------------|----------|
| PART I.     | FINANCIAL INFORMATION         |                                                                                                     |     |
|        |                          |                                                                                                     |     |
|        | ITEM 1.                       | Financial Statements (Unaudited)                                                                         |     |
|        |                          |                                                                                                     |     |
|        |                          | Statement Regarding Financial Information                                                                | 4        |
|        |                          |                                                                                                     |     |
|        |                          | Unaudited Condensed Balance Sheets as of  May 31, 2011 and February 28, 2011                   | 5        |
|        |                          |                                                                                                     |     |
|        |                          | Unaudited Condensed Statements of Operations for the Three  Months Ended May 31, 2011 and 2010 | 6        |
|        |                          |                                                                                                     |     |
|        |                          | Unaudited Condensed Statements of Cash Flows for the Three Months Ended May 31, 2011 and 2010            | 7        |
|        |                          |                                                                                                     |     |
|        |                          | Notes to Unaudited Condensed Financial Statements                                                        | 8        |
|        |                          |                                                                                                     |     |
|        | ITEM 2.                       | Management's Discussion and Analysis of Financial Condition and Results of Operations                    | 17       |
|        |                          |                                                                                                     |     |
|        | ITEM 4T.                      | Controls and Procedures                                                                                  | 21       |
|        |                          |                                                                                                     |     |
| PART II.    | OTHER INFORMATION             |                                                                                                     |     |
|        |                          |                                                                                                     |     |
|        | ITEM 2.                       | Unregistered Sales of Equity Securities and Use of Proceeds                                              | 21       |
|        |                          |                                                                                                     |     |
|        | ITEM 6.                       | Exhibits                                                                                                 | 21       |
|        |                          |                                                                                                     |     |
|        | SIGNATURES AND CERTIFICATIONS | 22                                                                                                       |

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|                                                                                                                                                                                                     |   | May 31, 2011 |         |   | February 28, 2011 |   |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------|--------------|--------|-------------------|--------|
| ASSETS                                                                                                                                                                                                   |   |         |         |   |              |   |
| Current assets:                                                                                                                                                                                          |   |         |         |   |              |   |
| Cash and cash equivalents                                                                                                                                                                                |   | $            | 146,878      |   |              | $      | 104,815 |   |
| Accounts receivable, net of allowance for doubtful accounts of $59,070 at May 31 and February 28, 2011, respectively                                                                                     |   |         | 789,510      |   |              |   | 296,297 |   |
| Inventory - current                                                                                                                                                                                      |   |         | 1,000,000    |   |              |   | 1,000,000 |   |
| Other current assets                                                                                                                                                                                     |   |         | 758,066      |   |              |   | 450,843 |   |
| Total current assets                                                                                                                                                                                     |   |         | 2,694,454    |   |              |   | 1,851,955 |   |
|                                                                                                                                                                                                     |   |         |         |   |              |   |   |   |
| Property, plant, and equipment, net                                                                                                                                                                      |   |         | 334,574      |   |              |   | 380,842 |   |
| Inventory, non-current, net of allowance for obsolete inventory of $2,045,540 and $2,106,391 at May 31 and February 28, 2011,  respectively                                                    |   |         | 2,181,735    |   |              |   | 2,274,013 |   |
| Total assets                                                                                                                                                                                             |   | $            | 5,210,763    |   |              | $      | 4,506,810 |   |
|                                                                                                                                                                                                     |   |         |         |   |              |
| LIABILITIES AND STOCKHOLDERS' DEFICIT                                                                                                                                                                    |   |         |         |   |              |
| Current liabilities:                                                                                                                                                                                     |   |         |         |   |              |   |   |   |
| Accounts payable                                                                                                                                                                                         |   | $            | 1,930,135    |   |              | $      | 1,945,372 |   |
| Accrued expenses                                                                                                                                                                                         |   |         | 2,631,230    |   |              |   | 2,632,856 |   |
| Customer advances                                                                                                                                                                                        |   |         | 384,213      |   |              |   | 336,308 |   |
| Notes payable                                                                                                                                                                                            |   |         | 394,500      |   |              |   | 82,500 |   |
| Convertible notes payable                                                                                                                                                                                |   |         | 90,000       |   |              |   | 290,000 |   |
| Notes payable and accrued interest- related party                                                                                                                                                        |   |         | 10,626,275   |   |              |   | 10,148,352 |   |
| Total current liabilities                                                                                                                                                                                |   |         | 16,056,353   |   |              |   | 15,435,388 |   |
|                                                                                                                                                                                                     |   |         |         |   |              |   |   |   |
| Convertible note payable                                                                                                                                                                                 |   |         | 500,000      |   |              |   | 500,000 |   |
|                                                                                                                                                                                                     |   |         |         |   |              |   |   |   |
| Total liabilities                                                                                                                                                                                        |   |         | 16,556,353   |   |              |   | 15,935,388 |   |
|                                                                                                                                                                                                     |   |         |         |   |              |   |   |   |
| Commitments and contingencies                                                                                                                                                                            |   |         | -            |   |              |   | - |   |
|                                                                                                                                                                                                     |   |         |         |   |              |   |   |   |
| Stockholders' deficit :                                                                                                                                                                                  |   |         |         |   |              |   |   |   |
| Common stock, $0.0001par value; 75,000,000 and 75,000,000 shares authorized at May 31 and February 28, 2011; 63,964,937 and 60,720,956  issued and outstanding at May 31 and February 28, 2011 |   |         | 6,396        |   |              |   | 6,072 |   |
| Additional paid-in capital                                                                                                                                                                               |   |         | 381,928,980  |   |              |   | 379,819,510 |   |
| Accumulated deficit                                                                                                                                                                                      |   |         | (393,280,966 | )      |              |   | (391,254,160 | ) |
| Total stockholders' deficit                                                                                                                                                                              |   |         | (11,345,590  | )      |              |   | (11,428,578 | ) |
| Total liabilities and stockholders' deficit                                                                                                                                                              |   | $            | 5,210,763    |   |              | $      | 4,506,810 |   |

----

|                                                                                            |   | May 31 |       |
|-------------------------------------------------------------------------------------------------|--------|--------|------------|
|                                                                                            |   | 2011   |       |   | 2010 |   |
| Net Revenues                                                                                    |   | $      | 951,171    |   |   | $ | 587,988 |   |
|        Cost of goods sold                                    |   |   | 322,978    |   |   |   | 300,134 |   |
| Gross Profit                                                                                    |   |   | 628,193    |   |   |   | 287,854 |   |
|                                                                                            |   |   |       |   |   |   |   |   |
| Operating expenses:                                                                             |   |   |       |   |   |   |   |   |
|        Engineering, research and development expenses        |   |   | 273,409    |   |   |   | 461,690 |   |
|        Selling, general and administrative expenses          |   |   | 2,162,075  |   |   |   | 2,372,029 |   |
|        Total operating expenses                              |   |   | 2,435,484  |   |   |   | 2,833,719 |   |
|                                                                                            |   |   |       |   |   |   |   |   |
| Loss from operations                                                                            |   |   | (1,807,291 | ) |   |   | (2,545,865 | ) |
|                                                                                            |   |   |       |   |   |   |   |   |
| Other (income) and expense:                                                                     |   |   |       |   |   |   |   |   |
|        Interest expense, net                                 |   |   | 260,503    |   |   |   | 171,926 |   |
|       (Gain) Loss on settlement of debt and beneficial conversion |   |   | (25,136    | ) |   |   | 105,632 |   |
|        Other income, net                                     |   |   | (15,852    | ) |   |   | 4,303 |   |
|        Total other (income) expense                          |   |   | 219,515    |   |   |   | 281,861 |   |
|                                                                                            |   |   |       |   |   |   |   |   |
| Net Loss                                                                                        |   | $      | (2,026,806 | ) |   | $ | (2,827,726 | ) |
|                                                                                            |   |   |       |   |   |   |   |   |
|       Total basic and diluted loss per share                      |   | $      | (0.03      | ) |   | $ | (0.05 | ) |
| Weighted average shares used to compute basic and diluted loss per share                        |   |   | 61,202,336 |   |   |   | 53,312,554 |   |
|                                                                                            |   |   |       |   |   |   |   |   |

----

|                                                                       |   | 2011   |       |   | 2010   |   |
|----------------------------------------------------------------------------|--------|--------|------------|--------|--------|--------|
| Cash flow from operating activities:                                       |   |   |       |   |   |   |
| Net Loss                                                                   |   | $      | (2,026,806 | )      |   | $      | (2,827,726 | ) |
| Adjustments to reconcile Net loss to net cash used in operating activities |   |   |       |   |   |   |   |   |
| Depreciation Expense                                                       |   |   | 46,268     |   |   |   | 46,545 |   |
| (Gain) Loss on settlement of debt                                          |   |   | (25,136    | )      |   |   | 105,632 |   |
| Stock issued for services                                                  |   |   | -          |   |   |   | 488,000 |   |
| Provision for inventory obsolescence                                       |   |   | (60,851    | )      |   |   | - |   |
| Stock options and warrants expense                                         |   |   | 44,182     |   |   |   | 43,565 |   |
| (Increase) decrease in:Accounts receivable                                 |   |   | (493,213   | )      |   |   | (109,653 | ) |
| Inventory                                                                  |   |   | 153,130    |   |   |   | 1,673 |   |
| Other current assets and deposit                                           |   |   | 67,777     |   |   |   | (28,192 | ) |
| Increase (decrease) in:                                                    |   |   |       |   |   |   |   |   |
| Accounts payable, customer deposit and accrued expenses                    |   |   | 722,692    |   |   |   | 328,439 |   |
| Net cash used in operations                                                |   |   | (1,571,957 | )      |   |   | (1,951,717 | ) |
|                                                                       |   |   |       |   |   |   |   |   |
| Investing activities:                                                      |   |   |       |   |   |   |   |   |
| Acquisition of plant and equipment                                         |   |   | -          |   |   |   | (9,599 | ) |
|                                                                       |   |   |       |   |   |   |   |   |
| Net cash used by investing activities                                      |   |   | -          |   |   |   | (9,599 | ) |
|                                                                       |   |   |       |   |   |   |   |   |
| Financing activities:                                                      |   |   |       |   |   |   |   |   |
| Issuance of common stock                                                   |   |   | 652,020    |   |   |   | 470,925 |   |
| Proceeds from notes payable, net                                           |   |   | 962,000    |   |   |   | 1,460,000 |   |
|                                                                       |   |   |       |   |   |   |   |   |
| Net cash provided by financing activities:                                 |   |   | 1,614,020  |   |   |   | 1,930,925 |   |
|                                                                       |   |   |       |   |   |   |   |   |
| Net increase (decrease) in cash & cash equivalents                     |   |   | 42,063     |   |   |   | (30,391 | ) |
|                                                                       |   |   |       |   |   |   |   |   |
| Cash and cash equivalents at beginning of period                           |   |   | 104,815    |   |   |   | 45,294 |   |
|                                                                       |   |   |       |   |   |   |   |   |
| Cash and cash equivalents at end of period                                 |   | $      | 146,878    |   |   | $      | 14,903 |   |
| Supplemental disclosures of cash flow information                          |   |   |       |   |   |   |   |   |
| Cash paid during the period for:                                           |   |   |       |   |   |   |   |   |
| Interest                                                                   |   |   | -          |   |   |   | - |   |
| Income taxes                                                               |   |   | -          |   |   |   | - |   |

----

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| Machinery and equipment | 5 to 10 years |
|-------------------------|---------------|
| Furniture and fixtures  | 7 years       |

----

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|                                       |   | May 31, 2011 |       |   | February 28, 2011 |   |
|--------------------------------------------|--------|--------------|------------|--------|-------------------|--------|
|                                       |   |         |       |   |              |   |
| Raw materials                              |   | $            | 2,406,596  |   |              | $      | 2,394,502 |   |
| Finished goods                             |   |         | 2,820,679  |   |              |   | 2,985,902 |   |
|                                       |   |         |       |   |              |   |   |   |
|                                       |   |         | 5,227,275  |   |              |   | 5,380,404 |   |
| Reserve for potential product obsolescence |   |         | (1,906,280 | )      |              |   | (1,991,241 | ) |
|                                       |   |         |       |   |              |   |   |   |
|                                       |   |         | 3,320,995  |   |              |   | 3,389,163 |   |
| Non-current portion                        |   |         | (2,181,735 | )      |              |   | (2,274,013 | ) |
| Discount on long term inventory            |   |         | (139,260   | )      |              |   | (115,150 | ) |
|                                       |   |         |       |   |              |   |   |   |
| Current portion                            |   | $            | 1,000,000  |   |              | $      | 1,000,000 |   |

----

|                                           |   | May 31, 2011 |      |   | February 28, 2011 |   |
|------------------------------------------------|--------|--------------|-----------|--------|-------------------|--------|
|                                           |   |         |      |   |              |   |
| Machinery and equipment                        |   | $            | 964,111   |   |              | $      | 964,111 |   |
| Furniture and fixtures                         |   |         | 163,302   |   |              |   | 163,302 |   |
| Leasehold improvements                         |   |         | 485,080   |   |              |   | 485,080 |   |
|                                           |   |         | 1,612,493 |   |              |   | 1,612,493 |   |
| Less accumulated depreciation and amortization |   |         | 1,277,919 |   |              |   | 1,231,651 |   |
| Property, plant and equipment, net             |   | $            | 334,574   |   |              | $      | 380,842 |   |

----

|                                |   | May 31, 2011 |    |   | February 28, 2011 |   |
|-------------------------------------|--------|--------------|---------|--------|-------------------|--------|
|                                |   |         |    |   |              |   |
| Demand notes payable  (a) |   | $            | 394,500 |   |              | $      | 82,500 |   |
| Convertible notes payable (b)       |   |         | 590,000 |   |              |   | 790,000 |   |
|                                |   |         | 984,500 |   |              |   | 872,500 |   |
|                                |   |         |    |   |              |   |   |   |
| Less: Current portion               |   |         | 484,500 |   |              |   | 372,500 |   |
|                                |   |         |    |   |              |   |   |   |
| Long-term portion                   |   | $            | 500,000 |   |              | $      | 500,000 |   |
|                                |   |         |    |   |              |   |   |   |

|   | (a) | Consists of four unsecured demand notes payable totaling $394,500, with interest at an annual rate of 10%, on which $4,362 in interest was accrued during the three months ended May 31, 2011. |
|--------|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (b) | Consists of an unsecured convertible note payable totaling $500,000, bearing interest at a rate of 7%, due in 2013. The note is convertible into our common stock at a price of $3 per share. The Company accrued interest of $8,761 on the note during the three months ended May 31, 2011. Also consists of two unsecured convertible notes entered into during the second quarter of fiscal 2010 totaling $290,000. The notes carry an interest rate of 10%, are for a term of 180 days, and are convertible into common stock of the company at $0.75 per share. The company accrued interest of $7,277 on the notes during the three months ended May 31, 2011.  One of these notes for $200,000 plus accrued interest of $40,953 was converted into shares of our common stock during the quarter ended May 31, 2011. |
|--------|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Year Ending February 28, |   |   |    |
|--------------------------|--------|--------|---------|
| 2012                     |   | $      | 484,500 |   |
| 2013                     |   |   | 500,000 |   |
| Total                    |   | $      | 984,500 |   |

----

|                                 |   | May 31, 2011 |      |   | February 28, 2011 |   |
|--------------------------------------|--------|--------------|-----------|--------|-------------------|--------|
|                                 |   |         |      |   |              |   |
| Accrued payroll and related expenses |   | $            | 2,552,400 |   |              | $      | 2,520,107 |   |
| Accrued interest                     |   |         | 48,571    |   |              |   | 112,749 |   |
| Other                                |   |         | 30,259    |   |              |   | - |   |
| Total                                |   | $            | 2,631,230 |   |              | $      | 2,632,856 |   |

|                           | 2006 Plan |                            |
|--------------------------------|-----------|---------------------------------|
|                           |      |                            |
|                           |      | Weighted-Average Exercise Price |   |   | Aggregate Intrinsic Value |   |   | Number of Options |   |
| Outstanding, February 28, 2011 |      | $                               | 0.75 |   |   | $ | 0.00 |   |   |   | 5,304,500 |   |
| Granted                        |      |                            | - |   |   |   |   |   |   |   | - |   |
| Cancelled                      |      | $                               | 0.75 |   |   | $ | 0.00 |   |   |   | (17,000 | ) |
| Outstanding, May 31, 2011      |      | $                               | 0.75 |   |   | $ | 0.00 |   |   |   | 5,287,500 |   |

| Options Outstanding    |   | Exercisable Options |      |
|------------------------|--------|---------------------|-----------|
| Range of ExercisePrice |   | Number              |      | Weighted Average Remaining Life |   | Weighted Average Exercise Price |   | Weighted Average Remaining Life |   | Number |   | Weighted Average Exercise Price |   |
|   $0.75           |   |                | 5,287,500 |   |   | 3.3 years |   | $ | 0.75 |   |   | 3.3 years |   |   | 4,797,947 |   | $ | 0.75 |   |

----

|                           | Number of Shares |   | Exercise Prices |
|--------------------------------|------------------|--------|-----------------|
| Outstanding, February 28, 2011 | 8,688,576        |   | $0.75-$4.00     |
| Granted                        | 155,000          |   | $1.50           |
| Expired                        | -                |   | -               |
| Outstanding, May 31, 2011      | 8,843,576        |   | $0.75-$1.50     |

| Range of Exercise Prices |   | Stock Warrants Outstanding |   | Stock Warrants Exercisable |   | Weighted-Average Remaining Contractual Life |   | Weighted-Average Exercise Price of Warrants Outstanding |   | Weighted-Average Exercise Price of Warrants Exercisable |   |  Intrinsic Value |
|--------------------------|--------|----------------------------|--------|----------------------------|--------|---------------------------------------------|--------|---------------------------------------------------------|--------|---------------------------------------------------------|--------|-----------------------|
| $1.50                    |   | 155,000                    |   | 155,000                    |   | 58 months                                   |   | $1.50                                                   |   | $1.50                                                   |   | $0.00                 |
| $0.75-1.50               |   | 2,693,286                  |   | 2,693,286                  |   | 44 months                                   |   | $0.90                                                   |   | $0.90                                                   |   | $0.00                 |
| $0.75-1.25               |   | 1,354,710                  |   | 1,354,710                  |   | 38 months                                   |   | $1.25                                                   |   | $1.25                                                   |   | $0.00                 |
| $1.50                    |   | 1,900,000                  |   | 1,900,000                  |   | 37 months                                   |   | $1.50                                                   |   | $1.50                                                   |   | $0.00                 |
| $1.00-$4.00              |   | 1,934,991                  |   | 1,934,991                  |   | 11 months                                   |   | $3.90                                                   |   | $3.90                                                   |   | $0.00                 |
| $4.00                    |   | 805,589                    |   | 805,589                    |   | 8months                                     |   | $4.00                                                   |   | $4.00                                                   |   | $0.00                 |
|                     |   | 8,843,576                  |   | 8,843,576                  |   |                                        |   |                                                    |   |                                                    |   |                  |

----

|          |   | 2011   |    |   | 2010   |   |
|---------------|--------|--------|---------|--------|--------|--------|
|          |   |   |    |   |   |   |
| United States |   | $      | 781,808 |   |   | $      | 393,802 |   |
| Canada        |   |   | 89,907  |   |   |   | 81,339 |   |
| Europe        |   |   | 51,124  |   |   |   | 6,347 |   |
| Asia          |   |   | 28,332  |   |   |   | 99,000 |   |
| Other         |   |   | -       |   |   |   | 7,500 |   |
| Total         |   | $      | 951,171 |   |   | $      | 587,988 |   |

----

| · | Our ability to generate positive cash flow from operations; |
|--------|-------------------------------------------------------------|

| · | Our ability to obtain additional financing to fund our operations; |
|--------|--------------------------------------------------------------------|

| · | Our business development and  operating development; and |
|--------|--------------------------------------------------------------------|

| · | Our expectations of growth in demand for our products. |
|--------|--------------------------------------------------------|

----

----

----

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| 10.56 | Demand Promissory Note dated March 18, 2011 by and between the Company and Warren Breslow in the original principal amount of $150,000. |
|-------|-----------------------------------------------------------------------------------------------------------------------------------------|

| 10.57 | Demand Promissory Note dated April 7, 2011 by and between the Company and Warren Breslow in the original principal amount of $300,000. |
|-------|----------------------------------------------------------------------------------------------------------------------------------------|

| 10.58 | Demand Promissory Note dated May 20, 2011 by and between the Company and Warren Breslow in the original principal amount of $200,000. |
|-------|---------------------------------------------------------------------------------------------------------------------------------------|

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