10-K/A

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

_________________

FORM 10-K

Amendment No. 1

_________________

þ     ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended: June 30, 2012

or

o     TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from: _______ to ______

_________________

HYDROMER, INC.

(Exact name of registrant as specified in its charter)

_________________

New Jersey	001-31238	22-2303576
(State or Other Jurisdiction	(Commission	(I.R.S. Employer
of Incorporation or Organization)	File Number)	Identification No.)

35 Industrial Parkway, Branchburg New Jersey 08876-3424
(Address of Principal Executive Offices) (Zip Code)

(908) 722-5000
(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

None

Title of each class
Name of each exchange on which registered

Securities registered pursuant to Section 12(g) of the Act:

Common Stock Without Par Value

Title of each class

Name of each exchange on which registered

_________________

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.     Yes  o     No  þ

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.

Yes  o     No  þ

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  þ     No  o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§229.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes  þ     No  o

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§229.405 of this chapter) is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.     þ

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.

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

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).     Yes  o     No  þ

The aggregate market value of the voting stock held by non-affiliates of the Registrant at September 18, 2012 was approximately $3,059,423

The number of shares of Registrant's Common Stock outstanding on September 18, 2012 was 4,772,318.

Portions of the Audited Financial Statements for the year ended June 30, 2012 are incorporated by reference in Part II of this report. Portions of the Proxy Statement of Registrant date November 6, 2012 are incorporated by reference in Part III of this report.

ITEMS AMENDED HEREBY

As used in this amended report, “Hydromer” and the “Company” or “Us” or “We” or “Our” refer to Hydromer, Inc., a New Jersey corporation, unless the context otherwise requires.

EXPLANATORY NOTE

The purpose of this Amendment (the “Amendment”) to our Form 10-K for the Fiscal Year Ended June 30, 2012 (the “Form 10-K”), as filed with the Securities and Exchange Commission (the “SEC”) on November 16, 2012, is solely to furnish Exhibit 101 to the Form 10-K in accordance with Rule 405 of Regulation S-T.

Exhibit 101 to this report provides the consolidated financial statements and related notes from the Form 10-K formatted in XBRL (eXtensible Business Reporting Language).

This Amendment makes no other changes to the Form 10-K as filed with the SEC on November 16, 2012 and no attempt has been made in this Amendment to modify or update the other disclosures presented in the Form 10-K.

This Amendment does not reflect subsequent events occurring after the original filing of the Form 10-K (i.e., those events occurring after November 16, 2012) or modify or update in any way those disclosures that may be affected by subsequent events.

Accordingly, this Amendment should be read in conjunction with the Form 10-K and our other filings with the SEC.

(i)

HYDROMER, INC.

FORM 10-K/A

FOR THE FISCAL YEAR ENDED JUNE 30, 2012

INDEX

			Page
PART IV	OTHER INFORMATION
	Item 15(a)3	Exhibits	1
SIGNATURES			2
INDEX OF EXHIBITS			3

(ii)

PART IV — OTHER INFORMATION

Item 15(a)3. Exhibits.

See Index of Exhibits on Page 3.

1

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this amended report to be signed on its behalf by the undersigned thereunto duly authorized.

Date: November 21, 2012	Hydromer Inc.
	Robert Y. Lee Chief Accounting Officer

Date: November 21, 2012	Hydromer Inc.
	By: /s/ Manfred F. Dyck
	Manfred F. Dyck President, Principal Executive Officer, Chairman of Board of Directors

2

INDEX OF EXHIBITS

Exhibit Number	Description
31.1	Certification of Manfred F. Dyck, Chief Executive Officer, pursuant to Securities Exchange Act Rule 13a-14(a) (1)
31.2	Certification of Robert Y. Lee, Chief Financial Officer, pursuant to Securities Exchange Act Rule 13a-14(a) (1)
32.1	Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, signed by Manfred F. Dyck, Chief Executive Officer of Hydromer, Inc. (1)
32.2	Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, signed by Robert Y. Lee, Chief Financial Officer of Hydromer, Inc. (1)
101.INS	XBRL Instance Document. (2)
101.SCH	XBRL Taxonomy Extension Schema Document. (2)
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document. (2)
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document. (2)
101.LAB	XBRL Taxonomy Extension Label Linkbase Document. (2)
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document. (2)
(1) These exhibits were previously included in the Registrant’s Form 10-K for the fiscal year ended June 30, 2012, filed with the SEC on November 16, 2012.
(2)  Pursuant to Rule 406T of Regulation S-T, the interactive data files on Exhibits 101 hereto are deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, and Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise are not subject to liability under those sections.

3

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Fair Value

12 Months Ended

Jun. 30, 2012

Notes to Financial Statements

Fair Value

3. FAIR VALUE

In accordance with ASC 820-10, the following table represents the Company’s fair value hierarchy for its financial assets and liabilities measured at fair value on a recurring basis as of June 30, 2011 :

as of June 30, 2011	Level 1	Level 2	Level 3	Total
Assets
Investments	$ 50,000	-	-	$ 50,000
Total Assets	$ 50,000	-	-	$ 50,000
Liabilities - n/a	-	-	-	-

Some of the Company’s financial instruments are not measured at fair value on a recurring basis but are recorded at amounts that approximate fair value due to their liquid or short-term nature, such as cash and cash equivalents, receivables and payables. The carrying amount of the mortgage is consistent with the terms available in the market for instruments with similar risk. There were no financial assets and liabilities requiring fair value reporting as of June 30, 2012.

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Concentration of Credit and Business Risk

12 Months Ended

Jun. 30, 2012

Risks and Uncertainties [Abstract]

Concentration of Credit Risk

2. CONCENTRATION OF CREDIT AND BUSINESS RISK

The Company is exposed to additional credit and business risks due to its concentration of activity with certain parties. For example, at times throughout the year, the Company may maintain certain bank accounts in excess of FDIC insured limits.

In addition, the Company provides credit in the normal course of business to customers. Ongoing credit evaluations of its customers are performed, and allowances for doubtful accounts are based on factors surrounding the credit risk of specific customers, historical trends and other information.

While there were no significant customers for the years ended June 30, 2011 and 2012, balances from two customers accounted for 27% of the total accounts receivables as of June 30, 2012; 99% of which was collected by mid-August 2012.

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Consolidated Balance Sheets (USD $)	Jun. 30, 2012	Jun. 30, 2011
Current Assets:
Cash and cash equivalents	$ 280,878	$ 502,597
Short-term investments	0	50,000
Trade receivables less allowance for doubtful accounts of $17,918 and $5,622 as of June 30, 2012 and 2011, respectively	993,378	774,753
Inventory	309,369	444,604
Prepaid expenses	207,207	209,241
Deferred tax asset	0	122,100
Other	3,485	13,547
Total Current Assets	1,794,317	2,116,842
Property and equipment, net	2,682,221	2,863,912
Deferred tax asset, non-current	1,267,311	1,196,704
Intangible Assets, net	761,519	820,231
Other assets	20,358
Total Assets	6,525,726	6,997,689
Current Liabilities:
Accounts payable	385,113	387,094
Accrued expenses	342,361	313,626
Current portion of capital leases	16,499	18,687
Current portion of deferred revenue	135,323	149,108
Current portion of mortgage payable	55,899	51,720
Total Current Liabilities	935,195	920,235
Deferred tax liability	251,758	294,012
Long-term portion of capital leases	0	15,398
Long-term portion of deferred revenue	145,593	120,940
Long-term portion of mortgage payable	2,656,239	2,714,817
Total Liabilities	3,988,785	4,065,402
Contingencies Stockholders'Equity
Preferred stock- no par value, authorized 1,000,000 shares, no shares issued and outstanding
Common stock- no par value, authorized 15,000,000 shares; 4,783,235 shares issued and 4,772,318 shares outstanding as of June 30, 2012 and 2011	3,721,815	3,721,815
Contributed capital	633,150	633,150
Accumulated deficit	(1,811,884)	(1,416,538)
Treasury stock, 10,917 common shares at cost	(6,140)	(6,140)
Total Stockholders' Equity	2,536,941	2,932,287
Total Liabilities and Stockholders' Equity	$ 6,525,726	$ 6,997,689

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Consolidated Statements of Cash Flows (USD $)	12 Months Ended
	Jun. 30, 2012	Jun. 30, 2011
Cash Flows From Operating Activities:
Net Loss	$ (395,346)	$ (581,298)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	431,891	431,793
Deferred income taxes	9,239	(331,222)
Changes in Assets and Liabilities
Trade receivables	(218,625)	145,499
Inventory	135,235	(196,035)
Prepaid expenses	6,476	16,794
Other assets	(10,296)	641
Accounts payable and accrued liabilities	30,809	107,415
Deferred revenues	10,868	28,407
Income taxes payable	(4,100)	0
Net Cash Used in Operating Activities	(3,849)	(378,006)
Cash purchases of property and equipment	(56,305)	(123,356)
Cash payments on Patents and Trademarks	(157,166)	(178,352)
Cash purchases of short-term investments	0	(50,000)
Maturity of short-term investments	50,000	440,000
Net Cash (Used in) Provided by Investing Activities	(163,471)	88,292
Cash Flows From Financing Activities:
Repayment of long-term borrowings	(54,399)	(51,299)
Net Cash Used in Financing Activities	(54,399)	(51,299)
Net Decrease in Cash and Cash Equivalents	(221,719)	(341,013)
Cash and Cash Equivalents at Beginning of Period	502,597	843,610
Cash and Cash Equivalents at End of Period	280,878	502,597
Cash paid during the year for:
Interest	193,762	197,210
Income taxes	$ 4,100	$ 4,160

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Summary of Significant Accounting Policies

12 Months Ended

Jun. 30, 2012

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Nature of Operations

Hydromer, Inc. & Subsidiary (the “Company”) is a polymer research and development company based in Branchburg, New Jersey. The Company develops polymer complexes for commercial markets in both the United States and abroad for the medical, cosmetics, animal health and industrial fields. Also in its array of capabilities, the Company offers R&D services and through its wholly owned subsidiary, Biosearch Medical Products, Inc. (“Biosearch”), engineering services and contract coating services. The Company obtains patent rights on certain products from which royalty revenues can be received.

Principles of Consolidation

The consolidated financial statements include the accounts of Hydromer, Inc. and its wholly owned subsidiary. All significant intercompany balances and transactions have been eliminated.

Cash and Cash Equivalents

Cash and cash equivalents consist of investments with original maturities of three months or less.

Short-Term Investments

Short-term investments consist of investments other than cash and cash equivalents with original maturities of greater than three months and less than one year. Short-term investments as of June 30, 2011 was $50,000, comprising of a bank CD with an interest rate of 0.345%.

Accounts Receivables

Accounts receivable are uncollateralized, non-interest-bearing customer obligations due under normal trade terms requiring payment typically within 30 days from the invoice date, or in the case of royalties or contract payments (see Revenue Recognition), usually 45 days from the end of a calendar quarter. Trade accounts receivable are stated at the amount billed to the customer; royalties and contract revenues are estimated until reported by the licensee / contractual party. Payments of accounts receivable are allocated to the specific invoices identified on the customer's remittance advice or, if unspecified, are applied to the oldest unpaid invoices. The carrying amount of accounts receivable is reduced by a valuation allowance that reflects the Company's best estimate of the amounts that may not be collected. This estimate is based on reviews of all balances in excess of 90 days past due from the invoice date. Based on this assessment of current credit worthiness, the Company estimates the portion, if any, of the balance that will not be collected. Management also considers the need for additional general reserves and reviews its valuation allowance on a quarterly basis.

Fair Value Measurements

Accounting Standards Codification (“ASC”) 820-10, Fair Value Measurements, defines fair value, establishes a framework for measuring fair value under generally accepted accounting principles and enhances disclosures about fair value measurements. Fair value is defined under ASC 820-10 as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or the most advantageous market for an asset or liability in an orderly transaction between participants on the measurement date. Valuation techniques used to measure fair value under ASC 820-10 must maximize the use of observable inputs and minimize the use of unobservable inputs. The standard describes a fair value hierarchy based on the levels of inputs, of which the first two are considered observable and the last unobservable, that may be used to measure fair value which are the following:

• Level 1 - Quoted prices in active markets for identical assets or liabilities.

•
Level 2 - Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or corroborated by observable market data or substantially the full term of the assets or liabilities.

• Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the value of the assets or liabilities.

Inventories

Inventories are valued at the lower of cost, determined by the first-in, first-out method, or market and include appropriate amounts of labor and overhead.

Depreciation

The cost of property and equipment, which includes a reasonable portion of labor costs for equipment built in-house, is depreciated on a straight-line method over the estimated useful lives of the assets: 5-10 years for machinery and equipment, 3-5 years for furniture and office equipment and 40 years for the building. When assets are retired or otherwise disposed of, the cost and related accumulated depreciation are removed from the accounts, and any resulting gain or loss is reflected in income for the period. Repairs and maintenance which do not extend the useful lives of the related assets are expensed as incurred.

Patents

Registration and maintenance costs associated with the filing and registration of patents are prepaid and amortized over its remaining life of the patent, not to exceed 20 years. Costs associated with patents which are not approved or abandoned are expensed in the period in which such patents are not approved or abandoned. The annual maintenance fees associated with existing patents are expensed over 12 months and are included in Prepaid Expenses. The Research and Development costs associated with the patented technology are expensed as incurred and are not capitalized.

Long-Lived Assets

The Company assesses long-lived assets for impairment as required under ASC 360-10, Accounting for the Impairment or Disposal of Long-Lived Assets. The Company reviews for impairment whenever events or circumstances indicate that the carrying amount of these assets may not be recoverable. The Company assesses these assets for impairment based on estimated future cash flows from these assets.

Revenue Recognition

Revenues from product and services sales are recognized at the time of shipment or when services are rendered provided that collection of the resulting receivable is probable. Revenues from royalties are recognized upon the sale of certain products by licensees with whom the Company has licensing agreements. Contract Revenues, which includes payments from Stand Still, Supply or Support agreements that are typically based on time frames, are recognized in the periods to which it pertains. Deferred revenues are recorded when agreements call for payment ahead of when the amounts are earned. In multiple element arrangements, revenue is allocated to each separate unit of accounting and each deliverable in an arrangement is evaluated to determine whether it represents separate units of accounting. A deliverable constitutes a separate unit of accounting when it has standalone value and there is no general right of return for the delivered elements. In instances when the aforementioned criteria are not met, the deliverable is combined with the undelivered elements and the allocation of the arrangement consideration and revenue recognition is determined for the combined unit as a single unit of accounting. Allocation of the consideration is determined at arrangement inception on the basis of each unit’s relative selling price.

Shipping and Handling Charges

The Company includes costs of shipping and handling billed to customers in Revenues and the related expense of shipping and handling costs in Cost of Sales.

Advertising

Advertising costs are expensed as incurred except for tangible assets, such as printed advertising materials, which are expensed as consumed. Advertising expense was $48,152 and $110,745 for the years ended June 30, 2012 and 2011, respectively.

Research and Development

Research and development costs, primarily employee salaries and benefits, are charged to operations when incurred and are included in Operating Expenses. The amounts charged to expense for the years ended June 30, 2012 and 2011 were $596,974 and $654,952, respectively.

Stock Based Compensation

The Company accounts for stock and stock options issued for services and compensation to employees under ASC 718-10. For non-employees, the fair market value of the Company's stock on the date of stock issuance or option/grant is used. The Company determines the fair market value of the options issued under the Black-Scholes Pricing Model. Under the provisions of ASC 718-10, share-based compensation cost is measured at the grant date, based on the fair value of the award, and is recognized as an expense over the employee's requisite service period (generally the vesting period of the equity grant). There were no such stock option grants issued during the years ended June 30, 2012 and June 30, 2011.

Foreign Currency Translation

The Company’s functional currency is the United States Dollar. The Company accounts for foreign currency translation pursuant to Financial Accounting Standards Board (“FASB”) ASC 830-20, Foreign Currency Transactions.   All assets and liabilities are translated into United States dollars using the rates prevailing at the end of the period.  Revenues and expenses are translated using the average exchange rates prevailing throughout the period.  Unrealized foreign exchange amounts resulting from translations at different rates according to their nature are included in accumulated other comprehensive income or loss.  Recognized foreign currency transaction gains and losses are recognized in the operations.

Comprehensive Income (Loss)

The Company applies the provisions of FASB’s ASC 220-10, Reporting Comprehensive Income, in which unrealized gains and losses from foreign exchange translations are reported in the consolidated statements of shareholders’ deficit as comprehensive income (loss).

As of June 30, 2012, there was no comprehensive income (loss).

Income Taxes

Income taxes are provided for the tax effects of transactions reported in the financial statements and consist of taxes currently due plus deferred taxes related primarily to differences between the bases of assets and liabilities for financial and income tax reporting. The deferred tax assets and liabilities represent the future tax return consequences of those differences, which will either be taxable or deductible when the assets and liabilities are recovered or settled. Deferred taxes are also recognized for operating losses that are available to offset future federal and state income taxes. Any interest charges on underpayment or other assessments are recorded as interest expense. Any penalties are recorded in Operating Expenses.

Effective January 1, 2007, the Company adopted the provisions of ASC 740-10, Accounting for Uncertainty in Income Taxes. The implementation of ASC 740-10 had no impact on the Company’s financial statements as the Company has not recognized any uncertain income tax positions.

Earnings Per Share

Earnings per share, in accordance with the provisions of ASC 260-10, Earnings Per Share, is computed by dividing net income by the weighted average number of common stock shares outstanding during the period.

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 disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

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Consolidated Balance Sheets (Parenthetical) (USD $)	Jun. 30, 2012	Jun. 30, 2011
Statement of Financial Position [Abstract]
Allowance for doubtful accounts	$ 17,918	$ 5,622
Preferred stock; par value	$ 0.0	$ 0.00
Preferred stock; shares authorized	1,000,000	1,000,000
Preferred stock; shares issued	0	0
Preferred stock; share outstanding	0	0
Common stock; par value	$ 0.00	$ 0.00
Common stock; shares authorized	15,000,000	15,000,000
Common stock; shares issued	4,783,235	4,783,235
Common stock; shares outstanding	4,772,318	4,772,318

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Retirement Plan

12 Months Ended

Jun. 30, 2012

Compensation and Retirement Disclosure [Abstract]

Retirement Plan

11. RETIREMENT PLAN

The Company sponsors a qualified 401(k) plan covering substantially all full time employees under which eligible employees can defer a portion of their annual compensation. The Company determines annually, the amount of matching contributions. There were no Company matching contributions made to the plan during the fiscal years ended June 30, 2011 or June 30, 2012.

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Document and Entity Information (USD $)	12 Months Ended
	Jun. 30, 2012	Sep. 18, 2012
Document And Entity Information
Entity Registrant Name	HYDROMER INC,
Entity Central Index Key	0000704432
Document Type	10-K
Document Period End Date	Jun. 30, 2012
Amendment Flag	false
Current Fiscal Year End Date	--06-30
Is Entity a Well-known Seasoned Issuer?	No
Is Entity a Voluntary Filer?	No
Is Entity's Reporting Status Current?	Yes
Entity Filer Category	Smaller Reporting Company
Entity Public Float		$ 3,059,423
Entity Common Stock, Shares Outstanding		4,772,318
Document Fiscal Period Focus	FY
Document Fiscal Year Focus	2012

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Industry Segment Information

12 Months Ended

Jun. 30, 2012

Segment Reporting [Abstract]

Industry Segment Information

12. INDUSTRY SEGMENT INFORMATION

The Company operates two primary business segments: (1) Polymer Research and (2) Medical Products.

Products included in the polymer research segment are Aquamere^®, Aquatrix^®, Dermaseal^®, Dragonhyde^®, Hydromer^® Anti-Fog/Condensation Control Coatings, Hydromer^® Lubricious Coatings, Sea-Slide^® and T-HEXX^® Barrier Dips and Sprays. Research and Development services and all of the Company’s royalties and contract revenues are reported in this segment.

The medical products segment includes the biofeedback medical devices, contract coating services and engineering equipment sales and services.

Due to the multitude of products offered and the product gross margins, the Company does not track sales contribution by products.

The Company operates globally in its segments with several large customers that are important to their operating results. No single customer accounted for more than 10% of the polymer research segment sales for the 2011 and 2012 fiscal years. For the medical products segment, the top three customers accounted for 41% and 48% of that segment’s 2011 and 2012 sales, respectively.

The Company evaluates the segments by revenues, total expenses and earnings before income taxes. The Company’s assets are not reviewed by business segment. The accounting policies of these segments are described in the summary of significant accounting policies.

Corporate Overhead, primarily the salaries and benefits of senior management, support services (Accounting, Legal, Human Resources and Purchasing) and other shared services (building maintenance and warehousing), is reflected separately from the results of the business segments in the following:

		Polymer	Medical	Corporate
		Research	Products	Overhead	Total
Year Ended June 30, 2012
Revenue		$     4,380,701	$     1,361,419		$     5,742,120
Expenses		(3,461,149)	(1,132,765)	(1,530,313)	(6,124,227)
Earnings (Loss)
	before
	Income Taxes	$        919,552	$        228,654	$   (1,530,313)	$      (382,107)
Year Ended June 30, 2011
Revenue		$     4,225,184	$     1,289,831		$     5,515,015
Expenses		(3,627,262)	(1,171,504)	(1,624,609)	(6,423,375)
Earnings (Loss)
	before
	Income Taxes	$        597,922	$        118,327	$   (1,624,609)	$      (908,360)

Geographic revenues were as follows for the years ended June 30

	2012	2011
Domestic	66%	60%
Foreign	34%	40%

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Consolidated Statements of Operations (USD $)	12 Months Ended
	Jun. 30, 2012	Jun. 30, 2011
Revenues
Sale of products	$ 3,202,162	$ 3,105,959
Service revenues	1,398,786	1,442,107
Royalties and Contract Revenues	1,141,172	966,949
Total Revenues	5,742,120	5,515,015
Cost of Sales	1,675,527	1,590,776
Operating Expenses	4,245,615	4,626,341
Other Expenses, net	203,085	206,258
Provision for (Benefit from) Income Taxes	13,239	(327,062)
Total Expenses	6,137,466	6,096,313
Net Loss	$ (395,346)	$ (581,298)
Loss Per Common Share	$ (0.08)	$ (0.12)
Weighted Average Number of Common Shares Outstanding	4,772,318	4,772,318

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Intangible Assets

12 Months Ended

Jun. 30, 2012

Goodwill and Intangible Assets Disclosure [Abstract]

Intangible Assets

6. INTANGIBLE ASSETS

Intangible Assets, including prepaid Patent Costs included in Prepaid Expenses of $86,634 and $82,434 as of June 30, 2012 and 2011, respectively, are comprised of the following:

			June 30,
			2012		2011
Patents	$	1,501,522		$	1,440,365
Trademarks		106,022			103,383
Less:  Accumulated amortization		(759,391)			(641,083)
Intangible Assets, net	$	848,153		$	902,665

Future amortization of Intangible Assets, as of June 30, 2012, are as follows:

Year ending June 30,
2013	$	226,639
2014		95,417
2015		89,779
2016		88,385
2017		80,540
Thereafter		267,383
	$	848,143

Amortization expense for the years ended June 30, 2012 and 2011 were $211,445 and $200,446, respectively.

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Property and Equipment

12 Months Ended

Jun. 30, 2012

Property, Plant and Equipment [Abstract]

Property and Equipment

5. PROPERTY AND EQUIPMENT

Property and equipment consists of the following:

		June 30,
		2012		2011
Land	$	472,410	$	472,410
Building		2,323,016		2,323,016
Machinery and equipment		2,287,283		2,250,263
Equipment under capital leases		86,729		86,729
Furniture and fixtures		211,518		209,818
		5,380,956		5,342,236
Less: Accumulated      depreciation and amortization		(2,651,515)		(2,441,596)
Accumulated      depreciation on capital leases		(47,220)		(36,728)
Property and Equipment, net	$	2,682,221	$	2,863,912

Depreciation expense, including that on assets under capitalized leases, charged to operations, was $220,446 and $231,347 for the years ended June 30, 2012 and 2011, respectively.

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Earnings per share

12 Months Ended

Jun. 30, 2012

Earnings Per Share [Abstract]

Earnings per share

13. EARNINGS PER SHARE

The following table sets forth the computation of earnings per share:

		2012	2011
Numerator:
	Net loss	$   (395,346)	$   (581,298)
Denominator:
	Denominator for basic earnings per share
	- weighted average share outstanding	4,772,318	4,772,318
Effect of dilutive securities - Stock Options		0	0
Denominator for dilutive earnings per share
	under the treasury stock method
	- weighted average share outstanding	4,772,318	4,772,318
Basic Loss per share		$          (0.08)	$         ( 0.12)
Dilutive Earnings per share		n/a	n/a

Common stock equivalents (consisting of 15,000 and 65,000 stock options for the years ended June 30, 2012 and 2011, respectively) were not included in computing diluted earnings per share as their effect would have been anti-dilutive.

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Income Taxes

12 Months Ended

Jun. 30, 2012

Income Tax Disclosure [Abstract]

Income Taxes

9. INCOME TAXES

The income tax provision (benefit) is comprised of the following:

		Federal		State		Total
Year Ended June 30, 2012
Current	$	-	$	4,100	$	4,100
Deferred		(72,881)		82,020		9,139
	$	(72,881)	$	86,120	$	13,239
Year Ended June 30, 2011
Current	$	-	$	4,160	$	4,160
Deferred		(314,045)		(17,177)		(331,222)
	$	(314,045)	$	(13,017)	$	(327,062)

The Company’s deferred tax asset and liability as presented in the Company’s financial statements are comprised of the following:

	June 30,
	2012			2011
Deferred Tax Asset
Net Operating Losses	$	944,658		$	891,783
Adjustment of Goodwill		196,069			196,069
Research & Development Credits		583,576			618,302
Valuation Allowance		(456,992	)		(387,350	)
Total Deferred Tax Assets		1,267,311			1,318,804
Deferred Tax Liability
Depreciation		(251,578	)		(294,012	)
Total Deferred Tax Liability	$	(251,578	)	$	(294,012	)

Deferred taxes are recognized for temporary differences between the bases of assets and liabilities for financial statement and income tax purposes. The differences relate primarily to depreciable assets (using accelerated depreciation methods for income tax purposes). The Company’s adjustment to Goodwill in 2004 and 2006 created a deferred tax asset, which although has an indefinite life, has been fully reserved for as realization of its benefit is unlikely.

As of June 30, 2012, the Company has net operating loss carry forwards of approximately $2,093,912 and $3,473,550 for Federal and State tax purposes respectively. These net operating loss carry forwards may be used to reduce federal and state taxable income and tax liabilities in future years and expire in various years through June 30, 2032 and June 30, 2019 for Federal and State tax purposes, respectively. In addition, the Company has Research and Development Tax Credits of approximately $380,095 and $203,481 for Federal and State tax purposes, respectively, which expire in various years through June 30, 2032 and June 30, 2019, respectively.

The Company’s provision for income taxes differs from applying the statutory U.S. federal income tax rate to the income before income taxes. The primary differences result from providing for state income taxes, generation of allowable tax credits and from deducting certain expenses for financial statement purposes but not for federal income tax purposes.

A reconciliation between taxes computed at the federal statutory rate and the consolidated effective tax rate follows:

	June 30,
	2012	2011
Federal statutory tax rate	(34.0)%	(34.0)%
State income tax - net of federal
tax Benefit	(5.2)	(5.2)
R&D credits	(1.8)	(2.3)
Adjustment in valuation
allowances	18.3	8.3
Permanent and other differences	26.2	(2.8)
	3.5%	(36.0)%

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Leases

12 Months Ended

Jun. 30, 2012

Leases [Abstract]

Leases

7. LEASES

The Company acquired equipment under long-term leases. For financial reporting purposes, the present value of the minimum lease payments has been capitalized.

Future payments under these capital lease arrangements, which includes $640 in finance charges, are as follows:

Year ending June 30, 2013 $        16,499

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Long-term Debt

12 Months Ended

Jun. 30, 2012

Debt Disclosure [Abstract]

Long-term Debt

8. LONG-TERM DEBT

As of June 30, 2012, the Company’s facility is financed by a twenty-five year mortgage note bearing a five year fixed interest rate of 6.75%, and then reset every five years at 2.75% over the then New York Federal Home Loan Bank 5/20 Amortizing Advance Rate. The mortgage is secured by the real estate and improvements, accounts receivables, inventory and all rents from leases subsequently entered into, amortized with monthly payments. As of June 30, 2012, the book value of the real estate and improvements was $2,165,985.

As a result of the net losses for the years ended June 30, 2011 and June 30, 2012, the Company did not meet certain financial covenants required under the loan document. Loan modifications and/or covenant waivers were issued by the lender during each year.

Although waivers/modifications were granted by the lender, there is no certainty that future waivers/modifications would be granted.

Long-term debt is comprised of the following:

	June 30,
	2012			2011
Mortgage note	$	2,712,138		$	2,766,537
Less:  Current Maturities		(55,899	)		(51,720	)
Long-term Debt,       Net of Current Maturities	$	2,656,239		$	2,714,817

Maturities of the long-term debt are as follows:

Year ending June 30		As of June 30, 20111
	2013	$	55,899
	2014		59,847
	2015		64,074
	2016		68,119
	2017		73,410
	Thereafter		2,390,789
		$	2,712,138

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Stock options and awards

12 Months Ended

Jun. 30, 2012

Equity [Abstract]

Stock options and awards

10. STOCK OPTIONS AND AWARDS

On February 22, 2000 the Board of Directors approved an option plan that granted each director 2,000 fully vested options for each meeting attended, awarded at the annual meeting at the 5-day market price average.

There were no stock option issuances during the 2011 or 2012 fiscal years as Directors waived their options earned in lieu of cash payments.

A summary of activity under the plan for the years ending June 30, 2011 and 2012 are as follows:

			Weighted Average
		Shares	Exercise Price
Balance, June 30, 2010		127,000	$            1.28
	Cancelled	(62,000)	0.95
Balance, June 30, 2011		65,000	$            1.60
	Cancelled	(50,000)	1.18
Balance, June 30, 2012		15,000	$           3.00

Following is a summary of the status of options outstanding as of June 30, 2012:

	Outstanding Options			Exercisable Options
		Weighted
		Average	Weighted		Weighted
Exercise		Remaining	Average		Average
Price		Contractual	Exercise		Exercise
Range	Number	Life	Price	Number	Price
$3.00	15,000	0.1 years	$      3.00	15,000	$      3.00

As the stock price of the Company’s stock on June 30, 2012 was lower than the exercise prices of the outstanding and exercisable options, there was no intrinsic value of the options.

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Subsequent Events

12 Months Ended

Jun. 30, 2012

Subsequent Events [Abstract]

Subsequent Events

15. SUBSEQUENT EVENTS

On November 8, 2012, the Company was granted a waiver on the loan covenants not met as of June 30, 2012 for a fee of $50,000. The amount paid will be amortized over the remaining life of the loan. The next covenant measurement date will be June 30, 2013.

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Consolidated Statements of Stockholders Equity (USD $)	Common Stock	Contributed Capital	Accumulated Deficit	Treasury Stock	Total
Beginning Balance, Amount at Jun. 30, 2010	$ 3,721,815	$ 633,150	$ (835,240)	$ (6,140)	$ 3,513,585
Beginning Balance, Shares at Jun. 30, 2010	4,783,235			10,917
Net Loss			(581,298)		(581,298)
Ending Balance, Amount at Jun. 30, 2011	3,721,815	633,150	(1,416,538)	(6,140)	2,932,287
Ending Balance, Shares at Jun. 30, 2011	4,783,235			10,917
Net Loss			(395,346)		(395,346)
Ending Balance, Amount at Jun. 30, 2012	$ 3,721,815	$ 633,150	$ (1,811,884)	$ (6,140)	$ 2,536,941
Ending Balance, Shares at Jun. 30, 2012	4,783,235			10,917

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Inventory

12 Months Ended

Jun. 30, 2012

Inventory Disclosure [Abstract]

Inventory

4. INVENTORY

Inventory consists of:

	June 30,
	2012		2011
Finished Goods	$	132,673	$	197,389
Work in process		6,156		32,116
Raw materials		170,540		215,099
	$	309,369	$	444,604

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Contingencies

12 Months Ended

Jun. 30, 2012

Commitments and Contingencies Disclosure [Abstract]

Contingencies

14. CONTINGENCIES

Royalty revenues and support fees recorded by the Company are based on the sales of products as reported by the Company’s customers, which has the risk of being under- or over-reported. To minimize such risks, the Company’s management utilizes its knowledge and understanding of the customer’s business, the market and other pertinent factors in assessing the validity of reported royalties or support fees. In addition, the Company may have a right to audit the amounts reported.

The Company has not received any claims by its customers for possible overpayment of royalties or support fees.