STOCKHOLDERS' DEFICIT

12 Months Ended

Feb. 28, 2013

STOCKHOLDERS' DEFICIT [Abstract]

STOCKHOLDERS' DEFICIT

NOTE 10 - STOCKHOLDERS' DEFICIT

Common Stock

At February 28, 2013 and February 29, 2012, we had 150,000,000 shares of $0.0001 par value common stock authorized for issuance, respectively. During the years ended February 28, 2013 and February 29, 2012, we issued 4,661,904 and 11,221,713 shares of common stock, respectively.

In the year ended February 28, 2013, we issued 3,866,867 shares of common stock, with 2,033,333 five year warrants attached with an exercise price of $1.00, for cash proceeds of $1,252,100 and the availability of up to $500,000 in additional loans on favorable terms; 341,748 shares were issued upon the conversion of $259,729 of notes payable and accrued interest with 206,941 five year warrants attached with an exercise price of $1.00 with a gain on settlement of debt of $102,336; 37,500 shares were issued in settlement of $30,000 of accounts payable with 25,000 five year warrants attached with an exercise price of $1.00 with a gain on settlement of debt of $10,688; and 415,789 shares were issued for marketing services and investor relation services valued at $316,000.

In the year ended February 29, 2012, we issued 2,460,849 shares of common stock, with 1,288,333 five year warrants attached with exercise prices ranging from $0.50-$0.75, for cash proceeds of $1,453,520; 2,227,612 shares were issued upon the conversion of $1,515,960 of notes payable and accrued interest; 1,006,054 shares were issued in settlement of $656,999 of accounts payable; 2,484,999 shares were issued for marketing services, investor relation services and finders fees valued at $1,129,000; and 3,042,199 shares were issued to employees in lieu of $2,259,865 in unpaid salary.

Employee Stock Options

In September, 2006, our Board of Directors adopted the 2006 Employee Stock Option Plan, subject to shareholder approval, which was obtained at a special shareholders meeting.   Under the Plan, the Company may grant options for up to the greater of Three Million (3,000,000) or 10% of the number of shares of the Common Stock of Aura from time to time outstanding. The exercise price of each option shall be at least equal to the fair market value of such shares on the date of grant. The term of the options may not be greater than ten years, and they typically vest over a three year period.

During the year ended February 28, 2013, the Company granted 2,590,500 options to certain employees.  These options immediately, have an exercise price of $.75, and have a seven year life.  The grant date fair value of these options amounted to $780,973 which was calculated using the Black-Scholes option pricing model with the following assumptions:  risk free rate of return of 1.26%, volatility of 74.98%, a dividend yield of 0%, and an expected life of 7 years.

The Company incurred stock options related expenses of $11,730 and $211,481, during the years ended February 28, 2013 and February 29, 2012, respectively.

Activity in this plan is as follows:

	2006 Plan
		Weighted-Average Exercise Price		Aggregate Intrinsic Value		Number of Options
Outstanding, February 28, 2011		$	0.75	$	0.00		5,287,500
Granted		$	0.75-$1.00				1,319,000
Cancelled		$	0.75				(338,000	)
Outstanding, February 29, 2012		$	0.75-$1.00	$	0.00		6,268,500
Granted		$	0.75				2,590,500
Cancelled		$	0.75				(311,000	)
Outstanding, February 28, 2013		$	0.75-$1.00	$	0.00		8,548,000

The exercise prices for the options outstanding at February 28, 2013, and information relating to these options is as follows:

Options Outstanding							Exercisable Options
Range of Exercise Price		Number		Weighted Average Remaining Life	Weighted Average Exercise Price		Weighted Average Remaining Life	Number	Weighted Average Exercise Price
$	0.75-$1.00		8,548,000	6.9 years	$	0.76	7.0 years	8,048,000	$	0.76

The weighted average fair values of the options on the date of grant for the year ended February 28, 2013 and February 29, 2012 were $0.31 per share and $0.38 per share, respectively.

A summary of the status of the Company's non-vested shares as of February 28, 2013, and changes during the year ended February 28, 2013, is presented below:

Non-vested Shares	Shares			Weighted-Average Grant-Date Fair Value
Non-vested at February 29, 2012		1,229,056		$	0.38
Granted		2,590,500		$	0.31
Vested		(3,319,556	)	$	0.38
Non-vested at February 28, 2013		500,000		$	0.38

As of February 28, 2013, there was $101,115 of total unrecognized compensation cost related to non-vested share-based compensation arrangements granted under the Plan. That cost is expected to be recognized over a weighted-average period of 2.50 years.

Warrants

Activity in issued and outstanding warrants is as follows:

	Number of Shares			Exercise Prices
Outstanding, February 29, 2012		31,009,738		$	0.75-$4.00
Granted		8,756,942		$	0.75-$1.00
Expired		(983,390	)	$	3.00-$4.00
Outstanding, February 28, 2013		38,783,290		$	0.75-$3.00

The exercise prices for the warrants outstanding at February 28, 2013, and information relating to these warrants is as follows:

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
$	0.75-$1.00		8,756,942		8,756,942	77 months	$	0.81	$	0.81	$	0.00
$	0.75-$1.00		6,225,000		6,225,000	43 months	$	0.99	$	0.99	$	0.00
$	1.00		16,722,787		16,722,787	42 months	$	1.00	$	1.00	$	0.00
$	1.50		155,000		155,000	37 months	$	1.50	$	1.50	$	0.00
$	0.75-1.50		1,109,198		1,109,198	34 months	$	1.17	$	1.17	$	0.00
$	1.50		156,000		156,000	30 months	$	1.50	$	1.50	$	0.00
$	1.50		704,000		704,000	29 months	$	1.50	$	1.50	$	0.00
$	1.50		350,642		350,642	26 months	$	1.50	$	1.50	$	0.00
$	0.75-$2.00		58,000		58,000	22 months	$	1.78	$	1.78	$	0.00
$	2.00		725,721		725,721	19 months	$	2.00	$	2.00	$	0.00
$	0.75-2.00		3,650,000		3,650,000	16 months	$	1.03	$	1.03	$	0.00
$	3.00		170,000		170,000	9 months	$	3.00	$	3.00	$	0.00
			38,783,290		38,783,290