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

SECURITIES AND EXCHANGE COMMISSION

Washington, D. C. 20549

FORM 10-K

☑x ANNUAL REPORT UNDER SECTION 13 OR 15 (D) OF THE SECURITIES EXCHANGE ACT OF 1934

For Fiscal Year Ended April 30, ~~2012~~ 2013

Commission File # 000-27397

INOVA TECHNOLOGY, INC. ~~(Exact name of registrant as specified in its charter)~~

~~NEVADA~~ (~~State~~Exact orname ~~other~~of ~~jurisdiction~~registrant ofas ~~incorporation~~specified orin ~~organization~~its charter)

~~98-0204280 (IRS Employer Identification Number)~~NEVADA

~~2300~~(State W.or ~~Sahara~~other ~~Ave. Suite~~jurisdiction ~~800 Las Vegas, Nevada 89102 (Address~~ of ~~principal~~incorporation ~~executive~~or ~~offices~~organization) ~~(Zip Code)~~

~~800~~98-~~507-2810 (Registrant's telephone no., including area code)~~0204280

(IRS Employer Identification Number)

2300 W. Sahara Ave. Suite 800 Las Vegas, Nevada 89102

(Address of principal executive offices) (Zip Code)

800-507-2810

(Registrant's telephone no., including area code)

SECURITIES REGISTERED PURSUANT TO SECTION 12(B) OF THE ACT: NONE

SECURITIES REGISTERED PURSUANT TO SECTION 12(G) OF THE ACT: COMMON STOCK, $0.001 PAR VALUE

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

~~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 ☐ x No ☐o

Indicate by check mark ~~whether~~ if the registrant ~~(1)~~is ~~has~~not ~~filed all reports~~ required to befile ~~filed~~reports bypursuant to Section 13 or Section 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 ☐ No ☐~~

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 (§232.405 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 ☐o No ☐o

Indicate by check mark if ~~disclosure~~whether ofthe ~~delinquent~~registrant ~~filers~~(1) ~~pursuant~~has tofiled ~~Item~~all ~~405~~reports ofrequired ~~Regulation~~to ~~S-K~~be isfiled ~~not~~by ~~contained~~Section ~~herein,~~13 ~~and~~or ~~will~~15(d) ~~not~~of bethe ~~contained,~~Securities ~~to the~~Exchange ~~best~~Act of ~~registrant's~~1934 ~~knowledge,~~during inthe ~~definitive~~preceding ~~proxy~~12 months (or ~~information~~for ~~statements~~such ~~incorporated~~shorter byperiod ~~reference~~that inthe ~~Part~~registrant ~~III~~was ofrequired ~~this Form~~to ~~10-K~~file orsuch ~~any~~reports), ~~amendment~~and (2) has been subject to ~~this~~such ~~Form~~filing ~~10-K.~~requirements ☐for the past 90 days.

Yes x No o

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K 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. o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer ☐ o Accelerated filer ☐o Non-accelerated filer o ☐Smaller reporting company x

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

~~Number~~Yes ofo ~~shares~~No ~~of the registrant's common stock outstanding as of July 26, 2012 was: 76,373,445.~~ x

Number of shares of the registrant's common stock outstanding as of July 24, 2013 was: 4,569,375.

DOCUMENTS INCORPORATED BY REFERENCE

None

~~Inova Technology Inc.~~2

Inova Technology Inc.

Form 10-K

Table of Contents

		Page
PART I
Item 1.	Description of Business	43
Item 1A	Risk Factors	4
Item 2.	Description of Property	45
Item 3.	Legal Proceedings	5
Item 4.	Submission of Matters to a Vote of Security Holders	5
PART II
Item 5.	Market for Common Equity and Related Stockholder Matters	65
Item 6	Selected Financial Data	6
Item 7.	Management’s Discussion and Analysis of Financial Condition and result of Operations	6
Item 8.	Financial Statements	10
Item 9	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	4740
Item 9A.	Controls and Procedures	4740
PART III
Item 10.	Directors, Executive Officers, and Corporate Governance	4841
Item 11.	Executive Compensation	4943
Item 12.	Security Ownership of Certain Beneficial Owners and Management	5044
Item 13.	Certain Relationships and Related Transactions	5144
Item 14.	Principal Accountant Fees and Services	5145
PART IV
Item 15.	Exhibits	5245

PART I

Item 1. Description of Business

Organization and History of the Company

Inova Technology Inc. (the “Company”) was incorporated in Nevada in 1997, as Newsgurus.com, Inc. The company changed its name to Secure Enterprise Solutions Inc. in 2002, then to Edgetech Services Inc. (“Edgetech”) In 2007, the Company assumed its present name of Inova Technology, Inc.

In 2005, Edgetech entered into an agreement with the shareholders of Web’s Biggest, Inc., Mr. Xavier Roy of Los Angeles, California, and Advisors LLC, (collectively, “Web’s Biggest”) which resulted in Edgetech issuing 25 million convertible preferred shares to the shareholders of Web’s Biggest in consideration for 100% of the outstanding capital of Web’s Biggest and $250,000 be used for general working capital of Edgetech.

In 2006, Edgetech bought certain assets of Data Management, Inc., a Nevada corporation in exchange for 25 million convertible preferred shares. The convertible shares used to acquire it represented approximately 90% of the voting stock of Edgetech on a fully diluted basis. Concurrently, Edgetech sold its wholly-owned subsidiary, Web’s Biggest Limited, to Advisors LLC in exchange for 25 million convertible preferred shares of Edgetech Services, Inc. held by Advisors LLC. The 25 million convertible preferred shares given to buy Data Management were the same 25 million convertible preferred shares received from the sale of Web’s Biggest.3

~~Prior~~In to2006, ~~these~~Edgetech ~~transactions~~bought ~~described~~certain ~~above, the~~assets ~~Company~~of ~~was~~Data ~~controlled~~Management, ~~by Advisors LLC~~Inc., ana ~~entity~~Nevada ~~related~~corporation toin ~~Mr.~~exchange ~~Paul~~for ~~Aunger,~~25 anmillion ~~officer~~convertible ~~and~~preferred ~~director~~shares. ofThe ~~the~~convertible ~~registrant.~~shares ~~When the~~used ~~transactions~~to ~~described~~acquire ~~above~~it ~~were~~represented ~~completed,~~approximately ~~this~~90% ~~resulted~~of inthe avoting ~~change~~stock of ~~control~~Edgetech ofon ~~the~~a ~~Company~~fully ~~and~~diluted ~~the~~basis. ~~controlling~~Concurrently, ~~shareholder became~~Edgetech ~~Southbase~~sold ~~International~~its ~~Ltd.~~wholly-owned subsidiary, anWeb’s ~~entity~~Biggest ~~related~~Limited, to ~~Mr.~~Advisors ~~Adam~~LLC ~~Radly,~~in anexchange ~~officer~~for ~~and~~25 ~~director~~million convertible preferred shares of ~~the~~Edgetech ~~Company~~Services, Inc. ~~Prior~~held toby ~~these transactions,~~Advisors ~~the~~LLC. ~~unaffiliated~~The ~~shareholders~~25 ofmillion ~~the~~convertible ~~Company~~preferred ~~owned~~shares ~~approximately~~given ~~10%~~to ofbuy ~~the~~Data ~~Registrant~~Management ~~and~~were ~~they~~the ~~continued~~same to25 ~~own approximately~~million ~~10%~~convertible ofpreferred ~~the~~shares ~~Company~~received onfrom athe ~~fully~~sale ~~diluted~~of ~~basis~~Web’s Biggest.

OnPrior ~~May~~to 1these transactions described above, ~~2007~~the Company was controlled by Advisors LLC, ~~Inova~~an ~~also~~entity ~~acquired~~related ~~RightTag Inc~~to Mr. ~~(“RightTag”)~~Paul Aunger, an officer and director of the registrant. When the transactions described above were completed, this resulted in a ~~manufacturer~~change of ~~radio~~control ~~frequency~~of ~~identification~~the ~~(“RFID”)~~Company ~~products~~and the controlling shareholder became Southbase International Ltd., an entity related to Mr. Adam Radly, an officer and director of the Company. Prior to these transactions, the unaffiliated shareholders of the Company owned approximately 10% of the Registrant and they continued to own approximately 10% of the Company on a fully diluted basis.

On ~~December~~May 211, 2007, Inova also acquired ~~Texas-based Desert~~RightTag ~~Communications~~Inc. (“~~Desert~~RightTag”), ~~for~~a ~~$5.9~~manufacturer ~~million~~of ~~($3.3~~radio ~~million~~frequency ~~paid~~identification in(“RFID”) ~~cash and $2~~products.~~6 million to be paid under notes payable).~~

On ~~September~~December 121, ~~2008~~2007, Inova acquired ~~Trakkers, LLC~~Texas-based ~~(“Trakkers”)~~Desert ~~and~~Communications ~~Tesselon, LLC~~ (“~~Tesselon~~Desert”) for $65.19 million ~~including~~ ($~~500,000 cash, $2~~3.3 million to be paid ~~under notes payable, $2 million paid~~ in ~~the~~cash ~~form of a seller note~~ and $12.36 million ofto ~~redeemable~~be ~~preferred~~paid ~~stock~~under ~~(non-convertible and~~notes ~~nonvoting~~payable).

~~Description~~On ofSeptember 1, 2008, Inova acquired Trakkers, LLC (“Trakkers”) and Tesselon, LLC (“Tesselon”) for $6.1 million including $500,000 cash, $2.3 million to be paid under notes payable, $2 million paid in the ~~Company’s~~form ~~Business~~of a seller note and $1.3 million of redeemable preferred stock (non-convertible and nonvoting).

~~Inova~~Trakkers ispurchased a ~~technology~~majority ~~holding~~of ~~company.~~Desert ~~Inova has~~Communications ~~five~~in ~~subsidiaries~~2008. As ~~These~~consideration ~~subsidiaries~~for ~~and~~the ~~their~~acquisition ~~respective~~the ~~businesses~~IBM ~~are~~note ~~listed~~was ~~below:~~setup in 2008 in the name of Desert Communications but to be paid by Trakkers, LLC. Trakkers is majority owned by Righttag.

~~Subsidiary/Division~~Description ~~Business Edgetech Services Inc. IT services and consulting Trakkers LLC RFID rentals RightTag, Inc. Manufacturer~~ of ~~radio~~the ~~frequency~~Company’s ~~identification (RFID) Products Inova Technology Holdings Holding company Desert Communications, Inc. IT consulting and sales and computer network solutions~~Business

~~Item~~Inova 1A(a Nevada Corporation) is a technology holding company. ~~Risk~~Inova ~~Factors~~has five subsidiaries. These subsidiaries and their respective businesses are listed below:

~~Safe~~Subsidiary/Division ~~Harbor~~Business ~~Statement~~Edgetech ~~under~~Services ~~the~~Inc. ~~Private Securities~~IT ~~Litigation~~services ~~Reform Act of 1995: Except for historical information, the forward-looking matters discussed in this news release are subject to certain risks~~ and ~~uncertainties~~consulting ~~which~~Trakkers ~~could~~LLC ~~cause~~RFID ~~the~~rentals ~~Company's actual results and financial condition to differ materially from those anticipated by the forward-looking statements including~~RightTag, ~~but~~Inc. ~~not~~Manufacturer ~~limited to, the Company's liquidity and the ability to obtain financing, the timing~~ of ~~regulatory~~radio ~~approvals,~~frequency ~~uncertainties~~identification ~~related~~(RFID) toProducts ~~corporate~~Inova ~~partners~~Technology orHoldings ~~third-parties, product~~Holding ~~liability,~~company ~~the~~Desert ~~dependence on third parties for manufacturing and marketing~~Communications, ~~patent~~Inc. ~~risk,~~IT ~~copyright~~consulting ~~risk, competition,~~ and ~~the~~ ~~early~~sales ~~stage of products being marketed or under development, as well as other risks indicated from time to time in the Company's filings with the Securities~~ and ~~Exchange~~computer ~~Commission.~~network ~~The Company assumes no obligation to update or supplement forward-looking statements that become untrue because of subsequent events.~~solutions

~~Item~~In 2total, the companies have approximately 75 employees and consultants. ~~Description~~It ofhas ~~Property~~offices in Texas, Nevada and Montana.

~~Inova~~Item ~~does~~1A. ~~not~~Risk ~~own any real estate property.~~Factors

4Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995: Except for historical information, the forward-looking matters discussed in this news release are subject to certain risks and uncertainties which could cause the Company's actual results and financial condition to differ materially from those anticipated by the forward-looking statements including, but not limited to, the Company's liquidity and the ability to obtain financing, the timing of regulatory approvals, uncertainties related to corporate partners or third-parties, product liability, the dependence on third parties for manufacturing and marketing, patent risk, copyright risk, competition, and the early stage of products being marketed or under development, as well as other risks indicated from time to time in the Company's filings with the Securities and Exchange Commission. The Company assumes no obligation to update or supplement forward-looking statements that become untrue because of subsequent events.

~~Leases:~~4

~~There~~Item ~~is an office lease for Desert, effective May 2008 until August 2011~~2. ~~Rent~~Description isof ~~payable at $6,300 per month including tax. The lease has not been renewed to date and Desert plans to continue on a month-to-month basis.~~Property

~~There~~Inova isdoes annot ~~office~~own ~~lease~~any ~~for~~real ~~Trakkers,~~estate ~~effective until April 2013~~property. ~~Rent is payable at $3,300 per month including tax.~~

~~Rent expense was $117,788 and $115,492 for fiscal 2012 and 2011, respectively. No real estate is owned by the Inova companies.~~Leases:

~~Item~~There 3was an office lease for Desert, effective May 2008 until August 2011. ~~Legal~~Rent ~~Proceedings~~is payable at $6,300 per month including tax. The lease has not been renewed to date and Desert plans to continue on a month-to-month basis.

InThere ~~2011~~is ~~Ascendiant~~an ~~filed~~office ~~suit~~lease for ~~collection of~~Trakkers, ~~the~~effective ~~$833,906~~until ~~principal~~April ~~and~~2013. ~~interest~~Rent ~~described~~is inpayable ~~Note~~at ~~10.~~$3,300 ~~The~~per ~~suit~~month isincluding ~~pending~~tax.

~~Item~~Rent 4.expense ~~Submission~~was of$211,058 ~~Matters~~and to$117,788 afor ~~Vote~~fiscal of2013 ~~Security~~and ~~Holders~~2012, ~~and~~respectively. ~~Small~~No ~~Business~~real ~~Issuer~~estate ~~Purchases~~is ofowned ~~Securities~~by the Inova companies.

NoItem ~~matters~~3. ~~were~~Legal ~~submitted to a vote of security holders through solicitation or otherwise during the fourth quarter of the fiscal year covered by this report.~~Proceedings

5In 2011 Ascendiant filed suit for collection of the $1,847,038 principal and interest described in Note 10.

~~PART~~George IIJones has filed a suit for $1,279,210. Inova has filed a suit against Jones for damages in excess of $1,000,000. See Note 10

Item 54. ~~Market~~Submission ~~for~~of ~~Common~~Matters ~~Equity~~to a Vote of Security Holders and ~~Related~~Small ~~Stockholder~~Business ~~Matters~~Issuer Purchases of Securities

~~The~~No ~~Company’s~~matters ~~common~~were ~~stock~~submitted isto ~~traded on~~a ~~the~~vote ~~OTCBB under~~of security holders through solicitation or otherwise during the ~~symbol~~fourth ~~“INVA”~~quarter ~~Our~~of ~~CUSIP~~the ~~No.~~fiscal isyear ~~45776L209~~covered by this report.

	High	Low
04/30/2012	.025	.008
01/31/2012	.03	.018
10/31/2011	.056	.025
07/31/2011	.08	.045
04/30/2011	.06	.07
01/31/2011	.20	.40
10/31/2010	.03	.20
07/31/2010	.02	.05

PART II.

~~The~~Item above table lists the high and low closing sales prices for each quarter on the OTCBB for our common shares for the past two fiscal years and are adjusted for our 400 to 1 reverse stock split which was effective on November 12, 2008 and a forward 20:1 split October, 20105. ~~There~~Market ~~are approximately 56 shareholders of record, 1 of which is a holder~~ for ~~several~~Common ~~hundred~~Equity ~~individuals. The below quotations reflect inter-dealer prices, without retail mark-up, mark-down or commission~~ and ~~may~~Related ~~not~~Stockholder ~~represent actual transactions.~~Matters

~~There~~The ~~are~~Company’s ~~no restrictions that limit our ability to pay dividends on our~~ common stock. Weis ~~have~~traded ~~not~~on ~~declared~~the ~~any~~OTCBB ~~dividends~~under ~~since incorporation and we do not anticipate doing so in~~ the ~~foreseeable future~~symbol INVA. Our ~~present~~CUSIP ~~policy~~No. is ~~to retain future earnings for use in our operations and expansion of our business~~45776L308.

Item 6. Selected Financial Data

	High	Low
04/30/2013	.85	.14
01/31/2013	1.6	.35
10/31/2012	1.5	.40
07/31/2012	.85	.50
04/30/2012	3	.80
01/31/2012	3.2	1.35
10/31/2011	5.60	2.50
07/31/2011	8.00	4.50

~~N/A~~The above table lists the high and low closing sales prices for each quarter on the OTCBB for our common shares for the past two fiscal years and are adjusted for our 400 to 1 reverse stock split which was effective on November 12, 2008, our forward 20:1 split October, 2010 and reverse split 100:1 June 17, 2013. There are approximately 56 shareholders of record, 1 of which is a holder for several hundred individuals. The below quotations reflect inter-dealer prices, without retail mark-up, mark-down or commission and may not represent actual transactions.

~~Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations~~5

~~The~~There ~~information~~are ~~contained~~no inrestrictions ~~this~~that ~~Management's Discussion~~limit ~~and~~our ~~Analysis~~ability ofto ~~Financial~~pay ~~Condition~~dividends ~~and~~on ~~Results~~our ofcommon ~~Operation contains "forward looking statements~~stock." ~~Actual results~~We ~~may~~have ~~materially~~not ~~differ~~declared ~~from~~any ~~those~~dividends ~~projected~~since inincorporation ~~the forward looking statements as a result of certain risks~~ and ~~uncertainties set~~we ~~forth~~do innot ~~this~~anticipate ~~report.~~doing ~~Although~~so ~~our management believes that the assumptions made and expectations reflected~~ in the ~~forward looking~~foreseeable ~~statements~~future. ~~are~~Our ~~reasonable,~~present ~~there~~policy is ~~no assurance that the underlying assumptions will, in fact, prove~~ to beretain ~~correct or that actual~~ future ~~results~~earnings ~~will~~for ~~not~~use ~~be materially different from the expectations expressed~~ in ~~this~~our ~~Annual~~operations ~~Report.~~and ~~The~~expansion ~~following discussion~~of ~~should~~our ~~be read in conjunction with the Company’s Consolidated Financial Statements~~business.

~~CRITICAL~~Item ~~ACCOUNTING~~6. ~~POLICIES~~Selected ~~AND~~Financial ~~ESTIMATES~~Data

~~Intangible assets~~N/A

~~Intangible~~Item ~~assets~~7. ~~with~~Management’s ~~definite~~Discussion ~~lives are recorded at cost~~ and ~~amortized~~Analysis ~~using~~of ~~the~~Financial ~~straight-line~~Condition ~~method~~and ~~over~~Results ~~their~~of ~~estimated useful lives.~~Operations

6The information contained in this Management's Discussion and Analysis of Financial Condition and Results of Operation contains "forward looking statements." Actual results may materially differ from those projected in the forward looking statements as a result of certain risks and uncertainties set forth in this report. Although our management believes that the assumptions made and expectations reflected in the forward looking statements are reasonable, there is no assurance that the underlying assumptions will, in fact, prove to be correct or that actual future results will not be materially different from the expectations expressed in this Annual Report. The following discussion should be read in conjunction with the Company’s Consolidated Financial Statements.

~~Impairment~~CRITICAL ofACCOUNTING ~~long-lived~~POLICIES ~~assets~~AND ESTIMATES

~~The~~Intangible ~~Company reviews the carrying value of its definite lived intangible~~ assets at least annually. Other long-lived assets, including intangibles, are reviewed whenever events or changes in circumstances indicate that the historical-cost carrying value of an asset may no longer be appropriate. The Company assesses recoverability of the asset by comparing the undiscounted future net cash flows expected to result from the asset to its carrying value. If the carrying value exceeds the undiscounted future net cash flows of the asset, an impairment loss is measured and recognized. An impairment loss is measured as the difference between the net book value and the fair value of the long-lived asset.

~~Goodwill~~Intangible assets with definite lives are recorded at cost and ~~other~~amortized ~~indefinite~~using ~~intangibles~~the straight-line method over their estimated useful lives.

~~Goodwill~~Impairment and other intangibles with indefinite lives are not amortized but are reviewed for impairment at least annually, or more frequently if an event or circumstance indicates that an impairment may have occurred. To test for impairment, the fair value of each reporting unit is compared to the related net book value, including goodwill. If the net book value of the reporting unit exceeds the fair value, an impairment loss is measured and recognized. An income approach is utilized to estimate the fair value of each reporting unit. The income approach is based on the projected debtlong-~~free~~lived ~~cash flow, which is discounted to the present value using discount factors that consider the timing and risk of cash flows.~~assets

~~Embedded~~The ~~conversion~~Company ~~features~~reviews the carrying value of its definite lived intangible assets at least annually. Other long-lived assets, including intangibles, are reviewed whenever events or changes in circumstances indicate that the historical-cost carrying value of an asset may no longer be appropriate. The Company assesses recoverability of the asset by comparing the undiscounted future net cash flows expected to result from the asset to its carrying value. If the carrying value exceeds the undiscounted future net cash flows of the asset, an impairment loss is measured and recognized. An impairment loss is measured as the difference between the net book value and the fair value of the long-lived asset.

~~The~~Goodwill ~~Company evaluates embedded conversion features within convertible debt~~ and ~~convertible~~other ~~preferred~~indefinite 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.intangibles

~~Revenue~~Goodwill and ~~cost~~other ~~recognition~~intangibles with indefinite lives are not amortized but are reviewed for impairment at least anually, or more frequently if an event or circumstance indicates that an impairment may have occurred. To test for impairment, the fair value of each reporting unit is compared to the related net book value, including goodwill. If the net book value of the reporting unit exceeds the fair value, an impairment loss is measured and recognized. An income approach is utilized to estimate the fair value of each reporting unit. The income approach is based on the projected debt-free cash flow, which is discounted to the present value using discount factors that consider the timing and risk of cash flows.

Inova has four sources of revenues: IT network design and implementation from Desert, computer equipment sales from Desert, IT consulting services from Edgetech, and sales of RFID items from RightTag rental income from Trakkers/Tesselon. Revenue that is received before it is earned is classified as deferred revenue.6

ITEmbedded ~~network~~conversion ~~design and implementation:~~features

~~Revenues~~The ~~from~~Company ~~fixed-price~~evaluates ~~contracts~~embedded ~~are~~conversion ~~recognized on~~features ~~the~~within ~~percentage-of-completion~~convertible ~~method,~~debt ~~measured~~and byconvertible ~~the~~preferred ~~percentage~~stock ofunder ~~cost~~ASC ~~incurred~~815 to“Derivatives ~~date~~and Hedging” to ~~estimated~~determine ~~total~~whether ~~cost~~the ~~for~~embedded ~~each~~conversion ~~contract. This~~feature ~~method~~should isbe ~~used~~bifurcated ~~because~~from ~~management~~the ~~considers~~host ~~total~~instrument ~~cost~~and toaccounted befor ~~the~~as ~~best~~a ~~available~~derivative ~~measure~~at offair ~~progress~~value onwith ~~the~~changes ~~contracts.~~in ~~Because of~~fair ~~inherent~~value ~~uncertainties~~recorded in ~~estimating~~earnings. ~~costs~~If the conversion feature does not require derivative treatment under ASC 815, itthe instrument is atevaluated ~~least~~under ~~reasonably~~ASC ~~possible~~470-20 ~~that~~“Debt ~~the~~with ~~estimates~~Conversion ~~used~~and ~~will~~Other ~~change~~Options” ~~within~~for ~~the near~~consideration ~~term~~of any beneficial conversion feature.

~~Contract~~Revenue ~~costs include all direct material~~ and ~~labor~~cost costs and those indirect costs related to contract performance, such as indirect labor, supplies, tools, repairs, and depreciation. Selling, general and administrative costs are charged to expense as incurred. Provisions for estimated losses on uncompleted contracts are made in the period in which such losses are determined. Changes in job performance, job conditions, and estimated profitability may result in revisions to costs and income, which are recognized in the period in which the revisions are determined. Changes in estimated job profitability resulting from job performance, job conditions, contract penalty provisions, claims, change orders, and settlements, are accounted for as changes in estimates in the current period.recognition

~~The~~Inova ~~asset,~~has ~~“Costs~~four ~~and~~sources ~~estimated~~of ~~earnings in~~revenues: ~~excess~~IT ofnetwork ~~billings~~design onand ~~uncompleted~~implementation ~~contracts~~from Desert,” ~~represents~~computer ~~revenues~~equipment ~~recognized~~sales infrom ~~excess~~Desert, sales of ~~amounts~~RFID ~~billed.~~items ~~The~~from ~~liability~~RightTag, ~~“Billings~~ inand ~~excess~~rental ofincome ~~costs~~from ~~and~~Trakkers/Tesselon. ~~estimated~~Revenue ~~earnings~~that onis ~~uncompleted~~received ~~contracts,”~~before ~~represents~~it ~~billings~~is inearned ~~excess~~is ofclassified ~~revenues recognized~~as deferred revenue.

~~Computer equipment sales,~~ IT ~~consulting services~~network &design ~~sales~~and ~~of RFID items~~implementation:

~~Revenue~~Revenues isfrom fixed-price contracts are recognized ~~when~~on ~~persuasive~~the ~~evidence~~ percentage-of-completion anmethod, ~~arrangement~~measured ~~exists,~~by ~~delivery~~the ~~has~~percentage ~~occurred~~of orcost ~~services~~incurred ~~have~~to ~~been~~date ~~rendered,~~to ~~the~~estimated ~~price~~total cost for each contract. This method is ~~fixed~~used orbecause ~~determinable~~management considers total cost to be the best available measure of progress on the contracts. Because of inherent uncertainties in estimating costs, ~~and~~it ~~collectability~~ is at least reasonably ~~assured~~possible that the estimates used will change within the near term.

~~Rental~~Contract costs include all direct material and labor costs and those indirect costs related to contract performance, such as indirect labor, supplies, tools, repairs, and depreciation. Selling, general and administrative costs are charged to expense as incurred. Provisions for estimated losses on uncompleted contracts are made in the period in which such losses are determined. Changes in job performance, job conditions, and estimated profitability may result in revisions to costs and income, which are recognized in the period in which the revisions are determined. Changes in estimated job profitability resulting from job performance, job conditions, contract penalty provisions, claims, change orders, and settlements, are accounted for ~~RFID~~as ~~items:~~changes in estimates in the current period.

The ~~Company~~asset, ~~follows~~“Costs ~~Staff Accounting Bulletin No. 104 recognizing RFID rental income. Revenue generally is realized or realizable~~ and ~~earned~~estimated ~~when~~earnings ~~all~~in ofexcess ~~the following criteria are met: (1) persuasive evidence~~ of anbillings ~~arrangement~~on ~~exists;~~uncompleted ~~(2)~~contracts,” ~~delivery~~represents ~~has~~revenues ~~occurred~~recognized orin ~~services~~excess ~~have~~of ~~been~~amounts ~~rendered; (3) the seller’s price to the buyer is fixed or determinable; and (4) collectability is reasonably assured~~billed. AThe ~~rental contract term can be daily or weekly. Consistent with SAB 104~~liability, ~~the~~“Billings ~~Company’s policy recognizes revenue from equipment rentals~~ in ~~the~~excess ~~period earned on a straight-line basis, over the contract term, regardless~~ of ~~the~~costs ~~timing of the billing to customers. Revenue from the sale of new~~ and ~~used~~estimated ~~equipment~~earnings ~~and~~on ~~parts~~uncompleted ~~is recognized at the time of delivery to~~contracts,” orrepresents ~~pick-up~~billings ~~by,~~in ~~the~~excess ~~customer and when all obligations under the sales contract have been fulfilled, risk~~ of ~~ownership~~revenues ~~has been transferred and collectability is reasonably assured. Services revenue is~~ recognized ~~at the time the services are rendered~~.

7Computer equipment sales & sales of RFID items:

~~Stock~~Revenue ~~based~~is ~~compensation~~recognized when persuasive evidence of an arrangement exists, delivery has occurred or services have been rendered, the price is fixed or determinable, and collectability is reasonably assured.

~~ASC~~Rental ~~718,~~income ~~“Accounting~~ for ~~Stock-Based Compensation"~~RFID established financial accounting and reporting standards for stock-based employee compensation plans. It defines a fair value based method of accounting for an employee stock option or similar equity instrument. In January 2006, Inova implemented ASC 718, and accordingly, Inova accounts for compensation cost for stock option plans in accordance with ASC 718. Inova accounts for share based payments to non-employees in accordance with ASC 505-50 “Accounting for Equity Instruments Issued to Non-Employees for Acquiring, or in Conjunction with Selling, Goods or Services”.items:

~~RESULTS~~The OFCompany ~~OPERATIONS~~follows ~~FOR~~Staff ~~THE~~Accounting ~~YEAR~~Bulletin ~~ENDED~~No. ~~APRIL 30~~104 recognizing RFID rental income. Revenue generally is realized or realizable and earned when all of the following criteria are met: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred or services have been rendered; (3) the seller’s price to the buyer is fixed or determinable; and (4) collectability is reasonably assured. A rental contract term can be daily or weekly. Consistent with SAB 104, ~~2012~~the ~~COMPARED~~Company’s TOpolicy ~~YEAR~~recognizes ~~ENDED~~revenue ~~APRIL~~from 30equipment rentals in the period earned on a straight-line basis, ~~2011~~over the contract term, regardless of the timing of the billing to customers. Revenue from the sale of new and used equipment and parts is recognized at the time of delivery to, or pick-up by, the customer and when all obligations under the sales contract have been fulfilled, risk of ownership has been transferred and collectability is reasonably assured. Services revenue is recognized at the time the services are rendered.

Total revenues (net sales) decreased from $22,121,789 for the twelve month period ending April 2011 to $21,207,693 for the twelve month period ending April 30, 2012. This is primarily the result of a decrease in awarded contracts compared to the previous year.7

~~The~~Stock ~~Company’s~~based selling, general and administrative expenses decreased from $5,731,783 for the twelve months ending April 30, 2011 to $5,583,358 for the same period in 2012. This is primarily the result of the loss on transfer of a decrease in sales.compensation

~~Last~~ASC ~~fiscal year~~718, ~~the~~“Accounting ~~Company~~for ~~reported~~Stock-Based ~~a net~~Compensation" ~~loss~~established ~~from~~financial ~~continuing~~accounting ~~operations~~and ofreporting ~~$3,350,377~~standards asfor ~~compared~~stock-based toemployee compensation plans. It defines a ~~loss~~fair value based method of $1accounting for an employee stock option or similar equity instrument. In January 2006,~~249~~ Inova implemented ASC 718,~~171~~ and accordingly, Inova accounts for ~~the~~compensation ~~fiscal~~cost ~~year~~for ~~ended~~stock ~~April~~option ~~30,~~plans ~~2012~~in accordance with ASC 718. ~~The~~ ~~decreased~~Inova ~~loss~~accounts isfor ~~due~~share based payments to ~~the~~non-employees ~~decrease~~in accordance with ASC 505-50 “Accounting for Equity Instruments Issued to Non-Employees for Acquiring, or in ~~operating~~Conjunction ~~loss~~with ofSelling, $1Goods or Services”.~~7m.~~

AsRESULTS ofOF ~~the~~OPERATIONS ~~date~~FOR ofTHE ~~the~~YEAR ~~filing~~ENDED ~~the~~APRIL ~~Company is attempting to restructure its debt with Boone and some other creditors. If successful there would be a significant decrease in the current portion of debt outstanding~~30, ~~interest~~2013 ~~rate~~COMPARED ~~reductions~~TO ~~and~~YEAR ~~extended~~ENDED ~~maturity~~APRIL ~~dates. If unsuccessful~~30, ~~we will continue to be in default on these loans and incur additional interest expense.~~2012

WeTotal ~~are~~revenues ~~exploring~~(net ~~various~~sales) ~~ways~~decreased tofrom ~~address~~$21,207,693 ~~our debt~~for ~~including~~the ~~restructuring~~twelve ~~the~~month ~~debt~~period ~~with~~ending ~~current~~April ~~lenders~~2012 ~~and~~to ~~refinancing~~$18,680,990 ~~with~~for ~~new~~the ~~lenders.~~twelve ~~However,~~month ~~there~~period ~~can~~ending beApril no30, ~~assurance that~~2013. This is primarily the ~~Company~~result ~~will~~of bea ~~successful~~decrease in awarded contracts compared to the previous year.

8The Company’s selling, general and administrative expenses increased from $5,583,358 for the twelve months ending April 30, 2012 to $6,781,038 for the same period in 2013. This is primarily the result of the increase in litigation settlement expenses.

~~EBITDA~~Last ~~for~~fiscal year, the ~~years~~Company ~~ending~~reported ~~April~~a ~~30,~~net ~~2012 and~~loss ~~2011~~from ~~was~~continuing operations of $~~529~~1,~~920~~249,171 ~~and~~as $compared 1to a loss of $6,~~595~~626,~~053~~238 for the fiscal year ~~ending~~ended April 30, ~~2011~~2013. ~~EBITDA~~The isincreased ~~Earnings~~loss ~~before~~is ~~interest,~~primarily ~~tax,~~due ~~depreciation and~~to ~~amortization.~~the ~~Inova~~decreased ~~also~~sales, ~~excludes~~increase ~~the~~in ~~non-cash~~litigation ~~loss~~settlement onexpenses ~~derivative liabilities~~ and ~~impairment~~decrease ~~charges~~in ~~from~~gain ~~its~~on ~~EBITDA~~derivative ~~calculation~~liabilities.

		Year ended		Year ended
EBITDA		April 30, 2012		April 30, 2011
Net loss	$	( 1,249,171)	$	(3,350,377	)
Interest		2,384,562		2,310,272
Tax		72,964		80,746
Depreciation/Amortization		355,056		865,390
Impairment loss				2,525,375
Gain on derivative liabilities, gain on debt extinguishment and loss on transfer of financial assets and liabilities		( 1,033,491)		(836,353	)
EBITDA	$	529,920	$	1,595,053

As of the date of the filing the Company is attempting to restructure its debt with Boone and some other secured creditors. If successful there would be a significant decrease in the current portion of debt outstanding, interest rate reductions and extended maturity dates. If unsuccessful, we will continue to be in default on these loans and incur additional interest expense.

~~LIQUIDITY~~We ~~AND~~are ~~CAPITAL~~exploring ~~RESOURCES~~various ways to address our debt including restructuring the debt with current lenders and refinancing with new lenders. However, there can be no assurance that the Company will be successful.

AsAdjusted ofEBITDA for the years ending April 30, ~~2012,~~2013 wewas ~~had~~$ ~~cash~~175,234 and ~~cash equivalents totaling~~ $~~752~~ 802,~~011,~~187 ~~current~~for ~~assets~~the ~~were~~year $3ending April 30,~~816,640,~~ ~~current~~2012. ~~liabilities~~EBITDA ~~were~~is ~~$19~~Earnings before interest,~~669~~ tax,~~156~~ depreciation and ~~total~~amortization. ~~stockholders’ deficit~~Inova ~~was~~also ~~$11,137,248.~~excludes ~~Working~~certain ~~capital~~one-time ~~deficit~~external ~~decreased~~professional ~~from $(15~~fees,~~287,148)~~ atlitigation ~~April~~settlement 30expenses, ~~2011~~the tonon-cash ~~$(15,852,516)~~loss aton ~~April~~derivative ~~30,~~liabilities ~~2012~~and impairment charges from its Adjusted EBITDA calculation.

The working capital increased due to higher cash in 2012 as compared to 2011. Since we are attempting to modify most of the notes, some lenders have agreed to us not making payments currently. This has caused the notes to be in default and, therefore, are shown as current liabilities. It is not likely the company will be required to make significant principal payments in the near future.

		Year ended			Year ended
Adjusted EBITDA		April 30, 2013			April 30, 2012
Net loss	$	(6,626,238	)	$	( 1,249,171)

Interest		4,002,178			2,384,562

Tax		64,930			72,964

Depreciation/Amortization		506,963			355,056
Litigation settlement expenses		1,316,325			-
Impairment loss and servicing fee		395,009			-

Derivative/warrant (gain) loss		37,100			( 1,033,491)
Legal fees (Inova and its lenders)		478,968			272,187
Adjusted EBITDA	$	175,234		$	802,187

As shown in the accompanying financial statements, we have incurred recurring losses from operations and have an accumulated deficit and negative working capital as of April 30, 2012. These conditions raise substantial doubt as to our ability to continue as a going concern. While we have significant EBITDA we are not able to make all required debt payments currently. Management is trying to raise additional capital through sales of stock and refinancing debt. The financial statements do not include any adjustments that might be necessary if we are unable to continue as a going concern.8

~~OFF-BALANCE~~LIQUIDITY ~~SHEET~~AND ~~ARRANGEMENTS~~CAPITAL RESOURCES

~~None~~As of April 30, 2013, we had cash and cash equivalents totaling $378,785, current assets were $1,880,527 , current liabilities were $23,083,402 and total stockholders’ deficit was $17,103,100. Working capital deficit increased from $15,852,516 at April 30, 2012 to $21,202,875 at April 30, 2013.

9The working capital deficit increased due to lower cash in 2013 as compared to 2012, and increased accrued expenses. Since we are attempting to modify most of the notes, some lenders have agreed to us not making payments currently. This has caused the notes to be in default and, therefore, are shown as current liabilities. It is not likely the company will be required to make significant principal payments in the near future.

~~Item~~As 8shown in the accompanying financial statements, we have incurred recurring losses from operations and have an accumulated deficit and negative working capital as of April 30, 2013. ~~Financial~~These ~~Statements~~conditions raise substantial doubt as to our ability to continue as a going concern. This condition is based on whether the company has over a year’s worth of cash to pay current liabilities. While we have positive adjusted EBITDA we are not able to make all required debt payments currently. Management is trying to raise additional capital through sales of stock and refinancing debt. The financial statements do not include any adjustments that might be necessary if we are unable to continue as a going concern.

~~REPORT~~OFF-BALANCE OFSHEET ~~INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM~~ARRANGEMENTS

~~To the Board of Directors Inova Technology, Inc~~None. ~~Santa Monica, California~~

We have audited the accompanying consolidated balance sheets of Inova Technology, Inc. and its subsidiaries (collectively“Inova”), as of April 30, 2012 and 2011 and the related consolidated statements of operations, changes in stockholders’ equity and cash flows for the years then ended. These consolidated financial statements are the responsibility of Inova’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits.9

WeItem ~~conducted our audits in accordance with standards of the Public Company Accounting Oversight Board (United States)~~8. ~~Those~~Financial standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatements. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the consolidated financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall consolidated financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.Statements

InREPORT ~~our~~OF ~~opinion,~~INDEPENDENT ~~the consolidated~~REGISTERED ~~financial~~PUBLIC ~~statements~~ACCOUNTING referred to above present fairly, in all material respects, the consolidated financial position of Inova technology, Inc and its subsidiaries as of April 30, 2012 and 2011 and the results of their consolidated operations and their consolidated cash flows for the years then ended in conformity with accounting principles generally accepted in the United States of America.FIRM

~~The~~To ~~accompanying financial statements have been prepared assuming that Inova will continue as a going concern. Inova incurred losses from operations for~~ the ~~years~~Board ~~ended April 30, 2012 and 2011 and has a working capital deficit as~~ of April 30, 2012. These factors raise substantial doubt about Inova’s ability to continue as a going concern. Management's plans in regard to these matters are described in Note 3. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.Directors

~~MALONEBAILEY,~~Inova ~~LLP www.malonebailey.com Houston~~Technology, ~~Texas July 30, 2012~~Inc.

INOVA TECHNOLOGY, INC.
CONSOLIDATED BALANCE SHEETS
			April 30, 2012	April 30, 2011
ASSETS
Current assets
	Cash		$ 752,011	$ 396,140
	Accounts receivable, net of allowance of $81,283 and $0		107,471	184,789
	Contract receivables, net of allowance of $21,746 and $21,746		1,126,221	782,286
	Credit facility receivable		1,477,930	1,230,596
	Inventory		98,921	100,471
	Costs in excess of billing and estimated earnings		201,602	229,039
	Prepaid and other current assets		52,484	31,165
		Total current assets	3,816,640	2,954,486
	Fixed assets, net		113,308	149,104
	Revenue earning equipment, net		586,896	892,690
	Goodwill, net		4,157,596	4,157,596
	Other assets		-	6,121
Total assets			$ 8,674,440	$ 8,159,997
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities
	Accounts payable		$ 1,739,006	$ 950,149
	Accrued liabilities		4,479,224	2,861,923
	Deferred income		395,781	442,669
	Derivative liabilities		1,461,265	2,515,687
	Notes payable - related parties		1,689,688	1,500,581
	Notes payable		9,904,192	9,961,625
		Total current liabilities	19,669,156	18,232,634
	Notes payable - related parties, net of current maturities		142,532	142,532
Total liabilities			19,811,688	18,375,166
Stockholders' deficit
	Convertible preferred stock, $0.001 par value; 25,000,000 shares
		authorized; 1,500,000 shares issued and outstanding (the cost of the
		shares are included in non-controlling interest)	-	-
	Common stock, $0.001 par value; 500,000,000 shares
		authorized; 76,364,065 and 61,263,909 shares issued and outstanding	76,364	61,264
	Additional paid-in capital		5,249,518	4,937,526
	Accumulated deficit		(17,770,636)	(16,521,465)
	Total Inova Technology, Inc stockholders' deficit		(12,444,754)	(11,522,675)
	Non-controlling interest		1,307,506	1,307,506
		Total stockholders' deficit	(11,137,248)	(10,215,169)
Total liabilities and stockholders' deficit			$ 8,674,440	$ 8,159,997
See summary of accounting policies and notes to consolidated financial statements.

Santa Monica, California

INOVA TECHNOLOGY, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
For the years ended April 30, 2012 and 2011
		2012			2011
Revenues	$	21,207,693		$	22,121,789
Cost of revenues		(15,809,385	)		(15,245,413	)
Selling, general and administrative		(5,583,358	)		(5,731,783	)
Impairment loss		—			(2,525,375	)
Amortization		—			(450,453	)
Depreciation expense		(35,640	)		(69,942	)
Operating loss		(220,690	)		(1,901,177	)
Other income (expense):
Gain on derivative liabilities		1,268,499			836,353
Interest income		—			24,719
Gain on debt extinguishment		87,582			—
Interest expense		(2,384,562	)		(2,310,272	)
Net loss	$	(1,249,171	)	$	(3,350,377	)
Basic and diluted loss per share	$	(0.02	)	$	(0.06	)
Weighted average common shares outstanding		67,470,101			58,560,338
See summary of accounting policies and notes to consolidated financial statements.

We have audited the accompanying consolidated balance sheets of Inova Technology, Inc. and its subsidiaries (collectively, “Inova”), as of April 30, 2013 and 2012 and the related consolidated statements of operations, changes in stockholders’ equity and cash flows for the years then ended. These consolidated financial statements are the responsibility of Inova’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits.

~~See~~We ~~summary~~conducted our audits in accordance with standards of ~~accounting policies~~the Public Company Accounting Oversight Board (United States). Those standards require that we plan and ~~notes~~perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatements. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the consolidated financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall consolidated financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

INOVA TECHNOLOGY, INC.
CONSOLIDATED STATEMENT OF STOCKHOLDERS EQUITY
For the years ended April 30, 2012 and 2011
	Common Stock		Preferred Stock		Additional	Non-Controlling	Retained
	Shares	Par (0.001)	Shares	Par (0.001)	Paid-in Capital	Interest	Deficit	Total
Balances at April 30, 2010	56,338,300	$ 56,338	1,500,000	$ -	$ 4,768,432	$ 1,307,506	$ (13,171,088)	$ (7,038,812)
Common stock issued for services	3,425,609	3,426	-	-	105,344	-	-	108,770
Common stock issued for conversion of notes payable	1,500,000	1,500	-	-	59,250	-	-	60,750
Common stock warrants issued for services	-	-	-	-	56,500	-	-	56,500
Reclassification of derivative liabilities from additional paid-in capital	-	-	-	-	(52,000)	-	-	(52,000)
Net loss	-	-	-	-	-	-	(3,350,377)	(3,350,377)
Balances at April 30, 2011	61,263,909	61,264	1,500,000	-	4,937,526	1,307,506	(16,521,465)	(10,215,169)
Common stock issued for services	2,933,333	2,933	-	-	69,067	-	-	72,000
Common stock issued for conversion of notes payable	4,889,046	4,889	-	-	52,361	-	-	57,250
Common stock issued for cash	333,333	333	-	-	9,667	-	-	10,000
Common stock issued for settlement of accounts payable	6,944,444	6,945	-	-	118,055	-	-	125,000
Reclassification of derivative liabilities from additional paid-in capital	-	-	-	-	62,842	-	-	62,842
Net loss	-	-	-	-	-	-	(1,249,171)	(1,249,171)
Balances at April 30, 2012	76,364,065	$ 76,364	1,500,000	$ -	$ 5,249,518	$ 1,307,506	$ (17,770,636)	$ (11,137,248)
See summary of accounting policies and notes to consolidated financial statements.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of Inova and its subsidiaries as of April 30, 2012 and 2011 and the results of their consolidated operations and their consolidated cash flows for the years then ended in conformity with accounting principles generally accepted in the United States of America.

INOVA TECHNOLOGY, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the years ended April 30, 2012 and 2011
				2012	2011
CASH FLOWS FROM OPERATING ACTIVITIES
	Net loss			$ (1,249,171)	$ (3,350,377)
	Adjustments to reconcile net loss to net cash used provided by
	operating activities:
		Depreciation expense, $319,416 and $344,995 included in cost of revenues		355,056	414,937
		Amortization expense - loan discounts and deferred financing costs		364,500	128,900
		Amortization expense - intangible		-	450,453
		Paid in kind interest		73,204	183,401
		Bad debt expense		81,283	-
		Gain on sale of asset		(2,929)	-
		Gain on debt extinguishment		(87,582)	-
		Impairment loss		-	2,525,375
		Stock issued for services		72,000	108,770
		Warrants issued for services		-	56,500
		Derivative gain		(1,268,499)	(836,353)
	Changes in operating assets and liabilities:
			Accounts receivable	(347,900)	1,154,278
			Credit facility receivable	(247,334)	(278,034)
			Inventory	1,550	(7,136)
			Costs in excess of billing and estimated earnings	27,437	61,290
			Prepaid expenses and other current assets	(21,855)	15,258
			Other assets	-	44,311
			Accounts payable and accrued expenses	2,727,348	193,562
			Deferred revenues	(46,888)	17,797
Net cash provided by operating activities of operations				430,220	882,932
CASH FLOW INVESTING ACTIVITIES
			Purchase of fixed assets	(10,537)	(20,785)
Net cash used in investing activities				(10,537)	(20,785)
CASH FLOW FINANCING ACTIVITIES
			Proceeds from notes payable	82,500	103,500
			Common stock issued for cash	10,000	-
			Repayments made on notes payable	(156,312)	(456,253)
			Repayments made on notes payable - related parties	-	(450,000)
Net cash used in financing activities				(63,812)	(802,753)
NET CHANGE IN CASH				355,871	59,394
CASH AT BEGINNING OF YEAR				396,140	336,746
CASH AT END OF YEAR				$ 752,011	$ 396,140
SUPPLEMENTAL INFORMATION:
	Interest paid			$ 637,852	$ 584,547
	Income taxes paid			$ 72,964	$ -
NON-CASH INVESTINGAND FINANCING ACTIVITIES:
	Common stock issued for conversion of notes payable			57,250	60,750
	Reclassification of derivative liabilities to notes payable			62,842	-
	Reclassification of derivative liabilities from additional paid-in capital			-	52,000
	Reclassification of put notes from derivative liabilities			-	2,307,900
	Accrued interest reclassified to related party notes payable			189,107	-
	Common stock issued for settlement of accounts payable			125,000	-
	Discount on notes payable from derivative liabilities			364,500	-
See summary of accounting policies and notes to consolidated financial statements

The accompanying financial statements have been prepared assuming that Inova will continue as a going concern. Inova incurred losses from operations for the years ended April 30, 2013 and 2012 and has a working capital deficit as of April 30, 2013. These factors raise substantial doubt about Inova’s ability to continue as a going concern. Management's plans in regard to these matters are described in Note 3. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

~~INOVA TECHNOLOGY~~MALONEBAILEY, ~~INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~LLP

~~NOTE 1 – HISTORY AND ORGANIZATION OF THE COMPANY~~www.malonebailey.com

~~Inova Technology~~Houston, Inc( “ we”,”us”, “inova”, “the company”)was incorporated in Nevada on May 16, 1997, as Newsgurus.com, Inc. and changed its name to Secure Enterprise Solutions Inc. on January 10, 2002, then to Edgetech Services Inc. and on August 17, 2006 to Inova Technology, Inc.Texas

15July 29, 2013

~~NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES~~10

~~Principles~~INOVA ofTECHNOLOGY, ~~consolidation~~INC.

~~These~~CONSOLIDATED ~~consolidated~~BALANCE financial statements include the accounts of Inova Technology, Inc. and its wholly owned subsidiaries Edgetech Services, Inc. (“Edgetech”), RightTag, Inc. (“RightTag”), Desert Communications, Inc. (“Desert”), Inova Technology Holdings, LLC., Trakkers, LLC (“Trakkers”) and Tesselon, LLC (“Tesselon”). Significant inter-company accounts and transactions have been eliminated.SHEETS

Use of estimates

	April 30, 2013			April 30, 2012

ASSETS

Current assets
Cash		378,785		$	752,011
Accounts receivable, net of allowance of $56,283 and $81,283		100,233			107,471
Contract receivables, net of allowance of $21,746 and $21,746		703,838			1,126,221
Credit facility receivable		485,673			1,477,930
Inventory		114,652			98,921
Costs in excess of billing and estimated earnings		13,123			201,602
Prepaid and other current assets		84,223			52,484

Total current assets		1,880,527			3,816,640

Fixed assets, net		81,458			113,308
Revenue earning equipment, net		89,048			586,896
Goodwill, net		4,014,801			4,157,596

Total assets	$	6,065,834		$	8,674,440

LIABILITIES AND STOCKHOLDERS' DEFICIT

Current liabilities
Accounts payable	$	646,185		$	1,739,006
Accrued liabilities		9,106,174			4,479,224
Deferred income		564,773			395,781
Derivative liabilities		1,123,715			1,461,265
Notes payable - related parties		1,639,688			1,689,688
Notes payable		10,002,876			9,904,192
Total current liabilities		23,083,411			19,669,156

Notes payable - related parties, net of current maturities		85,532			142,532

Total liabilities		23,168,943			19,811,688

Stockholders' deficit
Convertible preferred stock, $0.001 par value; 25,000,000 shares
authorized; 1,500,000 shares issued and outstanding (the cost of the
shares are included in non-controlling interest)		-			-
Common stock, $0.001 par value; 20,000,000 shares
authorized; 1,820,241 and 763,641 shares issued and outstanding		1,820			764
Additional paid-in capital		5,984,439			5,325,118
Accumulated deficit		(24,396,874	)		(17,770,636	)
Total Inova Technology, Inc stockholders' deficit		(18,410,615	)		(12,444,754	)
Non-controlling interest		1,307,506			1,307,506
Total stockholders' deficit		(17,103,109	)		(11,137,248	)

Total liabilities and stockholders' deficit	$	6,065,834		$	8,674,440

~~The~~See ~~preparation~~summary of ~~financial statements in accordance with~~ accounting ~~principles~~policies ~~generally~~and ~~accepted~~notes ~~in the United States of America requires management~~ to ~~make~~consolidated ~~estimates and assumptions that affect the reported amount of assets and liabilities, disclosure of contingent assets and liabilities at the date of the~~ financial statements ~~and the reported amount of revenues and expenses during the year~~. ~~Actual results could differ from these estimates.~~

~~Reclassifications~~11

~~Certain~~INOVA ~~prior~~TECHNOLOGY, ~~year~~INC. ~~amounts~~CONSOLIDATED ~~have~~STATEMENTS ~~been~~OF ~~reclassified to~~OPERATIONS ~~conform~~For to the ~~current~~years ~~year~~ended ~~presentation.~~April 30, 2013 and 2012

Cash and cash equivalents

	2013			2012

Revenues	$	18,680,990		$	21,207,693

Cost of revenues		(14,310,640	)		(15,809,385	)
Selling, general and administrative		(6,781,038	)		(5,583,358	)
Impairment		(142,795	)		-
Depreciation expense		(34,115	)		(35,640	)

Operating loss		(2,587,598	)		(220,690	)

Other income (expense):
Gain (Loss) on derivative liabilities		(37,100	)		1,268,499
Other income		638			-
Gain (Loss) on debt extinguishment		-			87,582
Interest expense		(4,002,178	)		(2,384,562	)

Net loss	$	(6,626,238	)	$	(1,249,171	)

Basic and diluted income (loss) per share	$	(6.76	)	$	(1.85	)

Weighted average common shares outstanding-basic		980,716			674,701
Weighted average common shares outstanding-diluted		980,716			674,701

~~For~~See ~~purposes~~summary of ~~the~~accounting ~~statement~~policies ofand ~~cash~~notes ~~flows, Inova considers all highly liquid investments purchased with an original maturity of three months or less~~ to beconsolidated ~~cash~~financial ~~equivalents~~statements.

~~Accounts receivable~~12

~~Trade~~INOVA and other accounts receivable are carried at face value less any provisions for uncollectible accounts considered necessary. Accounts receivable primarily include contract receivables from customers in Texas. Bad debt expense is recognized based on management’s estimate of likely losses per yearTECHNOLOGY, ~~based~~ ~~on past experience and an estimate of current year uncollectible amounts~~INC. ~~The~~CONSOLIDATED ~~allowance~~STATEMENT ~~for~~OF ~~doubtful~~STOCKHOLDERS ~~accounts~~EQUITY ~~was~~For ~~$103,029 and~~the ~~$21,746~~years asended of April 30, ~~2012~~2013 and ~~2011, respectively.~~2012

Inventory

	Common Stock				Preferred Stock				Additional		Non-Controlling		Retained
	Shares		Par (0.001)		Shares		Par (0.001)		Paid-in Capital		Interest		Deficit			Total
Balances at April 30, 2011		612,639	$	613		1,500,000	$	-	$	4,998,177	$	1,307,506	$	(16,521,465	)	$	(10,215,169	)

Common stock issued for services		29,333		29		-		-		71,971		-		-			72,000
Common stock issued for conversion of notes payable		48,890		49		-		-		57,201		-		-			57,250
Common stock issued for cash		3,333		3		-		-		9,997		-		-			10,000
Common stock issued for settlement of accounts payable		69,444		70		-		-		124,930		-		-			125,000
Reclassification of derivative liabilities from additional paid-in capital		-		-		-		-		62,842		-		-			62,842
Net loss		-		-		-		-		-		-		(1,249,171	)		(1,249,171	)
Balances at April 30, 2012		763,639		764		1,500,000		-		5,325,118		1,307,506		(17,770,636	)		(11,137,248	)

Common stock issued for patent		123,153		123		-		-		73,769		-		-			73,892
Common stock issued for conversion of notes payable		908,375		908		-		-		141,622		-		-			142,530
Reclassification of derivative liabilities from additional paid-in capital		-		-		-		-		426,955		-		-			426,955
Common stock issued for services		25,074		25		-		-		16,975		-		-			17,000
Net loss		-		-		-		-		-		-		(6,626,238	)		(6,626,238	)
Balances at April 30, 2013		1,820,241	$	1,820		1,500,000	$	-	$	5,984,439	$	1,307,506	$	(24,396,874	)	$	(17,103,109	)

~~Inventories~~See ~~are~~summary ~~stated at the lower~~ of ~~cost or~~accounting ~~market.~~policies ~~Cost is determined by the average cost method for all inventories. Inventories consist primarily of components~~ and ~~finished products~~notes ~~held~~to ~~for~~consolidated ~~sale.~~financial ~~Rapid technological change and new product introductions and enhancements could result in excess or obsolete inventory~~statements. ~~To minimize this risk, Inova evaluates inventory levels and expected usage on a periodic basis and records adjustments~~ ~~as required.~~

1613

~~Property~~INOVA TECHNOLOGY, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS For the years ended April 30, 2013 and ~~equipment~~2012

Property and equipment, including revenue–producing rental equipment are carried at cost, less accumulated depreciation and amortization. Additions are capitalized and maintenance and repairs are charged to expense as incurred. Depreciation and amortization is provided principally on the straight-line basis method over the estimated useful lives of the assets. When property is retired or otherwise disposed of, the related cost and accumulated depreciation are removed from the accounts and any resulting gains or losses are credited or charged to operations.

	2013			2012
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss	$	(6,626,238	)	$	(1,249,171	)
Adjustments to reconcile net loss to net cash used provided by
operating activities:
Depreciation expense, $472,848 and $319,416 included in cost of revenues		506,963			355,056
Impairment		142,795			-
Amortization expense - loan discounts and deferred financing costs		1,639			364,500
Paid in kind interest		18,932			73,204
Bad debt expense (recovery)		(25,000	)		81,283
Gain on sale of asset		-			(2,929	)
Gain on debt extinguishment		-			(87,582	)
Stock issued for services		17,000			72,000
Legal expenses paid directly by third party debtholder		222,751			-
Derivative gain		37,100			(1,268,499	)
Changes in operating assets and liabilities:
Accounts receivable		454,621			(347,900	)
Credit facility receivable		992,257			(247,334	)
Inventory		(15,731	)		1,550
Costs in excess of billing and estimated earnings		188,479			27,437
Prepaid expenses and other current assets		42,153			(21,855	)
Accounts payable		(1,067,781	)		-
Accrued expenses		4,731,476			2,727,348
Deferred revenues		168,992			(46,888	)
Net cash provided by operating activities of operations		(209,592	)		430,220

CASH FLOW INVESTING ACTIVITIES
Purchase of fixed assets		-			(10,537	)
Net cash used in investing activities		-			(10,537	)

CASH FLOW FINANCING ACTIVITIES
Proceeds from notes payable		37,500			82,500
Common stock issued for cash		-			10,000
Payment of legal fees capitalized		(118,877	)		-
Repayments made on notes payable - related party		(57,000	)		-
Repayments made on notes payable		(25,257	)		(156,312	)
Net cash used in financing activities		(163,634	)		(63,812	)

NET CHANGE IN CASH		(373,226	)		355,871
CASH AT BEGINNING OF YEAR		752,011			396,140
CASH AT END OF YEAR	$	378,785		$	752,011

SUPPLEMENTAL INFORMATION:
Interest paid	$	403,139		$	637,852
Income taxes paid	$	60,000		$	72,964

NON-CASH INVESTINGAND FINANCING ACTIVITIES:
Common stock issued for conversion of notes payable		142,530			57,250
Reclassification of derivative liabilities to notes payable		-			62,842
Accrued interest reclassified to related party notes payable		-			189,107
Purchase of patent with stock		73,892			-
Common stock issued for settlement of accounts payable		-			125,000
Settlement of derivative liabilities due to conversion of related notes payable		426,955			62,842
Assignment of related party debt to third party		50,000			-
Discount on notes payable from derivative liabilities		50,000			364,500

~~Intangible~~See ~~assets~~summary of accounting policies and notes to consolidated financial statements.

~~Intangible assets with definite lives are recorded at cost and amortized using the straight-line method over their estimated useful lives.~~14

~~Impairment~~INOVA ofTECHNOLOGY, ~~long-lived assets~~INC.

~~The~~NOTES ~~Company~~TO ~~reviews~~CONSOLIDATED ~~the~~FINANCIAL carrying value of its definite lived intangible assets at least annually. Other long-lived assets, including intangibles, are reviewed whenever events or changes in circumstances indicate that the historical-cost carrying value of an asset may no longer be appropriate. The Company assesses recoverability of the asset by comparing the undiscounted future net cash flows expected to result from the asset to its carrying value. If the carrying value exceeds the undiscounted future net cash flows of the asset, an impairment loss is measured and recognized. An impairment loss is measured as the difference between the net book value and the fair value of the long-lived asset. Impairment charges of $0 and $13,517 were recorded for the years ended April 30, 2012 and 2011, respectively.STATEMENTS

~~Goodwill~~NOTE ~~and~~1 ~~other~~– ~~indefinite~~HISTORY ~~intangibles~~AND ORGANIZATION OF THE COMPANY

~~Goodwill~~Inova ~~and other intangibles with indefinite lives are not amortized but are reviewed for impairment at least annually~~Technology, ~~or more frequently if an event or circumstance indicates that an impairment may have occurred~~Inc. To(“Inova” ~~test~~and ~~for impairment,~~ “the ~~fair~~Company”) ~~value~~was ofincorporated ~~each~~in ~~reporting~~Nevada ~~unit~~on isMay ~~compared~~16, ~~to the related net book value~~1997, ~~including~~as ~~goodwill~~Newsgurus. ~~If the net book value of the reporting unit exceeds the fair value~~com, anInc. ~~impairment loss is measured~~ and ~~recognized.~~changed Anits ~~income~~name ~~approach is utilized~~ to ~~estimate~~Secure ~~the~~Enterprise ~~fair~~Solutions ~~value of each reporting unit~~Inc. ~~The income approach is based~~ on ~~the~~January ~~projected~~10, ~~debt-free cash flow~~2002, ~~which~~then ~~is discounted~~ to ~~the~~Edgetech ~~present~~Services ~~value~~Inc. ~~using discount factors that consider the timing~~ and ~~risk~~on ofAugust ~~cash flows. Impairment charges of $0 and $2~~17,~~511,858~~ ~~were~~2006 ~~recorded~~to ~~for~~Inova ~~the years ended April 30~~Technology, ~~2012 and 2011, respectively~~Inc.

~~Embedded~~NOTE ~~conversion~~2 ~~features~~– SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

~~Inova~~Principles 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.~~consolidation

~~Income~~These ~~taxes~~consolidated financial statements include the accounts of Inova Technology, Inc. and its wholly owned subsidiaries Edgetech Services, Inc. (“Edgetech”), RightTag, Inc. (“RightTag”), Desert Communications, Inc. (“Desert”), Inova Technology Holdings, LLC., Trakkers, LLC (“Trakkers”) and Tesselon, LLC (“Tesselon”). Significant inter-company accounts and transactions have been eliminated.

~~Inova~~Use ~~uses the liability method~~ of accounting for income taxes. Under this method, deferred income taxes are recorded to reflect the tax consequences on future years of temporary differences between the tax basis of assets and liabilities and their financial amounts at year-end. Inova provides a valuation allowance to reduce deferred tax assets to their net realizable value.estimates

17The preparation of financial statements in accordance with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amount of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amount of revenues and expenses during the year. Actual results could differ from these estimates.

~~Revenue and cost recognition~~Reclassifications

~~Inova~~Certain ~~has~~prior ~~five~~year ~~sources~~amounts ofhave ~~revenues:~~been ~~Information technology~~reclassified ~~(“IT”)~~to ~~network~~conform ~~design~~to ~~and~~the ~~implementation~~current ~~from~~year Desert, computer equipment sales from Desert, IT consulting services from Edgetech, sales of radio frequency identification (“RFID”) items from RightTag and rental income from Trakkers and Tesselonpresentation. ~~Revenue that is received before it is earned is classified as deferred revenue.~~

ITCash ~~network design~~ and ~~implementation:~~cash equivalents

~~Revenues~~For ~~from~~purposes ~~fixed-price contracts are recognized on the percentage-~~of~~-completion~~ ~~method, measured by~~ the ~~percentage~~statement of ~~cost~~cash ~~incurred~~flows, toInova ~~date~~considers toall ~~estimated~~highly ~~total~~liquid ~~cost~~investments ~~for~~purchased ~~each~~with ~~contract. This~~an ~~method~~original ismaturity ~~used~~of ~~because~~three ~~management~~months ~~considers~~or ~~total~~less ~~cost~~ to be ~~the~~cash ~~best available measure of progress on the contracts~~equivalents. ~~Because of inherent uncertainties in estimating costs, it is at least reasonably possible that the estimates used will change within the near term.~~

~~Contract~~Accounts costs include all direct material and labor costs and those indirect costs related to contract performance, such as indirect labor, supplies, tools, repairs, and depreciation. Selling, general and administrative costs are charged to expense as incurred. Provisions for estimated losses on uncompleted contracts are made in the period in which such losses are determined. Changes in job performance, job conditions, and estimated profitability may result in revisions to costs and income, which are recognized in the period in which the revisions are determined. Changes in estimated job profitability resulting from job performance, job conditions, contract penalty provisions, claims, change orders, and settlements, are accounted for as changes in estimates in the current period.receivable

~~The~~Trade ~~asset,~~and ~~“Costs~~other ~~and~~accounts ~~estimated~~receivable ~~earnings~~ are carried at face value less any provisions for uncollectible accounts considered necessary. Accounts receivable primarily include contract receivables from customers in ~~excess~~Texas. ofBad ~~billings~~debt expense is recognized based on ~~uncompleted~~management’s ~~contracts~~estimate of likely losses per year,” ~~represents~~based ~~revenues~~on ~~recognized~~past inexperience ~~excess~~and an estimate of ~~amounts~~current ~~billed~~year uncollectible amounts. The ~~liability, “Billings~~allowance infor ~~excess~~doubtful ofaccounts ~~costs~~was $78,029 and ~~estimated~~$103,029 ~~earnings~~as onof ~~uncompleted~~April ~~contracts~~30,” ~~represents~~2013 ~~billings~~and in2012, ~~excess of revenues recognized~~respectively.

~~Computer equipment sales, IT consulting services & sales of RFID items:~~Inventory

~~Revenue~~Inventories are stated at the lower of cost or market. Cost is ~~recognized~~determined ~~when~~by ~~persuasive~~the ~~evidence~~ average cost method for all inventories. Inventories consist primarily of ancomponents ~~arrangement~~and ~~exists,~~finished ~~delivery~~products ~~has~~held ~~occurred~~for orsale. ~~services~~Rapid ~~have~~technological ~~been~~change ~~rendered,~~and ~~the~~new ~~price~~product isintroductions ~~fixed~~and enhancements could result in excess or ~~determinable~~obsolete inventory. To minimize this risk, Inova evaluates inventory levels and ~~collectability is~~expected ~~reasonably~~usage ~~assured~~on a periodic basis and records adjustments as required.

~~Rental income for RFID items:~~15

~~The~~Property ~~Company follows Staff Accounting Bulletin (“SAB”) No. 104 recognizing RFID rental income. Revenue generally is realized or realizable~~ and earned when all of the following criteria are met: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred or services have been rendered; (3) the seller’s price to the buyer is fixed or determinable; and (4) collectability is reasonably assured. A rental contract term can be daily or weekly. Consistent with SAB 104, the Company’s policy recognizes revenue from equipment rentals in the period earned on a straight-line basis, over the contract term, regardless of the timing of the billing to customers. Revenue from the sale of new and used equipment and parts is recognized at the time of delivery to, or pick-up by, the customer and when all obligations under the sales contract have been fulfilled, risk of ownership has been transferred and collectability is reasonably assured. Services revenue is recognized at the time the services are rendered.

~~Stock~~Property ~~based~~and ~~compensation~~equipment, including revenue–producing rental equipment are carried at cost, less accumulated depreciation and amortization. Additions are capitalized and maintenance and repairs are charged to expense as incurred. Depreciation and amortization is provided principally on the straight-line basis method over the estimated useful lives of the assets. When property is retired or otherwise disposed of, the related cost and accumulated depreciation are removed from the accounts and any resulting gains or losses are credited or charged to operations.

~~ASC~~Intangible 718, “Accounting for Stock-Based Compensation" established financial accounting and reporting standards for stock-based employee compensation plans. It defines a fair value based method of accounting for an employee stock option or similar equity instrument. In January 2006, Inova implemented ASC 718, and accordingly, Inova accounts for compensation cost for stock option plans in accordance with ASC 718. Inova accounts for share based payments to non-employees in accordance with ASC 505-50 “Accounting for Equity Instruments Issued to Non-Employees for Acquiring, or in Conjunction with Selling, Goods or Services”.assets

18Intangible assets with definite lives are recorded at cost and amortized using the straight-line method over their estimated useful lives.

~~Basic~~Impairment ~~and~~of ~~diluted~~long-lived ~~net income (loss) per share~~assets

~~Basic~~The ~~loss~~Company ~~per~~reviews ~~share~~the iscarrying ~~computed~~value ~~using~~of its definite lived intangible assets at least annually. Other long-lived assets, including intangibles, are reviewed whenever events or changes in circumstances indicate that the ~~weighted~~ ~~average~~historical-cost ~~number~~carrying value of ~~shares~~an asset may no longer be appropriate. The Company assesses recoverability of ~~common~~the ~~stock~~asset ~~outstanding~~by ~~during~~comparing ~~each~~the ~~period~~undiscounted future net cash flows expected to result from the asset to its carrying value. ~~Diluted~~If ~~loss~~the ~~per~~carrying ~~share~~value ~~includes~~exceeds the ~~dilutive effects~~undiscounted offuture ~~common~~net ~~stock~~cash ~~equivalents~~flows onof the asset, an ~~“as~~impairment ifloss ~~converted”~~is ~~basis~~measured and recognized. ~~For~~An impairment loss is measured as the ~~years~~difference ~~ended~~between ~~April~~the ~~30,~~net ~~2012~~book value and ~~2011,~~the ~~potential dilutive~~fair ~~securities~~value ~~had~~of anthe ~~anti~~long-~~dilutive~~lived ~~effect~~asset. ~~and~~There were ~~not~~no ~~included~~impairment incharges recorded for the ~~calculation~~years ofended ~~diluted~~April ~~net~~30, ~~loss~~2013 ~~per~~and ~~common~~2012, ~~share~~respectively.

~~Financial~~Goodwill ~~Instruments~~and other indefinite intangibles

~~The~~Goodwill ~~carrying~~and ~~amount~~other ofintangibles ~~our~~with ~~financial~~indefinite ~~instruments, consisting~~lives ofare ~~cash~~not ~~equivalents,~~amortized ~~accounts~~but ~~receivable,~~are ~~accounts~~reviewed ~~and~~for ~~notes~~impairment ~~payable~~at least annually, ~~short-term~~or ~~borrowings~~more ~~and~~frequently ~~certain~~if ~~other~~an ~~liabilities~~event or circumstance indicates that an impairment may have occurred. To test for impairment, ~~approximate~~ ~~their~~the fair value ~~due~~of each reporting unit is compared to ~~their~~the ~~relatively~~related ~~short~~net ~~maturities~~book value, including goodwill. ~~The~~If ~~carrying~~the ~~amount~~net book value of ~~our~~the ~~long-term~~reporting ~~debt~~unit ~~approximates~~exceeds the fair value, ~~since~~an impairment loss is measured and recognized. An income approach is utilized to estimate the ~~stated~~fair ~~rate~~value of ~~interest~~each ~~approximates~~reporting aunit. ~~market~~The ~~rate~~income approach is based on the projected debt-free cash flow, which is discounted to the present value using discount factors that consider the timing and risk of ~~interest~~cash flows. Impairment charges of $142,795 and $0 were recorded for the years ended April 30, 2013 and 2012, respectively.

~~Transfers~~Embedded ~~and~~conversion ~~Servicing of Financial Assets and Liabilities~~features

~~The~~Inova ~~Company~~evaluates ~~accounts~~embedded ~~for~~conversion ~~transfers~~features ~~and~~within ~~servicing of~~convertible ~~financial~~debt ~~assets~~ and ~~liabilities~~convertible inpreferred ~~accordance~~stock ~~with~~under ASC ~~860-10~~815 ~~(formerly SFAS 140)~~ “~~Accounting~~Derivatives ~~for Transfers~~ and ~~Servicing of Financial Assets and Extinguishment of Liabilities~~Hedging”. ~~When the conditions are met for the transfer of assets or liabilities~~ to ~~qualify~~determine aswhether ~~a sale,~~ the ~~assets~~embedded orconversion ~~liabilities~~feature ~~are~~should ~~derecognized~~be ~~and~~bifurcated ~~the~~from ~~gain or loss on~~ the ~~sale~~host isinstrument ~~determined at the date of transfer based upon the amount at which the assets~~ and ~~liabilities~~accounted ~~are~~for ~~transferred~~as ~~less~~a ~~any~~derivative ~~fees, discounts and other charges. The Company recognizes any servicing assets and servicing liabilities~~ at ~~their~~ fair value ~~using~~with ~~the~~changes in fair value ~~measurement~~recorded ~~method as~~in ~~prescribed by ASC 860-10~~earnings. AsIf ofthe ~~April~~conversion ~~30,~~feature ~~2012~~does ~~and~~not ~~2011,~~require ~~the~~derivative ~~Company’s~~treatment ~~servicing~~under ~~asset~~ASC ~~consisted~~815, ofthe ainstrument ~~credit~~is ~~facility receivable~~evaluated ~~due~~under ~~from~~ASC a470-20 ~~third~~“Debt ~~party~~with ~~that~~Conversion ~~purchased accounts receivable~~ and ~~accounts~~Other ~~payable~~Options” ~~from~~for ~~us.~~consideration ~~The carrying amount~~ of ~~our~~any ~~credit facility~~beneficial ~~receivable~~conversion ~~approximates its fair value due to its relatively short maturity~~feature.

~~Derivative~~Income ~~Financial Instruments~~taxes

Inova ~~does~~uses ~~not~~the ~~use~~liability ~~derivative~~method ~~instruments to hedge exposures to cash flow, market, or foreign currency risks. Inova evaluates all~~ of itaccounting ~~financial~~for ~~instruments~~income ~~to determine if such instruments are derivatives or contain features that qualify as embedded derivatives~~taxes. ~~For~~Under ~~derivative~~this ~~financial instruments that are accounted for as liabilities~~method, ~~the~~deferred ~~derivative~~income ~~instrument~~taxes isare ~~initially~~ recorded ~~at its fair value and is then re-valued at each reporting date, with changes in the fair value reported as charges or credits~~ to ~~income.~~reflect ~~For option-based simple derivative financial instruments, Inova uses~~ the ~~Black-Scholes~~tax ~~option-pricing~~consequences ~~model~~on tofuture ~~value~~years ~~the~~of ~~derivative~~temporary ~~instruments~~differences atbetween ~~inception and subsequent valuation dates. For complex embedded derivatives, Inova uses a Monte Carlo simulation model to value~~ the ~~derivative~~tax ~~instruments at~~basis ~~inception and subsequent valuation dates. The classification~~ of ~~derivative~~assets ~~instruments,~~and ~~including whether such instruments should be recorded as~~ liabilities orand astheir ~~equity,~~financial isamounts ~~re-assessed~~ at ~~the~~ year-end ~~of each reporting period~~. ~~Derivative~~Inova ~~instrument~~provides ~~liabilities are~~a ~~classified~~valuation inallowance ~~the~~to ~~balance~~reduce ~~sheet~~deferred astax ~~current~~assets orto ~~non-current~~their ~~based on whether or not~~ net~~-cash~~ ~~settlement~~realizable ~~of the derivative instrument could be required within 12 months of the balance sheet date~~value.

~~Fair Value Measurements~~16

InRevenue ~~September 2006, the FASB issued ASC 820 which defines fair value, establishes a framework for measuring fair value,~~ and ~~expands~~cost disclosures about fair value measurements. The provisions of ASC 820 were effective January 1, 2008. As defined in ASC 820, fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). The Company utilizes market data or assumptions that market participants would use in pricing the asset or liability, including assumptions about risk and the risks inherent in the inputs to the valuation technique. These inputs can be readily observable, market corroborated, or generally unobservable. The Company classifies fair value balances based on the observability of those inputs. ASC 820 establishes a fair value hierarchy that prioritizes the inputs used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (level 1 measurement) and the lowest priority to unobservable inputs (level 3 measurement).recognition

19Inova has four sources of revenues: Information technology (“IT”) network design and implementation from Desert, computer equipment sales from Desert, sales of radio frequency identification (“RFID”) items from RightTag and rental income from Trakkers and Tesselon. Revenue that is received before it is earned is classified as deferred revenue.

~~The~~IT ~~three~~network ~~levels~~design ofand ~~the fair value hierarchy defined by ASC 820 are as follows~~implementation:

~~Level~~Revenues 1from –fixed-price ~~Quoted~~contracts ~~prices~~ are ~~available in~~recognized ~~active~~on ~~markets~~the ~~for~~percentage-of-completion ~~identical~~method, ~~assets~~measured orby ~~liabilities~~the aspercentage of ~~the~~cost ~~reporting~~incurred to date. ~~Active~~to ~~markets~~estimated ~~are~~total ~~those~~cost ~~in which transactions~~ for ~~the~~each ~~asset~~contract. orThis ~~liability~~method ~~occur~~is inused ~~sufficient~~because ~~frequency~~management ~~and~~considers ~~volume~~total cost to ~~provide~~be ~~pricing~~the ~~information~~best onavailable anmeasure ~~ongoing~~of ~~basis.~~progress ~~Level~~on ~~1 primarily~~the ~~consists~~contracts. Because of ~~financial~~inherent ~~instruments~~uncertainties ~~such~~in asestimating ~~exchange-traded derivatives~~costs, ~~marketable~~it ~~securities~~is ~~and~~at ~~listed~~least ~~equities~~reasonably possible that the estimates used will change within the near term.

~~Level~~Contract 2costs –include ~~Pricing~~all ~~inputs~~direct ~~are~~material ~~other~~and ~~than quoted~~labor ~~prices~~costs inand ~~active~~those ~~markets~~indirect ~~included~~costs inrelated ~~level~~to 1contract performance, ~~which~~such ~~are~~as ~~either~~indirect ~~directly~~labor, orsupplies, ~~indirectly~~tools, ~~observable~~repairs, asand ~~of the reported date~~depreciation. ~~Level~~ 2Selling, ~~includes~~general ~~those~~and ~~financial~~administrative ~~instruments~~costs ~~that~~ are ~~valued~~charged ~~using~~to ~~models~~expense oras ~~other valuation methodologies~~incurred. ~~These~~Provisions ~~models~~for ~~are~~estimated ~~primarily industry-standard~~losses ~~models~~on ~~that~~uncompleted ~~consider~~contracts ~~various~~are ~~assumptions,~~made ~~including~~in ~~quoted~~the ~~forward~~period ~~prices~~in ~~for~~which ~~commodities,~~such ~~time~~losses ~~value,~~are ~~volatility factors,~~determined. ~~and~~Changes ~~current~~in ~~market~~job ~~and~~performance, ~~contractual~~job ~~prices for the underlying instruments~~conditions, asand ~~well~~estimated asprofitability ~~other~~may ~~relevant~~result ~~economic~~in ~~measures. Substantially~~revisions ~~all~~to ofcosts ~~these~~and ~~assumptions~~income, which are ~~observable~~recognized in the ~~marketplace~~period ~~throughout~~in ~~the~~which ~~full term of~~ the ~~instrument,~~revisions ~~can~~are bedetermined. ~~derived from~~Changes ~~observable~~in ~~data~~estimated orjob ~~are~~profitability ~~supported~~resulting byfrom ~~observable~~job ~~levels~~performance, atjob ~~which~~conditions, ~~transactions~~contract ~~are~~penalty ~~executed~~provisions, inclaims, ~~the~~change ~~marketplace.~~orders, ~~Instruments~~and ~~in this~~settlements, ~~category~~are ~~generally~~accounted ~~include~~for ~~non-exchange-traded derivatives such~~ as ~~commodity~~changes ~~swaps,~~in ~~interest~~estimates ~~rate~~in ~~swaps,~~the ~~options~~current ~~and collars~~period.

~~Level~~The 3asset, –“Costs ~~Pricing~~and ~~inputs~~estimated ~~include~~earnings ~~significant inputs~~in ~~that~~excess ~~are~~of ~~generally~~billings ~~less~~on ~~observable~~uncompleted ~~from~~contracts,” ~~objective~~represents ~~sources~~revenues recognized in excess of amounts billed. ~~These~~The ~~inputs~~liability, ~~may~~“Billings bein ~~used~~excess ~~with~~of ~~internally~~costs ~~developed~~and ~~methodologies that~~estimated ~~result~~earnings inon ~~management’s~~uncompleted ~~best~~contracts,” ~~estimate~~represents billings in excess of ~~fair~~revenues ~~value~~recognized.

~~The~~Computer ~~following~~equipment ~~tables~~sales ~~set~~& ~~forth~~sales ~~assets and liabilities measured at fair value on a recurring and non-recurring basis by level within the fair value hierarchy as~~ of ~~April 30,~~RFID 2012 and 2011. As required by ASC 820, financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurement requires judgment, and may affect the valuation of fair value assets and liabilities and their placement within the fair value hierarchy levels.items:

Liabilities Measured at Fair Value	April 30, 2012
	Level 1	Level 2		Level 3		Total
Derivative and warrant liabilities	-	-	$	1,461,265	$	1,461,265
	April 30, 2011
	Level 1	Level 2		Level 3		Total
Derivative and warrant liabilities	-	-	$	2,515,687	$	2,515,687

Revenue is recognized when persuasive evidence of an arrangement exists, delivery has occurred or services have been rendered, the price is fixed or determinable, and collectability is reasonably assured.

~~The~~Rental ~~derivatives~~income ~~listed~~for ~~above~~RFID are carried at fair value. The fair value amounts in current period earnings associated with the Company’s derivatives resulted from Level 3 fair value methodologies; that is, the Company’s pricing inputs include significant inputs that are generally less observable from objective sources. These inputs may be used with internally developed methodologies that result in management’s best estimate of fair value.items:

20The Company follows Staff Accounting Bulletin (“SAB”) No. 104 recognizing RFID rental income. Revenue generally is realized or realizable and earned when all of the following criteria are met: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred or services have been rendered; (3) the seller’s price to the buyer is fixed or determinable; and (4) collectability is reasonably assured. A rental contract term can be daily or weekly. Consistent with SAB 104, the Company’s policy recognizes revenue from equipment rentals in the period earned on a straight-line basis, over the contract term, regardless of the timing of the billing to customers. Revenue from the sale of new and used equipment and parts is recognized at the time of delivery to, or pick-up by, the customer and when all obligations under the sales contract have been fulfilled, risk of ownership has been transferred and collectability is reasonably assured. Services revenue is recognized at the time the services are rendered.

InStock ~~accordance~~based with the provisions of ASC 360-10 “Accounting for the Impairment and Disposal of Long-Lived Assets”, for the year ended April 30, 2011, long-lived intangible assets with a carrying amount of $13,517 were written down to their fair value of $0, resulting in an impairment charge of $13,517, which was included in earnings for the year ended April 30, 2011.compensation

InASC ~~accordance~~718, ~~with~~“Accounting ~~the~~for ~~provisions~~Stock-Based ofCompensation" ~~ASC~~established ~~350-20 “Goodwill~~financial accounting and ~~Other~~reporting ~~Intangible~~standards ~~Assets”,~~ for ~~the~~stock-based ~~year~~employee ~~ended~~compensation ~~April~~plans. ~~30,~~It ~~2011,~~defines ~~goodwill~~a ~~with~~fair avalue ~~carrying~~based ~~amount~~method of ~~$6,669,454 was~~accounting ~~written~~for ~~down~~an toemployee ~~its~~stock ~~implied~~option ~~fair~~or ~~value~~similar ofequity $4instrument. In January 2006,~~157~~ Inova implemented ASC 718,~~596~~ and accordingly, ~~resulting~~Inova accounts for compensation cost for stock option plans in anaccordance ~~impairment~~with ~~charge~~ASC of718. ~~$2,511,858,~~Inova ~~which~~accounts ~~was~~for ~~included~~share based payments to non-employees in ~~earnings~~ accordance with ASC 505-50 “Accounting for ~~year~~Equity ~~ended~~Instruments ~~April~~Issued 30to Non-Employees for Acquiring, ~~2011~~or in Conjunction with Selling, Goods or Services”.

~~Recent accounting pronouncements~~17

~~Inova~~Basic ~~does~~and ~~not~~diluted ~~expect~~net ~~the~~income ~~adoption~~(loss) ofper ~~recently issued accounting pronouncements to have a significant impact on our results of operations, financial position or cash flow.~~share

~~NOTE~~Basic 3loss –per ~~GOING~~share ~~CONCERN~~is computed using the weighted average number of shares of common stock outstanding during each period. Diluted loss per share includes the dilutive effects of common stock equivalents on an “as if converted” basis. For the years ended April 30, 2013 and 2012, potential dilutive securities had an anti-dilutive effect and were not included in the calculation of diluted net loss per common share.

AsFinancial shown in the accompanying financial statements, we have incurred losses of $1,249,171 and $3,350,377 for the years ended April 30, 2012 and 2011, and have an accumulated deficit of $17,770,636 and negative working capital of $15,852,516 as of April 30, 2012. These conditions raise substantial doubt as to our ability to continue as a going concern. The consolidated financial statements contained herein do not include any adjustments relating to the recoverability and classification of recorded asset amounts or amounts and classification of liabilities that might be necessary should we be unable to continue in existence. Our ability to continue as a going concern is dependent upon our ability to generate sufficient cash flows to meet our obligations on a timely basis, to obtain additional financing as may be required, and ultimately to attain profitable operations. However, there is no assurance that profitable operations or sufficient cash flows will occur in the future. Management is trying to raise additional capital through sales of stock and refinancing debt.Instruments

21The carrying amount of our financial instruments, consisting of cash equivalents, accounts receivable, accounts and notes payable, short-term borrowings and certain other liabilities, approximate their fair value due to their relatively short maturities. The carrying amount of our long-term debt approximates fair value since the stated rate of interest approximates a market rate of interest.

~~NOTE~~Transfers 4and –Servicing ~~CONTRACT~~of ~~RECEIVABLES~~Financial ~~& CREDIT~~Assets ~~FACILITY~~and ~~RECEIVABLE~~Liabilities

		30-Apr-12		30-Apr-11
Completed contracts	$	945,905	$	669,486
Contracts in progress		180,316		112,800
Total contract receivables	$	1,126,221	$	782,286

The Company accounts for transfers and servicing of financial assets and liabilities in accordance with ASC 860-10 (formerly SFAS 140) “Accounting for Transfers and Servicing of Financial Assets and Extinguishment of Liabilities”. When the conditions are met for the transfer of assets or liabilities to qualify as a sale, the assets or liabilities are derecognized and the gain or loss on the sale is determined at the date of transfer based upon the amount at which the assets and liabilities are transferred less any fees, discounts and other charges. The Company recognizes any servicing assets and servicing liabilities at their fair value using the fair value measurement method as prescribed by ASC 860-10. As of April 30, 2013 and 2012, the Company’s servicing asset consisted of a credit facility receivable due from a third party that purchased accounts receivable and accounts payable from us. The carrying amount of our credit facility receivable approximates its fair value due to its relatively short maturity.

~~Costs,~~Derivative ~~estimated~~Financial ~~earnings, and billings on uncompleted contracts are summarized as follows:~~Instruments

		30-Apr-12			30-Apr-11
Costs incurred on uncompleted contracts	$	1,414,293		$	1,016,219
Estimated earnings		432,821			581,875
Less: billings to date		(1,645,512	)		(1,369,055	)
Total	$	201,602		$	229,039

Inova does not use derivative instruments to hedge exposures to cash flow, market, or foreign currency risks. Inova evaluates all of it financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value and is then re-valued at each reporting date, with changes in the fair value reported as charges or credits to income. For option-based simple derivative financial instruments, Inova uses the Black-Scholes option-pricing model to value the derivative instruments at inception and subsequent valuation dates. For complex embedded derivatives, Inova uses a Monte Carlo simulation model to value the derivative instruments at inception and subsequent valuation dates. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is re-assessed at the end of each reporting period. Derivative instrument liabilities are classified in the balance sheet as current or non-current based on whether or not net-cash settlement of the derivative instrument could be required within 12 months of the balance sheet date.

~~Included~~Fair inValue ~~the accompanying balance sheet under the following captions:~~Measurements

		30-Apr-12		30-Apr-11
Costs and estimated earnings in excess of billings on uncompleted contracts	$	201,602	$	229,039
Billings in excess of costs and estimated earnings on uncompleted contracts		-		-
Total	$	201,602	$	229,039

In September 2006, the FASB issued ASC 820 which defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements. The provisions of ASC 820 were effective January 1, 2008. As defined in ASC 820, fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). The Company utilizes market data or assumptions that market participants would use in pricing the asset or liability, including assumptions about risk and the risks inherent in the inputs to the valuation technique. These inputs can be readily observable, market corroborated, or generally unobservable. The Company classifies fair value balances based on the observability of those inputs. ASC 820 establishes a fair value hierarchy that prioritizes the inputs used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (level 1 measurement) and the lowest priority to unobservable inputs (level 3 measurement).

2218

~~Credit~~The ~~Facility~~three ~~Receivable~~levels of the fair value hierarchy defined by ASC 820 are as follows:

OnLevel ~~December~~1 ~~30,~~– ~~2009,~~Quoted ~~the~~prices ~~Company~~are ~~entered into~~available ain ~~series~~active ofmarkets ~~related agreements with New England Technology Finance, LLC (“NETF”) providing~~ for ~~NETF~~identical toassets ~~purchase eligible~~or ~~accounts~~liabilities ~~receivable~~as ~~balances~~of ~~and~~the toreporting ~~finance qualified purchases (as defined)~~date. ~~This~~Active ~~facility~~markets isare ~~comprised~~those ofin ~~three~~which ~~components: (1)~~transactions anfor ~~Asset~~the ~~Purchase~~asset ~~and~~or ~~Liability~~liability ~~Assumption~~occur ~~Agreement~~in ~~(the~~sufficient ~~“APLA”),~~frequency ~~under~~and ~~which~~volume ~~NETF~~to ~~finances~~provide ~~certain~~pricing ofinformation ~~the~~on ~~Company's qualified~~an ~~product~~ongoing ~~purchases~~basis. inLevel ~~connection~~1 ~~with~~primarily ~~consummating~~consists ~~sales~~of tofinancial ~~customers~~instruments ~~and~~such ~~(2)~~as anexchange-traded ~~Asset~~derivatives, ~~Purchase~~marketable ~~Agreement~~securities ~~(the “APA”),~~ and ~~(3)~~listed ~~a Master Servicing Agreement (“MSA”)~~equities.

~~Qualified~~Level ~~product~~2 ~~purchases~~– ~~financed~~Pricing byinputs ~~NETF under~~are ~~the~~other ~~APLA~~than ~~are~~quoted ~~repaid~~prices ~~from~~in ~~collections~~active ofmarkets ~~accounts~~included ~~receivable~~in ~~balances~~level ~~that~~1, ~~the~~which ~~Company~~are ~~generates~~either ~~from~~directly ~~its~~or ~~sales~~indirectly observable as of ~~such~~the ~~products to~~reported ~~customers~~date. ~~The~~Level ~~Company~~2 ~~transfers~~includes ~~title~~those tofinancial ~~the~~instruments ~~invoices~~that toare ~~NETF~~valued atusing ~~the~~models ~~time~~or ~~these~~other ~~sales~~valuation methodologies. These models are ~~financed~~primarily ~~and~~industry-standard ~~delivery~~models isthat ~~made~~consider ~~to the~~various ~~customer.~~assumptions, ~~The~~including ~~Company~~quoted ~~pays~~forward ~~contractual~~prices ~~financing~~for commodities, time value, volatility factors, and ~~servicing~~current ~~fees~~market toand ~~NETF~~contractual prices for ~~its~~the ~~financing~~underlying instruments, as well as other relevant economic measures. Substantially all of these ~~purchases~~assumptions inare anobservable ~~amount that~~in isthe ~~equal~~marketplace tothroughout athe ~~percentage~~full term of the ~~gross~~instrument, ~~profit~~can ~~margin~~be onderived ~~such~~from ~~sales.~~observable ~~The~~data ~~percentages~~or ~~fees~~are ~~vary~~supported ~~based~~by onobservable ~~the~~levels ~~(a)~~at ~~amount~~which oftransactions ~~gross profit~~are onexecuted ~~such~~in ~~sales,~~the ~~and~~marketplace. ~~(b)~~Instruments ~~number~~in ofthis ~~days~~category ingenerally ~~which~~include ~~the~~non-exchange-traded ~~receivables~~derivatives ~~from~~ such ~~sales~~as ~~remain~~commodity ~~uncollected~~swaps, interest rate swaps, options and collars.

~~NETF~~Level ~~remits~~3 ~~periodically~~– toPricing ~~the~~inputs ~~Company~~include ~~an amount~~significant ~~equal~~inputs tothat ~~the~~are ~~monthly~~generally ~~gross profit margin on the sales~~ less ~~the~~observable ~~contractual~~from ~~fees~~objective sources. ~~The~~These ~~APLA~~inputs ~~also~~may ~~provides~~be ~~for~~used ~~the~~with ~~Company to~~internally ~~repurchase,~~developed ~~after~~methodologies 90that ~~days,~~result atin ~~NETF~~management’s ~~request,~~best ~~any~~estimate ~~amounts that remain by the customer at a repurchase price equal to the outstanding balance due on the account. NETF pre-approves all product purchases and the credit worthiness~~ of ~~the~~fair ~~Company's customers under this arrangement as a precondition to financing the sale~~value.

~~Under~~The ~~the~~following ~~APA,~~tables ~~the~~set ~~Company~~forth ~~transfers~~assets ~~eligible accounts~~and ~~receivable~~liabilities tomeasured ~~NETF~~at infair ~~exchange~~value ~~for~~on ~~advances~~a ofrecurring upand tonon-recurring ~~75%~~basis ofby ~~their~~level ~~gross~~within ~~amount less~~ the ~~amount~~fair ofvalue ~~any~~hierarchy ~~liability~~as toof aApril ~~third party~~30, ~~assumed~~2013 byand ~~NETF~~2012. ~~with~~As ~~respect~~required toby ~~the~~ASC ~~purchased~~820, ~~accounts.~~financial ~~NETF~~assets ~~charges~~and ~~the~~liabilities ~~Company~~are ~~fees~~classified ~~(the “Discount Factor”)~~ in antheir ~~amount~~entirety ~~equal~~based toon the ~~LIBOR~~lowest ~~rate~~level ~~plus~~of 4%input ~~per~~that ~~annum~~is onsignificant ~~advances~~to ~~made at~~ the ~~time~~fair ofvalue ~~the transfer~~measurement. The Company’s ~~also~~assessment ~~retains~~of ~~servicing rights under~~ the ~~MSA.~~significance ~~Under~~of ~~the~~a ~~terms~~particular ofinput to the ~~MSA,~~fair ~~the~~value ~~Company~~measurement ~~manages~~requires ~~collections~~judgment, and ~~other~~may ~~ongoing~~affect ~~interactions~~the ~~with~~valuation ~~its customers in exchange for fees amounting to approximately 20%~~ of ~~the~~fair ~~gross~~value ~~invoice~~assets ~~amount~~and ~~NETF~~liabilities ~~settles~~and ~~fees~~their ~~payable~~placement towithin the ~~Company~~fair ~~under this~~value ~~arrangement~~hierarchy ~~net of the Discount Factor~~levels.

The APA also provides for the Company to repurchase, after 90 days, at NETF’s request, any amounts that remain unpaid by the customer at a repurchase price equal to 75% of the outstanding balance due on the account; however such repurchases are limited to 15% of all receivables transferred to NETF under this arrangement. In addition, NETF pre-approves the credit worthiness of the Company's customers under this arrangement as a precondition to purchasing any invoice.

Liabilities Measured at Fair Value On a Recurring Basis	April 30, 2013
	Level 1	Level 2		Level 3		Total
Derivative and warrant liabilities	-	-	$	1,123,715	$	1,123,715
	April 30, 2012
	Level 1	Level 2		Level 3		Total
Derivative and warrant liabilities	-	-	$	1,461,265	$	1,461,265

The Company accounts for its transfers of accounts receivable to NETF under each of these agreements in accordance with the provision of ASC 860-10 (formerly SFAS 140) “Accounting for Transfers and Servicing of Financial Assets and Extinguishment of Liabilities” as sales of such accounts receivable balances. The gain or loss on sales of receivables NETF is determined at the date of transfer based upon the amount at which they are transferred to NETF less any fees, discounts and other charges provided under the agreements. The Company has determined that all transfers of receivables and payables to NETF under the above agreement qualify as sales because (1) the transferred assets and liabilities have been isolated from Desert (2) NETF has the right to pledge or exchange the assets and (3) Desert does not maintain effective control over the transferred assets. During fiscal 2012 and 2011, the Company recognized a loss on these sales of $322,590 and $296,829, which is the amount of fees incurred on gross margin advances noted above. As of April 30, 2012 and 2011, the credit facility receivable owed to Desert as a result of the servicing agreement was $1,477,930 and $1,230,596.

Assets Measured at Fair Value on a Non-Recurring Basis	April 30, 2013
	Level 1		Level 2		Level 3		Total		Gain (Loss)
Goodwill		-		-	$	4,014,801	$	4,014,801	$	142,795

During the year ended April 30, 2012, Desert sold approximately $15.9 million of accounts receivable to NETF and NETF assumed approximately $10.4 million in accounts payable related to these assets.

	April 30, 2012
	Level 1		Level 2		Level 3		Total		Gain (Loss)
Goodwill		-		-	$	4,157,596	$	4,157,596	$	-

~~During~~The derivatives listed above are carried at fair value. The fair value amounts in current period earnings associated with the ~~year~~Company’s ~~ended~~derivatives ~~April~~resulted ~~30,~~from ~~2011~~Level 3 fair value methodologies; that is, ~~Desert sold~~the ~~approximately~~Company’s ~~$14.5~~pricing ~~million~~inputs ofinclude ~~accounts~~significant ~~receivable~~inputs tothat ~~NETF~~are ~~and~~generally ~~NETF~~less ~~assumed~~observable ~~approximately~~from $9objective ~~million~~sources. These inputs may be used with internally developed methodologies that result in ~~accounts~~management’s ~~payable~~best ~~related to~~estimate ~~these~~of ~~assets~~fair value.

~~This~~In ~~facility~~accordance ~~contains~~with ~~customary~~the ~~affirmative and~~provisions ~~negative~~of ~~covenants~~ASC as350-20 ~~well~~“Goodwill asand ~~specific~~Other ~~provisions~~Intangible ~~related~~Assets”, tofor the ~~quality~~year ofended ~~the~~April ~~accounts~~30, ~~receivables~~2013, ~~sold.~~goodwill ~~The~~with ~~Company~~a ~~has also~~carrying ~~indemnified~~amount ~~NETF~~of ~~for~~$4,157,596 ~~the~~was ~~risk~~written ofdown ~~loss~~to ~~under~~its ~~any~~implied ~~transferred~~fair ~~balances~~value ~~except~~of ~~for~~$4,014,801, ~~loss~~resulting ~~incurred~~in asan aimpairment ~~result~~charge of ~~customer~~$142,795, ~~credit risk~~which was included in earnings for year ended April 30, 2013.

2319

~~NOTE~~Recent 5accounting ~~– PROPERTY AND EQUIPMENT~~pronouncements

~~Property~~Inova ~~and~~does ~~equipment~~not ~~consisted~~expect the adoption of ~~the~~recently ~~following at~~issued ~~April~~accounting 30pronouncements to have a significant impact on our results of operations, ~~2012~~financial ~~and~~position ~~2011:~~or cash flow.

	Life		2012			2011
Office equipment	2 to 10 years	$	100,850		$	100,850
Office furniture	7 to 8 years		37,504			37,504
Vehicles	3 to 5 years		275,857			275,857
Leasehold improvements	3.25		164,944			164,944
Scanners (revenue earning equipment)	5 years		2,021,560			2,011,023
Subtotal			2,600,715			2,590,178
Less: accumulated depreciation			(1,900,511	)		(1,548,384	)
Total		$	700,204		$	1,041,794

NOTE 3 – GOING CONCERN

~~Depreciation~~As ~~expense~~shown ~~totaled~~in the accompanying financial statements, we have incurred losses of $~~355~~6,~~056~~626,238 and $~~414~~1,~~937~~249,171 infor the years ended April 30, 2013 and 2012, and ~~2011~~have an accumulated deficit of $24,396,874 and ~~respectively~~negative working capital of $21,202,875 as of April 30, 2013. ~~Depreciation~~These onconditions ~~scanners~~raise issubstantial ~~included~~doubt ~~cost~~as ofto ~~revenues~~our inability ~~the~~to continue as a going concern. The consolidated financial statements ~~of operations.~~contained ~~For~~herein do not include any adjustments relating to the ~~years~~recoverability ~~ended~~and ~~April~~classification ~~30,~~of ~~2012~~recorded asset amounts or amounts and ~~2011~~classification of liabilities that might be necessary should we be unable to continue in existence. Our ability to continue as a going concern is dependent upon our ability to generate sufficient cash flows to meet our obligations on a timely basis, ~~$319~~to obtain additional financing as may be required,~~416~~ and ~~$344~~ultimately to attain profitable operations. However,~~995~~ ofthere ~~depreciation~~is ~~expense~~no ~~was~~assurance ~~included~~that profitable operations or sufficient cash flows will occur in ~~cost~~the future. Management is trying to raise additional capital through sales of ~~revenues,~~ ~~respectively~~stock and refinancing debt.

NOTE 64 – ~~GOODWILL~~CONTRACT ~~AND~~RECEIVABLES ~~INTANGIBLES~~& CREDIT FACILITY RECEIVABLE

RightTag:

		30-Apr-13		30-Apr-12
Completed contracts	$	649,865	$	945,905
Contracts in progress		53,973		180,316
Total contract receivables	$	703,838	$	1,126,221

InCosts, ~~May~~estimated ~~2007 when Inova acquired RightTag~~earnings, ~~Inova~~ ~~accounted for the acquisition using the purchase method of accounting for business combinations. The purchase price~~ and ~~costs associated~~billings ~~with~~on ~~the~~uncompleted ~~acquisition~~contracts ~~exceeded~~are ~~the~~summarized ~~fair~~as ~~value of net assets acquired by $436,572, which was preliminarily assigned to goodwill.~~follows:

During 2008, Inova completed the valuation of the intangible assets acquired in the RightTag transaction. Pursuant to the valuation, purchase price of $135,702 was assigned to the customer list acquired and the remaining $300,870 was assigned to goodwill. During fiscal 2009, goodwill impairment of $158,075 was recorded, resulting in a carrying value of $142,795. The customer list was fully amortized during fiscal 2010.

		30-Apr-13		30-Apr-12
Costs incurred on uncompleted contracts	$	645.990	$	1,414,293
Estimated earnings		268,767		432,821
Less: billings to date		(901,634)		(1,645,512)
Total	$	13,123	$	201,602

AnIncluded ~~impairment~~in ~~analysis on~~ the ~~goodwill~~accompanying ~~was performed~~balance atsheet ~~April~~under ~~30,~~the ~~2012~~following ~~and 2011 and no impairment to goodwill was recorded.~~captions:

Desert:

		30-Apr-13		30-Apr-12
Costs and estimated earnings in excess of billings on uncompleted contracts	$	13,123	$	201,602
Billings in excess of costs and estimated earnings on uncompleted contracts		-		-
Total	$	13,123	$	201,602

InCredit ~~December~~Facility 2007 when Inova acquired Desert, Inova accounted for the acquisition using the purchase method of accounting for business combinations. The purchase price and costs associated with the acquisition exceeded the fair value of net assets acquired by $4,275,000, of which $860,555 was assigned to the customer list and employment agreements acquired and the remaining $3,315,918 was assigned to goodwill. The customer list and employment agreements were fully amortized as of April 30, 2011.Receivable:

AnOn ~~impairment~~December ~~analysis~~30, on2009, the ~~goodwill~~Company ~~was performed~~entered atinto ~~April~~a 30series of related agreements with New England Technology Finance, ~~2012~~LLC (“NETF”) providing for NETF to purchase eligible accounts receivable balances and ~~2011~~to finance qualified purchases (as defined). This facility is comprised of three components: (1) an Asset Purchase and noLiability ~~impairment~~Assumption Agreement (the “APLA”), under which NETF finances certain of the Company's qualified product purchases in connection with consummating sales to ~~goodwill~~customers ~~was~~and ~~recorded~~(2) an Asset Purchase Agreement (the “APA”), and (3) a Master Servicing Agreement (“MSA”).

~~Trakkers:~~20

InQualified ~~September~~product ~~2008~~purchases ~~when~~financed ~~Inova~~by ~~acquired~~NETF ~~Trakkers, Inova~~under ~~accounted~~the ~~for~~APLA ~~the~~are ~~acquisition~~repaid ~~using~~from collections of accounts receivable balances that the ~~purchase~~Company ~~method~~generates from its sales of ~~accounting~~such ~~for~~products ~~business~~to ~~combinations~~customers. The ~~purchase~~Company ~~price~~transfers ~~and~~title ~~costs associated~~to ~~with~~the invoices to NETF at the ~~acquisition~~time ~~exceeded~~these sales are financed and delivery is made to the ~~fair~~customer. ~~value~~The ofCompany ~~net~~pays ~~assets~~contractual ~~acquired~~financing byand ~~$4,232,454,~~servicing offees ~~which~~to ~~$1,021,713~~NETF for ~~were~~its ~~assigned to~~financing ~~customer~~of ~~list~~these ~~and~~purchases ~~employment~~in ~~agreements~~an ~~and~~amount that is equal to a percentage of the ~~remaining~~gross ~~$3,210,741~~profit ~~was~~margin ~~assigned~~on tosuch ~~goodwill~~sales. The ~~customer~~percentages ~~list~~fees ~~and~~vary ~~employment agreements~~based ~~were~~on ~~fully~~the ~~amortized~~(a) asamount of ~~April~~gross 30profit on such sales, ~~2011~~and (b) number of days in which the receivables from such sales remain uncollected.

AnNETF ~~impairment~~remits ~~analysis~~periodically to the Company an amount equal to the monthly gross profit margin on the ~~goodwill~~sales ~~was performed~~less the contractual fees. The APLA also provides for the Company to repurchase, after 90 days, at ~~April~~NETF’s 30request, ~~2012~~any ~~and~~amounts ~~2011~~that ~~and~~remain $0by the customer at a repurchase price equal to the outstanding balance due on the account. NETF pre-approves all product purchases and ~~$2,511,858~~the credit worthiness of ~~impairment~~the Company's customers under this arrangement as a precondition to ~~goodwill~~financing ~~was~~the ~~recorded~~sale.

~~Goodwill~~Under ~~and~~the ~~Intangible~~APA, ~~Assets~~the ~~consists~~Company transfers eligible accounts receivable to NETF in exchange for advances of up to 75% of their gross amount less the ~~following~~amount asof any liability to a third party assumed by NETF with respect to the purchased accounts. NETF charges the Company fees (the “Discount Factor”) in an amount equal to the LIBOR rate plus 4% per annum on advances made at the time of ~~April~~the 30transfer. The Company also retains servicing rights under the MSA. Under the terms of the MSA, ~~2012~~the Company manages collections and ~~2011:~~other ongoing interactions with its customers in exchange for fees amounting to approximately 20% of the gross invoice amount NETF settles fees payable to the Company under this arrangement net of the Discount Factor.

Goodwill		2012		2011
RightTag	$	142,795	$	142,795
Desert		3,315,918		3,315,918
Trakkers/Tesselon		698,883		698,883
Total	$	4,157,596	$	4,157,596

~~For~~The Company accounts for its transfers of accounts receivable to NETF under each of these agreements in accordance with the ~~years~~provision ~~ended~~of ~~April~~ASC 30860-10 (formerly SFAS 140) “Accounting for Transfers and Servicing of Financial Assets and Extinguishment of Liabilities” as sales of such accounts receivable balances. The gain or loss on sales of receivables NETF is determined at the date of transfer based upon the amount at which they are transferred to NETF less any fees, discounts and other charges provided under the agreements. The Company has determined that all transfers of receivables and payables to NETF under the above agreement qualify as sales because (1) the transferred assets and liabilities have been isolated from Desert (2) NETF has the right to pledge or exchange the assets and (3) Desert does not maintain effective control over the transferred assets. During fiscal 2012 and ~~2011~~2013, ~~Inova~~ ~~recorded~~the ~~amortization~~Company ~~expenses~~recognized a loss on these sales of $0322,590 and $~~450~~252,~~453~~214, ~~respectively~~which is the amount of fees incurred on gross margin advances noted above. As of April 30, 2013 and 2012, the credit facility receivable owed to Desert as a result of the servicing agreement was $485,673 and $1,477,930.

25During the year ended April 30, 2012, Desert sold approximately $15.9 million of accounts receivable to NETF and NETF assumed approximately $10.4 million in accounts payable related to these assets.

~~NOTE~~During 7the –year ~~RELATED-PARTY~~ended ~~TRANSACTIONS~~April 30, 2013, Desert sold approximately $13.3 million of accounts receivable to NETF and NETF assumed approximately $9 million in accounts payable related to these assets.

AThis ~~summary~~facility ofcontains ~~changes~~customary inaffirmative and negative covenants as well as specific provisions related~~-party~~ ~~payable~~ to the quality of the accounts receivables sold. The Company has also indemnified NETF for the ~~years~~risk ~~ended~~of ~~April~~loss ~~30,~~under ~~2012~~any ~~and~~transferred ~~2011~~balances isexcept for loss incurred as ~~follows:~~a result of customer credit risk.

		2012		2011
Beginning balance	$	1,643,113	$	2,093,113
Less: repayments made on related-party payable		—		(450,000	)
Reclassification of accrued interest to related party note payable		189,107
Total related-party payable	$	1,832,220	$	1,643,113

~~Related-party~~NOTE ~~payable~~5 ~~account~~– ~~consisted~~PROPERTY ~~of the~~AND ~~following as of April 30, 2012 and 2011:~~EQUIPMENT

		2012			2011
Due to Southbase, entity related to CEO. Matures May 2017, 7%, unsecured	$	142,532		$	142,532
Due to Desert sellers, notes obtain from acquisition. Matured December 2010 (in default), 18%, secured by all common stock of Desert		1,389,107			1,200,000
Due to Harish Chander, CEO and President of Trakkers. Matured February 2010 (in default), 7%, unsecured		300,581			300,581
Total related-party payable		1,832,220			1,643,113
Less: current maturities		(1,689,688	)		(1,500,581	)
Long-term portion of related-party payable	$	142,532		$	142,532

Property and equipment consisted of the following at April 30, 2012 and 2013:

	Life		2013		2012
Office equipment	2 to 10 years	$	101,475	$	100,850
Office furniture	7 to 8 years		37,504		37,504
Vehicles	3 to 5 years		275,857		275,857
Leasehold improvements	3.25		164,944		164,944
Scanners (revenue earning equipment)	5 years		2,021,560		2,021,560

Subtotal			2,601,340		2,600,715
Less: accumulated depreciation			(2,430,834)		(1,900,511	)

Total		$	170,506	$	700,204

~~Advisors~~Depreciation expense totaled $530,324 ~~LLC~~and &$355,056 ~~Web’s~~in ~~Biggest~~2013 and 2012, ~~Inc~~ respectively. Depreciation on scanners is included cost of revenues in the consolidated statements of operations. For the years ended April 30, 2013 and 2012, $497,848 and $319,416 of depreciation expense was included in cost of revenues, respectively.

~~Advisors,~~NOTE ~~LLC~~6 is– aGOODWILL ~~company~~AND ~~owned by Paul Aunger, a director of the Company. The Company has a consulting agreement with Advisors, LLC for payments of $1,000 per month. Advisors, LLC owns Web’s Biggest, Inc.~~INTANGIBLES

During fiscal 2011, 2,248,649 shares of common stock with a fair value of $96,000 were issued to Advisors, LLC for services rendered. Advisors, LLC is controlled by a director of the Company. The fair value of the stock was recorded to expense during the quarter ended October 31, 2010.RightTag:

~~During~~An ~~fiscal~~impairment ~~2012,~~analysis ~~2,933,333~~on ~~shares~~the ofgoodwill ~~common stock~~was ~~with~~performed aat ~~fair~~April ~~value of $72~~30,~~000~~ ~~were~~2013 ~~issued~~and to2012 ~~Advisors,~~and ~~LLC for services rendered. Advisors~~$142,795 ~~LLC is controlled by a director~~ of ~~the~~impairment ~~Company.~~to ~~The~~goodwill ~~fair value of the stock~~ was recorded toin ~~expense~~2013 ~~during~~due ~~the~~to ~~quarters~~a ~~ended~~decline ~~July~~in 31customers and ~~October~~related ~~31, 2011~~revenues.

~~No amounts were owed to Advisors, LLC as of April 30, 2012 and 2011.~~Desert:

~~Southbase~~In ~~International~~December 2007 when Inova acquired Desert, ~~Limited(“Southbase”)~~Inova accounted for the acquisition using the purchase method of accounting for business combinations. As a result, $3,315,918 was recorded as goodwill.

~~Southbase~~An isimpairment aanalysis ~~company~~on ~~related~~the togoodwill ~~Adam~~was ~~Radly, our~~performed ~~CEO.~~at ~~The~~April ~~Company~~30, ~~has~~2013 aand ~~consulting~~2012 ~~agreement~~and ~~with~~no ~~Southbase~~impairment ~~earning~~to ~~fees~~goodwill ofwas ~~$20,000 per month~~recorded.

~~In November 2011, Inova converted $125,000 of related party accounts payable into 6,944,444 shares of common stock.~~Trakkers:

~~Desert~~In ~~Sellers~~September 2008 when Inova acquired Trakkers, Inova accounted for the acquisition using the purchase method of accounting for business combinations. There was $698,883 of goodwill balance as of April 30, 2013 and 2012.

~~There~~An ~~are~~impairment ~~notes~~analysis ~~payable~~on to the ~~previous~~goodwill ~~owners of~~was ~~Desert~~performed ~~Communications~~at inApril ~~the amount of $1~~30,~~389,106~~ ~~and~~2013 ~~accrued interest of $667,284~~ and ~~$619,451 as of April 30,~~ 2012 and ~~2011. The~~$0 ~~notes are secured by all~~ of ~~the~~impairment ~~common stock of Desert. On December 1, 2009, the sellers agreed~~ to ~~extend~~goodwill ~~the maturity of these notes through December 1, 2010. The notes are now in default. As a result of the extension, the interest rate increased to 18%. Prior to December 1, 2009, the interest rate~~ was 7%recorded. ~~During fiscal 2011, $300,000 was repaid on these notes.~~

~~The~~Goodwill ~~sellers also participated in a working capital facility~~ and ~~loaned~~Intangible ~~$150,000~~Assets toconsists of the ~~Company~~following ~~during~~as ~~fiscal~~of ~~2010.~~April ~~The note bears interest at 18%~~30, is2012 ~~due December, 2010~~ and is ~~unsecured. This note was repaid in fiscal 2011.~~2013:

The Desert sellers are paid bonuses based on the operating results of Desert. As of April 30, 2012 and 2011, $30,305 and $37,475 of bonuses owed to the Desert sellers and are included in accrued liabilities in the consolidated balance sheet.

Goodwill	2013		2012
RightTag	$	0	$	142,795
Desert		3,315,918		3,315,918
Trakkers/Tesselon		698,883		698,883

Total	$	4,014,801	$	4,157,596

2722

NOTE 87 – ~~NOTES~~RELATED-PARTY ~~PAYABLE~~TRANSACTIONS

~~Convertible~~A ~~Note~~summary ~~Payable~~of –changes ~~Ascendiant Opportunity~~in ~~Fund~~related-party payable accounts for the years ended April 30, ~~LLC~~2013 ~~(“Ascendiant”)~~and 2012 is as follows:

In July 2008, a note payable of $500,000 with an original issue discount of $52,875 was issued for 1.5 years by Ascendiant. It is secured by all assets of Desert. The note is convertible into shares of Inova common stock at $0.075 per share. In addition, 52,896,400 warrants to purchase Inova common stock were issued with this note. As of April 30, 2012 and 2011, this note was in default and due on demand.

	2013			2012
Beginning balance	$	1,832,220		$	1,643,113
Less: repayments made on related-party payable		(57,000	)		-
Reclassification of accrued interest to related party note payable		-			189,107
Reclassification of third party payable to related party note payable					-
Assignment of related party note payable to a third party		(50,000	)		-
Total related-party payable		$1,725,220		$	1,832,220

~~This~~Related-party ~~loan~~payable ~~has~~account consisted of the following ~~financial~~as ~~requirements~~of April 30, 2013 and 2012:

· Maintain cash plus availability under IBM $2.5 million line of credit of $250,000 or greater;

	2013			2012
Due to Southbase, entity related to CEO. Matures May 2017, 7%, unsecured	$	85,532		$	142,532

Due to Desert sellers, notes obtain from acquisition. Matured December 2010 (in default), 18%, secured by all common stock of Desert		1,389,107			1,389,107
Due to CEO and President of Trakkers. Matured February 2010 (in default), 7%, unsecured		250,581			300,581
Total related-party payable		1,725,220			1,832,220
Less: current maturities		(1,639,688	)		( 1,689,688	)

Long-term portion of related-party payable	$	85,532		$	142,532

~~· EBITDA of $1.7 million for 12 month period ending December 31~~Advisors, ~~2008~~LLC ~~and~~& ~~$300,000~~Web’s ~~for each 3-month period beginning December 31~~Biggest, ~~2007;~~Inc.

·Advisors, NoLLC ~~concentration~~is ~~above~~a ~~$2.5~~company ~~million~~owned toby ~~any~~Paul ~~supplier~~Aunger, ~~through~~a former director of the ~~IBM~~Company. ~~facility;~~The Company had a consulting agreement with Advisors, LLC for payments of $1,000 per month thru January 31, 2013. Advisors, LLC owns Web’s Biggest, Inc.

·During Nofiscal ~~concentration~~2012, ~~above~~2,933,333 ~~20%~~shares of common stock with a fair value of $72,000 were issued to ~~any~~Advisors, ~~single~~LLC ~~customer;~~for services rendered. Advisors, LLC is controlled by a former director of the Company. The fair value of the stock was recorded to expense during the quarters ended July 31 and October 31, 2011.

· No single accounts payable more than the greater of $300,000 or 20% of the accounts receivable balance under 60 days. The portion beyond 90 days past due must be less than 10% of the total accounts receivable.23

AsDuring offiscal ~~April~~2013, 3025,074 ~~2012~~shares ~~and~~of ~~2011~~common stock with a fair value of $17,000 ~~the~~were ~~Company was~~issued ~~not~~to inAdvisors, ~~compliance~~LLC ~~with~~for ~~these~~services ~~covenants~~rendered. AsAdvisors, LLC is controlled by a ~~result~~director of the ~~note~~Company. isThe infair ~~default~~value ~~and~~of the ~~interest~~stock ~~rate~~was ~~increased~~recorded ~~from~~to ~~15%~~expense toduring ~~18%~~the quarter ended January 31, 2013.

~~2,644,820~~No ~~warrants~~amounts were ~~issued~~owed to ~~Ascendiant with this note. The warrants expire in July 2013. They have an aggregated exercise price of $200. The warrant shares are subject to a put option agreement whereby anytime between January 1~~Advisors, ~~2010~~LLC ~~and July 1, 2013, Ascendiant can require Inova to repurchase from Ascendiant the warrant shares for $250,000. Under ASC 815-40 “Put Warrants”, warrants for put shares should be classified~~ as ~~liabilities and measured at fair value at the end~~ of ~~each~~April reporting period with the change in fair value recorded to earnings. As a result, the fair value of these warrants was recorded as a derivative liability. Upon exercise of the put option, if Inova does not repurchase the shares within 30 ~~days~~, ~~the~~2013 ~~resulting~~and ~~liability with become a convertible note that is convertible into shares of Inova common stock~~2012.

~~The~~Southbase ~~convertible note and warrant agreements both contain dilutive issuance clauses. Under these clauses~~International, based on future issuances of Inova common stock or other convertible instruments, the conversion price of the note above can be adjusted downward or the Company can be required to issue additional warrants to Ascendiant. During fiscal 2009, the Company issued 3,095,940 additional warrants to purchase Inova common stock with a fair value of $309,594 as a result of this clause. These warrants are also subject to the put option agreement described above. As a result, these warrants are also classified as liabilities under ASC 815-40.Limited(“Southbase”)

Southbase International is a company related to Adam Radly, our CEO. The Company has a consulting agreement with Southbase earning fees of $20,000 per month for software development and consulting fees. Fees are earned on a month to month basis only if Southbase provides the related services. If no services are provided, then Southbase will not earn its monthly fee. Since April of 2013, Southbase has not provided any software development or consulting services.

28Desert Sellers

~~Put~~There ~~Option~~are ~~Exercise~~notes payable to the previous owners of Desert Communications in the amount of $1,389,106 and accrued interest of $913,403 and $667,284 as of April 30, 2013 and 2012. The notes are secured by all of the common stock of Desert. On December 1, 2009, the sellers agreed to extend the maturity of these notes through December 1, 2010. The notes are now in default. As a result of the extension, the interest rate increased to 18%. Prior to December 1, 2009, the interest rate was 7%. During fiscal 2011, $300,000 was repaid on these notes.

OnThe ~~April~~Desert 8,sellers ~~2010~~that ~~Ascendiant~~remain ~~exercised~~as ~~2,448,900 warrants~~employees toare ~~purchase~~paid ~~Inova~~bonuses ~~common~~based ~~stock~~on ~~and~~the ~~concurrently~~operating ~~exercised~~results ~~its~~of ~~put~~Desert. ~~option,~~As ~~requiring~~of ~~Inova~~April to30, ~~repurchase~~2013 ~~the~~and ~~shares acquired~~2012, ~~from~~$0 ~~the~~and ~~warrant~~$30,305 ~~exercise~~of ~~from~~bonuses ~~Ascendiant~~owed ~~for~~to ~~$375,000.~~the ~~The~~Desert ~~$375,000~~sellers ~~note~~and isare included in ~~notes~~accrued ~~payable~~liabilities in the consolidated balance sheet ~~as of April 30, 2012 and 2011~~.

~~Since~~NOTE ~~Inova did not repurchase the shares within 30 days, on May~~ 8, ~~2010~~– aNOTES ~~one year $375,000 convertible note was established by Ascendiant at a 20% interest rate. The note is convertible into shares of Inova common stock at $1.50 per share and is unsecured.~~PAYABLE

~~Other~~Convertible ~~Amounts~~Note ~~Owed~~Payable to– Ascendiant Opportunity Fund, LLC (“Ascendiant”):

~~There~~In isJuly 2008, a ~~contested commission~~ note topayable ~~Ascendiant Securities~~of ~~for originally for~~ $78500,000 ofwith ~~commissions.~~an Asoriginal ofissue ~~April~~discount ~~30,~~of ~~2012 and 2011,~~ $~~278~~52,~~930~~875 was ~~owed~~issued for ~~this note~~1.5 ~~The~~years ~~note is~~by ~~included~~Ascendiant. inIt ~~notes~~is ~~payable~~secured inby ~~the~~all ~~consolidated~~assets ~~balance~~of ~~sheet~~Desert. The note ~~originally~~is ~~bore~~convertible ~~interest~~into atshares ~~11.25%,~~of ~~but~~Inova iscommon ~~now~~stock ~~in default and bears interest~~ at ~~18%~~$0.075 ~~The~~per ~~Company~~share. isIn ~~contesting~~addition, ~~this~~528,964 ~~note~~warrants ~~due~~ to ~~the~~purchase ~~original~~Inova ~~circumstances~~common ~~surrounding~~stock ~~it.~~were ~~Ascendiant~~issued ~~has claimed~~with tothis benote. ~~the~~As ~~broker~~of ~~that~~April ~~introduced~~30, ~~Inova~~2013 ~~to Boone~~ and ~~accordingly~~2012, ~~claims~~this ~~certain~~note ~~commissions~~was ~~from~~in ~~transactions~~default ~~between Inova~~ and ~~Boone.~~due ~~Inova~~on ~~disputes~~demand ~~this~~and ~~claim~~as a result.

~~Notes~~This ~~Payable~~loan –has ~~Boone~~the ~~Lenders,~~following ~~LLC (“Boone”)~~financial requirements:

~~Fiscal~~· ~~2008~~Maintain cash plus availability under IBM $2.5 million line of credit of $250,000 or greater;

~~During~~· ~~fiscal~~EBITDA ~~2008,~~of ~~Inova~~$1.7 ~~issued~~million ~~a note to Boone~~ for ~~$1,792,000~~12 ~~with~~month anperiod ~~original~~ending ~~issue~~December ~~discount~~31, of2008 and $~~192~~300,000 ~~due~~for ineach ~~November 2012. The note bears interest at Prime+~~3%-month orperiod ~~11.25% .~~beginning 8December 31,~~746,960~~ ~~warrants to purchase Inova common stock were issued to Boone with this note. The warrants expire in November 2012 and have an aggregate exercise price of $100.~~2007;

29· No concentration above $2.5 million to any supplier through the IBM facility;

~~The~~· ~~warrant~~No ~~shares~~concentration ~~are~~above ~~subject~~20% to aany ~~put~~single option agreement whereby anytime between June 10, 2010 and June 10, 2013, Boone can require Inova to repurchase from Boone the warrant shares for $1,300,000. Under ASC 815-40 “Put Warrants”, warrants for put shares should be classified as liabilities and measured at fair value at the end of each reporting period with the change in fair value recorded to earnings. As a result, the fair value of these warrants was recorded as a derivative liability. Upon exercise of the put option, if Inova does not repurchase the shares within 30 days, the resulting liability with become a convertible note. The exercise period for this put option was accelerated to April 1, 2010 as a result of the debt restructuring below. $1,000,000 of put options were exercised as of April 30, 2010, see “Convertible Put Exercise Note” below.customer;

~~Fiscal~~· ~~2009~~No single accounts payable more than the greater of $300,000 or 20% of the accounts receivable balance under 60 days. The portion beyond 90 days past due must be less than 10% of the total accounts receivable.

~~During~~As ~~fiscal 2009, Inova issued several notes to Boone for an aggregate principal amount~~ of $3April 30,~~373,763~~ ~~with~~2013 ~~aggregate~~and ~~original issue discounts of $339~~2012,~~600.~~ ~~The~~the ~~notes~~Company ~~bear~~was ~~interest at~~not ~~Prime+3%~~in orcompliance ~~11.25% . The notes were due at various dates from March 2009 through March 2011. In connection~~ with these ~~notes, Inova~~covenants. ~~granted~~As ~~warrants~~a toresult ~~purchase~~the ~~13,851,540~~note ~~shares~~is ofin ~~Inova's~~default ~~common~~and ~~stock,~~the ~~warrants~~interest torate ~~purchase~~increased 92from ~~shares~~15% ~~of Desert Communications, Inc. common stock, and warrants~~ to ~~purchase 19.44~~18% ~~of Trakkers, LLC~~. The warrants expire at various dates from April 2013 through February 2014 and have an aggregated exercise price of $1,300. As of April 30, 2012 and 2011, all of these notes were in default and due on demand

26,448 warrants were issued to Ascendiant with this note. The warrants expired in July 2013. They have an aggregated exercise price of $200. The warrant shares are subject to ~~various~~ a put option ~~agreements~~agreement whereby anytime between January 1, 2010 and ~~January~~July 1, 2013, Ascendiant ~~Boone~~ can require Inova to repurchase from ~~Boone~~Ascendiant the warrant shares for $~~1,574,~~250,000. Under ASC 815-40 “Put Warrants”, warrants for put shares should be classified as liabilities and measured at fair value at the end of each reporting period with the change in fair value recorded to earnings. As a result, the fair value of these warrants was recorded as a derivative liability. Upon exercise of the put option, if Inova does not repurchase the shares within 30 days, the resulting liability with become a convertible note. ~~The~~that ~~exercise~~is ~~period~~convertible ~~for these~~into ~~put~~shares ~~options was accelerated to April 1, 2010 as a result~~ of ~~the~~Inova ~~debt~~common ~~restructuring below~~stock. ~~$1,000,000 of put options were exercised as of April 30, 2010, see “Convertible Put Exercise Note” below.~~

~~Fiscal 2010~~24

~~During~~The ~~fiscal~~convertible ~~2010,~~note ~~Inova~~and ~~issued~~warrant ~~several~~agreements ~~notes to~~both ~~Boone~~contain ~~for~~dilutive anissuance ~~aggregate~~clauses. ~~principal~~Under ~~amount~~these ~~of $1~~clauses,~~128,856~~ ~~with~~based ~~aggregate~~on ~~original~~future ~~issue~~issuances ~~discounts~~ of ~~$178,357.~~Inova ~~The~~common ~~notes~~stock ~~bear~~or ~~interest at~~other ~~Prime+3%~~convertible orinstruments, ~~11.25%~~the .conversion ~~The~~price ~~notes~~of ~~were~~the ~~due~~note atabove ~~various~~can ~~dates~~be ~~from~~adjusted ~~December~~downward ~~2009~~or ~~through~~the ~~February~~Company ~~2011.~~can Inbe ~~connection~~required ~~with~~to ~~these notes,~~issue ~~Inova~~additional ~~granted~~ warrants to ~~purchase~~Ascendiant. ~~11,697,440~~During ~~shares~~fiscal of2009, ~~Inova's~~the ~~common~~Company ~~stock~~issued 30,959 additional warrants to purchase 64Inova ~~shares of Desert Communications, Inc.~~ common stock, ~~and~~with ~~warrants~~a tofair ~~purchase~~value ~~1.44%~~ of ~~Trakkers~~$309,594 ~~LLC.~~as ~~The~~a ~~warrants~~result ~~expire~~of atthis ~~various~~clause. ~~dates~~These ~~from~~warrants ~~May~~are ~~2014~~also ~~through January~~subject ~~2017~~to ~~and~~the ~~have~~put anoption ~~aggregated~~agreement ~~exercise~~described ~~price of $800~~above. As ofa ~~April 30~~result, ~~2012~~these ~~and~~warrants ~~2011,~~are ~~all~~also ofclassified ~~these~~as ~~notes~~liabilities ~~were~~under inASC ~~default~~815-40.

The warrant shares are subject to various put option agreements whereby for various periods ranging from April 2010 to February 2014, Boone can require Inova to repurchase from Boone the warrant shares for $534,900. Under ASC 815-40 “Put ~~Warrants”, warrants~~Option for put shares should be classified as liabilities and measured at fair value at the end of each reporting period with the change in fair value recorded to earnings. As a result, the fair value of these warrants was recorded as a derivative liability. Upon exercise of the put option, if Inova does not repurchase the shares within 30 days, the resulting liability with become a convertible note. The exercise period for these put options was accelerated to April 1, 2010 as a result of the debt restructuring below. $1,000,000 of put options were exercised as of April 30, 2010, see “Convertible Put Exercise ~~Note” below.~~

~~Fiscal~~On ~~2011~~April 8, 2010 Ascendiant exercised 24,489 warrants to purchase Inova common stock and concurrently exercised its put option, requiring Inova to repurchase the shares acquired from the warrant exercise from Ascendiant for $375,000. The $375,000 note is included in notes payable in the consolidated balance sheet as of April 30, 2013 and 2012.

~~During~~Since ~~the quarter ended July 31, 2010, Boone exercised warrants to purchase 30,111,440 shares of~~ Inova ~~common~~did ~~stock~~not ~~and~~repurchase ~~130.90~~the shares ofwithin ~~Desert~~30 ~~common stock. Contemporaneously~~days, ~~Boone~~ ~~exercised~~on ~~the~~May ~~related put options~~8, ~~requiring~~2010 ~~Inova~~a toone ~~repurchase~~year ~~the warrants shares from Boone for~~ $1375,~~515,900.~~000 ~~Under~~convertible ~~the put~~note ~~option~~was ~~agreement,~~established ifby ~~Inova~~Ascendiant ~~fails~~at toa ~~repurchase~~20% ~~the~~interest ~~warrant~~rate. ~~shares~~The ~~from~~note ~~Boone,~~is ~~the~~convertible ~~put~~into ~~option~~shares ~~liability~~of ~~will become a convertible note.~~ Inova ~~did~~common ~~not~~stock ~~repurchase~~at ~~the~~$150 ~~warrant~~per ~~shares~~share and ~~accordingly,~~is ~~the put option became a convertible note during the quarter ended July 31, 2010~~unsecured.

~~During~~Other ~~the~~Amounts ~~quarter~~Owed ~~ended October 31, 2010, Boone exercised warrants~~ to purchase 7,444,240 shares of Inova common stock and 19.44% of Trakkers common stock. Contemporaneously, Boone exercised the related put options, requiring Inova to repurchase the warrants shares from Boone for $792,000. Under the put option agreement, if Inova fails to repurchase the warrant shares from Boone, the put option liability will become a convertible note. Inova did not repurchase the warrant shares and accordingly, the put option became a convertible note in November 2010.Ascendiant

There is a contested commission note to Ascendiant Securities for originally for $78,000 of commissions. As of April 30, 2013 and 2012, $278,930 was owed for this note. The note is included in notes payable in the consolidated balance sheet. The note originally bore interest at 11.25%, but is now in default and bears interest at 18%. The Company is contesting this note due to the original circumstances surrounding it. Ascendiant has claimed to be the broker that introduced Inova to Boone and accordingly claims certain commissions from transactions between Inova and Boone. Inova disputes this claim.

~~Paid-In~~Notes ~~Kind~~Payable ~~Interest~~– Boone Lenders, LLC (“Boone”):

~~Boone~~Fiscal is capitalizing and charging paid in kind interest on several of its notes. Each period, at a rate mutually agreed to by the Company and Boone, interest is recognized on the outstanding principal balance and added to the principal balance of the note. This started in May 2010 for Boone’s notes as a temporary arrangement which can be cancelled at any time. The interest rates range from 11% to 20% on various notes.2008

~~For~~During ~~the~~fiscal ~~years~~2008, ~~ended~~Inova ~~April~~issued ~~30,~~a ~~2012~~note ~~and~~to ~~2011~~Boone for $1, a792,000 ~~total~~with an original issue discount of $73192,~~204~~000 ~~and~~due ~~$183,401~~in ofNovember 2012. The note bears interest ~~was~~at ~~recognized~~Prime+3% ~~and~~or ~~recorded~~11.25% . 87,470 warrants to ~~the~~purchase ~~principal~~Inova ~~balance~~common ofstock ~~all~~were ~~loans~~issued ~~from~~to Boone ~~Lenders, LLC~~with ~~except~~this ~~the~~note. ~~convertible~~The ~~put~~warrants ~~notes~~expire ~~described~~in ~~below~~November 2012 and have an aggregate exercise price of $100.

~~Anti~~The warrant shares are subject to a put option agreement whereby anytime between June 10, 2010 and June 10, 2013, Boone can require Inova to repurchase from Boone the warrant shares for $1,300,000. Under ASC 815-~~Dilution~~40 “Put Warrants”, warrants for put shares should be classified as liabilities and measured at fair value at the end of each reporting period with the change in fair value recorded to earnings. As a result, the fair value of these warrants was recorded as a derivative liability. Upon exercise of the put option, if Inova does not repurchase the shares within 30 days, the resulting liability with become a convertible note. The exercise period for this put option was accelerated to April 1, 2010 as a result of the debt restructuring below. $1,000,000 of put options were exercised as of April 30, 2010, see “Convertible Put Exercise Note” below.

All of the warrants granted above contained dilutive issuance clauses in their agreements. Under these clauses, based on future issuances of Inova common stock or other convertible instruments, Inova can be required to issue additional warrants to Boone. During fiscal 2008, the Company issued 468,120 additional warrants to purchase Inova common stock as a result of this clause. During fiscal 2009, the Company issued 8,031,040 additional warrants to purchase Inova common stock as a result of this clause. During fiscal 2010, the Company issued 2,123,200 additional warrants to purchase Inova common stock as a result of this clause. These warrants are also subject to the put option agreements described above. As a result, these warrants are also classified as liabilities under ASC 815-40. See Note 9 for more information.25

~~Debt~~Fiscal ~~Restructuring~~2009

InDuring ~~the third quarter of~~ fiscal ~~2010~~2009, Inova ~~restructured~~ ~~several of its previously~~ issued several notes ~~payable~~ to Boone tofor ~~extend~~an ~~the~~aggregate ~~maturity~~principal ~~dates,~~amount ~~modify~~of ~~the interest rate and payment terms. Inova combined 6 previous notes that had due dates ranging from December 16~~$3,373,763 ~~2009~~with ~~through~~aggregate ~~December~~original ~~30,~~issue ~~2010~~discounts ~~into one~~of $~~836~~339,~~446 note payable~~600. The ~~original~~ notes ~~had~~bear interest ~~rates~~at of Prime + 3% or 11.25% . The ~~new~~notes ~~note~~were ~~has~~due anat ~~interest~~various ~~rate~~dates ~~of 17.5%~~from .March ~~Starting~~2009 inthrough ~~December~~March ~~2010,~~2011. ~~principal~~In ~~payments~~connection ~~will~~with bethese ~~made~~notes, ~~out~~Inova ofgranted ~~Desert~~warrants ~~Communication~~to ~~Inc.’s~~purchase ~~(“DCI”) free~~138,515 ~~cash~~shares ~~flow~~of ~~which~~Inova's iscommon ~~defined~~stock, bywarrants ~~the~~to ~~agreement~~purchase as92 ~~DCI’s~~shares ~~earnings~~of ~~before~~Desert ~~interest~~Communications, ~~taxes,~~Inc. ~~depreciation~~common stock, and ~~amortization (“EBITDA”)~~warrants ~~subject~~ to ~~various~~purchase ~~adjustments~~19.44% ~~The~~of ~~note~~Trakkers, isLLC. ~~secured~~The bywarrants ~~all~~expire ~~assets~~at ~~including~~various ~~the~~dates ~~shares~~from ~~Inova~~April ~~holds~~2013 ofthrough ~~each of~~February ~~Inova’s~~2014 ~~subsidiaries.~~and Inhave ~~addition,~~an inaggregated ~~conjunction~~exercise ~~with~~price ~~the~~of ~~debt restructuring~~$1,300. ~~all~~As ~~put~~of ~~options~~April ~~that~~30, ~~previously~~2013 ~~could~~and ~~not be~~2012, ~~exercised~~all ~~until~~of ~~future~~these ~~periods~~notes were ~~accelerated~~in todefault ~~April~~and 1,due ~~2010.~~on demand

InThe ~~conjunction~~warrant ~~with~~shares ~~the~~are ~~$836,446~~subject ~~restructured note~~to ~~payable,~~various put option agreements whereby anytime between January 2010 and January 1,~~524~~ 2013,~~640~~ Boone can require Inova ~~warrants~~to repurchase ~~and~~from 7Boone the warrant shares for $1,574,250.01 ~~Desert~~Under ASC 815-40 “Put Warrants”, warrants ~~were~~for ~~issued~~put toshares ~~Boone~~should be classified as liabilities and measured at fair value at the end of each reporting period with the change in fair value recorded to earnings. As a result, the fair value of ~~$190,168~~these warrants was recorded as a derivative liability. ~~They~~Upon ~~have~~exercise ~~an aggregated~~of the put option, if Inova does not repurchase the shares within 30 days, the resulting liability with become a convertible note. The exercise ~~price~~period for these put options was accelerated to April 1, 2010 as a result of the debt restructuring below. $~~200~~1,000,000 of put options were exercised as of April 30, 2010, see “Convertible Put Exercise Note” below.

~~All~~Fiscal previous warrant grants and their associated put options under the notes included in the above restructuring are now combined into this note. This includes the warrants granted in conjunction with the restructuring mentioned above. The total warrants under this note as of the date of the restructuring was 27,476,420 warrants to purchase Inova common stock and 78.1 warrants to purchase Desert common stock, all of which are subject to aggregate put options of $2,213,500. In March 2010, $1,000,000 of these put options were exercised for 8,031,040 warrants to purchase Inova common stock and 31.59 warrants to purchase Desert common stock. See “Convertible Put Exercise Note” section below.

~~Convertible~~During ~~Put~~fiscal ~~Exercise~~2010, ~~Note~~Inova issued several notes to Boone for an aggregate principal amount of $1,128,856 with aggregate original issue discounts of $178,357. The notes bear interest at Prime+3% or 11.25% . The notes were due at various dates from December 2009 through February 2011. In connection with these notes, Inova granted warrants to purchase 116,974 shares of Inova's common stock, warrants to purchase 64 shares of Desert Communications, Inc. common stock, and warrants to purchase 1.44% of Trakkers, LLC. The warrants expire at various dates from May 2014 through January 2017 and have an aggregated exercise price of $800. As of April 30, 2013 and 2012, all of these notes were in default.

OnThe ~~March~~warrant ~~22,~~shares ~~2010~~are ~~Boone~~subject ~~exercised~~to ~~$1,000,000 of~~various ~~its~~ put ~~options~~option agreements whereby for various periods ranging from April 2010 to February 2014, Boone ~~requiring~~can require Inova to repurchase from Boone upthe towarrant 5shares for $534,~~768~~900. Under ASC 815-40 “Put Warrants”,~~300~~ warrants for put shares ofshould ~~Inova~~be ~~common~~classified ~~stock~~as liabilities and ~~31.59~~measured ~~shares~~ at fair value at the end of ~~Desert~~each ~~common~~reporting ~~stock~~period ~~for~~with $1the change in fair value recorded to earnings. As a result,~~000,000~~ the fair value of these warrants was recorded as a derivative liability. ~~Since~~Upon exercise of the put option, if Inova ~~did~~does not repurchase the shares within 30 days, the resulting liability with become a 2convertible ~~year~~note. The exercise period for these put options was accelerated to April 1, 2010 as a result of the debt restructuring below. $1,000,000 ~~convertible note~~of ~~was~~put ~~established~~options bywere ~~Boone~~exercised atas aof ~~24%~~April ~~interest~~30, ~~rate~~2010, see “Convertible Put Exercise Note” below.

31Fiscal 2011

During the quarter ended July 31, 2010, Boone exercised warrants to purchase 30301,~~111,440~~114 shares of Inova common stock and 130.90 shares of Desert common stock. Contemporaneously, Boone exercised the related put options, requiring Inova to repurchase the warrants shares from Boone for $1,515,900. Under the put option agreement, if Inova fails to repurchase the warrant shares from Boone, the put option liability will become a convertible note. Inova did not repurchase the warrant shares and accordingly, the put option became a convertible note during the quarter ended July 31, 2010. ~~The note is due on May 21, 2012 and bears interest at 22%. The note is currently in default.~~

During the quarter ended ~~January~~October 31, ~~2011~~2010, Boone exercised warrants to purchase 774,~~444,240~~442 shares of Inova common stock and 19.44% of Trakkers common stock. Contemporaneously, Boone exercised the related put options, requiring Inova to repurchase the warrants shares from Boone for $792,000. Under the put option agreement, if Inova fails to repurchase the warrant shares from Boone, the put option liability will become a convertible note. Inova did not repurchase the warrant shares and accordingly, the put option became a convertible note ~~during~~in ~~the~~November ~~quarter ended January 31, 2011~~2010. ~~The note is due on January 31, 2012 and bears interest at 20%. The note is currently in default.~~

~~The conversion options are subject to reset provisions that can reduce the conversion prices based on subsequent equity or rights offerings by Desert, Trakkers or Inova below the prices above.~~26

~~The notes are convertible into shares of Desert or Trakkers common stock at an amount equal to (A) 350% of Desert or Trakkers’s EBITDA for the 12 full~~Paid-~~months~~In ~~preceding~~Kind ~~such date,~~Interest ~~minus~~& ~~(i)~~Legal the aggregate amount of Desert’s indebtedness to the initial Holder at such date and (ii) the aggregate amount of the Company’s indebtedness to the Desert Sellers at such date, divided by (B) the total number of issued and outstanding shares of common stock at such date.Fees

~~The~~Boone ~~notes~~is ~~are~~capitalizing ~~also~~and ~~convertible~~charging ~~into~~paid ~~shares of~~in ~~Inova~~kind ~~common~~interest ~~stock~~on atseveral ~~the lower~~ of ~~(i)~~its $0notes.~~075~~ ~~per~~Each ~~share~~period, ofat ~~Inova~~a ~~common~~rate ~~stock~~mutually ~~and~~agreed ~~(ii)~~to by the ~~lowest~~Company ~~per~~and ~~share~~Boone, ~~price~~interest ofis ~~Inova~~recognized ~~common stock~~on ~~conversion~~the ~~price~~outstanding inprincipal ~~effect~~balance atand ~~April~~added ~~22,~~to ~~2010~~the inprincipal ~~any~~balance ~~warrant,~~of ~~option,~~the ~~convertible~~ note. orThis ~~other~~started ~~instrument~~in ~~that~~May ~~has~~2010 ~~been~~for ~~issued by~~Boone’s ~~Inova~~notes oras ~~that~~a istemporary ~~otherwise~~arrangement ~~convertible~~which orcan ~~exchangeable~~be ~~into~~cancelled ~~Inova,~~at ~~after taking into effect~~ any ~~applicable reset or other conversion or exchange price adjustments~~time. AsThe ofinterest ~~April~~rates ~~30,~~range ~~2011,~~from ~~the~~11% ~~lowest~~to ~~per~~20% ~~share~~on ~~price~~various ~~in effect was $0~~notes.~~0405.~~

~~The~~For ~~conversion~~the ~~options~~years ~~are~~ended ~~subject~~April to30, ~~reset provisions~~2013 ~~that~~and ~~can~~2012, ~~reduce~~a ~~the~~total ~~conversion~~of ~~prices~~$18,932 ~~based~~and on$73,204 ~~subsequent~~of ~~equity~~interest orwas ~~rights~~recognized ~~offerings~~and byrecorded ~~Desert~~to orthe ~~Inova~~principal ~~below~~balance of all loans from Boone Lenders, LLC except the ~~prices above~~convertible put notes described below.

During fiscal 2013, Inova ~~analyzed~~agreed ~~the~~to ~~instruments~~pay ~~above~~certain ~~under ASC~~legal ~~815~~fees ~~“Derivatives~~on ~~and~~behalf ~~Hedging”~~of ~~and~~Boone. It ~~determined~~was agreed that these ~~instruments~~amounts ~~should~~would be ~~classified~~added ~~as liabilities and recorded at fair value due~~ to ~~their being no explicit limit to~~ the ~~number~~outstanding ofprincipal ~~shares~~balance ~~to be delivered upon settlement~~ of ~~the~~Boones’s ~~above conversion options~~notes. During ~~The~~fiscal ~~fair~~2013, ~~value of the instruments was determined using~~ a ~~Monte~~total ~~Carlo~~of ~~simulation~~$222,751 ~~model utilizing present value and various probabilities~~ of ~~events.~~legal ~~This~~fees ~~amount~~were isadded ~~included~~to ~~in derivative liabilities in~~ the ~~consolidated~~principal balance ~~sheet.~~of ~~See~~Boone’s ~~Note~~notes 10and ~~for~~a ~~more information~~total onof ~~derivatives~~$118,877 ~~and~~was ~~the valuation model~~repaid.

~~Covenants~~Anti-Dilution Warrants

All of the warrants granted above contained dilutive issuance clauses in their agreements. Under these clauses, based on future issuances of Inova common stock or other convertible instruments, Inova can be required to issue additional warrants to Boone. ~~loans~~During ~~have~~fiscal 2008, the ~~following~~Company ~~financial requirements:~~issued 4,681 additional warrants to purchase Inova common stock as a result of this clause. During fiscal 2009, the Company issued 80,310 additional warrants to purchase Inova common stock as a result of this clause. During fiscal 2010, the Company issued 21,232 additional warrants to purchase Inova common stock as a result of this clause. These warrants are also subject to the put option agreements described above. As a result, these warrants are also classified as liabilities under ASC 815-40. See Note 9 for more information.

·Debt ~~Maintain cash plus availability under IBM $2.5 million line of credit of $250,000 or greater;~~Restructuring

·In ~~EBITDA~~the third quarter of fiscal 2010 Inova restructured several of its previously issued notes payable to Boone to extend the maturity dates, modify the interest rate and payment terms. Inova combined 6 previous notes that had due dates ranging from December 16, 2009 through December 30, 2010 into one $1836,446 note payable.7 ~~million~~The ~~for~~original ~~any~~notes ~~fiscal~~had ~~year;~~interest rates of Prime + 3% or 11.25% . The new note has an interest rate of 17.5% . Starting in December 2010, principal payments will be made out of Desert Communication Inc.’s (“DCI”) free cash flow which is defined by the agreement as DCI’s earnings before interest, taxes, depreciation and amortization (“EBITDA”) subject to various adjustments. The note is secured by all assets including the shares Inova holds of each of Inova’s subsidiaries. In addition, in conjunction with the debt restructuring, all put options that previously could not be exercised until future periods were accelerated to April 1, 2010.

·In Noconjunction ~~concentration~~with ~~above~~the $~~2.5~~836,446 ~~million~~restructured note payable, 15,246 Inova warrants and 7 Desert warrants were issued to ~~any~~Boone ~~supplier~~with ~~through~~a ~~the~~fair ~~IBM~~value ~~facility;~~of $190,168. They have an aggregated exercise price of $200.

·All Noprevious ~~concentration~~warrant grants and their associated put options under the notes included in the above ~~20%~~restructuring are now combined into this note. This includes the warrants granted in conjunction with the restructuring mentioned above. The total warrants under this note as of the date of the restructuring was 274,764 warrants to ~~any~~purchase ~~single~~Inova ~~customer;~~common stock and 78 warrants to purchase Desert common stock, all of which are subject to aggregate put options of $2,213,500. In March 2010, $1,000,000 of these put options were exercised for 80,310 warrants to purchase Inova common stock and 32 warrants to purchase Desert common stock. See “Convertible Put Exercise Note” section below.

·Convertible NoPut ~~single~~Exercise ~~accounts payable more than the greater of $300,000 or 20% of the accounts receivable balance under 60 days. The portion beyond 90 days past due must be less than 10% of the total accounts receivable.~~Note

On March 22, 2010 Boone exercised $1,000,000 of its put options, requiring Inova ~~was~~to repurchase ~~not~~from inBoone ~~compliance~~up ~~with~~to ~~these~~57,683 ~~covenants as~~shares of ~~April~~Inova ~~30,~~common ~~2012~~stock and ~~2011~~32 ~~and~~shares asof Desert common stock for $1,000,000. Since Inova did not repurchase the shares within 30 days a ~~result~~2 year $1,000,000 ~~these~~convertible ~~notes~~note ~~are~~was inestablished ~~default~~by Boone at a 24% interest rate.

~~Note Payable - Agile Opportunity Fund, LLC (“Agile”):~~27

InDuring ~~February~~the ~~2008,~~quarter ~~Inova~~ended ~~borrowed~~July ~~$250~~31,~~000 under~~ a2010, ~~note~~Boone ~~payable~~exercised ~~from~~warrants ~~Agile~~to ~~Opportunity~~purchase ~~Fund~~301,114 ~~LLC.~~shares ~~This~~of ~~note~~Inova ~~has~~common anstock ~~interest~~and ~~rate~~131 shares of ~~18%~~Desert ~~per~~common ~~annum~~stock. ~~and~~Contemporaneously, itBoone ~~matures~~exercised onthe ~~December 31~~related put options, ~~2010.~~requiring ~~The~~Inova ~~note~~to ~~was~~repurchase ~~convertible~~the ~~into~~warrants shares offrom ~~Inova~~Boone ~~common~~for ~~stock at~~ $01,515,900.10 ~~per~~Under ~~share.~~the Input ~~addition,~~option 1agreement,~~250,000~~ ~~warrants~~if Inova fails to ~~purchase~~ repurchase the warrant shares from Boone, the put option liability will become a convertible note. Inova ~~common~~did ~~stock~~not ~~were~~repurchase ~~issued~~the ~~with~~warrant ~~this~~shares and accordingly, the put option became a convertible note during the quarter ended July 31, 2010. ~~This~~The note is ~~secured~~due byon ~~all~~May ~~tangible~~21, 2012 and ~~intangible~~bears ~~assets~~interest ofat ~~Inova~~22%. The note is currently in default.

32During the quarter ended January 31, 2011, Boone exercised warrants to purchase 74,442 shares of Inova common stock and 19.44% of Trakkers common stock. Contemporaneously, Boone exercised the related put options, requiring Inova to repurchase the warrants shares from Boone for $792,000. Under the put option agreement, if Inova fails to repurchase the warrant shares from Boone, the put option liability will become a convertible note. Inova did not repurchase the warrant shares and accordingly, the put option became a convertible note during the quarter ended January 31, 2011. The note is due on January 31, 2012 and bears interest at 20%. The note is currently in default.

~~1,250,000 warrants were issued to Agile with this note. These warrants expire in February 2013. They have an exercise price of $0.10 per share.~~ The ~~warrant~~conversion ~~shares~~options are subject to areset ~~put~~provisions ~~option~~that ~~agreement whereby anytime between February 2010 and February 2013, Agile~~ can ~~require~~reduce ~~Inova to repurchase from Agile~~ the ~~warrant~~conversion ~~shares~~prices ~~for~~based ~~$100,000.~~on ~~Under~~subsequent ~~ASC~~equity ~~815-40~~or ~~“Put~~rights ~~Warrants”,~~offerings ~~warrants~~by ~~for put shares should be classified as liabilities and measured at fair value at the end of each reporting period with the change in fair value recorded to earnings. As a result~~Desert, ~~the~~Trakkers ~~fair~~or ~~value of these warrants was recorded as a derivative liability. Upon exercise of the put option, if~~ Inova ~~does~~ ~~not~~below ~~repurchase~~ the ~~shares~~prices ~~within 30 days, the resulting liability with become a convertible note that is convertible into shares of Inova common stock~~above.

The notes are convertible ~~note~~into ~~and~~shares ~~warrant~~of ~~agreements both~~Desert ~~contain~~or ~~dilutive~~Trakkers ~~issuance~~common ~~clauses.~~stock ~~Under~~at ~~these~~an ~~clauses,~~amount ~~based~~equal onto ~~future~~(A) ~~issuances~~350% of ~~Inova~~Desert ~~common~~or ~~stock~~Trakkers’s orEBITDA ~~other~~for ~~convertible instruments~~the 12 full-months preceding such date, minus (i) the ~~conversion~~aggregate ~~price~~amount of Desert’s indebtedness to the ~~note~~initial ~~above~~Holder ~~can~~at besuch ~~adjusted~~date ~~downward~~and or(ii) the ~~Company~~aggregate ~~can~~amount beof ~~required~~the toCompany’s ~~issue~~indebtedness ~~additional warrants~~ to ~~Inova.~~the ~~During~~Desert ~~fiscal~~Sellers ~~2009~~at such date, divided by (B) the ~~Company~~total ~~issued~~number ~~4,260~~of ~~additional~~issued ~~warrants~~and tooutstanding ~~purchase~~shares ~~Inova~~of common stock at such date.

~~Note~~The ~~Modification~~notes are also convertible into shares of Inova common stock at the lower of (i) $7.50 per share of Inova common stock and (ii) the lowest per share price of Inova common stock conversion price in effect at April 22, 2010 in any warrant, option, convertible note or other instrument that has been issued by Inova or that is otherwise convertible or exchangeable into Inova, after taking into effect any applicable reset or other conversion or exchange price adjustments. As of April 30, 2011, the lowest per share price in effect was $4.05.

InThe ~~December~~conversion ~~2009,~~options ~~Inova~~are ~~modified~~subject ~~the~~to ~~terms of~~reset ~~its~~provisions ~~$250,000~~that ~~note~~can ~~with~~reduce ~~Agile to extend~~ the ~~first~~conversion ~~principal~~prices ~~payment~~based ~~date~~on ~~from~~subsequent ~~December~~equity ~~2009~~or torights ~~December~~offerings ~~2010. It also increased the original issue discount~~ by ~~$50,000~~Desert ~~and~~or ~~reduced~~Inova below the ~~conversion~~prices ~~price to $0~~above.~~0405 per share.~~

On June 20, 2011, the Agile Opportunity Fund, LLC (“Agile”) note from 2008 was amended to allow the principal to be converted to stock at the rate of $0.03 per share (previously convertible at $0.0405 per share). Inova ~~evaluated~~analyzed the ~~amendment~~instruments above under ASC ~~470-60~~815 “~~Troubled~~Derivatives ~~Debt~~and ~~Restructurings~~Hedging”~~. Because~~ ~~the~~and ~~investors~~determined ~~did~~that ~~not~~these ~~grant~~instruments ashould ~~concession~~be onclassified ~~this outstanding loan, the transaction was not accounted for~~ as ~~troubled~~liabilities ~~debt restructuring.~~and ~~Consequently,~~recorded ~~Inova~~at ~~evaluated these transactions under ASC 470-50 “Debtor’s Accounting for a Modification or Exchange of Debt Instruments” to determine if the modification was substantial. Because the change in~~ fair value ofdue ~~the conversion~~to ~~option~~their ~~was~~being ~~greater~~no ~~than~~explicit ~~10%~~limit ofto the ~~carrying~~number ~~value~~ of ~~the~~shares ~~note, the debt modification was determined~~ to be ~~substantial and~~delivered ~~accordingly~~upon ~~the~~settlement ~~debt~~of ~~was extinguished.. As a result,~~ the ~~Company~~above ~~extinguished the related derivative liability associated with the~~ conversion ~~option~~options. ~~with~~The a fair value of ~~$253,730 on~~ the ~~amendment~~instruments ~~date~~was ~~and~~determined ~~recorded~~using a ~~new~~Monte ~~derivative~~Carlo ~~liability~~simulation ~~with~~model autilizing ~~fair~~present value of ~~$344,648~~and onvarious ~~the~~probabilities ~~same~~of ~~date~~events. ~~The~~This ~~Company~~amount ~~recognized~~is aincluded ~~full~~in ~~discount~~derivative ofliabilities ~~$178,500 on the date of the amendment against the related note. Because the note was already~~ in ~~default,~~ the ~~Company~~consolidated ~~immediately~~balance ~~amortized this discount to interest expense~~sheet. InSee ~~addition, the~~Note ~~Company~~9 ~~recognized~~for amore ~~gain~~information on ~~debt~~derivatives ~~extinguishment~~and ofthe ~~$87,582~~valuation ~~as a result of this transaction~~model.

~~Conversions~~Covenants

~~During~~All ~~fiscal~~Boone ~~2011,~~loans ~~Inova~~have ~~issued 1,500,000 shares of common stock for~~ the ~~conversion~~following offinancial ~~$60,750 of debt to Agile Opportunity Fund, LLC at a conversion price of $0.0405.~~requirements:

~~During~~· ~~the~~Maintain ~~three~~cash ~~months~~plus ~~ended~~availability ~~July~~under ~~31,~~IBM ~~2011,~~$2.5 ~~Inova~~million ~~issued~~line ~~666,667 shares~~ of ~~common~~credit ~~stock for the conversion~~ of $~~25,~~250 ~~of Agile debt and sold 333~~,~~333~~000 ~~shares~~or ~~of common stock to Agile for $10,000.~~greater;

~~Registration~~· ~~Rights~~EBITDA ~~for~~of ~~Ascendiant,~~$1.7 ~~Boone and~~million ~~Agile~~for ~~Notes~~any fiscal year;

~~Inova~~· ~~entered~~No ~~into~~concentration aabove registration rights agreement with Ascendiant, Boone and Agile requiring that a filing be done for the number of Registrable Securities equal to the lesser of (i) the total number of Registrable Securities and (ii) one-third of the number of issued and outstanding shares of Common Stock that are held by non-affiliates. Registrable securities are (i) all Warrant Shares (ii) any additional shares of Common Stock issuable in connection with any anti-dilution provisions in the Warrants (iii) all Put Shares (iv) any securities issued or issuable upon any stock split, dividend or other distribution, recapitalization or similar event. Inova shall pay to each party an amount in cash, as partial liquidated damages and not as a penalty, equal to $2.~~00%~~5 ofmillion ~~the aggregate purchase price paid by each party pursuant~~ to ~~the original note agreements for~~ any ~~unregistered~~supplier ~~Registrable~~through ~~Securities then held by each party. The parties agree that Inova shall not be liable for liquidated damages under this Agreement with respect to any Warrants or Warrant Shares. Inova analyzed~~ the ~~registration~~IBM ~~right arrangement under the guidance of FSP ASC 815-15-b and determined that the contingent obligation to make future payments under the registration payment arrangement is not probable.~~facility;

If· ~~Inova~~No ~~were~~concentration ~~required~~above ~~to pay the 2~~20% penalty for not filing registration statements, the estimated penalty would be approximately $164,000. The lenders have historically granted waivers for these registration rights penalties and therefore management believes the likelihood of this payment to beany ~~remote.~~single customer;

33· No single accounts payable more than the greater of $300,000 or 20% of the accounts receivable balance under 60 days. The portion beyond 90 days past due must be less than 10% of the total accounts receivable.

~~Working Capital Facility:~~28

~~The~~Inova ~~Company~~was ~~entered~~not ~~into a tri-party secured agreement~~ in ~~April,~~compliance ~~2010~~with ~~whereby~~these ~~Agile~~covenants ~~($150,000),~~as ~~Boone ($100,000) and the former owners~~ of ~~Desert~~April ~~Communications ($150~~30,~~000)~~ ~~provided amounts~~2013 ~~totaling~~and ~~$400,000~~2012 toand ~~Desert~~as ~~Communications. This was in the form of~~ a ~~Note due December~~result, ~~2010~~these ~~bearing~~notes ~~interest~~are ~~at a rate of 20% and containing the same covenants all Boone documents require. Fees of $10,450 were paid to Boone~~ in ~~conjunction with this debt and were recorded as a discount to the note~~default.

~~During~~Note ~~fiscal~~Payable ~~2011~~- Agile ~~and~~Opportunity ~~Desert~~Fund, ~~sellers were~~LLC ~~paid off and Boone's balance was paid down to $50,000.~~(“Agile”):

~~Other~~In ~~significant~~February ~~debt~~2008, ~~transactions:~~Inova borrowed $250,000 under a note payable from Agile Opportunity Fund, LLC. This note has an interest rate of 18% per annum and it matures on December 31, 2010. The note was convertible into shares of Inova common stock at $0.10 per share. In addition, 12,500 warrants to purchase Inova common stock were issued with this note. This note is secured by all tangible and intangible assets of Inova.

~~Asher~~12,500 warrants were issued to Agile with this note. These warrants expire in February 2013. They have an exercise price of $0.10 per share. The warrant shares are subject to a put option agreement whereby anytime between February 2010 and February 2013, Agile can require Inova to repurchase from Agile the warrant shares for $100,000. Under ASC 815-40 “Put Warrants”, warrants for put shares should be classified as liabilities and measured at fair value at the end of each reporting period with the change in fair value recorded to earnings. As a result, the fair value of these warrants was recorded as a derivative liability. Upon exercise of the put option, if Inova does not repurchase the shares within 30 days, the resulting liability with become a convertible note that is convertible into shares of Inova common stock.

OnThe ~~March~~convertible 7,note ~~2011,~~and ~~Inova~~warrant ~~borrowed~~agreements ~~$103,500 from~~both ~~Asher~~contain indilutive anissuance ~~8% convertible note~~clauses. ~~The~~Under ~~note~~these isclauses, ~~convertible~~based ~~180~~on ~~days~~future ~~from~~issuances ~~the~~of ~~issuance date into~~ Inova common stock ator aother ~~price equal~~convertible toinstruments, ~~61% of~~ the ~~average~~conversion price of the ~~stock’s~~note ~~lowest~~above ~~three~~can ~~prices~~be ~~during~~adjusted downward or the ~~ten~~Company ~~trading~~can ~~days~~be ~~prior~~required to ~~conversion.~~issue ~~The~~additional ~~note is~~warrants ~~due~~to onInova. ~~December~~During 8fiscal 2009, ~~2011~~the ~~and~~Company isissued ~~unsecured~~43 additional warrants to purchase Inova common stock.

InNote May and July of 2011, Inova borrowed $82,500 from Asher Enterprises, Inc. (“Asher”) in an 8% convertible note. The note is convertible 180 days from the issuance date into Inova common stock at a price equal to 61% of the average of the stock’s lowest three prices during the ten trading days prior to conversion. The notes are due in November and January, 2012 and are unsecured.Modification

In ~~September~~December ~~2011~~2009, ~~$103,500~~Inova ofmodified ~~debt~~the ~~issued~~terms ~~during fiscal 2011 to Asher matured. As a result~~ of ~~the~~its ~~maturity~~$250,000 ~~the~~note ~~debt~~with ~~became~~Agile ~~convertible~~to ~~under~~extend the ~~same~~first ~~terms~~principal aspayment ~~the~~date ~~May~~from ~~and~~December ~~July~~2009 ~~notes. Due~~ to ~~there~~ ~~being~~December ~~no explicit limit to the number of shares to be issued upon conversion, the conversion option was classified as a liability on the date of maturity~~2010. ~~The~~It ~~fair~~also ~~value~~increased of the ~~conversion~~original ~~option~~issue ~~on the maturity date was $208,956, resulting in a full~~ discount to ~~the~~by ~~note of~~ $~~103~~50,~~500~~000 and areduced ~~day~~the ~~one~~conversion ~~loss~~price onto ~~derivatives of~~ $~~105,456~~4.05 ~~Because~~per ~~the note already matured, the entire discount was amortized to interest expense during the three months ended October 31, 2011~~share.

~~During~~On ~~the~~June ~~fourth~~20, ~~quarter~~2011, ofthe ~~fiscal~~Agile ~~2012,~~Opportunity ~~$82~~Fund,~~500~~ ofLLC ~~debt~~(“Agile”) ~~issued to~~note ~~Asher~~from ~~matured.~~2008 Aswas aamended ~~result~~to ofallow the ~~maturity,~~principal to be converted to stock at the ~~debt~~rate ~~became~~of $300 per share (previously convertible at $4.05 ~~Due~~per toshare). ~~there~~Inova ~~being~~evaluated nothe ~~explicit~~amendment ~~limit~~under toASC 470-60 “Troubled Debt Restructurings”. Because the ~~number of~~investors ~~shares~~did tonot begrant ~~issued~~a ~~upon~~concession ~~conversion~~on this outstanding loan, the ~~conversion~~transaction ~~option~~ was ~~classified~~not accounted for as troubled debt restructuring. Consequently, Inova evaluated these transactions under ASC 470-50 “Debtor’s Accounting for a ~~liability~~Modification onor Exchange of Debt Instruments” to determine if the ~~date~~modification ofwas ~~maturity~~substantial. ~~The~~Because the change in fair value of the conversion option onwas greater than 10% of the ~~maturity~~carrying ~~date~~value ~~was~~of ~~$137~~the note,~~536,~~ ~~resulting~~the indebt amodification ~~full~~was ~~discount~~determined to be substantial and accordingly the ~~note~~debt was extinguished.. As a result, the Company extinguished the related derivative liability associated with the conversion option with a fair value of $82253,~~500~~730 on the amendment date and recorded a ~~day~~new ~~one~~derivative ~~loss~~ liability with a fair value of $344,648 on ~~derivatives~~the same date. The Company recognized a full discount of $55178,~~036~~500 on the date of the amendment against the related note. Because the note was already ~~matured~~in default, the ~~entire~~Company ~~discount~~immediately ~~was~~ amortized this discount to interest expense. ~~during~~In addition, the ~~three months~~Company ~~ended~~recognized ~~April~~a 30gain on debt extinguishment of $87,582 ~~2012~~as a result of this transaction.

~~During the year ended April 30, 2012, Inova issued 4,222,379 shares of common stock to convert $32,000 of Asher debt.~~Conversions

34During fiscal 2011, Inova issued 15,000 shares of common stock for the conversion of $60,750 of debt to Agile Opportunity Fund, LLC at a conversion price of $4.05.

During the ~~year~~three months ended ~~April~~July 3031, ~~2012 and~~ 2011, Inova ~~made~~issued 6,667 shares of common stock for the ~~following~~conversion ~~cash~~of ~~repayments~~$25,250 onof ~~its~~Agile ~~outstanding~~debt ~~notes~~and ~~payable:~~sold 3,333 shares of common stock to Agile for $10,000.

		2012			2011
Notes payable to Boone/Ascendiant/Agile	$	-		$	210,000
IBM		142,604			114,643
Notes payable to Desert/Trakkers/RightTag previous owners			-		450,000
Notes payable to other		13,708			131,610
Total cash paid	$	156,312		$	906,253

ARegistration ~~summary~~Rights ~~of changes in notes payable~~ for ~~the~~ ~~years ended April 30~~Ascendiant, ~~2012~~Boone and ~~2011~~Agile ~~is as follows:~~Notes

		2012			2011
Beginning balance	$	11,604,738		$	9,848,040
Gross proceeds from the notes payable		82,500			103,500
Non-cash additions due to put note exercises		-			2,307,900
Less: repayments made on notes payable		(156,312	)		(906,253	)
Less: conversion		(57,250)			(60,750	)
Add: paid in kind interest		73,204			183,401
Less: other		425			(162)
Less: discounts to notes payable from derivative liabilities		(364,500)			-
Add: amortization of discount		364,500			128,900
Add: reclassification of accrued interest to notes payable		189,107			-
Total notes payable	$	11,736,412		$	11,604,738

Inova entered into a registration rights agreement with Ascendiant, Boone and Agile requiring that a filing be done for the number of Registrable Securities equal to the lesser of (i) the total number of Registrable Securities and (ii) one-third of the number of issued and outstanding shares of Common Stock that are held by non-affiliates. Registrable securities are (i) all Warrant Shares (ii) any additional shares of Common Stock issuable in connection with any anti-dilution provisions in the Warrants (iii) all Put Shares (iv) any securities issued or issuable upon any stock split, dividend or other distribution, recapitalization or similar event. Inova shall pay to each party an amount in cash, as partial liquidated damages and not as a penalty, equal to 2.00% of the aggregate purchase price paid by each party pursuant to the original note agreements for any unregistered Registrable Securities then held by each party. The parties agree that Inova shall not be liable for liquidated damages under this Agreement with respect to any Warrants or Warrant Shares. Inova analyzed the registration right arrangement under the guidance of FSP ASC 815-15-b and determined that the contingent obligation to make future payments under the registration payment arrangement is not probable.

35If Inova were required to pay the 2% penalty for not filing registration statements, the estimated penalty would be approximately $184,000. The lenders have historically granted waivers for these registration rights penalties and therefore management believes the likelihood of this payment to be remote.

~~Notes~~Working ~~payable~~Capital ~~consisted of the following as of April 30, 2012 and 2011~~Facility:

Lender		2012		2011
Boone Lenders, LLC	$	6,883,176	$	6,809,972
Ascendiant Opportunity Fund, LLC		1,153,930		1,153,930
Agile Opportunity Fund, LLC		173,500		198,750
IBM - Trakkers, LLC
Lease Facility Desert Communications, Inc.		70,183		212,362
Desert Sellers		1,389,107		1,200,000
Trakkers, LLC Sellers		1,769,686		1,769,686
Southbase, LLC - Related Party		142,532		142,532
Other debt		154,298		117,506
Total	$	11,736,412	$	11,604,738

The Company entered into a tri-party secured agreement in April, 2010 whereby Agile ($150,000), Boone ($100,000) and the former owners of Desert Communications ($150,000) provided amounts totaling $400,000 to Desert Communications. This was in the form of a Note due December, 2010 bearing interest at a rate of 20% and containing the same covenants all Boone documents require. Fees of $10,450 were paid to Boone in conjunction with this debt and were recorded as a discount to the note.

~~The~~During ~~following~~fiscal ~~are~~2011 ~~the~~Agile ~~future~~and ~~minimum~~Desert ~~payments for~~sellers ~~the~~were ~~notes~~paid ~~payable:~~off and Boone's balance was paid down to $50,000.

Year		Amount
2012	$	11,593,880
2013		-
2014		-
2015		-
2016 and after		142,532
Total notes payable		11,736,412
Less: current maturities		(11,593,880	)
Notes payable, net of current maturities	$	142,532

Other significant debt transactions:

36Asher

~~NOTE~~On 9March -7, ~~DERIVATIVE~~2011, ~~LIABILITIES~~Inova borrowed $103,500 from Asher in an 8% convertible note. The note is convertible 180 days from the issuance date into Inova common stock at a price equal to 61% of the average of the stock’s lowest three prices during the ten trading days prior to conversion. The note is due on December 8, 2011 and is unsecured.

~~ASC~~In ~~815-40~~May ~~Put~~and ~~Warrant~~July ~~Liabilities~~of 2011, Inova borrowed $82,500 from Asher Enterprises, Inc. (“Asher”) in an 8% convertible note. The note is convertible 180 days from the issuance date into Inova common stock at a price equal to 61% of the average of the stock’s lowest three prices during the ten trading days prior to conversion. The notes are due in November and January, 2012 and are unsecured.

~~Under~~In ~~ASC~~September ~~815-40~~2011, ~~“Put~~$103,500 ~~Warrants”~~of debt issued during fiscal 2011 to Asher matured. As a result of the maturity, ~~warrants~~ ~~for~~the ~~put~~debt ~~shares~~became ~~should~~convertible beunder ~~classified~~the same terms as ~~liabilities~~the May and ~~measured~~July atnotes. ~~fair~~Due ~~value~~to atthere being no explicit limit to the ~~end~~number of ~~each~~shares ~~reporting~~to ~~period~~be ~~with the~~issued ~~change~~upon inconversion, ~~fair~~the ~~value~~conversion ~~recorded~~option towas ~~earnings.~~classified Asas a ~~result,~~liability on the date of maturity. The fair value of the ~~warrants~~conversion ~~granted~~option toon ~~Ascendiant,~~the ~~Agile~~maturity ~~and~~date ~~Boone~~ was $208,956, resulting in ~~conjunction~~a ~~with~~full ~~the~~discount ~~debt~~to ~~offerings~~the ~~noted~~note ~~above~~of ~~were~~$103,500 ~~recorded~~and asa ~~derivative~~day ~~liabilities~~one atloss ~~inception.~~on ~~The~~derivatives ~~liabilities~~of ~~were~~$105,456. ~~subsequently measured~~Because atthe ~~fair~~note ~~value~~already atmatured, the ~~end~~entire ofdiscount ~~each~~was ~~reporting~~amortized ~~period~~to ~~with~~interest expense during the ~~changes~~three ~~recorded~~months toended ~~earnings~~October 31, 2011.

~~Boone Convertible Put Exercise Note~~30

AsDuring ~~discussed in Note 9, Inova determined that~~ the ~~instruments~~fourth ~~embedded~~quarter inof ~~the~~fiscal ~~convertible~~2012, ~~put~~$82,500 ~~notes~~of ~~exercised~~debt byissued ~~Boone~~to ~~during~~Asher ~~fiscal~~matured. ~~2010~~As ~~and~~a ~~2011~~result ~~should~~of bethe ~~classified~~maturity, asthe ~~liabilities and~~debt ~~recorded~~became atconvertible. ~~fair~~Due ~~value due~~ to ~~their~~there being no explicit limit to the number of shares to be ~~delivered~~issued upon ~~settlement of the above~~ conversion, ~~options. The fair value of~~ the ~~embedded~~ conversion option ~~in the $1,000,000 convertible put note~~ was ~~determined to~~classified ~~be $200,000~~ as ofa ~~April~~liability ~~30,~~on ~~2010~~the ~~using~~date aof ~~Monte Carlo simulation model~~maturity. ~~Because~~The ~~the~~fair ~~number~~value of ~~shares~~the toconversion beoption ~~issued~~on ~~upon~~the ~~settlement cannot~~maturity bedate ~~determined~~was ~~under this instrument~~$137,536, ~~Inova~~resulting ~~cannot~~in ~~determine whether it will have sufficient authorized shares at~~ a ~~given date~~full discount to ~~settle~~the ~~any~~note ~~other~~ of ~~its share-settleable instruments. As a result of this~~$82,500 ~~under ASC 815-15 “Accounting for Derivative Financial Instruments Indexed to~~ and ~~Potentially Settled in,~~ a ~~Company's~~day ~~Own~~one ~~Stock”~~loss ~~(formerly~~on ~~EITF~~derivatives ~~00-19),~~of ~~all other share-settleable instruments must be reclassified from equity to liabilities~~$55,036. ~~Inova~~Because ~~had~~the ~~two~~note ~~conversion~~already ~~options~~matured, ~~embedded~~the inentire ~~notes~~discount ~~payable~~was ~~agreements (Ascendiant~~amortized ~~and Agile) and 1,528,140 warrants~~ to ~~purchase~~interest ~~Inova~~expense ~~common~~during ~~stock that were classified in equity as of~~ the ~~date~~three ~~that the~~months ~~Boone~~ended ~~put~~April ~~note~~30, ~~became convertible~~2012.

~~During~~The ~~the~~Asher ~~quarter~~notes ~~ended~~contain ~~July~~provisions ~~31,~~that ~~2010,~~cause ~~Boone exercised~~the ~~warrants~~principal balances to ~~purchase~~increase ~~30,111,440~~by ~~shares~~150% ofupon ~~Inova~~default ~~common~~of ~~stock~~the ~~and 130~~notes.90 Due ~~shares~~to default ofprovisions ~~Desert~~being ~~common~~triggered ~~stock.~~in ~~Contemporaneously, Boone~~certain ~~exercised~~notes ~~the~~during ~~related~~fiscal ~~put options~~2013, ~~requiring Inova to repurchase~~ the ~~warrants~~principal ~~shares~~balances ~~from~~increased ~~Boone~~by ~~for~~ $183,~~515,900~~250. This ~~Under~~amount ~~the put~~was ~~option~~recorded ~~agreement, if Inova fails~~ to ~~repurchase~~interest ~~the~~expense ~~warrant shares from Boone, the put option liability will become a convertible note. Inova did not repurchase the warrant shares and accordingly, the put option became a convertible note~~ during ~~the~~fiscal ~~quarter ended July 31, 2010~~2013.

Additionally, Inova determined that the instruments embedded in a second convertible put note exercised by Boone during fiscal 2011 should be classified as liabilities and recorded at fair value due to their being no explicit limit to the number of shares to be delivered upon settlement of the above conversion options. During the ~~quarter~~year ended ~~January~~April 3130, ~~2011~~2012, ~~Boone~~Inova ~~exercised~~issued ~~warrants to purchase 7~~42,~~444,240~~224 shares of ~~Inova~~ common stock ~~and~~ ~~19.44% of Trakkers common stock. Contemporaneously, Boone exercised the related put options, requiring Inova~~ to ~~repurchase the~~convert ~~warrants shares from Boone for~~ $~~792~~32,000. ~~Under~~of ~~the~~Asher ~~put option agreement, if Inova fails to repurchase the warrant shares from Boone, the put option liability will become a convertible note~~debt. ~~Inova did not repurchase the warrant shares and accordingly, the put option became a convertible note during the quarter ended January 31, 2011.~~

~~The~~During ~~fair value of~~ the ~~embedded~~year ~~conversion options~~ended inApril ~~the $1~~30,~~000,000,~~ $12013,~~515,900~~ ~~and~~Inova ~~$792~~issued 908,~~000~~280 shares ~~convertible~~of ~~put~~common ~~notes~~stock ~~was determined~~ to beconvert $~~593~~142,~~950 as~~ 530 of ~~April~~Asher ~~30, 2012 using a Monte Carlo simulation model~~debt.

37During the year ended April 30, 2013 and 2012, Inova made the following cash repayments on its outstanding notes payable:

These notes are convertible into shares of Desert or Trakkers common stock at an amount equal to (A) 350% of the subsidiary’s EBITDA for the 12 full-months preceding such date, minus (i) the aggregate amount of the subsidiary’s indebtedness to the initial Holder at such date and (ii) the aggregate amount of the Company’s indebtedness to the subsidiary’s Sellers at such date, divided by (B) the total number of issued and outstanding shares of common stock at such date. The note is also convertible into shares of Inova common stock at the lower of (i) $30 per share of Inova common stock and (ii) the lowest per share price of Inova common stock conversion price in effect in any warrant, option, convertible note or other instrument that has been issued by Inova or that is otherwise convertible or exchangeable into Inova, after taking into effect any applicable reset or other conversion or exchange price adjustments. The conversion options are subject to reset provisions that can reduce the conversion prices based on subsequent equity or rights offerings by Desert, Trakkers or Inova below the prices above. As a result of the exercise, the put option liabilities were transferred from derivative liabilities to notes payable during the quarter.

	2013		2012
Notes payable to Boone/Ascendiant/Agile	$		$	-
IBM		24,959		142,604
Notes payable to Desert/Trakkers/RightTag previous owners
Notes payable to other		57,298		13,708

Total cash paid	$	82,257	$	156,312

~~Because~~A ~~the~~summary ~~number~~ of ~~shares~~changes to be issued upon settlement cannot be determined under these instruments, Inova cannot determine whether it will have sufficient authorized shares at a given date to settle any other of its share-settleable instruments. As a result of this, under ASC 815-15 “Accounting for Derivative Financial Instruments Indexed to and Potentially Settled in, a Company's Own Stock” (formerly EITF 00-19), the conversion options noted above and all other share-settleable instruments are classified as liabilities. Inova has three conversion options embedded in notes payable ~~agreements~~for ~~and~~the ~~7,038,475~~years ~~and~~ended ~~11,367,655 warrants at~~ April 30, ~~2012~~2013 and ~~2011~~2012 tois ~~purchase Inova common stock that are classified~~ as ~~liabilities as a result of the provisions of the convertible put notes.~~follows:

The following table summarizes the derivative liabilities included in the consolidated balance sheet:

	2013			2012
Beginning balance	$	11,736,412		$	11,604,738
Gross proceeds from the notes payable		37,500			82,500
Additions due to legal fees capitalized		103,874			-
Additons due to Asher default		83,250			-
Less: repayments made on notes payable		(82,257	)		(156,312	)
Less: conversion		(142,530	)		(57,250	)
Add: paid in kind interest		18,932			73,204
Less: other		-			425
Add: Extension of capital lease		21,276
Less: discounts to notes payable from derivative liabilities		(50,000	)		(364,500	)
Add: amortization of discount		1,639			364,500
Add: reclassification of accrued interest to notes payable		-			189,107
Total notes payable	$	11,728,096		$	11,736,412

Derivative Liabilities
Balance at April 30, 2010	$	5,607,940
ASC 815-15 (EITF 00-19) Additions		52,000
Change in fair value		(836,353	)
Put exercise reclass to debt		(2,307,900	)
Balance at April 30, 2011	$	2,515,687
Change in fair value		(1,428,991	)
Reclassification of derivative liabilities to additional paid-in capital due to conversion of related notes payable		(62,842)
ASC 815-15 (EITF 00-19) Additions		437,411
Balance at April 30, 2012	$	1,461,265

Notes payable consisted of the following as of April 30, 2013 and 2012:

The following table summarizes the derivative gain recorded as a result of the derivative liabilities above:

Lender	2013		2012
Boone Lenders, LLC	$	7,005,982	$	6,883,176
Ascendiant Opportunity Fund, LLC		1,153,930		1,153,930
Agile Opportunity Fund, LLC		173,500		173,500
Lease Facility Desert Communications, Inc.*		66,500		70,183
Desert Sellers - Related Parties		1,389,107		1,389,107
Trakkers, LLC Sellers		1,469,105		1,769,686
Southbase, LLC - Related Party		85,532		142,532
Other debt		384,440		154,298
Total	$	11,728,096	$	11,736,412

		Year Ended			Year Ended
Derivative gain		April 30, 2012			April 30, 2011
Excess of fair value of derivative liabilities over note payable	$	(160,492	)	$	—
Change in fair value		1,428,991			836,353
Total	$	1,268,499		$	836,353

~~Valuation~~The ~~Models~~following are the future minimum payments for the notes payable:

Inova values its warrant derivatives and simple conversion option derivatives using the Black-Scholes option-pricing model. Assumptions used include (1) .20% to 3.20% risk-free interest rate, (2) warrant life is the remaining contractual life of the warrants, (3) expected volatility 233% to 315%, (4) zero expected dividends (5) exercise prices as set forth in the agreements, (6) common stock price of the underlying share on the valuation date, and (7) number of shares to be issued if the instrument is converted.

Year	Amount
2013	$	11,642,564
2014		-
2015		-
2016 and after		85,532

Total notes payable		11,728,096
Less: current maturities		(11,642,564	)

Notes payable, net of current maturities	$	85,532

~~Inova~~The ~~valued the conversion options and reset provisions under its convertible put exercise note with~~ Boone, ~~using~~NETF, aAscendiant, ~~Monte~~Agile, ~~Carlo~~IBM, ~~simulation~~Southbase ~~model utilizing present value~~ and ~~various~~ ~~probabilities~~certain ofseller ~~events.~~notes ~~Assumptions~~are ~~used~~secured ~~include~~by ~~(1)~~UCC’s ~~0.19% risk free rate, (2) conversion prices as set forth~~ in ~~the agreement~~Nevada, ~~(3)~~ ~~expected~~Texas ~~Inova stock price volatility of 236%, (4) expected Desert~~ and ~~Trakkers stock price volatility of 25%~~Montana, ~~and~~where ~~(6) common stock price of~~ the ~~underlying~~company’s ~~share~~assets ~~on the valuation date~~reside. ~~Inova~~These ~~valued~~are the ~~note~~collectively ~~as a combination of~~ the ~~underlying~~senior ~~debt payment~~ and ~~series~~junior ofsecured ~~two options~~creditors. Since the options are mutually exclusive, the Monte Carlo simulation was used to estimate when either of the options are exercisable. When both are exercisable Inova assumed that the more valuable of the two would be exercised.

38NOTE 9 - DERIVATIVE LIABILITIES

~~NOTE~~ASC 10815-40 –Put ~~COMMITMENTS~~Warrant ~~AND CONTINGENCIES~~Liabilities

~~Earn~~Under ~~Outs:~~ASC 815-40 “Put Warrants”, warrants for put shares should be classified as liabilities and measured at fair value at the end of each reporting period with the change in fair value recorded to earnings. As a result, the fair value of the warrants granted to Ascendiant, Agile and Boone in conjunction with the debt offerings noted above were recorded as derivative liabilities at inception. The liabilities were subsequently measured at fair value at the end of each reporting period with the changes recorded to earnings.

AsBoone ~~part~~Convertible ofPut ~~the~~Exercise ~~Trakkers acquisition an earn-out of 5% annually of all revenues generated by Trakkers less than $2.5 million and 10% of any revenues greater than $2.5 million for 5 years was established.~~Note

As ~~part~~discussed ofin Note 9, Inova determined that the ~~Right~~instruments ~~Tag~~embedded ~~acquisition~~in anthe ~~earn-out was~~convertible ~~established:~~put ~~Gross~~notes ~~Profit~~exercised ~~for~~by ~~Right~~Boone ~~Tag~~during ~~for~~fiscal ~~the~~2010 12and ~~months~~2011 ~~period~~should ~~(“Earn~~be ~~Out~~classified ~~Period”)~~as ~~ending~~liabilities ~~April~~and ~~2008~~recorded xat ~~100%, Gross~~fair ~~Profit~~value ~~for~~due ~~Right~~to ~~Tag~~their ~~for~~being no explicit limit to the 12number ~~months~~of ~~period~~shares ~~ending~~to ~~April~~be ~~2009~~delivered xupon ~~100%,~~settlement ~~Gross~~of ~~Profit~~the ~~for~~above ~~Right~~conversion ~~Tag~~options. ~~for~~The fair value of the 12embedded ~~months~~conversion ~~period ending~~option ~~April~~in ~~2010~~the x$1,000,000 ~~40%~~convertible put note was determined to be $200,000 ~~Gross~~as ~~Profit~~of ~~for~~April ~~Right~~30, ~~Tag~~2010 ~~for~~using a Monte Carlo simulation model. Because the 12number ~~month~~of ~~period~~shares ~~ending~~to ~~April~~be ~~2011~~issued xupon ~~20%~~settlement cannot be determined under this instrument, ~~and~~Inova ~~Gross~~cannot ~~Profit~~determine ~~Right~~whether ~~Tag for~~it ~~for~~will ~~the~~have 12sufficient ~~month~~authorized ~~period~~shares ~~April~~at ~~2012~~a xgiven ~~15%.~~date ~~Each~~to ~~payment~~settle ~~will~~any beother ~~comprised~~of its share-settleable instruments. As a result of ~~50%~~this, ~~cash~~under ASC 815-15 “Accounting for Derivative Financial Instruments Indexed to and ~~50%~~Potentially ~~stock~~Settled ofin, a Company's Own Stock” (formerly EITF 00-19), all other share-settleable instruments must be reclassified from equity to liabilities. Inova had two conversion options embedded in notes payable agreements (Ascendiant and ~~will~~Agile) beand ~~paid 45~~15,281 ~~days~~warrants ~~after~~to ~~final~~purchase ~~date~~Inova ~~for~~common ~~calculation~~stock that were classified in equity as of the ~~Earn~~date ~~Out~~that ~~for~~the ~~each~~Boone ~~Earn~~put ~~Out~~note ~~Period~~became convertible.

~~The~~During ~~amount~~the ~~payable~~quarter ~~under~~ended ~~these~~July ~~earn~~31, ~~outs~~2010, ~~as of~~Boone ~~April~~exercised 30warrants to purchase 301,114 ~~2012~~shares of Inova common stock and ~~2011~~131 isshares of Desert common stock. Contemporaneously, Boone exercised the related put options, requiring Inova to repurchase the warrants shares from Boone for $~~450~~1,~~671~~515,900. Under the put option agreement, if Inova fails to repurchase the warrant shares from Boone, the put option liability will become a convertible note. Inova did not repurchase the warrant shares and ~~$335~~accordingly,~~574~~ the put option became a convertible note during the quarter ended July 31, ~~respectively~~2010.

~~Leases:~~32

~~There~~Additionally, isInova andetermined ~~office~~that ~~lease~~the ~~for~~instruments ~~Desert,~~embedded ~~effective May~~in ~~2008~~a ~~until~~second ~~August~~convertible put note exercised by Boone during fiscal 2011. ~~Rent~~should isbe ~~payable~~classified as liabilities and recorded at ~~$6,300~~fair ~~per~~value ~~month~~due ~~including~~to ~~tax~~their being no explicit limit to the number of shares to be delivered upon settlement of the above conversion options. ~~The~~During ~~lease~~the ~~has~~quarter ~~not~~ended ~~been~~January ~~renewed~~31, 2011, Boone exercised warrants to ~~date~~purchase 74,442 shares of Inova common stock and ~~Desert plans~~19.44% of Trakkers common stock. Contemporaneously, Boone exercised the related put options, requiring Inova to ~~continue~~repurchase onthe awarrants ~~month-~~shares from Boone for $792,000. Under the put option agreement, if Inova fails to~~-month~~ ~~basis~~repurchase the warrant shares from Boone, the put option liability will become a convertible note. Inova did not repurchase the warrant shares and accordingly, the put option became a convertible note during the quarter ended January 31, 2011.

~~There~~The isfair anvalue ~~office~~of ~~lease~~the ~~for~~embedded ~~Trakkers~~conversion options in the $1,000,000, ~~effective until~~$1,515,900 ~~April~~and ~~2013.~~$792,000 ~~Rent~~convertible isput ~~payable~~notes atwas determined to be $3671,~~300~~245 ~~per~~as ~~month~~of ~~including~~April ~~tax~~30, 2013 using a Monte Carlo simulation model.

~~Rent~~These ~~expense~~notes ~~was~~are ~~$117~~convertible into shares of Desert or Trakkers common stock at an amount equal to (A) 350% of the subsidiary’s EBITDA for the 12 full-months preceding such date,~~788~~ minus (i) the aggregate amount of the subsidiary’s indebtedness to the initial Holder at such date and (ii) the aggregate amount of the Company’s indebtedness to the subsidiary’s Sellers at such date, divided by (B) the total number of issued and outstanding shares of common stock at such date. The note is also convertible into shares of Inova common stock at the lower of (i) $~~115~~3,~~492~~000 ~~for fiscal~~per ~~2012~~share of Inova common stock and ~~2011~~(ii) the lowest per share price of Inova common stock conversion price in effect in any warrant, ~~respectively.~~option, Noconvertible ~~real~~note ~~estate~~or isother ~~owned~~instrument that has been issued by Inova or that is otherwise convertible or exchangeable into Inova, after taking into effect any applicable reset or other conversion or exchange price adjustments. The conversion options are subject to reset provisions that can reduce the conversion prices based on subsequent equity or rights offerings by Desert, Trakkers or Inova ~~companies~~below the prices above. As a result of the exercise, the put option liabilities were transferred from derivative liabilities to notes payable during the quarter.

~~Litigation:~~Because the number of shares to be issued upon settlement cannot be determined under these instruments, Inova cannot determine whether it will have sufficient authorized shares at a given date to settle any other of its share-settleable instruments. As a result of this, under ASC 815-15 “Accounting for Derivative Financial Instruments Indexed to and Potentially Settled in, a Company's Own Stock” (formerly EITF 00-19), the conversion options noted above and all other share-settleable instruments are classified as liabilities. Inova has three conversion options embedded in notes payable agreements and 70,385 and 113,677 warrants at April 30, 2013 and 2012 to purchase Inova common stock that are classified as liabilities as a result of the provisions of the convertible put notes.

InThe ~~May,~~following ~~2010~~table ~~Ascendiant~~summarizes ~~filed suit for collection of~~ the ~~$833,906~~derivative ~~principal~~liabilities ~~and~~included ~~interest. The suit was stayed to New York and Inova and Desert have been dismissed. Ascendiant filed a new suit~~ in ~~a different California court for~~ the ~~same~~consolidated ~~action;~~balance ~~the suit is pending.~~sheet:

NOTE 11 – CAPITAL LEASES

Derivative Liabilities
Balance at April 30, 2011	$	2,515,687
Change in fair value		(1,428,991	)
Reclassification of derivative liabilities to additional paid-in capital due to conversion of related notes payable		(62,842	)
ASC 815-15 (EITF 00-19) Additions		437,411
Balance at April 30, 2012	$	1,461,265

Equipment leases:

Change in fair value		(114,398	)
Reclassification of derivative liabilities to additional paid-in capital due to conversion of related notes payable		(426,955	)
ASC 815-15 (EITF 00-19) Additions		200,859
Balance at April 30, 2013	$	1,123,715

~~Assets under capital leases, included in property and equipment, consisted of the following at April 30:~~33

		2012			2011
Vehicle	$	18,492		$	18,492
Revenue-producing equipment		917,056			917,056
Less: accumulated depreciation		(715,185	)		(531,774	)
Net assets under capital leases	$	220,363		$	403,774

The following table summarizes the derivative gain recorded as a result of the derivative liabilities above:

	Year Ended			Year Ended
Derivative gain (loss)	April 30, 2013			April 30, 2012
Excess of fair value of derivative liabilities over note payable	$	(151,498	)	$	(160,492	)
Change in fair value		114,398			1,428,991
Total	$	37,100		$	1,268,499

~~NOTE~~Valuation ~~12 – PROFIT SHARING PLAN~~Models

AInova ~~401K~~values ~~plan~~its ~~was~~warrant ~~established~~derivatives inand ~~September~~simple ~~2008. Employer~~conversion ~~contributions~~option ~~are~~derivatives ~~made~~using ~~each~~the ~~pay~~Black-Scholes ~~period~~option-pricing ~~and~~model. aAssumptions ~~total~~used ofinclude ~~$88~~(1) .20% to 3.20% risk-free interest rate,~~110~~ ~~was~~(2) ~~contributed~~warrant ~~for~~life is the ~~year~~remaining ~~ended~~contractual ~~April~~life 30of the warrants, ~~2012~~(3) ~~and~~expected ~~$151~~volatility 233% to 315%,~~889 for~~ (4) zero expected dividends (5) exercise prices as set forth in the ~~year~~agreements, ~~ended~~(6) ~~April~~common 30stock price of the underlying share on the valuation date, ~~2011~~and (7) number of shares to be issued if the instrument is converted.

~~NOTE~~Inova 13valued –the ~~INCOME~~conversion ~~TAX~~options and reset provisions under its convertible put exercise note with Boone using a Monte Carlo simulation model utilizing present value and various probabilities of events. Assumptions used include (1) 0.19% risk free rate, (2) conversion prices as set forth in the agreement, (3) expected Inova stock price volatility of 236%, (4) expected Desert and Trakkers stock price volatility of 25%, and (6) common stock price of the underlying share on the valuation date. Inova valued the note as a combination of the underlying debt payment and series of two options. Since the options are mutually exclusive, the Monte Carlo simulation was used to estimate when either of the options are exercisable. When both are exercisable Inova assumed that the more valuable of the two would be exercised.

~~Inova~~NOTE ~~uses~~10 ~~the~~– ~~liability~~COMMITMENTS ~~method,~~AND where deferred tax assets and liabilities are determined based on the expected future tax consequences of temporary differences between the carrying amounts of assets and liabilities for financial and income tax reporting purposes.CONTINGENCIES

AtEarn April 30, 2012, for federal income tax and alternative minimum tax reporting purposes, Inova had approximately $708,000 of unused net operating losses available for carry forward to future years. The benefit from carry-forward of such net operating losses will expire in various years through 2032. As a result of an internal revenue service audit during fiscal 2012, the company significantly reduced its estimated net operating losses available for carry forward purposes.Outs:

AtAs ~~April~~part ~~30,~~of ~~2011,~~the ~~deferred~~Trakkers ~~tax~~acquisition ~~assets~~an ~~consisted~~ earn-out of ~~the~~5% ~~following:~~annually of all revenues generated by Trakkers less than $2.5 million and 10% of any revenues greater than $2.5 million for 5 years was established.

		United
		States			Canada			Total
NOL at April 30, 2011	$	4,900,000		$	89,000		$	4,989,000
Estimated tax rate		35	%		20	%		N/A
Deferred tax assets		1,715,000			18,000			1,733,000
Valuation allowance		(1,715,000	)		(18,000	)		(1,733,000	)
Net deferred tax assets	$	—		$	—		$	—

As part of the Right Tag acquisition an earn-out was established: Gross Profit for Right Tag for the 12 months period (“Earn Out Period”) ending April 2008 x 100%, Gross Profit for Right Tag for the 12 months period ending April 2009 x 100%, Gross Profit for Right Tag for the 12 months period ending April 2010 x 40%, Gross Profit for Right Tag for the 12 month period ending April 2011 x 20%, and Gross Profit Right Tag for the 12 month period April 2012 x 15%. Each payment will be comprised of 50% cash and 50% stock of Inova and will be paid 45 days after final date for calculation of the Earn Out for each Earn Out Period.

40The amount payable under these earn outs as of April 30, 2013 and 2012 is $446,102 and $450,671, respectively.

~~At April 30, 2012, deferred tax assets consisted of the following~~Leases:

		United
		States			Canada			Total
NOL at April 30, 2012	$	708,000		$	89,000		$	797,000
Estimated tax rate		35	%		20	%		N/A
Deferred tax assets		248,000			18,000			266,000
Valuation allowance		(248,000	)		(18,000	)		(266,000	)
Net deferred tax assets	$	—		$	—		$	—

There is an office lease for Desert, effective May 2008 until August 2011. Rent is payable at $6,300 per month including tax. The lease has not been renewed to date and Desert plans to continue on a month-to-month basis.

There are no federal income taxes payable in 2012 or 2011 as a result of the operating losses recorded during those years. Based on a number of factors, including the lack of a history of profits, management believes that there is ~~sufficient~~an ~~uncertainty~~office ~~regarding~~lease ~~the~~for ~~realization of deferred tax assets~~Trakkers, ~~and,~~ ~~accordingly,~~effective ~~has~~until ~~not booked an income tax benefit as of~~ April ~~30, 2012 and 2011~~2013. ~~All~~Rent ~~losses~~is ~~incurred~~payable ~~can~~at be$3,300 ~~carried~~per ~~forward for~~month ~~seven~~including ~~years for Canadian income~~ tax ~~purposes and twenty years for United States income tax purposes~~.

~~NOTE 14 – COMMON STOCK~~34

~~During~~Rent expense was $211,058 and $117,788 for fiscal 2013 and 2012, respectively. No real estate is owned by the Inova ~~issued:~~companies.

~~· 666,667 shares of common stock for the conversion of $25,250 of Agile debt and sold 333,333 shares of common stock for $10,000.~~Litigation:

·In 4May,~~222,379~~ ~~shares~~2010 Ascendiant filed suit for collection of ~~common~~the ~~stock~~$1,847,038 principal and interest. The suit was stayed to New York and Inova and Desert have been dismissed. Ascendiant filed a new suit in a different California court for the ~~conversion~~same action; judgment was granted for the amount of ~~$32,000~~the existing debt. Boone has obtained a Temporary Restraining Order (“TRO”) in New York against one of ~~Asher~~the two Ascendiant entities for 1 of the 2 notes which prevents Ascendiant Opportunity Fund from collecting on the debt due.

·A 6judgment for $1,~~944~~279,~~444~~219 ~~shares~~in favor of ~~common~~George ~~stock~~Jones has been entered against Inova Technology, Inc and one subsidiary Inova Technology Holdings LLC and includes an order to pay $20,000 per month to Jones. The judgment does not apply to any of Inova's operating subsidiaries. In order to ensure that Inova's operating subsidiaries are not affected, the Company has filed motions requesting TRO’s that prevent Jones from pursuing any collection activity against Inova's primary operating subsidiaries Desert Communications and Trakkers. The TRO's have been granted. Inova has also filed a motion to have the judgment set aside in addition to appealing the judgment. Inova has also commenced litigation in Nevada against Mr Jones and his related party attorney, Sean Kneafsey, seeking damages in excess of $1,000,000 for ~~settlement~~fraud on the court, practicing law without a license and other claims. Jones is in last position behind all other creditors. Inova has accrued $1,279,219 related to this judgment as of ~~accounts~~April ~~payable~~30, 2013.

·NOTE ~~2,933,333~~11 ~~shares~~– ofCAPITAL ~~common stock for services with a fair value of $72,000~~LEASES

AsEquipment ~~a result of conversion of debt described above, Inova settled derivative liabilities with a fair value of $62,842 on the conversion dates. This amount was reclassified to additional paid-in capital.~~leases:

~~During~~Assets ~~fiscal~~under ~~2011~~capital leases, included in property and equipment, consisted of the following at April 30:

2,248,649 shares of common stock with a fair value of $96,000 were issued to Advisors, LLC for services rendered. Advisors, LLC is controlled by a director of the Company. The fair value of the stock was recorded to expense.

	2013			2012
Vehicle	$	18,492		$	18,492
Revenue-producing equipment		917,056			917,056
Less: accumulated depreciation		(865,263	)		(715,185	)

Net assets under capital leases	$	70,285		$	220,363

OnNOTE ~~August~~12 3,– ~~2010,~~PROFIT ~~Inova~~SHARING entered into an agreement with a public relations firm. Under the terms of the agreement, Inova issued 2% of its outstanding common shares at the inception of the agreement as an advance and non-refundable fee for future services. This resulted in the issuance of 1,126,960 shares of common stock with a fair value of $11,270. This amount was expensed during the quarter ended October 31, 2010.PLAN

~~During~~A ~~the~~401K ~~quarter~~plan ~~ended~~was ~~October~~established ~~30,~~in ~~2010 50,000~~September ~~shares~~2008. ofEmployer ~~common~~contributions ~~stock~~are ~~with~~made aeach ~~fair~~pay ~~value~~period and a total of $142,~~500~~812 ~~were~~was ~~issued~~contributed ~~to a public relations firm~~ for ~~services~~the ~~rendered.~~year ~~The~~ending ~~fair value~~April of30, ~~the~~2013 ~~stock~~and ~~was~~$88,110 ~~recorded~~for ~~to expense during~~ the ~~quarter~~year ~~ended~~ending ~~October~~April 30, ~~2010~~2012.

OnNOTE ~~October~~13 ~~20,~~– ~~2010~~INCOME the Board of Directors approved a resolution to complete the issue of a stock dividend to all current shareholders. The ratio will be 20 new shares for every one share held by all shareholders as at the record date. The authorized shares of the company will be adjusted by the same ratio. All share and per share amounts have been adjusted retroactively as if the dividend occurred on the first day of the first period presented.TAX

Inova ~~issued~~uses 1the liability method,~~500,000~~ ~~shares~~where ofdeferred ~~common~~tax ~~stock for~~assets and liabilities are determined based on the ~~conversion~~expected future tax consequences of ~~$60,750~~temporary differences between the carrying amounts of ~~debt~~assets toand ~~Agile~~liabilities ~~Opportunity~~for ~~Fund,~~financial ~~LLC~~and income tax reporting purposes.

41At April 30, 2013, for federal income tax and alternative minimum tax reporting purposes, Inova had approximately $4,629,000 of unused net operating losses available for carry forward to future years. The benefit from carry-forward of such net operating losses will expire in various years through 2033.

~~NOTE 15 – REDEEMABLE PREFERRED STOCK & NON-CONTROLLING INTEREST~~35

~~Series~~At AApril ~~Preferred~~30, ~~Stock~~2013, deferred tax assets consisted of the following:

Inova has authorized an undesignated amount of Series A preferred shares. Each Series A preferred share is convertible into common stock at the rate of 1 to 0.06. There were no shares of Series A preferred stock issued as of April 30, 2012 and 2011.

	United
	States			Canada			Total
NOL at April 30, 2013	$	4,541,000		$	89,000		$	4,630,000
Estimated tax rate		35	%		20	%		N/A

Deferred tax assets		1,589,000			18,000			1,607,000
Valuation allowance		(1,589,000	)		(18,000	)		(1,607,000	)

Net deferred tax assets	$	-		$	-		$	-

~~Series~~At BApril ~~Convertible~~30, ~~Preferred~~2012, ~~Stock~~deferred tax assets consisted of the following:

Inova has authorized 5,000 non-restricted Series B preferred shares to be issued for each acquisition with more than $40 million in sales or $10 million in EBITDA and 5,000 non-restricted Series B preferred shares authorized to be issued for each acquisition with less than $40 million in sales. Each Series B preferred share is convertible into common stock at the rate of 1 to 100. There were no shares of Series B preferred stock issued as of April 30, 2012 and 2011.

	United
	States			Canada			Total
NOL at April 30, 2012	$	708,000		$	89,000		$	797,000
Estimated tax rate		35	%		20	%		N/A

Deferred tax assets		248,000			18,000			266,000
Valuation allowance		(248,000	)		(18,000	)		(266,000	)

Net deferred tax assets	$	-		$	-		$	-

~~Series~~There Bare ~~Redeemable~~no ~~Preferred~~federal ~~Stock~~income taxes payable in 2013 or 2012 as a result of the operating losses recorded during those years. Based on a number of factors, including the lack of a history of profits, management believes that there is sufficient uncertainty regarding the realization of deferred tax assets, and, accordingly, has not booked an income tax benefit as of April 30, 2013 and 2012. All losses incurred can be carried forward for seven years for Canadian income tax purposes and twenty years for United States income tax purposes.

OnNOTE ~~September~~14 1,– ~~2008,~~COMMON 1,500,000 shares of redeemable preferred stock were issued in conjunction with the purchase of Trakkers and Tesselon. This is redeemable Series B, non-voting preferred, which has a dissolution value of $1 per share. The agreement was amended on December 18, 2008 and again in July 2009. The original and first amended preferred stock agreements were determined to have errors and did not represent the intent of both parties causing both to be amended. Inova must determine the method of redemption of the preferred stock any time over the one year period from issuance and when redeemed Inova may choose from the following 3 redemption options: 1) $1,500,000 payment of cash 2) Issuance of 375,000 common shares 3) Transfer of 10% of the Trakkers/Tesselon companies. Option 2) requires the company to issue the 375,000 common shares in three annual installments of 125,000 common shares each beginning no later than October 31, 2010. If elected, options 1) and 3) are due on the third anniversary of the issuance of the preferred stock. During 2009, the company originally anticipated that it would select option 2 and therefore classified the fair value of the preferred stock as a component of stockholders’ equity as of April 30, 2009. Management later determined it is best for the company to elect option 3) and therefore will settle the instrument by issuing 10% ownership of Trakkers LLC on the third anniversary of the agreement. Because the one year period from the original issuance of the preferred stock has passed, the Company can no longer change the method of redemption. At inception of the instrument, the company determined the fair value of the preferred stock was $1,307,506. Because the instrument will now be settled with subsidiary stock, Inova has classified the instrument as non-controlling interest in the consolidated balance sheet as of April 30, 2012 and 2011 in accordance with ASC 810-10-45-17A and ASC 815-40-15-5C (formerly EITF 08-08) “Accounting for an Instrument (or an Embedded Feature) with a Settlement Amount That Is Based on the Stock of an Entity’s Consolidated Subsidiary”. As of April,30, 2012, Inova had not issued the 10 % interest in trakkers to the original sellers. Inova is currently in the process of determining if this settlement option is in conflict with other secured creditors of trakkers.STOCK

~~NOTE~~During 16fiscal –2012 ~~WARRANTS~~Inova issued:

~~Fiscal~~· ~~2011~~6,667 shares of common stock for the conversion of $25,250 of Agile debt and sold 3,333 shares of common stock for $10,000.

~~During~~· ~~the quarter ended July 31~~42,224 ~~2010, Boone exercised warrants to purchase 30,111,440~~ shares of ~~Inova~~ common stock ~~and~~for ~~130.90~~the ~~shares~~conversion of ~~Desert common stock. Contemporaneously, Boone exercised the related put options, requiring Inova to repurchase the warrants shares from Boone for~~ $132,~~515,900.~~000 ~~Under~~of ~~the put~~Asher option agreement, if Inova fails to repurchase the warrant shares from Boone, the put option liability will become a convertible note. Inova did not repurchase the warrant shares and accordingly, the put option became a convertible note during the quarter ended July 31, 2010. See Note 8.debt

~~During~~· ~~the quarter ended October 31~~69,444 ~~2010, Boone exercised warrants to purchase 7,682,340~~ shares of ~~Inova~~ common stock ~~and~~for ~~19.44%~~settlement of ~~Trakkers~~accounts common stock. Contemporaneously, Boone exercised the related put options, requiring Inova to repurchase the warrants shares from Boone for $792,000. Under the put option agreement, if Inova fails to repurchase the warrant shares from Boone, the put option liability will become a convertible note. Inova did not repurchase the warrant shares and accordingly, the put option became a convertible note in November 2010. See Note 8.payable

~~Inova~~· ~~issued 1~~29,~~000,000~~333 ~~warrants~~shares toof acommon ~~public relations~~stock ~~firm~~for services with a fair value of $5672,~~500 that were fully vested and non-forfeitable on the date of grant. The fair value of these warrants was reclassified to derivative liabilities at $52,~~000 ~~due to provisions in certain convertible note agreements (described in Note 9) that cause all share-settable instruments issued by Inova to be classified as liabilities.~~

~~Fiscal~~As ~~2012~~a result of conversion of debt described above, Inova settled derivative liabilities with a fair value of $62,842 on the conversion dates. This amount was reclassified to additional paid-in capital.

During fiscal ~~2012, 1,528,142 warrants to purchase Inova common stock expired unexercised.~~2013:

~~The~~Inova ~~following~~purchased ~~tables~~intellectual ~~summarize~~property from Southbase International Limited (“Southbase), a related party due to ownership in Southbase by Inova’s CEO. Inova issued 123,153 shares of common stock ~~warrants~~ ~~outstanding~~for bythe ~~entity:~~intellectual property, for a total value of $73,892, based on the Inova stock trading price on the closing date.

							Weighted
				Weighted			average
				average		Aggregate	remaining
				exercise		intrinsic	contractual
Warrants to purchase Inova common stock	Warrants			price		value	life (years)
Outstanding at April 30, 2010	48,161,435		$	0.05	$	2,720,778	4.11
Granted	1,000,000			0.18
Exercised	(37,793,780	)		.00
Forfeited	—			—
Expired
Outstanding at April 30, 2011	11,367,655		$	0.03	$	676,196	2.56
Granted	—			—
Exercised	—			—
Forfeited	—			—
Expired	(1,528,142	)		0.00
Outstanding at April 30, 2012	9,839,513		$	0.03	$	77,441	1,57

43· 908,280 shares of common stock for the conversion of $142,530 of third party debt.

								Weighted
				Weighted				average
				average			Aggregate	remaining
				exercise			intrinsic	contractual
Warrants to purchase Desert common stock	Warrants			price			value	life (years)
Outstanding at April 30, 2010	130.90		$	0.00		$	1,072,842	5.10
Granted				0.00
Exercised	(130.90	)		0.00
Forfeited	—			—
Expired	—			—
Outstanding at April 30, 2011 and 2012	0		$	0.00	$			0

25,074 shares of common stock with a fair value of $17,000 were issued to Advisors, LLC for services rendered. Advisors, LLC is controlled by a former director of the Company. The fair value of the stock was recorded to expense.

							Weighted
				Weighted			average
				average		Aggregate	remaining
				exercise		intrinsic	contractual
Warrants to purchase Trakkers common stock	Warrants			price		value	life (years)
Outstanding at April 30, 2010	32.94	%	$	—	$	1,082,932	3.69
Granted				0.00
Exercised	19.44	%		—
Forfeited	—			—
Expired	—			—
Outstanding at April 30, 2011	13.50	%	$	—	$	10,606	3.18
Granted	—			—
Exercised	—			—
Forfeited	—			—
Expired	—			—
Outstanding at April 30, 2012	13.50	%	$	—	$	—	2.18

As a result of conversion of debt described above, Inova settled derivative liabilities with a fair value of $426,955 on the conversion dates. This amount was reclassified to additional paid-in capital.

NOTE 1715 – ~~MAJOR~~REDEEMABLE ~~CUSTOMERS~~PREFERRED ~~AND~~STOCK ~~MAJOR VENDORS~~& NON-CONTROLLING INTEREST

~~During~~Series ~~fiscal~~A ~~2012~~Preferred ~~and 2011, revenues generated from three customers were approximately 45% and 43% of total revenues. These revenues were generated by Desert from its customers in network solution contracts.~~Stock

~~During~~Inova ~~fiscal~~has ~~2012~~authorized ~~and~~an ~~2011,~~undesignated ~~purchases~~amount ~~from four~~of ~~vendors~~Series ~~totaled~~A ~~approximately~~preferred ~~81%~~shares. ~~and~~Each ~~63%~~Series A preferred share is convertible into common stock at the rate of ~~total~~1 ~~purchases~~to 0.06. ~~These~~There ~~purchases~~ were ~~made~~no byshares ~~Desert~~of Series A preferred stock issued as of April 30, 2013 and 2012.

~~NOTE~~Series 18B –Convertible ~~SEGMENT~~Preferred ~~INFORMATION~~Stock

Inova has ~~two~~authorized ~~reportable segments~~5,000 ~~one~~non-restricted ~~providing RFID~~Series ~~products~~B ~~(RFID)~~preferred ~~and~~shares ~~one~~to ~~providing~~be ~~network~~issued ~~solutions~~for ~~(DCI).~~each ~~Operating~~acquisition ~~segments~~with ~~are~~more ~~defined~~than as$40 ~~components~~million ofin ansales ~~enterprise~~or ~~about which~~$10 ~~separate~~million ~~financial~~in ~~information~~EBITDA isand ~~available~~5,000 ~~that~~non-restricted isSeries ~~evaluated~~B ~~regularly~~preferred inshares ~~deciding~~authorized ~~how~~ to ~~allocate~~be ~~resources~~issued ~~and~~for each acquisition with less than $40 million in ~~assessing performance~~sales. ~~The~~Each ~~following~~Series B preferred share is convertible into common stock at the ~~summary~~rate of ~~operations~~1 byto ~~segment:~~100. There were no shares of Series B preferred stock issued as of April 30, 2013 and 2012.

44Series B Redeemable Preferred Stock

~~For~~On September 1, 2008, 1,500,000 shares of redeemable preferred stock were issued in conjunction with the purchase of Trakkers and Tesselon. This is redeemable Series B, non-voting preferred, which has a dissolution value of $1 per share. The agreement was amended on December 18, 2008 and again in July 2009. The original and first amended preferred stock agreements were determined to have errors and did not represent the intent of both parties causing both to be amended. Inova must determine the method of redemption of the preferred stock any time over the one year ~~ended~~period from issuance and when redeemed Inova may choose from the following 3 redemption options: 1) $1,500,000 payment of cash 2) Issuance of 375,000 common shares 3) Transfer of 10% of the Trakkers/Tesselon companies. Option 2) requires the company to issue the 375,000 common shares in three annual installments of 125,000 common shares each beginning no later than October 31, 2010. If elected, options 1) and 3) are due on the third anniversary of the issuance of the preferred stock. During 2009, the company originally anticipated that it would select option 2 and therefore classified the fair value of the preferred stock as a component of stockholders’ equity as of April 30, 2009. Management later determined it is best for the company to elect option 3) and therefore will settle the instrument by issuing 10% ownership of Trakkers LLC on the third anniversary of the agreement. Because the one year period from the original issuance of the preferred stock has passed, the Company can no longer change the method of redemption. At inception of the instrument, the company determined the fair value of the preferred stock was $1,307,506. Because the instrument has been settled with subsidiary stock, Inova has classified the instrument as non-controlling interest in the consolidated balance sheet as of April 30, 2012: and 2011 in accordance with ASC 810-10-45-17A and ASC 815-40-15-5C (formerly EITF 08-08) “Accounting for an Instrument (or an Embedded Feature) with a Settlement Amount That Is Based on the Stock of an Entity’s Consolidated Subsidiary”.

	RFID		DCI		Corporate		Total
Revenues	1,642,242		19,565,451		0		21,207,693
Cost of revenues	(241,916	)	(15,248,053	)	0		(15,489,969	)
Gross profit	1,400,326		4,317,398		0		5,717,724
Operating costs	(1,698,103	)	(3,436,431	)	(803,896	)	(5,938,430	)
Operating income	(297,777	)	880,967		(803,896	)	(220,706	)
Interest expense	(350,830	)	(310,324	)	(1,723,408	)	(2,384,562	)
Interest income	0		16		0		16
Other income	0		0		1,356,081		1,356,081
Net income (loss)	(648,607	)	570,659		(1,171,223	)	(1,249,171	)
Total assets	1,758,797		3,517,143		3,398,500		8,674,440

The shares are in the process of being distributed as of this date.

~~For the year ended April 30, 2011:~~37

	RFID		DCI		Corporate		Total
Revenues	2,041,870		20,079,919		—		22,121,789
Cost of revenues	(635,206	)	(14,610,207	)	—		(15,245,413	)
Gross profit	1,406,664		5,469,712		—		6,876,376
Operating costs	(3,910,601	)	(3,957,810	)	(72,790	)	(7,941,201	)
Operating income	(2,503,937	)	1,511,902		(72,790	)	(1,064,825	)
Interest expense	(656,936	)	(418,978	)	(1,234,358	)	(2,310,272	)
Other income	—		24,720		—		24,720
Net income (loss)	(3,160,873	)	1,117,644		(1,307,148	)	(3,350,377	)
Total assets	2,114,081		2,639,220		3,406,696		8,159,997

NOTE 16 – WARRANTS

45The following tables summarize common stock warrants outstanding by entity:

NOTE 19 – SUBSEQUENT EVENTS

								Weighted
				Weighted				average
				average		Aggregate		remaining
				exercise		intrinsic		contractual
Warrants to purchase Inova common stock	Warrants			price		value		life (years)
Outstanding at April 30, 2011		113,677		$	3.00	$	676,196		2.56
Granted		-			-
Exercised		-			-
Forfeited		-			-
Expired		(15,281	)		0.00
Outstanding at April 30, 2012		98,395		$	3.00	$	77,441		1.57

Granted		-			-
Exercised		-			-
Forfeited		-			-
Expired		(22,543	)		13.31
Outstanding at April 30, 2013		75,853		$	0.00	$	39,414		1.21

The company refinanced its lease with IBM for $77,500 until July, 2013.

								Weighted
				Weighted				average
				average		Aggregate		remaining
				exercise		intrinsic		contractual
Warrants to purchase Trakkers common stock	Warrants			price		value		life (years)
Outstanding at April 30, 2011		13.50	%	$	-	$	10,606		3.18
Granted		-			-
Exercised		-			-
Forfeited		-			-
Expired		-			-
Outstanding at April 30, 2012		13.50	%	$	-	$	-		2.18
Granted		-			-
Exercised		-			-
Forfeited		-			-
Expired		-			-
Outstanding at April 30, 2013		13.50	%	$	-	$	-		1.18

InNOTE ~~July~~17 ~~2012,~~– ~~the~~MAJOR ~~company purchased~~CUSTOMERS ~~certain~~AND ~~intellectual~~MAJOR ~~property from Southbase International Limited, a company controlled by Inova’s CEO. The purchase price is $100,000 and will be paid with 12,315,270 shares of Inova common stock.~~VENDORS

46During fiscal 2013 and 2012, revenues generated from three customers were approximately 36 % and 45% of total revenues. These revenues were generated by Desert from its customers in network solution contracts.

~~Item~~During 9.fiscal ~~Changes~~2013 in and ~~Disagreements~~2012, ~~with~~purchases ~~Accountants~~from onfour ~~Accounting~~vendors totaled approximately 77 % and ~~Financial~~81% ~~Disclosure~~of total purchases. These purchases were made by Desert.

~~There are no disagreements with our accountant on accounting and financial disclosure.~~38

~~Item~~NOTE ~~9A.~~18 ~~Controls~~– ~~and~~SEGMENT ~~Procedures~~INFORMATION

~~Evaluation~~Inova has two reportable segments, one providing RFID products (RFID) and one providing network solutions (DCI). Operating segments are defined as components of ~~Disclosure~~an ~~Controls~~enterprise about which separate financial information is available that is evaluated regularly in deciding how to allocate resources and ~~Procedures~~in assessing performance. The following is the summary of operations by segment:

~~Disclosure~~For ~~controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in~~ the ~~reports that~~year itended ~~files~~April ~~or submits under the Securities Exchange Act of 1934~~30, as amended (the "Act") is accumulated and communicated to the issuer's management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. It should be noted that the design of any system of controls is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions, regardless of how remote. As of the end of the period covered by this Annual Report, we carried out an evaluation, under the supervision and with the participation of our Chief Financial Officer and Chief Executive Officer, of the effectiveness of the design and operation of our disclosure controls and procedures. Based on this evaluation, our Chief Financial Officer and Chief Executive Officer have concluded that the Company’s disclosure controls and procedures are not effective due to the identification of material weaknesses in our internal controls.2013:

Changes in Internal Controls over Financial Reporting

	RFID			DCI			Corporate			Total

Revenues		1,194,888			17,486,102			-			18,680,990
Cost of revenues		(177,178	)		(13,660,614	)		-			(13,837,792	)

Gross profit		1,017,710			3,825,488			-			4,843,198

Operating costs		(1,366,775	)		(4,193,034	)		(1,728,192	)		(7,288,001	)

Operating income		(349,065	)		(367,546	)		(1,728,192	)		(2,444,803	)

Interest expense		(664,729	)		(356,976	)		(2,980,473	)		(4,002,178	)
Interest income		-			-			-			-
Other income		-			-			(179,257	)		(179,257	)

Net income (loss)		(1,013,794	)		(724,522	)		(4,887,922	)		(6,626,238	)

Total assets		1,063,263			1,612,761			3,389,810			6,065,834

WeFor ~~have not yet made any changes in our internal controls over financial reporting that occurred during~~ the ~~period~~year ~~covered~~ended byApril ~~this report on Form 10-K that has materially affected~~30, or ~~is reasonably likely to materially affect, our internal control over financial reporting.~~2012:

Management’s Annual Report on Internal Control Over Financial Reporting

	RFID	DCI	Corporate	Total
Revenues	1,642,242	19,565,451	0	21,207,693

Cost of revenues	(241,916)	(15,248,053)	0	(15,489,969)

Gross profit	1,400,326	4,317,398	0	5,717,724

Operating costs	(1,698,103)	(3,436,431)	(803,896)	(5,938,430)

Operating income	(297,777)	880,967	(803,896)	(220,706)

Interest expense	(350,830)	(310,324)	(1,723,408)	(2,384,562)

Interest income	0	16	0	16

Other income	0	0	1,356,081	1,356,081

Net income (loss)	(648,607)	570,659	(1,171,223)	(1,249,171)

Total assets	1,758,797	3,517,143	3,398,500	8,674,440

Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act. Our internal control system was designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes, in accordance with generally accepted accounting principles. Because of inherent limitations, a system of internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate due to change in conditions, or that the degree of compliance with the policies or procedures may deteriorate.39

~~Our~~NOTE ~~management~~19 ~~conducted~~– anSUBSEQUENT evaluation of the effectiveness of our internal control over financial reporting using the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control—Integrated Framework. Based on its evaluation, our management concluded that our internal controls over financial reporting are not effective due to material weaknesses in areas covering impairment determination, revenue recognition and supervisory responsibilities.EVENTS

In ~~assessing~~May and July 2013, the ~~effectiveness~~Company ofissued ~~our~~three ~~internal control~~notes ~~over~~payable ~~financial~~for ~~reporting,~~a ~~management~~total ~~identified~~of ~~the~~$146,500. These ~~following~~notes ~~material~~are ~~weakness~~all inconvertible ~~internal~~into ~~control~~common stock ~~over~~at ~~financial~~various ~~reporting as~~percentages of ~~April~~Inova’s ~~30,~~market ~~2012:~~price.

~~Deficiencies~~In inMay, ~~Segregation~~June, ofand ~~Duties.~~July ~~The~~2013, ~~Chief Executive Officer and~~ the ~~Chief~~company ~~Financial~~converted ~~Officer~~$111,250 ~~are actively involved in the preparation~~ of ~~the~~notes ~~financial~~payable ~~statements,~~ and ~~therefore~~$8,196 ~~cannot~~of ~~provide an~~accrued ~~independent~~interest ~~review.~~to ~~The~~Asher ~~company~~for ~~may establish an audit committee this year~~1,220,414 ~~which~~shares ~~should~~of ~~address~~the ~~this~~company’s ~~problem~~common stock.

~~Deficiencies~~In inMay, ~~Recording~~June, ~~Transactions. Inova~~and ~~failed~~July to2013, ~~properly record~~the ~~material~~company ~~transactions~~converted ~~related~~$61,000 toof ~~its~~notes ~~credit~~payable ~~facility~~for ~~receivable~~923,487 ~~goodwill,~~shares ~~fixed~~of ~~assets,~~the ~~derivative~~company’s ~~liabilities,~~common ~~equity and certain expense accounts~~stock.

~~The~~We ~~transactional~~issued ~~controls~~a ofproxy ~~revenue~~in May indicating the majority shareholders had voted to increase the authorized shares to 2 billion (2,000,000,000). As ~~cash and~~a ~~assets~~result ~~for~~of the ~~subsidiaries~~reverse ~~are~~split ~~adequate~~described below, this number was reduced to 20,000,000.

~~This~~We ~~annual~~approved ~~report~~a ~~does~~100:1 ~~not~~reverse ~~include~~split anon ~~attestation report~~June of17, ~~the Company’s registered public accounting firm regarding internal control over financial reporting~~2013. All ~~Management’s report~~share ~~was~~and ~~not~~per ~~subject~~share toamounts ~~the~~have ~~attestation~~been byadjusted ~~the~~retroactively ~~Company’s registered public accounting firm pursuant~~ to ~~temporary~~reflect ~~rules of the SEC that permit the Company to provide only management’s report in~~ this ~~annual report~~split.

47In July 2013, Inova assigned $50,000 of related party debt to a third party. The note was immediately amended to make it convertible into shares of Inova’s common stock. Subsequently, $10,000 of principal was converted into 194,704 shares of common stock.

~~PART~~Item ~~III~~9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

~~Item~~There ~~10.~~are ~~Directors,~~no ~~Executive~~disagreements ~~Officers~~with our accountant on accounting and ~~Corporate~~financial ~~Governance~~disclosure.

~~Our~~Item ~~directors~~9A. Controls and ~~executive officers as of the date of this Report are as follows:~~Procedures

Name	Age	Position
Adam Radly	43	Chief Executive Officer, President, Treasurer
Paul Aunger	53	Secretary, Director
Bob Bates	43	Chief Financial Officer
Alex Lightman	49	Director

Evaluation of Disclosure Controls and Procedures

~~Adam~~Disclosure ~~Radly~~controls and procedures include, ~~President~~without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Securities Exchange Act of 1934, as amended (the "Act") is accumulated and communicated to the issuer's management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. It should be noted that the design of any system of controls is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions, regardless of how remote. As of the end of the period covered by this Annual Report, we carried out an evaluation, under the supervision and with the participation of our Chief Accounting Officer and Chief Executive Officer, ~~Chairman~~ of the effectiveness of the design and ~~Treasurer~~operation of our disclosure controls and procedures. Based on this evaluation, our Chief Accounting Officer and Chief Executive Officer have concluded that the Company’s disclosure controls and procedures are not effective due to the identification of material weaknesses in our internal controls.

~~Mr.~~Changes Radly became Chief Executive Officer of Inova after the merger with Web’s Biggest. Mr. Radly was previously the founder and CEO of Isis Communications. While he was CEO of Isis, the company’s revenue increased from zero to $22 million. He also complete an IPO for Isis raising A$50 million. During his tenure, Isis completed eight acquisitions, and raised an additional $30 million from U.S. institutional investors in aInternal ~~secondary~~Controls ~~offering.~~over ~~Isis~~Financial ~~later merged with AAV Ltd.~~Reporting

~~Paul~~We ~~Aunger~~have not yet made any changes in our internal controls over financial reporting that occurred during the period covered by this report on Form 10-K that has materially affected, ~~Secretary~~or is reasonably likely to materially affect, our internal control over financial reporting.

~~Mr. Aunger became a director and the Company~~Management’s ~~Secretary~~ onAnnual ~~November~~Report ~~22,~~on ~~2005.~~Internal HeControl isOver ~~managing~~Financial ~~partner of Advisors, LLC.~~Reporting

~~Bob~~Our ~~Bates~~management is responsible for establishing and maintaining adequate internal control over financial reporting, ~~Chief~~as ~~Financial~~such ~~Officer~~term is defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act. Our internal control system was designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes, in accordance with generally accepted accounting principles. Because of inherent limitations, a system of internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate due to change in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Bob is a CPA, CVA and CFE with over 20 years experience as a Controller and CFO for various public and private entities in several countries. He was with Allied Capital (NYSE) as Controller and has worked for other Billion dollar companies. He also worked with KPMG. He is a director of Catalyst Group.40

MrOur management conducted an evaluation of the effectiveness of our internal control over financial reporting using the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control—Integrated Framework. ~~Alex~~Based ~~Lightman~~on its evaluation, ~~Director~~our management concluded that our internal controls over financial reporting are not effective due to material weaknesses in areas covering impairment determination, revenue recognition and supervisory responsibilities.

~~Mr.~~In ~~Alex~~assessing ~~Lightman has been a director since August 2008. He was~~ the ~~founding~~effectiveness ~~CEO and Chairman~~ of ~~IPv6~~our ~~Summit,~~internal ~~Inc.,~~control aover ~~leading~~financial ~~organizer of international IPv6 events and consultants to government and industry on IPv6 applications~~reporting, ~~training, and promotion. Mr. Lightman has nearly 20 years of high technology~~ management ~~experience~~ ~~and,~~identified inthe ~~addition,~~following ~~has~~material ~~experience~~weakness in ~~politics~~internal ~~(including~~control ~~work~~over ~~for~~financial USreporting ~~Senator),~~as ~~consulting, the oil drilling industry, and the renewable energy industry. Mr. Lightman is the author~~ of ~~Brave~~April ~~New Unwired World (Wiley~~30, ~~2002) and a 1983 graduate of the Massachusetts Institute of Technology. He has attended graduate school at the Kennedy School of Government (Harvard University) and the University of Phoenix.~~2013:

~~Director~~· ~~Independence~~Deficiencies in Segregation of Duties. The Chief Executive Officer and the Chief Financial Officer are actively involved in the preparation of the financial statements, and therefore cannot provide an independent review. The company may establish an audit committee this year, which should address this problem.

~~The~~· ~~full~~Deficiencies ~~Board~~in ofRecording ~~Directors fulfills the role of the Audit Committee~~Transactions. WeInova dofailed ~~not~~to ~~have~~properly anrecord ~~Audit~~material ~~Committee~~transactions ~~financial~~related ~~expert.~~to ~~The~~its ~~Board~~credit ~~believes~~facility ~~that~~receivable, ~~due~~goodwill, tofixed ~~the~~assets, ~~Company’s small~~derivative ~~size~~liabilities, anequity, ~~audit~~revenue ~~committee is unnecessary~~ and ~~would~~certain ~~impose~~expense ~~high costs in comparison to the potential benefits~~accounts.

48The transactional controls of cash and assets for the subsidiaries are adequate.

~~SECTION~~This ~~16(a)~~annual ~~BENEFICIAL~~report ~~OWNERSHIP~~does ~~REPORTING COMPLIANCE~~not include an attestation report of the Company’s registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to the attestation by the Company’s registered public accounting firm pursuant to temporary rules of the SEC that permit the Company to provide only management’s report in this annual report.

~~Section~~PART 16(a) of the Securities Exchange Act of 1934 requires the Company's directors and executive officers, and persons who own more than ten percent of a registered class of the Company's equity securities, to file with the Securities and Exchange Commission (the "SEC”) initial reports of ownership and reports of changes in ownership of common stock and other equity securities of our CompanyIII. ~~Officers, directors and greater than ten percent stockholders are required by SEC regulation to furnish our Company with copies of all Section 16(a) forms they file.~~

~~Based~~Item ~~on our review of the Section 16(a) forms filed with the SEC, no director, officer, or~~ 10~~% beneficial owner of our securities failed to timely file any report required under Section 16(a)~~. ~~To our knowledge~~Directors, ~~none~~Executive ofOfficers ~~the~~and ~~above~~Corporate ~~persons failed to report a reportable transaction.~~Governance

WeOur dodirectors ~~not~~and ~~have a code of ethics that applies to our principal~~ executive ~~officer,~~officers ~~principal~~as ~~financial officer, principal accounting officer or controller, or persons performing similar functions. We have not adopted a formal code~~ of ~~ethics because we have determined that such a code would be an unnecessary and bureaucratic practice given~~ the ~~small~~date ~~size~~ of ~~the~~this ~~Company's~~Report ~~management;~~are ~~however~~as ~~we endeavor to carry out our responsibilities in accordance with required laws and regulations.~~follows:

Item 1110. Directors, Executive ~~Compensation.~~Officers and Corporate Governance

~~The~~Our ~~following describes the cash and stock compensation paid to our~~ directors and executive officers ~~during the two past fiscal years. Our fiscal year ends on April 30. As a result, our most recent fiscal year ended April 30, 2012, and is referred to below~~ as ~~2012.~~of ~~The~~the ~~previous~~date ~~fiscal~~of ~~year~~this ~~ended~~Report ~~April~~are ~~30, 2011 and is referred to~~ as ~~2011 below.~~follows:

SUMMARY COMPENSATION TABLE

Name	Age	Position
Adam Radly	44	Chief Executive Officer, President, Treasurer

Bob Bates	44	Chief Accounting Officer
Subsidiary executives:		VP Administration, Desert Chief Executive Officer, Trakkers, Righttag, Tesselon Chief Executive Officer, Desert Communications, Inc

Name and principal		Management fee	Stock
position	Year	($)	Awards ($)	Total ($)
Adam Radly, Chairman and CEO	2011		-0-	0,000
Adam Radly, Chairman and CEO	2012	0	-0-	0,000
Paul Aunger, Secretary and Director	2011	0	48,000	48,000
Paul Aunger, Secretary and Director	2012	0	48,000	48,000
Bob Bates, CFO (HP Accounting)	2011	120,000	-0-	120,000
Bob Bates, CFO (HP Accounting)	2012	120,000	-0-	120,000
Alex Lightman, Director	2011	12,000	-0-	12,000
Alex Lightman, Director	2012	12,000	-0-	12,000

~~Other~~Adam ~~related~~Radly, ~~party~~President, ~~information:~~Chief Executive Officer, Chairman and Treasurer

~~We are not a party to an employment agreement with~~ Mr ~~Radly~~. Mr Radly ~~has~~became ~~agreed~~Chief toExecutive ~~provide~~Officer ~~his~~of ~~services~~Inova atafter nothe ~~cost~~merger towith ~~the~~Web’s ~~Company~~Biggest. ~~Companies in which~~ Mr. Radly ~~has~~was anpreviously ~~interest (and~~the ~~therefore~~founder ~~are~~and ~~defined~~CEO asof ~~“related”~~Isis toCommunications. MrWhile ~~Radly)~~he dowas ~~provide~~CEO ~~additional~~of ~~services~~Isis, to the ~~Company~~company’s ~~that~~revenue doincreased ~~not~~from ~~include his~~zero ~~services~~to as$22 ~~CEO of Inova~~million. ~~The~~He ~~total~~also ~~amount~~complete ~~earned~~an byIPO ~~these~~for ~~entities~~Isis inraising ~~the~~A$50 ~~most~~million. ~~recent~~During ~~fiscal~~his ~~years~~tenure, ~~(the~~Isis 12completed ~~months~~eight ~~ending~~acquisitions, ~~April 2011~~ and ~~2012)~~raised ~~was~~an additional $~~240,000,~~30 ~~per~~million ~~the~~from ~~management fee agreement~~U.S. ~~These~~institutional ~~amounts~~investors ~~are reflected~~ in ~~the~~a ~~executive~~secondary ~~compensation~~offering. ~~for~~Isis ~~Mr. Radly~~later inmerged ~~our~~with ~~filings~~AAV ~~because~~Ltd. heMr. Radly has ~~disclosed~~subsequently ~~that~~done he8 ~~has~~other anacquisitions ~~interest~~and innumerous ~~these~~financing ~~companies~~transactions.

~~The~~Bob ~~management~~Bates, ~~fees~~Chief ~~payable~~Accounting for work provided by Mr Radly and Mr Aunger are paid to various companies related to them and not paid to them personally. The amounts in the table above represent the total compensation paid in relation to work provided by Mr Radly and Mr Aunger and staff of their entities.Officer

49Bob is a CPA, CVA and CFE with over 20 years experience as a Controller and CFO for various public and private entities in several countries. He was with Allied Capital (NYSE) as Controller and has worked for other Billion dollar companies. He also worked with KPMG. He is a director of Orion Financial Group. Mr. Bates' company, HP Accounting Inc., provides the accounting services of 3 staff to Inova on a consulting basis. He is not an officer of the company.

~~Item~~Senior ~~12. Security Ownership of Certain Beneficial Owners and~~ Management ~~and Related Stockholder Matters~~

The ~~following~~5 ~~table~~executives ~~describes~~that comprise the ~~equity~~management ~~compensation available~~of tothe ~~our~~Inova ~~management~~Companies have over 135 years of experience in various industries, multiple continents, in public and private companies. There are 2 MBA’s, a CPA, a Phd and CVA and CFE. They have experience at such companies as Hewlett Packard, KPMG and other multi-national companies, leading large and small corporations, in such positions as CEO, COO and CFO.

Equity Compensation Plan Information
			Number of securities
			remaining available for
	Number of securities to be	Weighted-average exercise	future issuance under
	issued upon exercise of	price of outstanding	equity compensation plans
	outstanding options,	options, warrants and	(excluding securities
	warrants and rights	rights	reflected in column (a))
Plan category	(a)	(b)	(c)
Equity compensation plans approved by security holders	-0-	-0-	1,125,000	(1)
Equity compensation plans not approved by security holders	-0-	-0-	-0-
Total	-0-	-0-	1,125,000	(1)

Director Independence

~~(1)~~The ~~Includes~~full ~~5,000~~Board ~~non-restricted~~of ~~Class~~Directors ~~B preferred~~fulfills ~~shares~~the ~~authorized~~role toof bethe ~~issued~~Audit ~~for~~Committee. ~~each~~We ~~acquisition~~do ~~with~~not ~~more~~have ~~than~~an ~~$40~~Audit ~~million~~Committee infinancial ~~sales~~expert. orThe ~~$10~~Board ~~million~~believes inthat ~~EBITDA~~due ~~and 5,000~~to ~~non-restricted~~the ~~Class~~Company’s Bsmall ~~preferred~~size, ~~shares~~an ~~authorized~~audit tocommittee beis ~~issued~~unnecessary ~~for~~and ~~each~~would ~~acquisition~~impose ~~with~~high ~~less~~costs ~~than $40 million~~ in ~~sales. Each~~

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