It's red because there's no object selected to Boolean with. When I picked the other Cube it worked fine. You might need to update your Blender to 2.74

![enter image description here][1]

The "Cannot Execute Boolean" is because of this beauty:

![enter image description here][2]


  [1]: https://i.sstatic.net/McpYJ.png
  [2]: https://i.sstatic.net/I4Lp2.png