SUBSEQUENT EVENTS

12 Months Ended

Jun. 30, 2014

SUBSEQUENT EVENTS [Abstract]

SUBSEQUENT EVENTS

12.

SUBSEQUENT EVENTS

In July 2014, the Company issued 107,143 shares of common stock to its chief operating officer and principal stockholder in payment of accrued interest in the amount of $75,000 related to a convertible note.

In accordance with the 2007 Equity Incentive Plan, on July 1, 2014, the Company issued options to purchase 470,000 shares of common stock to directors. The options have an exercise price of $0.70 per share, vest on June 30, 2015¸ subject to continuing service as a director and bear a ten year term. The options were valued using the Black-Scholes model using a volatility of 88.55% (derived using the historical market price for the Company's common stock since it began trading in June 2008), an expected term of 5.5 years (using the simplified method) and a discount rate of 1.79%. The value of these options will be recognized as expense over the requisite service period.

Since July 1, 2014, the Company has issued 1,855,188 shares of common stock and two year warrants to purchase 906,586 shares of common stock at an exercise price of $2.00 per share in exchange for $1,025,000 in connection with private placements with accredited investors, including 1,603,087 shares and 801,544 warrants to our chief operating officer and principal stockholder in exchange for $850,000.