Stock-based compensation

9 Months Ended

Mar. 31, 2015

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Stock-based compensation

4.   Stock-based compensation

During the nine months ended March 31, 2015, the Company granted stock options under its 2013 Equity Incentive Plan.  Stock-based compensation related to these awards is recognized on a straight-line basis over the applicable vesting period and is included in selling, general and administrative expenses in the accompanying condensed consolidated statements of operations for the nine months ended March 31, 2015 and 2014.  During the nine months ended March 31, 2015, options issued were valued using the Black Scholes method assuming the following:

Expected volatility	88%
Dividend yield	0%
Risk-free interest rate	0.77%
Expected life in years	3.5

The expected volatility was estimated based on the volatility of a set of companies that management believes are comparable to the Company.  The risk-free rate was based on the U.S. Treasury note rate over the expected life of the options.  The expected life was determined using the simplified method as we have no historical experience.  We recorded stock-based compensation expense of $82,936 and $42,222 during the three months ended March 31, 2015 and 2014, respectively. During the nine months ended March 31, 2015 and 2014, we recorded stock-based compensation expense of $218,317 and $227,949, respectively.

The following table summarizes the stock option activity for the nine months ended March 31, 2015: 

	Options			Weighted Average Exercise Price
Outstanding at June 30, 2014		500,000		$	0.165
Granted		385,000		$	0.550
Exercised		(55,552	)	$	0.165
Forfeited		-			-
Outstanding at March 31, 2015		829,448		$	0.344