Equity Instruments

9 Months Ended

Mar. 31, 2015

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

Note 8 – Equity Instruments

Rosewind has two approved stock option plans (Luoxis 2013 Stock Option Plan and Vyrix 2013 Stock Option Plan) which we have reserved a total of 10.0 million shares of common stock.

Pursuant to the Luoxis 2013 Stock Option Plan, 5.0 million shares of its common stock were reserved for issuance. Stock option activity is as follows:


	Number of Options		Weighted Average Exercise Price		Weighted Average Remaining Contractual Life		Aggregate Fair Value
Outstanding June 30, 2014		1,950,000	$	1.00		9.01	$	1,374,000
Granted		885,000	$	1.60
Exercised		—	$	—
Forfeited/Cancelled		—	$	—

Outstanding March 31, 2015		2,835,000	$	1.19		8.61	$	2,541,000

Exercisable at March 31, 2015		937,500	$	1.00		8.26	$	687,000

Available for grant at March 31, 2015		2,165,000

Pursuant to the Vyrix 2013 Stock Option Plan, 5.0 million shares of its common stock were reserved for issuance. Stock option activity is as follows:


	Number of Options		Weighted Average Exercise Price		Weighted Average Remaining Contractual Life		Aggregate Fair Value
Outstanding June 30, 2014		950,000	$	0.70		9.54	$	417,000
Granted		—	$	—
Exercised		—	$	—
Forfeited/Cancelled		—	$	—

Outstanding March 31, 2015		950,000	$	0.70		8.79	$	417,000

Exercisable at March 31, 2015		475,000	$	0.70		8.79	$	208,000

Available for grant at March 31, 2015		4,050,000

Stock-based compensation expense related to the fair value of stock options was included in the statements of operations as research and development expenses and general and administrative expenses as set forth in the table below. Rosewind determined the fair value as of the date of grant using the Black-Scholes option pricing model and expenses the fair value ratably over the vesting period. The following table summarizes stock-based compensation expense for the three and nine months ended March 31, 2015 and 2014:


	Three Months Ended March 31,					Nine Months Ended March 31,
	2015		2014			2015		2014
Research and development expenses Stock options
Luoxis option plan	$	107,000	$	52,000		$	297,000	$	155,000
Vyrix option plan		8,000		29,000			26,000		29,000
General and administrative expenses Stock options
Luoxis option plan		138,000		58,000			371,000		116,000
Vyrix option plan		19,000		(55,000	)		56,000		85,000

	$	272,000	$	84,000		$	750,000	$	385,000

Unrecognized expense at March 31, 2015
Luoxis option plan	$	1,129,000
Vyrix option plan	$	194,000
Weighted average remaining years to vest
Luoxis option plan		2.23
Vyrix option plan		1.79

Warrants

Rosewind issued warrants in conjunction with the closing of its 2013 private placement. A summary of all warrants is as follows:


	Number of Warrants		Weighted Average Exercise Price		Weighted Average Remaining Contractual Life
Outstanding June 30, 2014		465,250	$	1.00		3.92
Warrants exercised - Private/Registered Direct Placements		—

Outstanding March 31, 2015		465,250	$	1.00		3.17

These warrants were valued using the Black-Scholes option pricing model. In order to calculate the fair value of the warrants, certain assumptions were made regarding components of the model, including the closing price of the underlying common stock, risk-free interest rate, volatility, expected dividend yield, and expected life. Changes to the assumptions could cause significant adjustments to valuation. The Company estimated a volatility factor utilizing a weighted average of comparable published volatilities of peer companies. The risk-free interest rate is based on the U.S. Treasury yield in effect at the time of the grant for treasury securities of similar maturity. The offering costs and the additional paid-in capital for the warrants associated with the common stock offering was valued at $313,000 using the Black-Scholes valuation methodology.

- Definition

The entire disclosure for compensation-related costs for equity-based compensation, which may include disclosure of policies, compensation plan details, allocation of equity compensation, incentive distributions, equity-based arrangements to obtain goods and services, deferred compensation arrangements, employee stock ownership plan details and employee stock purchase plan details.

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