8 - Subsequent Events

On December 15, 2011, the Board unanimously elected Anthony D. Caracciolo to serve as a member of the Board. Mr. Caracciolo was formerly employed at Gilead Sciences, Inc. ("Gilead"), a research-based biopharmaceutical company that discovers, develops and commercializes innovative medicines in areas of unmet medical need, from 1997 until retiring in October of 2010. During his tenure, Mr. Caracciolo served as Senior Vice President, Manufacturing and Operations and was a senior member of Gilead's executive committee, which was responsible for the strategic and operational direction of Gilead.

On November 14, 2011, the Board approved a private placement to sell up to 2,000,000 shares of the Company's common stock, no par value, at a price of $1.50 per share. The offering commenced on or about December 1, 2011 and was completed on December 31, 2011. 1,997,388 shares were sold for proceeds totaling $2,996,082.

Following November 30, 2011, the Company received confirmations from the Prospective Investors representing approximately $665,000 of the $1,425,000 in cash related to deposits received from common stock purchases occurring subsequent to February 18, 2011. In those confirmations, such Prospective Investors confirmed their investment in the Company. As of the date of the filing, the Company has not received any requests from any of the Prospective Investors that their investments in the Company be returned.

Subsequent to November 30, 2011, the Company entered into a release agreement with certain consultants. Pursuant to the release agreement, the Company granted the consultants 250,000 warrants at exercise prices ranging from $2.10 to $2.95, with immediate vesting, and expiration dates of one to two years. The warrants were granted for past services, and for the three and six months ended November 30, 2011, the Company recognized approximately $260,000 in stock-based compensation expense.