Can't create a new projects or import existing

I'm new to Grails/Groovy. I downloaded a fresh STS install with the Grails Extensions installed.

When I create a new basic Grails project called "Simple", I get an error that looks like this:

Command terminated with an exception: java.lang.Exception: Command: C:\Program Files\Java\jdk1.7.0_21\bin\javaw.exe (Jul 16, 2013, 12:22:18 PM)

---- System.out ----
| Loading Grails 2.1.2
| Configuring classpath
| Running pre-compiled script
| Script 'CreateApp Simple' not found, did you mean:
1) CreateApp_
2) CreatePom
3) CreatePlugin_
4) CreateScript
5) CreateFilters
> Please make a selection or enter Q to quit: | Environment set to development
| Environment set to development.....
> Application name not specified. Please enter: | Error Error executing script CreateApp Simple: java.lang.NullPointerException: Cannot invoke method replaceAll() on null object (Use --stacktrace to see the full trace)



I'm guessing this is due to a configuration/classpath issue, but I don't have much experience with these tools so it's difficult to troubleshoot.

Any suggestions?