The
table
below lists the selling shareholders and other information regarding the
beneficial ownership of the common stock by each of the selling shareholders.
The first column lists the name of each selling shareholder. The second column
lists the number of shares of common stock beneficially owned by each selling
shareholder prior to this offering on May 23, 2006. The third column lists
the
number of shares of common stock that are covered by this prospectus. The fourth
and fifth columns list the number of shares of common stock owned and the
percentage of common stock owned, assuming to sale of all of the shares of
common stock covered by this prospectus. The following table assumes that the
number of shares beneficially owned, other than the shares offered hereby,
do
not change after May 23, 2006. We do not know how long the selling shareholders
will hold the shares set forth in the following table or how many shares they
will ultimately sell or otherwise dispose of pursuant to this
offering.
Common Shares
Beneficially Owned
Prior
to Offering
Securities
beneficially owned by The Pinnacle Fund, L.P. represent 3,529,411
shares
of common stock underlying Series C convertible preferred stock,
2,000,000
shares of common stock underlying Series B convertible preferred
stock and
2,764,706 shares of common stock underlying warrants. Pinnacle Advisers,
L.P., which is the investment advisor and general partner of The
Pinnacle
Fund, L.P., has sole dispositive, investment and voting power for
all the
shares. Pinnacle Fund Management, L.L.C is the general partner of
Pinnacle
Advisors, L.P. Barry M. Kitt is the sole member of Pinnacle Fund
Management, L.L.C. and disclaims beneficial ownership of the shares
except
for his pecuniary interest. The holder may not convert the Series
B
convertible preferred stock into shares of our common stock or exercise
warrants, if after the conversion, such holder, together with any
of its
affiliates, would beneficially own over 9.99% of the outstanding
shares of
our common stock. However, the 9.99% limitation would not prevent
the
holder from acquiring and selling in excess of 9.99% of our common
stock
through a series of conversions. Moreover, the holder may not convert
the
Series C convertible preferred stock into shares of our common stock
or
exercise warrants if after the conversion, such holder, together
with any
of its affiliates, would beneficially own over 4.99% or 9.99% of
the
outstanding shares of our common stock. However, the 4.99% and the
9.99%
limitations would not prevent the holder from acquiring and selling
in
excess of 4.99% or 9.99% of our common stock through a series of
conversions.
Securities
beneficially owned by Gryphon Master Fund represent 1,176,470 shares
of
common stock underlying Series C convertible preferred stock and
588,235
shares of common stock underlying warrants immediately exercisable.
The
natural person who has voting and dispositive power for the shares
held by
Gryphon Master Fund is E.B. Lyons, IV. Mr. Lyons disclaims beneficial
ownership of the shares except for his pecuniary interest.
(3)
Securities
beneficially owned by Westpark Capital, L.P. represent 1,176,470
shares of
common stock underlying Series C convertible preferred stock and
588,235
shares of common stock underlying warrants immediately exercisable.
The
natural person who has voting and dispositive power for the shares
held by
Westpark Capital, L.P. is Patrick J. Brosnahan, who is Managing Partner
of
the fund. Mr. Brosnahan disclaims beneficial ownership of the shares
except for his pecuniary interest.
(4)
Securities
beneficially owned by Iroquois Master Fund Ltd. represent 1,176,470
shares
of common stock underlying Series C convertible preferred stock and
588,235 shares of common stock underlying warrants immediately
exercisable. The natural person who has voting and dispositive power
for
the shares held by Iroquois Master Fund Ltd. is Joshua Silverman,
who is
an authorized signatory of the fund. Mr. Silverman disclaims beneficial
ownership of the shares except for his pecuniary interest.
(5)
Securities
beneficially owned by Sherleigh Associates Profit Sharing Plan represent
1,176,470 shares of common stock underlying Series C convertible
preferred
stock and 588,235 shares of common stock underlying warrants immediately
exercisable. The natural person who has voting and dispositive power
for
the shares held by Sherleigh Associates Profit Sharing Plan is Jack
Silver, who is Trustee of the fund. Mr. Silver disclaims beneficial
ownership of the shares except for his pecuniary interest.
(6)
Securities
beneficially owned by Bushido Capital Master Fund, L.P. represent
1,176,470 shares of common stock underlying Series C convertible
preferred
stock and 588,235 shares of common stock underlying warrants immediately
exercisable. Bushido Capital Partners, Ltd. is the general partner
of
Bushido Capital Master Fund, L.P. and Christopher Rossman is the
Managing
Director of Bushido Capital Partners, Ltd. Mr. Rossman disclaims
beneficial ownership of the shares except for his pecuniary interest.
(7)
Securities
beneficially owned by SF Capital Partners Ltd. represent 1,176,470
shares
of common stock underlying Series C convertible preferred stock and
588,235 shares of common stock underlying warrants immediately
exercisable. The natural persons who have voting and dispositive
power for
the shares held by SF Capital Partners Ltd. are Michael A. Roth and
Brian
J. Stark. Mr. Roth and Mr. Stark disclaim beneficial ownership of
the
shares except for their respective pecuniary interests. The selling
security holder has indicated to the issuer that it may be considered
an
affiliate of a broker-dealer. The selling security holder has represented
to the issuer that the securities were acquired in the ordinary course
of
business, and that at the time of the acquisition of securities,
the
selling security holder had no agreements or understandings, directly
or
indirectly, with any party to distribute the securities.
(8)
Securities
beneficially owned by Enable Partners represent shares of common
stock
underlying Series C convertible preferred stock, of which 1,147,058
are
held of record by Enable Growth Partners LP and 205,882 are held
of record
by Enable Opportunity Partners LP, and shares of common stock underlying
Series B convertible preferred stock, of which 362,960 shares are
held of
record by Enable Growth Partners LP and 80,000 shares are held of
record
by Enable Opportunity Partners LP. In addition, Enable Partners represents
shares of common stock underlying warrants immediately exercisable
of
which 1,173,529 shares are held of record by Enable Growth Partners
LP and
252,941 shares are held of record by Enable Opportunity Partners
LP. The
natural person who has voting and dispositive power for the shares
held by
both funds named above is Mitch Levine, who is Managing Partner of
both
funds. Mr. Levine disclaims beneficial ownership of the shares except
for
his pecuniary interest. The selling security holder has indicated
to the
issuer that it may be considered an affiliate of a broker-dealer.
The
selling security holder has represented to the issuer that the securities
were acquired in the ordinary course of business, and that at the
time of
the acquisition of securities, the selling security holder had no
agreements or understandings, directly or indirectly, with any party
to
distribute the securities.
SRB
Management
is
the
general partner of SRB Offshore Fund, SRB QP Fund; and SRB Capital
Fund
is
the general partner of SRB Management
.
Steven
R. Becker is the sole principal of BCA. Through his control of BCA,
Mr.
Becker possesses sole voting and investment control over the portfolio
securities of
each
of SRB Offshore Fund, SRB QP Fund and SRB Capital Fund. Pursuant
to a
letter agreement, Steven R. Becker may collaborate with Messrs. Walker
and
Smith on investment strategies from time to time
.
(10)
Securities
beneficially owned by Corsair Capital Management, LLC (“Corsair”)
represent shares of common stock underlying Series C convertible
preferred
stock, of which 810,588 are held of record by Corsair Capital Partners
L.P., 38,823 are held of record by Corsair Capital Partners 100 L.P.,
91,764 are held of record by Corsair Capital Investors Ltd., and
235,294
are held of record by Corsair Select, L.P. In addition, Corsair represents
shares of common stock underlying warrants immediately exercisable
of
which 405,294 shares are held of record by Corsair Capital Partners
L.P.,
19,412 are held of record by Corsair Capital Partners 100 L.P., 45,882
are
held by Corsair Capital Investors Ltd., and 117,647 are held of record
by
Corsair Select, L.P. The natural persons who have voting and dispositive
power for the shares held by Corsair are Steven Major and Jay Petschek.
Mr. Major and Mr. Petschek disclaim beneficial ownership of the shares
except for their respective pecuniary interests. The selling security
holder has indicated to the issuer that it may be considered an affiliate
of a broker-dealer. The selling security holder has represented to
the
issuer that the securities were acquired in the ordinary course of
business, and that at the time of the acquisition of securities,
the
selling security holder had no agreements or understandings, directly
or
indirectly, with any party to distribute the securities.
(11)
Securities
beneficially owned by Sandor Capital Master Fund, L.P. represent
600,000
shares of common stock underlying Series C convertible preferred
stock and
300,000 shares of common stock underlying warrants immediately
exercisable. The natural person who has voting and dispositive power
for these shares is John S. Lemak, who is General Partner of the
fund. Mr. Lemak disclaims beneficial ownership of the shares except
for his pecuniary interest.
(12)
Securities
beneficially owned by GSSF Master Fund represent 588,235 shares of
common
stock underlying Series C convertible preferred stock and 294,118
shares
of common stock underlying warrants immediately exercisable. The
natural person who has voting and dispositive power for these shares
is
Tom C. Davis. Mr. Davis disclaims beneficial ownership of the shares
except for his pecuniary interest.
(13)
Securities
beneficially owned by Xerion Partners II Master Fund Limited represent
588,235 shares of common stock underlying Series C convertible preferred
stock, 700,000 shares of common stock underlying Series B convertible
preferred stock and 644,118 shares of common stock underlying warrants
immediately exercisable. The natural person who has voting and
dispositive power for these shares is Daniel J. Arbess. Mr. Arbess
disclaims beneficial ownership of the shares except for his pecuniary
interest.
(14)
Securities
beneficially owned by Southwell Partners, L.P. represent 588,235
shares of
common stock underlying Series C convertible preferred stock and
294,118
shares of common stock underlying warrants immediately exercisable.
The natural person who has voting and dispositive power for these
shares
is Wilson S. Jaeggli, who is Managing Director of the partnership.
Mr. Jaeggli disclaims beneficial ownership of the shares except for
his
pecuniary interest.
(15)
WSC
Management
is
the general partner
of
WSC and WSCQP, the agent and attorney-in-fact for WS International
and the
investment manager
of
HHMI
.
WS
Capital
is
the general partner of
WSC
Management.
Reid
S. Walker
and
G.
Stacy Smith
are
the
controlling
principals of WS Capital. Through
their
control
of WS Capital, Messrs
.
Walker
and Smith share voting and investment control over the portfolio
securities of each of WSC, WSCQP, WS International and HHMI. Pursuant
to a
letter agreement, Steven R. Becker may collaborate with Messrs. Walker
and
Smith on investment strategies from time to time.
(
16)
WS
Ventures Management, L.P. (“WSVM”) is the general partner of WS
Opportunity Fund, L.P. (“WSO”) and WS Opportunity Fund (Q.P.), L.P.
(“WSOQP”) and is the agent and attorney-in-fact for WS Opportunity Fund
International, Ltd. (“WSO International”). WSV Management, L.L.C. (“WSV
Management”) is the general partner of WSVM. Reid S. Walker, G. Stacy
Smith and Patrick P. Walker are the controlling principals of WSV
Management. Through their control of WSV Management, Messrs. R. Walker,
Smith and P. Walker share voting and investment control over the
portfolio
securities of each of WSO, WSOQP and WSO International. Pursuant
to a
letter agreement, Steven R. Becker may collaborate with Reid S. Walker,
G.
Stacy Smith and Patrick P. Walker on investment strategies from time
to
time.
Securities
beneficially owned by Pierce Diversified Strategy Master Fund LLC
represent 411,764 shares of common stock underlying Series C convertible
preferred stock and 205,882 shares of common stock underlying warrants
immediately exercisable. The natural person who has voting and
dispositive power for these shares is Mitch Levine, managing partner
of
the LLC. Mr. Levine disclaims beneficial ownership of the shares
except for his pecuniary interest. The selling security holder has
represented to the issuer that the securities were acquired in the
ordinary course of business, and that at the time of the acquisition
of
securities, the selling security holder had no agreements or
understandings, directly or indirectly, with any party to distribute
the
securities.
(18)
Securities
beneficially owned by Gamma Opportunity Capital Partners, L.P. represent
294,117 shares of common stock underlying Series C convertible preferred
stock and 441,176 shares of common stock underlying warrants immediately
exercisable. Gamma Opportunity Capital Partners, LP Class A is the
general
partner of Gamma Opportunity Capital Partners, L.P. Jonathan P. Knight
is
an authorized signatory of Gamma Opportunity Capital Partners, LP
Class A
and disclaims beneficial ownership of the shares except for his pecuniary
interest.
(19)
Securities
beneficially owned by Clear View Investment Fund, L.P. represent
235,294
shares of common stock underlying Series C convertible preferred
stock and
117,647 shares of common stock underlying warrants immediately
exercisable. The natural person who has voting and dispositive power
for these shares is Walter T. Beach, Managing Director of the
partnership. Mr. Beach disclaims beneficial ownership of the shares
except for his pecuniary interest.
(20)
Securities
beneficially owned by Insiders Trend Fund L.P. represent 235,294
shares of
common stock underlying Series C convertible preferred stock and
117,647
shares of common stock underlying warrants immediately exercisable.
The natural person who has voting and dispositive power for these
shares
is Anthony Marchese, General Partner. Mr. Marchese disclaims
beneficial ownership of the shares except for his pecuniary
interest.
(21)
Securities
beneficially owned by Leo E Mindel Non-Est Exempt Family Trust II
represent 117,647 shares of common stock underlying Series C convertible
preferred stock and 58,824 shares of common stock underlying warrants
immediately exercisable. The natural person who has voting and
dispositive power for these shares is Meg Mindel, Trustee of the
trust. Ms. Mindel disclaims beneficial ownership of the shares
except for her pecuniary interest.
(22)
Securities
beneficially owned by Carlin Multi-Manger Fund L.P. represent 117,647
shares of common stock underlying Series C convertible preferred
stock and
58,824 shares of common stock underlying warrants immediately
exercisable. The natural person who has voting and dispositive power
for these shares is Sachin Shah, who is director of the partnership.
Mr. Shah disclaims beneficial ownership of the shares except for
his
pecuniary interest. The selling security holder has indicated to the
issuer that it may be considered an affiliate of a broker-dealer.
The
selling security holder has represented to the issuer that the securities
were acquired in the ordinary course of business, and that at the
time of
the acquisition of securities, the selling security holder had no
agreements or understandings, directly or indirectly, with any party
to
distribute the securities.
(23)
Securities
beneficially owned by Presidio Management represent shares of common
stock
underlying Series C convertible preferred stock, of which 100,000
are held
of record by Presidio Partners, 101,176 are held of record by Geary
Partners L.P. and 34,117 are held of record by Brady Retirement Fund
L.P.,
and shares of common stock underlying Series B convertible preferred
stock, of which 256,000 are held of record by Presidio Partners,
190,000
are held of record by Geary Partners and 56,000 are held of record
by
Brady Retirement Fund. In addition, Presidio Management represents
shares
of common stock underlying warrants immediately exercisable of which
177,500 shares are held of record by Presidio Partners, 145,338 shares
are
held of record by Geary Partners L.P. and 44,809 shares are held
of record
by Brady Retirement Fund L.P. The natural person who has voting and
dispositive power for the shares held by all funds named above is
William
Brady, who is Managing Partner of all funds named above. Mr. Brady
disclaims beneficial ownership of the shares except for his pecuniary
interest.
Represents
250,000 shares of common stock underlying an outstanding warrant
received
subject to a service agreement.
(25)
Represents
warrants for Series B and Series C convertible preferred stock received
as
compensation for investment banking services. David Kolb and Baruch
Halpern have indicated to the issuer that they may be considered
affiliates of a broker-dealer. Mr. Kolb and Mr. Halpern have represented
to the issuer that the securities were acquired in the ordinary course
of
business, and that at the time of the purchase of shares, the selling
security holders had no agreements or understandings, directly or
indirectly, with any party to distribute the shares.
(26)
Represents
securities purchased and securities received as compensation for
investment banking services. Baruch Halpern has indicated that he
may be
considered an affiliate of a broker-dealer. Mr. Halpern has represented
to
the issuer that the securities were acquired in the ordinary course
of
business, and that at the time of the acquisition of securities,
the
selling security holder had no agreements or understandings, directly
or
indirectly, with any party to distribute the
securities.
(27)
Represents
securities received as compensation for investment banking services.
David
Kolb has indicated to the issuer that he may be considered an affiliate
of
a broker-dealer. Mr. Kolb has represented to the issuer that the
securities were acquired in the ordinary course of business, and
that at
the time of the purchase of shares, the selling security holder had
no
agreements or understandings, directly or indirectly, with any party
to
distribute the shares.
(28)
The
natural person who has voting and dispositive power for these shares
is
Win Wolcott. Mr. Wolcott disclaims beneficial ownership of the shares
except for his pecuniary interest.
(29)
The
natural person who has voting and dispositive power for these shares
is
Scott Wolcott. Mr. Wolcott disclaims beneficial ownership of the
shares except for his pecuniary interest.
(30)
The
natural persons who have voting and dispositive power for these shares
are
Calvert and Shirly Cecil, Trustees of the above named trust. Calvert
and
Shirly Cecil disclaim beneficial ownership of the shares except for
their
respective pecuniary interest.
(31)
The
natural persons who have voting and dispositive power for these shares
are
Donna and Howard Mehlschau, Trustees of the above-named trust. Donna
and
Howard Mehlschau disclaim beneficial ownership of the shares except
for
their respective pecuniary
interest.
(32)
The
natural persons who have voting and dispositive power for these shares
are
Evan and David Stone, Trustees. Evan and David Stone disclaim beneficial
ownership of the shares except for their respective
interest.
(33)
The
natural person who has voting and dispositive power for these shares
is
Margaret Winton, Trustee. Ms. Winton disclaims beneficial ownership
of the
shares except for her pecuniary
interest.
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