Item 2. Unregistered Sales of Equity Securities
Item
2. Unregistered Sales of Equity Securities and Use Of Proceeds
During
the three months ended June 30, 2021, we issued the following securities in transactions not involving any public offering. For each
of the following transactions, we relied upon Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”),
as transactions by an issuer not involving any public offering or Section 1145 of the Bankruptcy Code as a security exchanged by an issuer
for a claim against the issuer in a bankruptcy plan of reorganization. For each such transaction, we did not use general solicitation
or advertising to market the securities, the securities were offered to a limited number of persons, the investors had access to information
regarding us (including information contained in our Annual Report on Form 10-K for the year ended December 31, 2020, Quarterly Report
on Form 10-Q for the period ended June 30, 2021 and Current Reports on Form 8-K filed with the Securities and Exchange Commission, press
releases made by us and information contained in filings with the bankruptcy court), and we were available to answer questions by prospective
investors. We reasonably believe that each of the investors is an accredited investor.
Warrants
Date Issued
Common Stock
Shares
Exercise
Price
Term
(Years)
Purchaser(s)
Consideration (1)
6/1/2021
12,866,735
-
-
-
(2 )
$ 103,703 (3)
6/28/2021
159,000,000
-
-
-
(2 )
$ 1,113,000 (4)
(1)
The
value of the non-cash consideration was estimated to be the fair value of our restricted common stock. Since our shares are thinly
traded in the open market, the fair value of our equity instruments was estimated by management based on observations of the cash
sale prices of both restricted shares and freely tradeable shares.
(2)
Accredited
investor.
(3)
Issued
upon conversion of secured convertible notes.
(4)
Issued
on a cashless net exercise basis pursuant to the exercise of warrants.
Item
3. Defaults upon Senior Securities
None.
Item
4. Mine Safety Disclosures
Not
Applicable.
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