Item 2. Unregistered Sales of Equity Securities
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
Between February 1, 2011 and April 30, 2011, we sold and issued an aggregate of 1,107,600 shares of our common stock to a total of 24 purchasers in private transactions we conducted in Germany. Gross proceeds from such sales totaled approximately $554,000 and selling commissions and other sale expenses totaled approximately $222,000, resulting in net proceeds from such sales of $332,000. We believe that the issuance of such shares is exempt from the registration requirements of the Securities Act, by reason of the exemption from registration granted under Section 4(2) of the Securities Act due to the fact that the issuance of the shares was conducted in a transaction not involving any public offering.
On February 16, 2011, we sold and issued to a single investor 40,000 shares for a total consideration of $20,000. Also, February 16, 2011, the Company sold and issued to a single investor 600,000 shares for a total consideration of $322,000. In a third separate transaction occurring on February 16, 2011, the Company sold and issued to three investors 491,100 shares of its common stock for a total consideration of $270,000. The Company did not incur any commission or other fees in connection with such sales. We believe that the issuance of such shares is exempt from the registration requirements of the Securities Act, by reason of the exemption from registration granted under Section 4(2) of the Securities Act due to the fact that the issuance of the shares was conducted in a transaction not involving any public offering.
On May 5, 2011, we issued 50,000 shares of our common stock and paid $12,000 in cash in consideration of Cooper Global Communications, LLC (“CGC”) agreeing to enter into a retention agreement with our company, to assist us on a non-exclusive basis as a investor relations and public relations advisor. We believe that the issuances of such shares are exempt from the registration requirements of the Securities Act, by reason of the exemption from registration granted under Section 4(2) of the Securities Act due to the fact that the issuance of the shares was conducted in a transaction not involving any public offering.
On May 5, 2011, we issued 300,000 shares of our common stock to a total of three consultants as consideration for entering into consultancy agreements with our company. We believe that the issuances of such shares are exempt from the registration requirements of the Securities Act, by reason of the exemption from registration granted under Section 4(2) of the Securities Act due to the fact that the issuances of the shares were conducted in a transaction not involving any public offering.
On May 20, 2011, we pledged 5,000,000 shares of our common stock with a single lender as a collateral security for a loan of $300,000 granted to us by the lender. The loan carries an interest rate of 10% per annum and matures on November 21, 2011. The shares are being held in escrow by the lender’s legal counsel. We believe that the issuance of such shares is exempt from the registration requirements of the Securities Act, by reason of the exemption from registration granted under Section 4(2) of the Securities Act due to the fact that the issuance of the shares was conducted in a transaction not involving any public offering.
Item 3. Defaults upon Senior Securities.
Not applicable.
Item 4. (Removed and Reserved).
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