This financing triggers anti-dilution provisions of certain of our outstanding securities. The exercise price on warrants exercisable for 4,070,000 shares of common stock adjusts from $0.50 per share to $0.08 per share, the exercise price on warrants exercisable for 2,112,500 shares of common stock adjusts from $0.19 per share to $0.08 per share, the conversion price on $1,500,000 of our 12% subordinated promissory notes adjusts from $0.19 per share to $0.08 per share, and the conversion price of the stated value and accumulated dividends on outstanding shares of Series D and Series EE convertible preferred stock adjusts from $0.19 per common share to $0.08 per common share. We have 110,000 shares (stated value of $10 per preferred share) of Series D convertible preferred stock and 4,330 shares (stated value of $100 per preferred share) of Series EE convertible preferred stock outstanding.

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