Item 3.02. Unregistered Sales of Equity Securities

On January 9, 2009, WB QT, LLC, the holder of Registrant's $16.2 million convertible promissory note, converted $500,000 of principal at a conversion price of $1.35 per share. As a result of such conversion, the Registrant issued to WB QT, LLC a total of 484,537 shares of its common stock, consisting of 370,370 shares to satisfy the principal conversion and 114,167 shares to satisfy the Make-Whole Amount.

Previously, on December 11, 2008, WB QT, LLC also converted $500,000 of principal at a conversion price of $1.35 per share. As a result of that conversion, Registrant issued to WB QT, LLC a total of 503,704 shares of its common stock, consisting of 370,370 shares to satisfy the principal conversion and 133,334 shares to satisfy the Make-Whole Amount.

As described in the Registrant's Current Report on Form 8-K filed with the Commission on June 5, 2008 ("Prior Filing"), which is incorporated herein by reference, the Make-Whole Amount is the amount of interest that would have been paid through the maturity date of the convertible promissory note on each $500,000 of principal had WB QT, LLC not converted. As disclosed in the Prior Filing, the number of shares issuable in satisfaction of the Make-Whole Amount is based on a fixed price of $1.50 per share. The material conversion and other terms of the Registrant's $16.2 million convertible promissory note are described in Item 1.01 of the Prior Filing.

The common shares issued by the Registrant as a result of the conversions described herein were issued to an accredited investor in transactions exempt from Registration pursuant to Section 4(2) of the Securities Act of 1933 and/or Rule 506 of Regulation D. The transactions did not involve a public offering, were made without general solicitation or advertising, and there were no underwriting commissions or discounts.

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