Item 3.02 Unregistered Sales of Equity Securities

On March 19, 2009 and March 25, 2009 the Company sold two 8% Convertible Debentures ("the Debentures") to JED Management Corp. ("JED") for $185,000 each.

Principal and accrued interest on the Debentures matures as follows: $76,000 on March 19, 2011, $109,000 on March 25, 2011 for the first of the Debentures, and $185,000 on March 25, 2011on the second of the Debentures. The Company may prepay, at its sole discretion, any portion of the principal for 125% of the amount being prepaid plus any portion of the accrued interest. JED, at its sole discretion, may convert the principal plus accrued interest into shares of Common Stock at a price of (60%) of the lowest closing bid price, determined on the then current trading market for the Company's Common Stock, for 10 trading days prior to conversion. In addition, one of the Debenture's, in lieu of conversion may be exchanged, including all principal and interest, for non-trade debt of $275,000.

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For a period of six months from March 19, 2009 and March 25, 2009, respectively, JED shall be entitled to "piggyback" registration rights on registration statements being filed by the Company except if the registration statements are being filed for the purposes of "Pipe" transactions.

In the case of an Event of Default, as defined, the payment of principal and accrued interest shall be immediately due and payable if JED so elects.

As to the Debenture, we claim an exemption from the registration requirements of the Securities Act of 1933, as amended (the "Act") for the private placement of these securities pursuant to Section 4(2) of the Act and/or Rule 506 of Regulation D promulgated thereunder since, among other things, the transaction does not involve a public offering, the Investor is an "accredited investor" and/or qualified institutional buyer, the Investor has access to information about the Company and its investment, the Investor will take the securities for investment and not resale, and the Company is taking appropriate measures to restrict the transfer of the securities.