Item 3.02 Unregistered Sales of Equity Securities

The Company has issued an aggregate of 1,385,000 Rule 144 restricted shares of common stock of the Company to a total of 21 persons and/or entities. The shares were issued as compensation pursuant to certain consulting agreements, to employees and directors in exchange for services rendered for the Company, and to investors in exchange for investment proceeds. The valuation of the consideration received by the Company ranged from $0.10 to $0.20 per share depending upon the transaction. The issuance of the shares to consultants, employees and directors was exempt from the registration requirements of Section 5 of the Securities Act of 1933 (the "Act") pursuant to Section 4(2) of the Act since the shares were issued by the Company and did not involve any public offering. These share recipients are closely related to and well known by the Company. The shares issued in exchange for investment proceeds were exempt from the registration requirements of Section 5 of the Act under Section 4(2) of the Act pursuant to the safe harbor set forth in Rule 506 promulgated under the Act. In connection with the sale and issuance of the 506 shares, there was no general solicitation, appropriate disclosure information was distributed, all investors are accredited investors as defined in Rule 501 and the issuer filed its Form D with the Securities and Exchange Commission. All shares issued are restricted shares pursuant to Rule 144 promulgated under the Act.