CUSIP No. 883906406
(b) The Reporting Persons have shared voting and dispositive power with
respect to 32,953,334 shares of Common Stock. Each of David Gelbaum and Monica
Chavez Gelbaum, acting alone, has the power to exercise voting and investment
control over shares of Common Stock beneficially owned by the Trust.
(c) Prior to September 28, 2009, the Reporting Persons owned the
following securities of the Issuer:
(i) 6,666,667 shares of Common Stock and Warrant to purchase
up to 10,000,000 shares of Common Stock, with an original exercise price of
$1.50 per share (collectively, the "2007 Warrant"), pursuant to that certain
Securities Purchase Agreement dated as of December 18, 2007 entered into by and
between the Reporting Persons and the Issuer (the "2007 SPA"). As discussed
below, the 2007 Warrant contained anti-dilution rights that resulted in the
reduction of the exercise price to $0.36 in connection with the September 2009
Issuance. The total purchase price for the 6,666,667 shares of Common Stock and
the 2007 Warrant was $5,000,000. Other terms and conditions of the 2007 SPA are
described in the Issuer's Form 8-K filed with the SEC on December 19, 2007,
which contains a copy of a form of the 2007 Warrant as an exhibit thereto.
(ii) Secured Convertible Promissory Note in the principal
amount of $2,000,000, with a conversion price of $0.75 per share and an interest
rate of ten percent (10%) per annum (the "2008 Note"), and Warrant to purchase
up to 4,000,000 shares of Common Stock, with an exercise price of $1.12 (the
"2008 Warrant"), pursuant to that certain Securities Purchase Agreement dated as
of September 15, 2008 entered into by and between the Reporting Persons and the
Issuer (collectively, the "2008 SPA"). As discussed below, the 2008 Warrant
contained anti-dilution rights that resulted in the reduction of the exercise
price to $0.36 in connection with the September 2009 Issuance. The total
purchase price of securities issued pursuant to the 2008 SPA (including the 2008
Note and the 2008 Warrant) was $2,000,000. Other terms and conditions of the
2008 SPA are described in the Issuer's Form 8-K filed with the SEC on September
17, 2008, which contains a copy of a form of the 2008 Note and the 2008 Warrant
as exhibits thereto. Prior to the reduction of the exercise price of the 2007
Warrant in connection with the September 2009 Issuance, the execution of the
2008 SPA and the securities issued in connection therewith triggered an
anti-dilution protection set forth in the 2007 SPA and, as a result thereof, the
exercise price for the 2007 Warrant was reduced to $1.25 per share.
(iii) Secured Convertible Promissory Note in the principal
amount of $250,000, issued by the Issuer to the Reporting Persons on February
11, 2009 (the "February 2009 Note"). The original terms and conditions of the
February 2009 Note are more particularly set forth in the Issuer's Form 8-K
filed on February 17, 2009, which also contains a copy of the February 2009 Note
as an exhibit thereto. The February 2009 Note was not convertible into shares of
Common Stock by the Reporting Persons at the time of its issuance.
(iv) Secured Convertible Promissory Note in the principal
amount of $150,000, issued by the Issuer to the Reporting Persons on June 25,
2009 (the "June 2009 Note"). The original terms and conditions of the June 2009
Note are more particularly set forth in the Issuer's Form 8-K filed on June 30,
2009, which also contains a copy of the June 2009 Note as an exhibit thereto.
The June 2009 Note was not convertible into shares of Common Stock by the
Reporting Persons at the time of its issuance.
On September 28, 2009, the Issuer issued to a group of
investors, including, without limitation, the Reporting Persons, those certain
8% Secured Convertible Promissory Notes in the aggregate principal amount of
$1,680,000, with a conversion price of $0.24 per share (the "September 2009
Notes"), and Warrants to purchase up to a total of 6,720,000 shares of Common
Stock with an exercise price of $0.50 per share (the "September 2009 Warrants")
(collectively, the "September 2009 Issuance"). As part of the September 2009
Issuance, the Reporting Persons acquired, for a total purchase price of
$280,000, two 8% Secured Convertible Promissory Notes in the aggregate principal
amount of $280,000, convertible into 1,166,667 shares of Common Stock, and two
Warrants to purchase up to a total of 1,120,000 shares of Common Stock. The
terms and conditions of the September 2009 Issuance are more particularly set
forth in the Issuer's Form 8-K filed on October 2, 2009, which also contains a
copy of a form of the September 2009 Notes and the September 2009 Warrants as
exhibits thereto.
6
|