Page 12 of 21 – SEC Filing
| Item 4. | Purpose of Transaction. |
The Reporting Persons
acquired the Shares in the Issuer based on the Reporting Persons’ belief that the Shares, when acquired, were materially
undervalued and represented an attractive investment opportunity. The Reporting Persons have had discussions with management and
the Issuer’s Board of Directors (the “Board”), including its Chairman, regarding the Reporting Persons’
concerns with the Issuer’s fourth quarter financial results and 2019 guidance, which concerns appear to be shared by other
stockholders given the significant declines in the Issuer’s stock price. In the Reporting Person’s view, the
market’s reaction should signify to the Board the complete rejection of the Issuer’s 2019 operating plan. The Reporting
Persons believe the Issuer must take immediate steps to improve its operating model, including, but not limited to, materially
reducing its cash burn and enacting a pathway to improving its gross margins and profitability while maintaining the integrity
of the Issuer’s balance sheet. The Reporting Persons call upon management and the Board to communicate these plans
publicly to investors in the near term. Concurrently, the Reporting Persons believe that the Issuer should be mindful of, and open
to, initiatives that can maximize stockholder value. If the Issuer does not take appropriate action that the Reporting Persons
believe are imperative to reduce cash burn and maximize stockholder value, then the Reporting Persons will hold the Board accountable
by, among other things, seeking representation at the 2019 annual meeting of stockholders.
No Reporting Person
has any present plan or proposal which would relate to or result in any of the matters set forth in subparagraphs (a) – (j) of
Item 4 of Schedule 13D except as set forth herein or such as would occur upon or in connection with completion of, or following,
any of the actions discussed herein. The Reporting Persons intend to review their investment in the Issuer on a continuing basis.
Depending on various factors including, without limitation, the Issuer’s financial position and investment strategy, the
price levels of the Shares, conditions in the securities markets and general economic and industry conditions, the Reporting Persons
may in the future take such actions with respect to their investment in the Issuer as they deem appropriate including, without
limitation, engaging in communications with management and the Board of the Issuer, engaging in discussions with stockholders of
the Issuer and others about the Issuer and the Reporting Persons’ investment, making proposals to the Issuer concerning changes
to the capital allocation strategy, capitalization, ownership structure, including a sale of the Issuer as a whole or in parts,
Board structure (including Board composition) or operations of the Issuer, purchasing additional Shares, selling some or all of
their Shares, engaging in short selling of or any hedging or similar transaction with respect to the Shares, or changing their
intention with respect to any and all matters referred to in Item 4.
| Item 5. | Interest in Securities of the Issuer. |
The aggregate percentage
of Shares reported owned by each Reporting Person is based upon 74,255,189 Shares outstanding, which is the total number of Shares
outstanding as of February 1, 2019 as reported in the Issuer’s Annual Report on Form 10-K, filed with the Securities and
Exchange Commission on February 22, 2019.
| A. | Series One |
| (a) | As of the close of business on February 25, 2019, Series One beneficially owned 2,991,727 Shares, including 668,600 shares underlying call options currently exercisable . |
Percentage: Approximately
4.0%
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