Filing Details

Tohuan Steve Chen

c/o Armistice Capital LLC

510 Madison Avenue

7^th Floor

New York, NY 10022

Telephone Number: 212-231-4930

(Name, Address and Telephone Number of Person Authorized to Receive

Notices and Communications)

Armistice Capital is an investment adviser registered with the Securities and Exchange Commission (the “SEC”) that is principally engaged in the business of providing investment management services to private investment vehicles, including the Master Fund. The principal business address of Armistice Capital is 510 Madison Avenue, 7^th Floor, New York, New York 10022.

The Master Fund is principally engaged in the business of investing in securities. The principal business address of the Master Fund is c/o dms Corporate Services Ltd., 20 Genesis Close, P.O. Box 314, Grand Cayman KY1-1104, Cayman Islands. The board of directors of the Master Fund consists of Steven Boyd, Kevin A. Phillip and Gregory S. Bennett.

Steven Boyd is the managing member of Armistice Capital and a director of the Master Fund. Mr. Boyd’s business address is 510 Madison Avenue, 7^th Floor, New York, New York 10022.

On December 30, 2018, the Issuer and the Master Fund entered into a securities purchase agreement (the “Securities Purchase Agreement”), pursuant to which the Issuer agreed to offer and sell to the Master Fund in a private placement: (i) an aggregate of 45,306,347 units (“Units”) for $0.07 per Unit, with each Unit consisting of: (A) one Share; (B) one warrant to purchase one Share at an exercise price of $0.07 per Share (the “Series A Warrant”); and (C) one warrant to purchase one Share at an exercise price of $0.08 per Share (the “Series B Warrant”) (the “Offering”); provided, however, that to the extent that the Master Fund determines, in its sole discretion, that its subscription amount would cause its beneficial ownership to exceed 9.9% of the outstanding Shares, then the Master Fund may elect to purchase prefunded warrants (the “Series C Warrants,” and together with the Series A and Series B Warrants, the “Warrants”) in lieu of Shares as part of the Units, which Series C Warrants shall have a nominal exercise price of $0.001 per Share.

The Warrants became exercisable immediately upon issuance, subject to an issuance limitation set forth therein equal to the number of authorized and unreserved Shares available for issuance, and shall terminate as follows: (i) the Series A Warrants shall terminate 18 months from the date of the Reverse Split (as defined below); (ii) the Series B Warrants shall terminate five and a half years from the date of the Reverse Split; and (iii) the Series C Warrants shall terminate at such time that they are exercised in full. In addition, each of the Warrants contains a beneficial ownership limitation.

In connection with the Offering, the Issuer and the Master Fund also entered into a registration rights agreement (the “Registration Rights Agreement”), pursuant to which the Issuer agreed to file a registration statement (“Registration Statement”) with the SEC no later than 30 days after the Closing Date (as defined in the Securities Purchase Agreement) in order to register, on behalf of the Master Fund, the Shares acquired by the Master Fund pursuant to the Securities Purchase Agreement, as well as the Shares issuable upon exercise of the Warrants issued in connection with the Offering.

In order to provide the Issuer with additional authorized Shares, the Issuer has disclosed that it intends to seek shareholder approval of an amendment to the Issuer’s Amended and Restated Articles of Incorporation to effect a reverse split (the “Reverse Split”) of the Issuer’s issued and outstanding Shares, but not the number of authorized Shares, on the basis of a ratio to be determined by the Issuer’s board of directors (the “Reverse Split Amendment”). The Securities Purchase Agreement provides that: (i) the Issuer shall not file the Reverse Split Amendment until at least 30 days after the Registration Statement has been declared effective by the SEC; and (ii) the Master Fund must vote its Shares in favor of the Reverse Split Amendment.

The foregoing was a summary of certain material terms of the: (i) Securities Purchase Agreement; (ii) Form of Warrants; and (iii) Registration Rights Agreement. The foregoing descriptions are not, and do not purport to be, complete and are qualified in their entirety by reference to the full text of those documents, which have been filed as Exhibits B, C and D, respectively, and are incorporated herein by reference.

The Reporting Persons purchased the Shares for investment in the ordinary course of their investment activities based on the Reporting Persons’ belief that the Shares, when purchased, were undervalued and represented an attractive investment opportunity. 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, 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.

Except as otherwise set forth herein, the Reporting Persons do not have any present plans or proposals which would relate to, or result in, the matters set forth in subparagraphs (a) – (j) of Item 4 of Schedule 13D. However, subject to market conditions and in compliance with applicable securities laws, the Reporting Persons reserve the right, at a later date, to effect one or more of such changes or transactions in the number of Shares they may be deemed to beneficially own in open-market or privately negotiated transactions, on such terms and at such times as the Reporting Persons may deem advisable.

As of the date hereof, each of the Reporting Persons may be deemed to be the beneficial owner of 24,239,503 Shares, constituting 9.9% of the Shares, based upon 244,839,264 Shares outstanding as of the date hereof. Each of the Reporting Persons has the sole power to vote or direct the vote of 0 Shares and the shared power to vote or direct the vote of 24,239,503 Shares. Each of the Reporting Persons has the sole power to dispose or direct the disposition of 0 Shares and the shared power to dispose or direct the disposition of 24,239,503 Shares.

Other than having entered into the Securities Purchase Agreement with the Issuer as described in Item 4 above, there have been no transactions in the Shares by the Reporting Persons during the past sixty days.

(e)

N/A

The Master Fund holds a Series A Common Stock Purchase Warrant that, subject to a beneficial ownership limitation, permits it to purchase 8,000,000 Shares at an exercise price of $0.15 per Share. Such warrants expire on March 21, 2022.

In addition, the information set forth in Item 4 above is incorporated by reference in its entirety in this Item 6. The Reporting Persons do not have any contract, arrangement, understanding or relationship with any person with respect to securities of the Issuer that is not described above, in Item 4 and/or incorporated herein by reference.

Exhibit A: Joint Filing Agreement

Exhibit B: Form of Securities Purchase Agreement (incorporated by reference to Exhibit 10.1 to the Form 8-K filed with the SEC by the Issuer on December 31, 2018)

Exhibit C: Form of Warrants (incorporated by reference to Exhibit 4.1 to the Form 8-K filed with the SEC by the Issuer on December 31, 2018)

Exhibit D: Form of Registration Rights Agreement (incorporated by reference to Exhibit 10.2 to the Form 8-K filed with the SEC by the Issuer on December 31, 2018)

Name: Steven Boyd

Title: Managing Member

Name: Steven Boyd

Title: Director

Name: Steven Boyd

Title: Managing Member

Name: Steven Boyd

Title: Director