REG.
D PRIVATE PLACEMENT – FEBRUARY 23, 2007

    Subscription:
$3.00 per Unit: 1 Unit = 1 common share and 1⁄2 warrant exercisable at $4.50 for
24 months, callable if stock trades at $6.50 for 20 consecutive trading
days

    


    
      
        
          
            	 
      	 	
                    $

                  	 	 	
                    SHARES

                  	 	 	
                    WARRANTS

                  	 
	
                    SUBSCRIBER

                  	 	
                    INVESTED

                  	 	 	
                    ISSUED

                  	 	 	
                    ISSUED

                  	 
	 
      	 	 	 	 	 	 	 	 	 	 
	
                    James
      Harpel

                  	 	$	2,700,000	 	 	 	900,000	 	 	 	450,000	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                    Anthony
      David Bune

                  	 	$	1,302,000	 	 	 	434,000	 	 	 	217,000	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                    Glen
      Tobias

                  	 	$	450,000	 	 	 	150,000	 	 	 	75,000	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                    Donald
      Wohl, TTE Donald Wohl Revocable Trust dtd. 6/8/05

                  	 	$	300,000	 	 	 	100,000	 	 	 	50,000	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                    Barbara
      Jaffe TTE Barbara Jaffe Revocable Trust dtd. 10/13/97

                  	 	$	300,000	 	 	 	100,000	 	 	 	50,000	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                    Todd
      Wohl

                  	 	$	75,000	 	 	 	25,000	 	 	 	12,500	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                    Diwan
      & Tracey Nesicolaci

                  	 	$	50,000	 	 	 	16,667	 	 	 	8,333	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                    Cutler
      Family Trust UTD 5/4/89

                  	 	$	150,000	 	 	 	50,000	 	 	 	25,000	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                    Fred
      Kayne Family Trust dtd. 3/29/04

                  	 	$	900,000	 	 	 	300,000	 	 	 	150,000	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                    Bruce
      Burnam Trust of 1992

                  	 	$	300,000	 	 	 	100,000	 	 	 	50,000	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                    Mark
      Beychok

                  	 	$	285,000	 	 	 	95,000	 	 	 	47,500	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                    Bush
      Family Trust

                  	 	$	150,000	 	 	 	50,000	 	 	 	25,000	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                    Gunther
      Family Trust

                  	 	$	600,000	 	 	 	200,000	 	 	 	100,000	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                    Michael
      S. Rosenblum

                  	 	$	99,000	 	 	 	33,000	 	 	 	16,500	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                    Jim
      Miles

                  	 	$	100,000	 	 	 	33,333	 	 	 	16,667	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                    Andrew
      Williams

                  	 	$	100,002	 	 	 	33,334	 	 	 	16,667	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                    WES-TEX
      Drilling Company, L.P.

                  	 	$	300,000	 	 	 	100,000	 	 	 	50,000	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                    Kenneth
      G. Dallamora

                  	 	$	300,000	 	 	 	100,000	 	 	 	50,000	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                    Martin
      B. Oring

                  	 	$	375,000	 	 	 	125,000	 	 	 	62,500	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                    Bruce
      Lazier

                  	 	$	210,000	 	 	 	70,000	 	 	 	35,000	 


          

        

      

    

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    


    
      
        
          
            	 
      	 	
                    $

                  	 	 	
                    SHARES

                  	 	 	
                    WARRANTS

                  	 
	
                    SUBSCRIBER

                  	 	
                    INVESTED

                  	 	 	
                    ISSUED

                  	 	 	
                    ISSUED

                  	 
	 
      	 	 	 	 	 	 	 	 	 	 
	
                    Kenneth
      L. Brush & Sue A. Brush

                  	 	$	105,000	 	 	 	35,000	 	 	 	17,500	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                    Anthony
      C. Lisa II Revocable Trust

                  	 	$	105,000	 	 	 	35,000	 	 	 	17,500	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                    Paul
      R. Hobson

                  	 	$	60,000	 	 	 	20,000	 	 	 	10,000	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                    Crown
      Growth Partners II, L.P.

                  	 	$	735,000	 	 	 	245,000	 	 	 	122,500	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                    Kenneth
      Sutherland

                  	 	$	100,000	 	 	 	33,333	 	 	 	16,667	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                    E.
      Wayne Nordberg

                  	 	$	180,000	 	 	 	60,000	 	 	 	30,000	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                    John
      C. Thompson

                  	 	$	300,000	 	 	 	100,000	 	 	 	50,000	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                    Leigh
      S. Curry

                  	 	$	30,000	 	 	 	10,000	 	 	 	5,000	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                    Robert
      Allen White

                  	 	$	102,000	 	 	 	34,000	 	 	 	17,000	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                    SLP
      Investments Ltd.

                  	 	$	100,000	 	 	 	33,333	 	 	 	16,667	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                    MidSouth
      Investor Fund LP

                  	 	$	300,000	 	 	 	100,000	 	 	 	50,000	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                    Jeremy
      A. Wise

                  	 	$	15,000	 	 	 	5,000	 	 	 	2,500	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                    Rosalind
      M. Reis, Trust of 18 June 1993

                  	 	$	75,000	 	 	 	25,000	 	 	 	12,500	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                    Michele
      I. Reis, Trust of 21 May 1993

                  	 	$	75,000	 	 	 	25,000	 	 	 	12,500	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                    Ralph
      I. Reis Revocable Trust

                  	 	$	75,000	 	 	 	25,000	 	 	 	12,500	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                    Charles
      H. Brunie

                  	 	$	300,000	 	 	 	100,000	 	 	 	50,000	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                    Hebrides
      LP

                  	 	$	480,000	 	 	 	160,000	 	 	 	80,000	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                    James
      Pledger

                  	 	$	15,000	 	 	 	5,000	 	 	 	2,500	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                    Cary
      Schwartz

                  	 	$	75,000	 	 	 	25,000	 	 	 	12,500	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                    Sander
      Jacobs

                  	 	$	175,000	 	 	 	58,333	 	 	 	29,167	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                    Fred
      Fialkow

                  	 	$	30,000	 	 	 	10,000	 	 	 	5,000	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                    Bruce
      Shpiner

                  	 	$	60,000	 	 	 	20,000	 	 	 	10,000	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                    E.
      Franklin Hirsch

                  	 	$	25,000	 	 	 	8,333	 	 	 	4,167	 


          

        

      

    

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    
      
        
          
            	 
      	 	
                    $

                  	 	 	
                    SHARES

                  	 	 	
                    WARRANTS

                  	 
	
                    SUBSCRIBER

                  	 	
                    INVESTED

                  	 	 	
                    ISSUED

                  	 	 	
                    ISSUED

                  	 
	 
      	 	 	 	 	 	 	 	 	 	 
	
                    Robert
      and Ellen Snyder

                  	 	$	24,000	 	 	 	8,000	 	 	 	4,000	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                    Jayme
      Nozzi

                  	 	$	15,000	 	 	 	5,000	 	 	 	2,500	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                    John
      H. Staab & Nancy A. Staab

                  	 	$	15,000	 	 	 	5,000	 	 	 	2,500	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                    Robert
      Hover

                  	 	$	15,000	 	 	 	5,000	 	 	 	2,500	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                    Leonard
      Adler

                  	 	$	30,000	 	 	 	10,000	 	 	 	5,000	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                    Brian
      W. Lawrence UDT 7/1/99

                  	 	$	900,000	 	 	 	300,000	 	 	 	150,000	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 
	
                    TOTAL

                  	 	$	13,562,002	 	 	 	4,520,666	 	 	 	2,260,335