From time to time Mr. Richard T. Schumacher, the Company’s President and CEO, makes loans to the Company to provide the Company with operating cash. The balance of these loans at December 31, 2012 was $98,675 and is recorded as related party debt in the accompanying consolidated balance sheet as of December 31, 2012.

On February 7, 2012, Mr. Schumacher invested $100,000 in our private placement in February 2012 for shares of restricted Common Stock and warrants to purchase shares of Common Stock at a purchase price of $0.9125 per share for 109,589 shares of restricted Common Stock and a Warrant to purchase 54,795 shares of common stock at an exercise price of $0.85 per share.

 On July 6, 2012, Mr. Schumacher invested $30,000 in our Series G Private Placement of Convertible Preferred Stock and warrants to purchase shares of Common Stock at a purchase price of $0.50 per share for 6,000 shares of convertible Preferred Stock (convertible into 60,000 shares of Common Stock) and a Warrant to purchase 30,000 shares of Common Stock at an exercise price of $0.50 per share.

On October 19, 2012, the Board of Directors awarded Mr. Schumacher 100,000 shares of Common Stock valued at $40,000 for reimbursement of a penalty Mr. Schumacher incurred related to a loan he made to the Company that was not repaid by the Company upon the maturity date.

Mr. Wayne Fritzsche, a member of the board of directors from October 2003 to February 2013, received annual cash compensation of $60,000 during 2012 as an investor relations consultant to the Company. In connection with this engagement, Mr. Fritzsche did not serve on any Board committees from January 2012 to February 2013. As of December 31, 2012, Mr. Fritzsche no longer provided consulting services to the Company.

On February 7, 2012, Mr. Fritzsche invested $12,453 in our private placement in February 2012 for shares of restricted Common Stock and warrants to purchase shares of Common Stock at a purchase price of $0.8025 per share for 15,518 shares of restricted common stock and a Warrant to purchase 7,759 shares of Common Stock at an exercise price of $0.74 per share.

On July 6, 2012, Mr. Fritzsche invested $15,000 in our Series G Private Placement of Convertible Preferred Stock and warrants to purchase shares of Common Stock at a purchase price of $0.50 per share for 3,000 shares of convertible Preferred Stock (convertible into 30,000 shares of Common Stock) and a Warrant to purchase 15,000 shares of Common Stock at an exercise price of $0.50 per share.

On July 6, 2012, Mr. Jeffrey N. Peterson invested $23,000 in our Series G Private Placement of Convertible Preferred Stock and warrants to purchase shares of Common Stock at a purchase price of $0.50 per share for 4,600 shares of convertible Preferred Stock (convertible into 46,000 shares of Common Stock) and a Warrant to purchase 23,000 shares of Common Stock at an exercise price of $0.50 per share.

On July 6, 2012, Mr. Vito J. Mangiardi invested $20,000 in our Series G Private Placement of Convertible Preferred Stock and warrants to purchase shares of Common Stock at a purchase price of $0.50 per share for 4,000 shares of convertible Preferred Stock (convertible into 40,000 shares of Common Stock) and a Warrant to purchase 20,000 shares of Common Stock at an exercise price of $0.50 per share.

On July 6, 2012, Mr. Kevin A. Pollack invested $40,000 in our Series G Private Placement of Convertible Preferred Stock and warrants to purchase shares of Common Stock at a purchase price of $0.50 per share for 8,000 shares of convertible Preferred Stock (convertible into 80,000 shares of Common Stock) and a Warrant to purchase 40,000 shares of Common Stock at an exercise price of $0.50 per share.