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gemmerling

09/14/05 9:34 PM

#15877 RE: dlewisfl #15875

dlewisfl - The financiers cannot naked short the stock. From the original SB2 filing.

Neither Dutchess II nor its agents has a short position or has had a short position at any time since the investment agreement for the equity line was executed on February, 25, 2005.

The selling shareholders should be aware that the anti-manipulation provisions of Regulation M under the Exchange Act will apply to purchases and sales of shares of common stock by the selling shareholders and that there are restrictions on market-making activities by persons engaged in the distribution of the shares. Under Regulation M, the selling shareholders or their agents may not bid for, purchase, or attempt to induce any person to bid for or purchase, shares of our common stock while they are distributing shares covered by this prospectus. Accordingly, except as noted below, the selling shareholders are not permitted to cover short sales by purchasing shares while the distribution is taking place. Dutchess II can cover any short positions only with shares received from us under the equity line. We will advise the selling shareholders that if a particular offer of common stock is to be made on terms materially different from the information set forth in the above Plan of Distribution, then a post-effective amendment to the accompanying registration statement must be filed with the Securities and Exchange Commission.


I know the company was looking into who was naked shorting the stock.