-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, O8lpR2yhvyC6loYUdL25bCus4FskkpuA9+XtnjqkDoafO1ugikz+UiQq+Ah6J8Jg EoLqmeo2m8yLyXJMK6ErqA== 0001144204-11-007659.txt : 20110211 0001144204-11-007659.hdr.sgml : 20110211 20110211134608 ACCESSION NUMBER: 0001144204-11-007659 CONFORMED SUBMISSION TYPE: SC 13G/A PUBLIC DOCUMENT COUNT: 1 FILED AS OF DATE: 20110211 DATE AS OF CHANGE: 20110211 GROUP MEMBERS: CHRIS JOHNSON GROUP MEMBERS: DAVID GRIN GROUP MEMBERS: EUGENE GRIN GROUP MEMBERS: LAURUS CAPITAL MANAGEMENT, LLC GROUP MEMBERS: PSOURCE STRUCTURED DEBT LIMITED GROUP MEMBERS: RUSSELL SMITH GROUP MEMBERS: VALENS CAPITAL MANAGEMENT, LLC GROUP MEMBERS: VALENS OFFSHORE SPV I, LTD. GROUP MEMBERS: VALENS U.S. SPV I, LLC FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: LAURUS MASTER FUND LTD CENTRAL INDEX KEY: 0001189294 IRS NUMBER: 980337673 STATE OF INCORPORATION: E9 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13G/A BUSINESS ADDRESS: STREET 1: 152 W 57TH ST CITY: NEW YORK STATE: NY ZIP: 10019 BUSINESS PHONE: 2125415800 SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: IMPLANT SCIENCES CORP CENTRAL INDEX KEY: 0001068874 STANDARD INDUSTRIAL CLASSIFICATION: MEASURING & CONTROLLING DEVICES, NEC [3829] IRS NUMBER: 042837126 STATE OF INCORPORATION: MA FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: SC 13G/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-58711 FILM NUMBER: 11597207 BUSINESS ADDRESS: STREET 1: 107 AUDUBON ROAD #5 CITY: WAKEFIELD STATE: MA ZIP: 01880-1246 BUSINESS PHONE: 7812460700 MAIL ADDRESS: STREET 1: 107 AUDUBON ROAD, #5 CITY: WAKEFIELD STATE: MA ZIP: 01880 SC 13G/A 1 v209429_sc13ga.txt UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 SCHEDULE 13G Under the Securities Exchange Act of 1934 (Amendment No.5)* IMPLANT SCIENCES CORPORATION - -------------------------------------------------------------------------------- (Name of Issuer) Common Stock, $.10 par value per share - -------------------------------------------------------------------------------- (Title of Class of Securities) 45320R108 - -------------------------------------------------------------------------------- (CUSIP Number) December 31, 2010 - -------------------------------------------------------------------------------- (Date of Event Which Requires Filing of this Statement) Check the appropriate box to designate the rule pursuant to which this Schedule 13G is filed: |_| Rule 13d-1(b) |X| Rule 13d-1(c) |_| Rule 13d-1(d) *The remainder of this cover page shall be filled out for a reporting person's initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter the disclosures provided in a prior cover page. The information required in the remainder of this cover page shall not be deemed to be "filed" for the purpose of Section 18 of the Securities Exchange Act of 1934 ("Act") or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes). - -------------------------------------------------------------------------------- CUSIP No. 45320R108 - -------------------------------------------------------------------------------- 1 NAME OF REPORTING PERSON: Laurus Capital Management, LLC S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON: 13-4150669 - -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) |_| (b) |X| - -------------------------------------------------------------------------------- 3 SEC USE ONLY - -------------------------------------------------------------------------------- 4 CITIZENSHIP OR PLACE OF ORGANIZATION Delaware - -------------------------------------------------------------------------------- NUMBER OF 5 SOLE VOTING POWER: SHARES BENEFICIALLY 0 shares of Common Stock.* OWNED BY -------------------------------------------------------------- EACH 6 SHARED VOTING POWER: REPORTING PERSON 608,000 shares of Common Stock.* -------------------------------------------------------------- 7 SOLE DISPOSITIVE POWER: 0 shares of Common Stock.* -------------------------------------------------------------- 8 SHARED DISPOSITIVE POWER: 608,000 shares of Common Stock.* - -------------------------------------------------------------------------------- 9 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 608,000 shares of Common Stock. - -------------------------------------------------------------------------------- 10 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES |-| - -------------------------------------------------------------------------------- 11 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9 2.47% - -------------------------------------------------------------------------------- 12 TYPE OF REPORTING PERSON OO - -------------------------------------------------------------------------------- * Based on 24,624,195 shares of the common stock, par value $.10 per share (the "Shares") of Implant Sciences Corporation, a Massachusetts corporation (the "Company") outstanding as of May 10, 2010, as disclosed in the Company's Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2010. As of December 31, 2010, PSource Structured Debt Limited (the "Investor"), held (i) a common stock purchase warrant (the "First Tranche Warrant"), to acquire 150,000 Shares at an exercise price of $4.26, subject to certain adjustments, and (ii) a common stock purchase warrant (the "2006 Warrant #2") to acquire 458,000 Shares at an exercise price of $2.50, subject to certain adjustments. The First Tranche Warrant contains an issuance limitation prohibiting the Investor from exercising that security to the extent that such exercise would result in beneficial ownership by the Investor of more than 4.99% of the Shares then issued and outstanding (the "4.99% Issuance Limitation"). The 2006 Warrant #2 contains an issuance limitation prohibiting the Investor from exercising that security to the extent that such exercise would result in beneficial ownership by the Investor of more than 9.99% of the Shares then issued and outstanding (the "9.99% Issuance Limitation" and together with the 4.99% Issuance Limitation, the "Issuance Limitations"). The 4.99 Issuance Limitation in the First Tranche Warrant may be waived by the Investor upon 75 days prior notice and shall automatically become null and void following notice to the Issuer upon the occurrence and during the continuance of an event of default (as defined in the applicable instrument). The 9.99% Issuance Limitation may be waived by the holder upon at least 61 days notice, and shall become automatically null and void follow notice to the Issuer of the occurrence and/or continuance of an event of default (as defined in the applicable instrument) or automatically upon receipt by the holder of a Notice of Redemption (as defined in the applicable instrument). PSource is managed by Laurus Capital Management, LLC ("LCM"), subject to certain preapproval rights of the board of directors of Psource. Eugene Grin and David Grin, through other entities, are the controlling principals of LCM and share voting and investment power over the securities owned by the Fund reported in this Schedule 13G, as amended. - -------------------------------------------------------------------------------- CUSIP No. 45320R108 - -------------------------------------------------------------------------------- 1 NAME OF REPORTING PERSON: Laurus Master Fund, Ltd. (In Liquidation)* S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON: 98-0337673 - -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) |_| (b) |X| - -------------------------------------------------------------------------------- 3 SEC USE ONLY - -------------------------------------------------------------------------------- 4 CITIZENSHIP OR PLACE OF ORGANIZATION Cayman Islands - -------------------------------------------------------------------------------- NUMBER OF 5 SOLE VOTING POWER: SHARES BENEFICIALLY 0 shares of Common Stock.* OWNED BY -------------------------------------------------------------- EACH 6 SHARED VOTING POWER: REPORTING PERSON 0 shares of Common Stock.* -------------------------------------------------------------- 7 SOLE DISPOSITIVE POWER: 0 shares of Common Stock.* -------------------------------------------------------------- 8 SHARED DISPOSITIVE POWER: 0 shares of Common Stock.* - -------------------------------------------------------------------------------- 9 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 0 shares of Common Stock. - -------------------------------------------------------------------------------- 10 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES |-| - -------------------------------------------------------------------------------- 11 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9 0.00%* - -------------------------------------------------------------------------------- 12 TYPE OF REPORTING PERSON CO - -------------------------------------------------------------------------------- * Based on 24,624,195 shares of the common stock, par value $.10 per share (the "Shares") of Implant Sciences Corporation, a Massachusetts corporation (the "Company") outstanding as of May 10, 2010, as disclosed in the Company's Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2010. As of December 31, 2010, PSource Structured Debt Limited (the "Investor"), held (i) a common stock purchase warrant (the "First Tranche Warrant"), to acquire 150,000 Shares at an exercise price of $4.26, subject to certain adjustments, and (ii) a common stock purchase warrant (the "2006 Warrant #2") to acquire 458,000 Shares at an exercise price of $2.50, subject to certain adjustments. The First Tranche Warrant contains an issuance limitation prohibiting the Investor from exercising that security to the extent that such exercise would result in beneficial ownership by the Investor of more than 4.99% of the Shares then issued and outstanding (the "4.99% Issuance Limitation"). The 2006 Warrant #2 contains an issuance limitation prohibiting the Investor from exercising that security to the extent that such exercise would result in beneficial ownership by the Investor of more than 9.99% of the Shares then issued and outstanding (the "9.99% Issuance Limitation" and together with the 4.99% Issuance Limitation, the "Issuance Limitations"). The 4.99 Issuance Limitation in the First Tranche Warrant may be waived by the Investor upon 75 days prior notice and shall automatically become null and void following notice to the Issuer upon the occurrence and during the continuance of an event of default (as defined in the applicable instrument). The 9.99% Issuance Limitation may be waived by the holder upon at least 61 days notice, and shall become automatically null and void follow notice to the Issuer of the occurrence and/or continuance of an event of default (as defined in the applicable instrument) or automatically upon receipt by the holder of a Notice of Redemption (as defined in the applicable instrument). PSource is managed by Laurus Capital Management, LLC ("LCM"), subject to certain preapproval rights of the board of directors of Psource. Eugene Grin and David Grin, through other entities, are the controlling principals of LCM and share voting and investment power over the securities owned by the Fund reported in this Schedule 13G, as amended. - -------------------------------------------------------------------------------- CUSIP No. 45320R108 - -------------------------------------------------------------------------------- 1 NAME OF REPORTING PERSON: PSource Structured Debt Limited S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON: - -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) |_| (b) |X| - -------------------------------------------------------------------------------- 3 SEC USE ONLY - -------------------------------------------------------------------------------- 4 CITIZENSHIP OR PLACE OF ORGANIZATION Guernsey - -------------------------------------------------------------------------------- NUMBER OF 5 SOLE VOTING POWER: SHARES BENEFICIALLY 0 shares of Common Stock.* OWNED BY -------------------------------------------------------------- EACH 6 SHARED VOTING POWER: REPORTING PERSON 608,000 shares of Common Stock.* -------------------------------------------------------------- 7 SOLE DISPOSITIVE POWER: 0 shares of Common Stock.* -------------------------------------------------------------- 8 SHARED DISPOSITIVE POWER: 608,000 shares of Common Stock.* - -------------------------------------------------------------------------------- 9 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 608,000 shares of Common Stock. - -------------------------------------------------------------------------------- 10 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES |-| - -------------------------------------------------------------------------------- 11 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9 2.47%* - -------------------------------------------------------------------------------- 12 TYPE OF REPORTING PERSON OO - -------------------------------------------------------------------------------- * Based on 24,624,195 shares of the common stock, par value $.10 per share (the "Shares") of Implant Sciences Corporation, a Massachusetts corporation (the "Company") outstanding as of May 10, 2010, as disclosed in the Company's Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2010. As of December 31, 2010, PSource Structured Debt Limited (the "Investor"), held (i) a common stock purchase warrant (the "First Tranche Warrant"), to acquire 150,000 Shares at an exercise price of $4.26, subject to certain adjustments, and (ii) a common stock purchase warrant (the "2006 Warrant #2") to acquire 458,000 Shares at an exercise price of $2.50, subject to certain adjustments. The First Tranche Warrant contains an issuance limitation prohibiting the Investor from exercising that security to the extent that such exercise would result in beneficial ownership by the Investor of more than 4.99% of the Shares then issued and outstanding (the "4.99% Issuance Limitation"). The 2006 Warrant #2 contains an issuance limitation prohibiting the Investor from exercising that security to the extent that such exercise would result in beneficial ownership by the Investor of more than 9.99% of the Shares then issued and outstanding (the "9.99% Issuance Limitation" and together with the 4.99% Issuance Limitation, the "Issuance Limitations"). The 4.99 Issuance Limitation in the First Tranche Warrant may be waived by the Investor upon 75 days prior notice and shall automatically become null and void following notice to the Issuer upon the occurrence and during the continuance of an event of default (as defined in the applicable instrument). The 9.99% Issuance Limitation may be waived by the holder upon at least 61 days notice, and shall become automatically null and void follow notice to the Issuer of the occurrence and/or continuance of an event of default (as defined in the applicable instrument) or automatically upon receipt by the holder of a Notice of Redemption (as defined in the applicable instrument). PSource is managed by Laurus Capital Management, LLC ("LCM"), subject to certain preapproval rights of the board of directors of Psource. Eugene Grin and David Grin, through other entities, are the controlling principals of LCM and share voting and investment power over the securities owned by the Fund reported in this Schedule 13G, as amended. - -------------------------------------------------------------------------------- CUSIP No. 45320R108 - -------------------------------------------------------------------------------- 1 NAME OF REPORTING PERSON: Valens U.S. SPV I, LLC S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON: 20-8903266 - -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) |_| (b) |X| - -------------------------------------------------------------------------------- 3 SEC USE ONLY - -------------------------------------------------------------------------------- 4 CITIZENSHIP OR PLACE OF ORGANIZATION Delaware - -------------------------------------------------------------------------------- NUMBER OF 5 SOLE VOTING POWER: SHARES BENEFICIALLY 0 shares of Common Stock.* OWNED BY -------------------------------------------------------------- EACH 6 SHARED VOTING POWER: REPORTING PERSON 0 shares of Common Stock.* -------------------------------------------------------------- 7 SOLE DISPOSITIVE POWER: 0 shares of Common Stock.* -------------------------------------------------------------- 8 SHARED DISPOSITIVE POWER: 0 shares of Common Stock.* - -------------------------------------------------------------------------------- 9 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 0 shares of Common Stock. - -------------------------------------------------------------------------------- 10 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES |-| - -------------------------------------------------------------------------------- 11 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9 0.0%* - -------------------------------------------------------------------------------- 12 TYPE OF REPORTING PERSON CO - -------------------------------------------------------------------------------- * Based on 24,624,195 shares of the common stock, par value $.10 per share (the "Shares") of Implant Sciences Corporation, a Massachusetts corporation (the "Company") outstanding as of May 10, 2010, as disclosed in the Company's Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2010. As of December 31, 2010, PSource Structured Debt Limited (the "Investor"), held (i) a common stock purchase warrant (the "First Tranche Warrant"), to acquire 150,000 Shares at an exercise price of $4.26, subject to certain adjustments, and (ii) a common stock purchase warrant (the "2006 Warrant #2") to acquire 458,000 Shares at an exercise price of $2.50, subject to certain adjustments. The First Tranche Warrant contains an issuance limitation prohibiting the Investor from exercising that security to the extent that such exercise would result in beneficial ownership by the Investor of more than 4.99% of the Shares then issued and outstanding (the "4.99% Issuance Limitation"). The 2006 Warrant #2 contains an issuance limitation prohibiting the Investor from exercising that security to the extent that such exercise would result in beneficial ownership by the Investor of more than 9.99% of the Shares then issued and outstanding (the "9.99% Issuance Limitation" and together with the 4.99% Issuance Limitation, the "Issuance Limitations"). The 4.99 Issuance Limitation in the First Tranche Warrant may be waived by the Investor upon 75 days prior notice and shall automatically become null and void following notice to the Issuer upon the occurrence and during the continuance of an event of default (as defined in the applicable instrument). The 9.99% Issuance Limitation may be waived by the holder upon at least 61 days notice, and shall become automatically null and void follow notice to the Issuer of the occurrence and/or continuance of an event of default (as defined in the applicable instrument) or automatically upon receipt by the holder of a Notice of Redemption (as defined in the applicable instrument). PSource is managed by Laurus Capital Management, LLC ("LCM"), subject to certain preapproval rights of the board of directors of Psource. Eugene Grin and David Grin, through other entities, are the controlling principals of LCM and share voting and investment power over the securities owned by the Fund reported in this Schedule 13G, as amended. CUSIP No. 45320R108 - -------------------------------------------------------------------------------- 1 NAME OF REPORTING PERSON: Valens Offshore SPV I, Ltd. S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON: 98-0539781 - -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) |_| (b) |X| - -------------------------------------------------------------------------------- 3 SEC USE ONLY - -------------------------------------------------------------------------------- 4 CITIZENSHIP OR PLACE OF ORGANIZATION Cayman Islands - -------------------------------------------------------------------------------- NUMBER OF 5 SOLE VOTING POWER: SHARES BENEFICIALLY 0 shares of Common Stock.* OWNED BY -------------------------------------------------------------- EACH 6 SHARED VOTING POWER: REPORTING PERSON 0 shares of Common Stock.* -------------------------------------------------------------- 7 SOLE DISPOSITIVE POWER: 0 shares of Common Stock.* -------------------------------------------------------------- 8 SHARED DISPOSITIVE POWER: 0 shares of Common Stock.* - -------------------------------------------------------------------------------- 9 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 0 shares of Common Stock. - -------------------------------------------------------------------------------- 10 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES |-| - -------------------------------------------------------------------------------- 11 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9 0.0% - -------------------------------------------------------------------------------- 12 TYPE OF REPORTING PERSON OO - -------------------------------------------------------------------------------- * Based on 24,624,195 shares of the common stock, par value $.10 per share (the "Shares") of Implant Sciences Corporation, a Massachusetts corporation (the "Company") outstanding as of May 10, 2010, as disclosed in the Company's Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2010. As of December 31, 2010, PSource Structured Debt Limited (the "Investor"), held (i) a common stock purchase warrant (the "First Tranche Warrant"), to acquire 150,000 Shares at an exercise price of $4.26, subject to certain adjustments, and (ii) a common stock purchase warrant (the "2006 Warrant #2") to acquire 458,000 Shares at an exercise price of $2.50, subject to certain adjustments. The First Tranche Warrant contains an issuance limitation prohibiting the Investor from exercising that security to the extent that such exercise would result in beneficial ownership by the Investor of more than 4.99% of the Shares then issued and outstanding (the "4.99% Issuance Limitation"). The 2006 Warrant #2 contains an issuance limitation prohibiting the Investor from exercising that security to the extent that such exercise would result in beneficial ownership by the Investor of more than 9.99% of the Shares then issued and outstanding (the "9.99% Issuance Limitation" and together with the 4.99% Issuance Limitation, the "Issuance Limitations"). The 4.99 Issuance Limitation in the First Tranche Warrant may be waived by the Investor upon 75 days prior notice and shall automatically become null and void following notice to the Issuer upon the occurrence and during the continuance of an event of default (as defined in the applicable instrument). The 9.99% Issuance Limitation may be waived by the holder upon at least 61 days notice, and shall become automatically null and void follow notice to the Issuer of the occurrence and/or continuance of an event of default (as defined in the applicable instrument) or automatically upon receipt by the holder of a Notice of Redemption (as defined in the applicable instrument). PSource is managed by Laurus Capital Management, LLC ("LCM"), subject to certain preapproval rights of the board of directors of Psource. Eugene Grin and David Grin, through other entities, are the controlling principals of LCM and share voting and investment power over the securities owned by the Fund reported in this Schedule 13G, as amended. - -------------------------------------------------------------------------------- CUSIP No. 45320R108 - -------------------------------------------------------------------------------- 1 NAME OF REPORTING PERSON: Valens Capital Management, LLC S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON: 20-8903345 - -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) |_| (b) |X| - -------------------------------------------------------------------------------- 3 SEC USE ONLY - -------------------------------------------------------------------------------- 4 CITIZENSHIP OR PLACE OF ORGANIZATION Delaware - -------------------------------------------------------------------------------- NUMBER OF 5 SOLE VOTING POWER: SHARES BENEFICIALLY 0 shares of Common Stock.* OWNED BY -------------------------------------------------------------- EACH 6 SHARED VOTING POWER: REPORTING PERSON 0 shares of Common Stock.* -------------------------------------------------------------- 7 SOLE DISPOSITIVE POWER: 0 shares of Common Stock.* -------------------------------------------------------------- 8 SHARED DISPOSITIVE POWER: 0 shares of Common Stock.* - -------------------------------------------------------------------------------- 9 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 0 shares of Common Stock. - -------------------------------------------------------------------------------- 10 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES |-| - -------------------------------------------------------------------------------- 11 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9 0.0%* - -------------------------------------------------------------------------------- 12 TYPE OF REPORTING PERSON CO - -------------------------------------------------------------------------------- * Based on 24,624,195 shares of the common stock, par value $.10 per share (the "Shares") of Implant Sciences Corporation, a Massachusetts corporation (the "Company") outstanding as of May 10, 2010, as disclosed in the Company's Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2010. As of December 31, 2010, PSource Structured Debt Limited (the "Investor"), held (i) a common stock purchase warrant (the "First Tranche Warrant"), to acquire 150,000 Shares at an exercise price of $4.26, subject to certain adjustments, and (ii) a common stock purchase warrant (the "2006 Warrant #2") to acquire 458,000 Shares at an exercise price of $2.50, subject to certain adjustments. The First Tranche Warrant contains an issuance limitation prohibiting the Investor from exercising that security to the extent that such exercise would result in beneficial ownership by the Investor of more than 4.99% of the Shares then issued and outstanding (the "4.99% Issuance Limitation"). The 2006 Warrant #2 contains an issuance limitation prohibiting the Investor from exercising that security to the extent that such exercise would result in beneficial ownership by the Investor of more than 9.99% of the Shares then issued and outstanding (the "9.99% Issuance Limitation" and together with the 4.99% Issuance Limitation, the "Issuance Limitations"). The 4.99 Issuance Limitation in the First Tranche Warrant may be waived by the Investor upon 75 days prior notice and shall automatically become null and void following notice to the Issuer upon the occurrence and during the continuance of an event of default (as defined in the applicable instrument). The 9.99% Issuance Limitation may be waived by the holder upon at least 61 days notice, and shall become automatically null and void follow notice to the Issuer of the occurrence and/or continuance of an event of default (as defined in the applicable instrument) or automatically upon receipt by the holder of a Notice of Redemption (as defined in the applicable instrument). PSource is managed by Laurus Capital Management, LLC ("LCM"), subject to certain preapproval rights of the board of directors of Psource. Eugene Grin and David Grin, through other entities, are the controlling principals of LCM and share voting and investment power over the securities owned by the Fund reported in this Schedule 13G, as amended. CUSIP No. 45320R108 - -------------------------------------------------------------------------------- 1 NAME OF REPORTING PERSON: Chris Johnson - -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) |_| (b) |X| - -------------------------------------------------------------------------------- 3 SEC USE ONLY - -------------------------------------------------------------------------------- 4 CITIZENSHIP OR PLACE OF ORGANIZATION Cayman Islands - -------------------------------------------------------------------------------- NUMBER OF 5 SOLE VOTING POWER: 0 shares of Common Stock. * SHARES ------------------------------------------------------------------- BENEFICIALLY 6 SHARED VOTING POWER: 0 shares of Common Stock. * OWNED BY ------------------------------------------------------------------- EACH 7 SOLE DISPOSITIVE POWER: 0 shares of Common Stock. * REPORTING ------------------------------------------------------------------- PERSON 8 SHARES DISPOSITIVE POWER: 0 shares of Common Stock. * - -------------------------------------------------------------------------------- 9 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 0 shares of Common Stock - -------------------------------------------------------------------------------- 10 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES |_| - -------------------------------------------------------------------------------- 11 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9 0.0% - -------------------------------------------------------------------------------- 12 TYPE OF REPORTING PERSON IN - -------------------------------------------------------------------------------- * Based on 24,624,195 shares of the common stock, par value $.10 per share (the "Shares") of Implant Sciences Corporation, a Massachusetts corporation (the "Company") outstanding as of May 10, 2010, as disclosed in the Company's Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2010. As of December 31, 2010, PSource Structured Debt Limited (the "Investor"), held (i) a common stock purchase warrant (the "First Tranche Warrant"), to acquire 150,000 Shares at an exercise price of $4.26, subject to certain adjustments, and (ii) a common stock purchase warrant (the "2006 Warrant #2") to acquire 458,000 Shares at an exercise price of $2.50, subject to certain adjustments. The First Tranche Warrant contains an issuance limitation prohibiting the Investor from exercising that security to the extent that such exercise would result in beneficial ownership by the Investor of more than 4.99% of the Shares then issued and outstanding (the "4.99% Issuance Limitation"). The 2006 Warrant #2 contains an issuance limitation prohibiting the Investor from exercising that security to the extent that such exercise would result in beneficial ownership by the Investor of more than 9.99% of the Shares then issued and outstanding (the "9.99% Issuance Limitation" and together with the 4.99% Issuance Limitation, the "Issuance Limitations"). The 4.99 Issuance Limitation in the First Tranche Warrant may be waived by the Investor upon 75 days prior notice and shall automatically become null and void following notice to the Issuer upon the occurrence and during the continuance of an event of default (as defined in the applicable instrument). The 9.99% Issuance Limitation may be waived by the holder upon at least 61 days notice, and shall become automatically null and void follow notice to the Issuer of the occurrence and/or continuance of an event of default (as defined in the applicable instrument) or automatically upon receipt by the holder of a Notice of Redemption (as defined in the applicable instrument). PSource is managed by Laurus Capital Management, LLC ("LCM"), subject to certain preapproval rights of the board of directors of Psource. Eugene Grin and David Grin, through other entities, are the controlling principals of LCM and share voting and investment power over the securities owned by the Fund reported in this Schedule 13G, as amended. CUSIP No. 45320R108 - -------------------------------------------------------------------------------- 1 NAME OF REPORTING PERSON: Russell Smith - -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) |_| (b) |X| - -------------------------------------------------------------------------------- 3 SEC USE ONLY - -------------------------------------------------------------------------------- 4 CITIZENSHIP OR PLACE OF ORGANIZATION Cayman Islands - -------------------------------------------------------------------------------- NUMBER OF 5 SOLE VOTING POWER: 0 shares of Common Stock. * SHARES ------------------------------------------------------------------- BENEFICIALLY 6 SHARED VOTING POWER: 0 shares of Common Stock. * OWNED BY ------------------------------------------------------------------- EACH 7 SOLE DISPOSITIVE POWER: 0 shares of Common Stock. * REPORTING ------------------------------------------------------------------- PERSON 8 SHARES DISPOSITIVE POWER: 0 shares of Common Stock. * - -------------------------------------------------------------------------------- 9 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 0 shares of Common Stock - -------------------------------------------------------------------------------- 10 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES |_| - -------------------------------------------------------------------------------- 11 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9 0.0% - -------------------------------------------------------------------------------- 12 TYPE OF REPORTING PERSON IN - -------------------------------------------------------------------------------- * Based on 24,624,195 shares of the common stock, par value $.10 per share (the "Shares") of Implant Sciences Corporation, a Massachusetts corporation (the "Company") outstanding as of May 10, 2010, as disclosed in the Company's Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2010. As of December 31, 2010, PSource Structured Debt Limited (the "Investor"), held (i) a common stock purchase warrant (the "First Tranche Warrant"), to acquire 150,000 Shares at an exercise price of $4.26, subject to certain adjustments, and (ii) a common stock purchase warrant (the "2006 Warrant #2") to acquire 458,000 Shares at an exercise price of $2.50, subject to certain adjustments. The First Tranche Warrant contains an issuance limitation prohibiting the Investor from exercising that security to the extent that such exercise would result in beneficial ownership by the Investor of more than 4.99% of the Shares then issued and outstanding (the "4.99% Issuance Limitation"). The 2006 Warrant #2 contains an issuance limitation prohibiting the Investor from exercising that security to the extent that such exercise would result in beneficial ownership by the Investor of more than 9.99% of the Shares then issued and outstanding (the "9.99% Issuance Limitation" and together with the 4.99% Issuance Limitation, the "Issuance Limitations"). The 4.99 Issuance Limitation in the First Tranche Warrant may be waived by the Investor upon 75 days prior notice and shall automatically become null and void following notice to the Issuer upon the occurrence and during the continuance of an event of default (as defined in the applicable instrument). The 9.99% Issuance Limitation may be waived by the holder upon at least 61 days notice, and shall become automatically null and void follow notice to the Issuer of the occurrence and/or continuance of an event of default (as defined in the applicable instrument) or automatically upon receipt by the holder of a Notice of Redemption (as defined in the applicable instrument). PSource is managed by Laurus Capital Management, LLC ("LCM"), subject to certain preapproval rights of the board of directors of Psource. Eugene Grin and David Grin, through other entities, are the controlling principals of LCM and share voting and investment power over the securities owned by the Fund reported in this Schedule 13G, as amended. - -------------------------------------------------------------------------------- CUSIP No. 45320R108 - -------------------------------------------------------------------------------- 1 NAME OF REPORTING PERSON: David Grin - -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) |_| (b) |X| - -------------------------------------------------------------------------------- 3 SEC USE ONLY - -------------------------------------------------------------------------------- 4 CITIZENSHIP OR PLACE OF ORGANIZATION United States and Israel - -------------------------------------------------------------------------------- NUMBER OF 5 SOLE VOTING POWER: SHARES BENEFICIALLY 0 shares of Common Stock.* OWNED BY -------------------------------------------------------------- EACH 6 SHARED VOTING POWER: REPORTING PERSON 608,000 shares of Common Stock.* -------------------------------------------------------------- 7 SOLE DISPOSITIVE POWER: 0 shares of Common Stock.* -------------------------------------------------------------- 8 SHARED DISPOSITIVE POWER: 608,000 shares of Common Stock.* - -------------------------------------------------------------------------------- 9 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 608,000 shares of Common Stock. - -------------------------------------------------------------------------------- 10 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES |-| - -------------------------------------------------------------------------------- 11 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9 2.47% - -------------------------------------------------------------------------------- 12 TYPE OF REPORTING PERSON IN - -------------------------------------------------------------------------------- * Based on 24,624,195 shares of the common stock, par value $.10 per share (the "Shares") of Implant Sciences Corporation, a Massachusetts corporation (the "Company") outstanding as of May 10, 2010, as disclosed in the Company's Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2010. As of December 31, 2010, PSource Structured Debt Limited (the "Investor"), held (i) a common stock purchase warrant (the "First Tranche Warrant"), to acquire 150,000 Shares at an exercise price of $4.26, subject to certain adjustments, and (ii) a common stock purchase warrant (the "2006 Warrant #2") to acquire 458,000 Shares at an exercise price of $2.50, subject to certain adjustments. The First Tranche Warrant contains an issuance limitation prohibiting the Investor from exercising that security to the extent that such exercise would result in beneficial ownership by the Investor of more than 4.99% of the Shares then issued and outstanding (the "4.99% Issuance Limitation"). The 2006 Warrant #2 contains an issuance limitation prohibiting the Investor from exercising that security to the extent that such exercise would result in beneficial ownership by the Investor of more than 9.99% of the Shares then issued and outstanding (the "9.99% Issuance Limitation" and together with the 4.99% Issuance Limitation, the "Issuance Limitations"). The 4.99 Issuance Limitation in the First Tranche Warrant may be waived by the Investor upon 75 days prior notice and shall automatically become null and void following notice to the Issuer upon the occurrence and during the continuance of an event of default (as defined in the applicable instrument). The 9.99% Issuance Limitation may be waived by the holder upon at least 61 days notice, and shall become automatically null and void follow notice to the Issuer of the occurrence and/or continuance of an event of default (as defined in the applicable instrument) or automatically upon receipt by the holder of a Notice of Redemption (as defined in the applicable instrument). PSource is managed by Laurus Capital Management, LLC ("LCM"), subject to certain preapproval rights of the board of directors of Psource. Eugene Grin and David Grin, through other entities, are the controlling principals of LCM and share voting and investment power over the securities owned by the Fund reported in this Schedule 13G, as amended. - -------------------------------------------------------------------------------- CUSIP No. 45320R108 - -------------------------------------------------------------------------------- 1 NAME OF REPORTING PERSON: Eugene Grin - -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) |_| (b) |X| - -------------------------------------------------------------------------------- 3 SEC USE ONLY - -------------------------------------------------------------------------------- 4 CITIZENSHIP OR PLACE OF ORGANIZATION United States - -------------------------------------------------------------------------------- NUMBER OF 5 SOLE VOTING POWER: SHARES BENEFICIALLY 0 shares of Common Stock.* OWNED BY -------------------------------------------------------------- EACH 6 SHARED VOTING POWER: REPORTING PERSON 608,000 shares of Common Stock.* -------------------------------------------------------------- 7 SOLE DISPOSITIVE POWER: 0 shares of Common Stock.* -------------------------------------------------------------- 8 SHARED DISPOSITIVE POWER: 608,000 shares of Common Stock.* - -------------------------------------------------------------------------------- 9 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 608,000 shares of Common Stock. - -------------------------------------------------------------------------------- 10 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES |-| - -------------------------------------------------------------------------------- 11 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9 2.47% - -------------------------------------------------------------------------------- 12 TYPE OF REPORTING PERSON IN - -------------------------------------------------------------------------------- * Based on 24,624,195 shares of the common stock, par value $.10 per share (the "Shares") of Implant Sciences Corporation, a Massachusetts corporation (the "Company") outstanding as of May 10, 2010, as disclosed in the Company's Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2010. As of December 31, 2010, PSource Structured Debt Limited (the "Investor"), held (i) a common stock purchase warrant (the "First Tranche Warrant"), to acquire 150,000 Shares at an exercise price of $4.26, subject to certain adjustments, and (ii) a common stock purchase warrant (the "2006 Warrant #2") to acquire 458,000 Shares at an exercise price of $2.50, subject to certain adjustments. The First Tranche Warrant contains an issuance limitation prohibiting the Investor from exercising that security to the extent that such exercise would result in beneficial ownership by the Investor of more than 4.99% of the Shares then issued and outstanding (the "4.99% Issuance Limitation"). The 2006 Warrant #2 contains an issuance limitation prohibiting the Investor from exercising that security to the extent that such exercise would result in beneficial ownership by the Investor of more than 9.99% of the Shares then issued and outstanding (the "9.99% Issuance Limitation" and together with the 4.99% Issuance Limitation, the "Issuance Limitations"). The 4.99 Issuance Limitation in the First Tranche Warrant may be waived by the Investor upon 75 days prior notice and shall automatically become null and void following notice to the Issuer upon the occurrence and during the continuance of an event of default (as defined in the applicable instrument). The 9.99% Issuance Limitation may be waived by the holder upon at least 61 days notice, and shall become automatically null and void follow notice to the Issuer of the occurrence and/or continuance of an event of default (as defined in the applicable instrument) or automatically upon receipt by the holder of a Notice of Redemption (as defined in the applicable instrument). PSource is managed by Laurus Capital Management, LLC ("LCM"), subject to certain preapproval rights of the board of directors of Psource. Eugene Grin and David Grin, through other entities, are the controlling principals of LCM and share voting and investment power over the securities owned by the Fund reported in this Schedule 13G, as amended. Item 1(a). Name of Issuer: IMPLANT SCIENCE CORPORATION Item 1(b). Address of Issuer's Principal Executive Offices: 600 Research Drive, Wilmington, MA 01887 Item 2(a). Name of Person Filing: Laurus Capital Management, LLC* This Schedule 13G, as amended, is also filed on behalf of Laurus Master Fund, Ltd. (in liquidation), PSource Structured Debt Limited, a closed ended company incorporated with limited liability in Guernsey, Laurus Capital Management, LLC, a Delaware limited liability company, Valens Offshore SPV I, Ltd., a Cayman Islands limited company, Valens U.S. SPV I, LLC, a Delaware limited liability company, Valens Capital Management, LLC, a Delaware limited liability company, Russell Smith, Chris Johnson, Eugene Grin and David Grin. Laurus Master Fund, Ltd. (In Liquidation) is in official liquidation under the supervision of the Grand Court of the Cayman Islands. The Joint Official Liquidators are Chris Johnson and Russell Smith of Johnson Smith Associates, Ltd. The JOLs have discretion over the management of Laurus Master Fund, Ltd. (In Liquidation) and the disposition of its assets, including the securities owned by Laurus Master Fund, Ltd. (In Liquidation) reported in this Schedule 13G, as amended. Laurus Capital Management, LLC, acting through its controlling principals, Eugene Grin and David Grin, provides day to day investment management services to Laurus Master Fund, Ltd. (In Liquidation) and its two feeder funds concerning their respective assets, including the securities owned by Laurus Master Fund, Ltd. (In Liquidation) reported in this Schedule 13G, as amended, subject to the oversight and preapproval rights of the Joint Official Liquidators and LCM's obligations to Laurus Master Fund, Ltd. (In Liquidation) under the Seventh Amended and Restated Investment Management Agreement of April 26, 2007, as amended, restated, modified and/or supplemented from time to time; all of the foregoing subject to specific directions otherwise given by the Joint Official Liquidators at their discretion. Laurus Capital Management, LLC manages PSource Structured Debt Limited, subject to certain preapproval rights of the board of directors of Psource Structured Debt Limited. Valens Capital Management, LLC manages Valens Offshore SPV I Ltd. and Valens U.S. SPV I, LLC. Eugene Grin and David Grin, through other entities, are the controlling principals of Laurus Capital Management, LLC and Valens Capital Management, LLC and share voting and investment power over the securities owned PSource Structured Debt Limited reported in this Schedule 13G, as amended. Information related to each of Joint Official Liquidators, Laurus Master Fund, Ltd. (in liquidation), PSource Structured Debt Limited, Valens U.S. SPV I, LLC, Valens Offshore SPV I, Ltd., Valens Capital Management, LLC, Eugene Grin and David Grin is set forth on Appendix A hereto. Item 2(b). Address of Principal Business Office or if none, Residence: 875 Third Avenue, 3rd Floor, New York, NY 10022 Item 2(c). Citizenship: Delaware Item 2(d). Title of Class of Securities: Class A Common Stock Item 2(e). CUSIP Number: 45320R108 Item 3. Not Applicable Item 4. Ownership: (a) Amount Beneficially Owned: 608,000 shares of Common Stock* (b) Percent of Class: 2.47%* (c) Number of shares as to which such person has: (i) sole power to vote or to direct the vote: 0 shares of Common Stock* (ii) shared power to vote or to direct the vote: 608,000 shares of Common Stock* (iii) sole power to dispose or to direct the disposition of: 0 shares of Common Stock* (iv) shared power to dispose or to direct the disposition of: 608,000 shares of Common Stock* Item 5. Ownership of Five Percent or Less of a Class: If this statement is being filed to report the fact that as of the date hereof the reporting person has ceased to be the owner of more than five percent of the class of securities, check the following: [X] Item 6. Ownership of More than Five Percent on Behalf of Another Person: Not applicable Item 7. Identification and Classification of Subsidiary Which Acquired the Securities: Not applicable Item 8. Identification and Classification of Members of the Group: Not applicable Item 9. Notice of Dissolution of Group: Not applicable Item 10. Certification: By signing below I certify that, to the best of my knowledge and belief, the securities referred to above were not acquired and are not held for the purpose of or with the effect of changing or influencing the control of the issuer of the securities and were not acquired and are not held in connection with or as a participant in any transaction having that purpose or effect. - ------------ * Based on 24,624,195 shares of the common stock, par value $.10 per share (the "Shares") of Implant Sciences Corporation, a Massachusetts corporation (the "Company") outstanding as of May 10, 2010, as disclosed in the Company's Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2010. As of December 31, 2010, PSource Structured Debt Limited (the "Investor"), held (i) a common stock purchase warrant (the "First Tranche Warrant"), to acquire 150,000 Shares at an exercise price of $4.26, subject to certain adjustments, and (ii) a common stock purchase warrant (the "2006 Warrant #2") to acquire 458,000 Shares at an exercise price of $2.50, subject to certain adjustments. The First Tranche Warrant contains an issuance limitation prohibiting the Investor from exercising that security to the extent that such exercise would result in beneficial ownership by the Investor of more than 4.99% of the Shares then issued and outstanding (the "4.99% Issuance Limitation"). The 2006 Warrant #2 contains an issuance limitation prohibiting the Investor from exercising that security to the extent that such exercise would result in beneficial ownership by the Investor of more than 9.99% of the Shares then issued and outstanding (the "9.99% Issuance Limitation" and together with the 4.99% Issuance Limitation, the "Issuance Limitations"). The 4.99 Issuance Limitation in the First Tranche Warrant may be waived by the Investor upon 75 days prior notice and shall automatically become null and void following notice to the Issuer upon the occurrence and during the continuance of an event of default (as defined in the applicable instrument). The 9.99% Issuance Limitation may be waived by the holder upon at least 61 days notice, and shall become automatically null and void follow notice to the Issuer of the occurrence and/or continuance of an event of default (as defined in the applicable instrument) or automatically upon receipt by the holder of a Notice of Redemption (as defined in the applicable instrument). PSource is managed by Laurus Capital Management, LLC ("LCM"), subject to certain preapproval rights of the board of directors of Psource. Eugene Grin and David Grin, through other entities, are the controlling principals of LCM and share voting and investment power over the securities owned by the Fund reported in this Schedule 13G, as amended. SIGNATURE After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct. February 11, 2011 --------------------------------- Date Laurus Capital Management, LLC /s/ Eugene Grin ---------------------------------------- Eugene Grin Authorized Signatory February 11, 2011 APPENDIX A A. Name: Laurus Master Fund, Ltd. (in liquidation), an exempted company incorporated with limited liability under the laws of the Cayman Islands Business Address: c/o Laurus Capital Management, LLC 875 Third Avenue, 3rd Floor New York, New York 10022 Place of Organization: Cayman Islands B. Name: PSource Structured Debt Limited, a closed ended company incorporated with limited liability in Guernsey Business Address: c/o Laurus Capital Management, LLC 875 Third Avenue, 3rd Floor New York, New York 10022 Place of Organization: Guernsey C. Name: Valens U.S. SPV I, LLC a Delaware limited liability company Business Address: c/o Valens Capital Management, LLC 875 Third Avenue, 3rd Floor New York, New York 10022 Place of Organization: Delaware D. Name: Valens Capital Management, LLC, a Delaware limited liability company Business Address: 875 Third Avenue, 3rd Floor New York, New York 10022 Place of Organization: Delaware E. Name: Valens Offshore SPV I, Ltd., an exempted company incorporated with limited liability under the laws of the Cayman Islands Business Address: c/o Laurus Capital Management, LLC 875 Third Avenue, 3rd Floor New York, New York 10022 Place of Organization: Cayman Islands F. Name: Eugene Grin Business Address: c/o Laurus Capital Management, LLC 875 Third Avenue, 3rd Floor New York, New York 10022 Principal Occupation: Principal of Laurus Capital Management, LLC Citizenship: United States G. Name: David Grin Business Address: c/o Laurus Capital Management, LLC 875 Third Avenue, 3rd Floor New York, New York 10022 Principal Occupation: Principal of Laurus Capital Management, LLC Citizenship: United States and Israel H. Name: Chris Johnson Business Address: Elizabethan Square, 80 Shedden Road, George Town, Grand Cayman, Cayman Islands KY1-1104 Principal Occupation: Managing Director, Johnson Smith Associates Ltd. Citizenship: Cayman Islands I. Name: Russell Smith Business Address: Elizabethan Square, 80 Shedden Road, George Town, Grand Cayman, Cayman Islands KY1-1104 Principal Occupation: Director, Johnson Smith Associates Ltd. Citizenship: Cayman Islands Each of Laurus Master Fund, Ltd. (in liquidation), PSource Structured Debt Limited, Valens U.S. SPV I, LLC, Valens Offshore SPV I, Ltd., Valens Capital Management, LLC, Chris Johnson, Russell Smith, Eugene Grin and David Grin hereby agrees, by their execution below, that the Schedule 13G, as amended, to which this Appendix A is attached is filed on behalf of each of them, respectively. Laurus Master Fund, Ltd. (in liquidation) /s/ Russell Smith - --------------------------------- Russell Smith Joint Official Liquidator (for the account of Laurus Master Fund, Ltd. and with no personal liability) February 11, 2011 PSource Structured Debt Limited By: Laurus Capital Management, Individually and as investment manager /s/ Eugene Grin - --------------------------------- Eugene Grin Principal February 11, 2011 Valens U.S. SPV I, LLC Valens Offshore SPV I, Ltd. By: Valens Capital Management, LLC Individually and as investment manager /s/ Eugene Grin - --------------------------------- Eugene Grin Principal February 11, 2011 /s/ Chris Johnson - ----------------------------------------- Chris Johnson, on his individual behalf February 11, 2011 /s/ Russell Smith - ----------------------------------------- Russell Smith, on his individual behalf February 11, 2011 /s/ David Grin - --------------------------------- David Grin, on his individual behalf February 11, 2011 /s/ Eugene Grin - --------------------------------- Eugene Grin, on his individual behalf February 11, 2011 -----END PRIVACY-ENHANCED MESSAGE-----