Subsequent Events

9 Months Ended

Sep. 30, 2011

Subsequent Events

Subsequent Events

(14)Subsequent Events

On November 4, 2010, we were notified by NYSE Arca, Inc. (“NYSE Arca”) that we are not in compliance with the following NYSE Arca continued listing standards:  (i) Rule 5.5(b) - failure to maintain a closing price at or above $3.00 over a 30 consecutive trading day period; (ii) Rule 5.5(b) — failure to maintain a minimum net worth of $4,000,000; and (iii) Rule 5.5(l)(3) - NYSE Arca has concluded that our financial condition is currently impaired to the degree requiring consideration of a suspension or delisting action. We responded to the NYSE Arca on November 6, 2011 addressing the areas of noncompliance.  On November 8, 2011, we received another letter from NYSE Arca indicating that it planned to initiate delisting procedures for the reasons stated above holding a meeting on November 29, 2011 to determine whether we should remain listed. Until NYSE Arca makes a final determination with respect to our listing status, our common stock will remain listed on the NYSE Arca exchange under the symbol “EEE,” but will be assigned a “.BC” indicator by the NYSE Arca to show that we are currently out of compliance with the NYSE Arca’s continued listing standards.

As disclosed in our 8-K dated November 14, 2011, effective November 13, 2011, Mr. Ilyas Khan resigned from his positions as director, Executive Chairman and Interim Chief Executive Officer of the Company. Also effective November 13, 2011, Mr. Peter B. Moss resigned as a director of the Company.

The Board has appointed Mr. Thomas H. Stoner and Mr. Richard Perl to serve as Co-Chairman of the Board of Directors.

On November 17, 2011, we entered into a Securities Purchase Agreement pursuant to which we agreed to sell $700,000 aggregate principal amount of convertible notes in a registered direct public offering for an aggregate gross purchase price of $662,000.  The notes mature thirty days after issuance and can be repaid in cash or, subject to certain equity limitations, can be repaid in common stock.  Subject to certain ownership limitations and certain conversion price adjustments, the convertible notes are convertible at $0.46 per share (the “Conversion Price”).  In the event of a change of control, the Notes may be redeemed at the greater of (i) the principal amount of notes outstanding multiplied by the quotient determined by dividing the largest closing price between the day preceding the announcement of the change of control and receipt of the redemption notice by the Conversion Price; and (ii) 115% of the principal amount of notes outstanding.  In the event of an event of default, the Notes may be redeemed at the greater of (i) ) the principal amount of notes outstanding multiplied by the quotient determined by dividing the largest closing price between the date preceding the event of default through the receipt of the redemption notice by the Conversion Price; or (ii) a premium of up to 115% (depending on the type of event of default) of the principal amount of notes outstanding.  Net proceeds of the offering, including the sale of the warrants described below, after deducting estimated offering expenses are estimated to be approximately $628,750.  In addition, we entered into a Securities Purchase Agreement pursuant to which we agreed to sell warrants to purchase up to 760,870 shares of our Common Stock in a private placement for an aggregate purchase price of $38,000.