This excerpt taken from the PRVT 10-K filed Mar 31, 2006.
Sale of Unregistered Securities in the Fourth Quarter of 2005
During the three months ended December 31, 2005, we sold unregistered securities in the following transactions.
In the fall of 2003 we sold convertible notes to four accredited institutional investors in the aggregate principal amount of $2.25 million. Interest on the convertible notes accrues at the rate of 7%, and is payable quarterly in cash or common stock, at the election of the Company, based upon a weighted average market price during the 15 trading days preceding payment. The notes are convertible at the option of the holder at a fixed conversion price of $2.00. In fourth quarter of 2005 we issued an aggregate of 16,543 shares of common stock in payment of $36,429 of accrued interest under the outstanding notes. In addition, one convertible note holder converted $625,000 of principal and received 312,500 shares of common stock. The issuance of the common stock is deemed to be exempt from the registration requirements of the Securities Act of 1933, as amended, in reliance on Section 4(2) of the Securities Act and Regulation D promulgated thereunder, as it was sold to institutional investors believed to be accredited investors and was made without general solicitation or advertising.