AN "AFFILIATED PERSON" OF, OR "PROMOTER" OR "PRINCIPAL
UNDERWRITER" FOR AN INVESTMENT COMPANY, WITHIN THE MEANING OF THE INVESTMENT
COMPANY ACT OF 1940, AS AMENDED.
3.17
INSURANCE.
THE COMPANY AND ITS SUBSIDIARIES
MAINTAIN INSURANCE OF THE TYPES AND IN THE AMOUNTS THAT THE COMPANY REASONABLY
BELIEVES IS ADEQUATE FOR THE BUSINESSES OF THE COMPANY AND ITS SUBSIDIARIES,
INCLUDING, BUT NOT LIMITED TO, INSURANCE COVERING REAL AND PERSONAL PROPERTY
OWNED OR LEASED BY THE COMPANY AND ITS SUBSIDIARIES AGAINST THEFT, DAMAGE,
DESTRUCTION, ACTS OF VANDALISM AND ALL OTHER RISKS CUSTOMARILY INSURED AGAINST
BY SIMILARLY SITUATED COMPANIES, ALL OF WHICH INSURANCE IS IN FULL FORCE AND
EFFECT.
3.18
OFFERING MATERIALS.
THE COMPANY HAS NOT IN THE PAST
NOR WILL IT HEREAFTER TAKE ANY ACTION TO SELL, OFFER FOR SALE OR SOLICIT OFFERS
TO BUY ANY SHARES OF THE COMPANY WHICH WOULD BRING THE OFFER OR SALE OF THE
SHARES AS CONTEMPLATED BY THIS AGREEMENT WITHIN THE PROVISIONS OF SECTION 5 OF
THE SECURITIES ACT WITHOUT THE AVAILABILITY OF AN EXCEPTION FROM THE
REGISTRATION REQUIREMENTS CONTAINED THEREIN.
BASED IN PART UPON THE
REPRESENTATIONS AND WARRANTIES OF THE INVESTOR CONTAINED IN SECTION 4 OF THE
AGREEMENT, THE OFFER, SALE AND ISSUANCE OF THE SHARES AS CONTEMPLATED BY THIS
AGREEMENT ARE EXEMPT FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT,
AND FROM THE REGISTRATION OR QUALIFICATION REQUIREMENTS OF THE LAWS OF ANY
APPLICABLE STATE OR U.S. JURISDICTION WHICH HAS NOT OR WILL NOT BE OBTAINED.
3.19
LISTING.
THE COMPANY SHALL COMPLY WITH ALL
REQUIREMENTS OF THE NASD WITH RESPECT TO THE ISSUANCE OF THE SHARES AND SHALL
USE ITS COMMERCIALLY REASONABLE EFFORTS TO HAVE THE SHARES LISTED ON THE NASDAQ
STOCK MARKET ON OR BEFORE THE FIRST DATE THAT THE REGISTRATION STATEMENT (AS
DEFINED IN SECTION 6.1) IS DECLARED EFFECTIVE BY THE SEC.
D-5
3.20
BOOKS AND RECORDS.
THE BOOKS, RECORDS AND ACCOUNTS
OF THE COMPANY AND THE SUBSIDIARIES ACCURATELY AND FAIRLY REFLECT, IN REASONABLE
DETAIL, THE TRANSACTIONS IN, AND DISPOSITIONS OF, THE ASSETS OF, AND THE
OPERATIONS OF, THE COMPANY AND THE SUBSIDIARIES.
THE COMPANY MAINTAINS A SYSTEM
OF INTERNAL ACCOUNTING CONTROLS SUFFICIENT TO PROVIDE REASONABLE ASSURANCES THAT
(I) TRANSACTIONS ARE EXECUTED IN ACCORDANCE WITH MANAGEMENT'S GENERAL OR
SPECIFIC AUTHORIZATIONS, (II) TRANSACTIONS ARE RECORDED AS NECESSARY TO PERMIT
PREPARATION OF FINANCIAL STATEMENTS IN ACCORDANCE WITH GENERALLY ACCEPTED
ACCOUNTING PRINCIPLES AND TO MAINTAIN ASSET ACCOUNTABILITY, (III) ACCESS TO
ASSETS IS PERMITTED ONLY IN ACCORDANCE WITH MANAGEMENT'S GENERAL OR SPECIFIC
AUTHORIZATION AND (IV) THE RECORDED ACCOUNTABILITY FOR ASSETS IS COMPARED WITH
THE EXISTING ASSETS AT REASONABLE INTERVALS AND APPROPRIATE ACTION IS TAKEN WITH
RESPECT TO ANY DIFFERENCES.
3.21
COMPLIANCE WITH ENVIRONMENTAL LAWS.
EXCEPT AS
DISCLOSED IN THE SEC REPORTS AND EXCEPT FOR MATTERS WHICH ARE NOT REASONABLY
LIKELY TO HAVE A MATERIAL ADVERSE EFFECT, (I) THE COMPANY IS NOT IN VIOLATION OF
ANY APPLICABLE STATUTE, LAW OR REGULATION RELATING TO THE ENVIRONMENT OR
OCCUPATIONAL HEALTH AND SAFETY, AND, (II) TO THE COMPANY'S KNOWLEDGE, NO
MATERIAL EXPENDITURES ARE OR WILL BE REQUIRED IN ORDER TO COMPLY