FROM ANY OFFICER, DIRECTOR OR SUCH EMPLOYEE OR, TO THE KNOWLEDGE
OF THE COMPANY, ANY ENTITY IN WHICH ANY OFFICER, DIRECTOR, OR ANY SUCH EMPLOYEE
HAS A SUBSTANTIAL INTEREST OR IS AN OFFICER, DIRECTOR, TRUSTEE OR PARTNER.
4.19
INSURANCE.
THE COMPANY AND ITS SUBSIDIARIES HAVE INSURANCE
POLICIES IN FULL FORCE AND EFFECT OF A TYPE, COVERING SUCH RISKS AND IN SUCH
AMOUNTS, AND HAVING SUCH DEDUCTIBLES AND EXCLUSIONS AS ARE CUSTOMARY FOR
CONDUCTING BUSINESSES AND OWNING ASSETS SIMILAR IN NATURE AND SCOPE TO THOSE OF
THE COMPANY AND ITS SUBSIDIARIES.
THE AMOUNTS OF ALL SUCH INSURANCE POLICIES
AND THE RISKS COVERED THEREBY ARE IN ACCORDANCE IN ALL MATERIAL RESPECTS WITH
ALL MATERIAL CONTRACTS AND AGREEMENTS TO WHICH THE COMPANY AND/OR ITS
SUBSIDIARIES IS A PARTY AND WITH ALL APPLICABLE LEGAL REQUIREMENTS.
WITH
RESPECT TO EACH SUCH INSURANCE POLICY:
(I) THE POLICY IS VALID, OUTSTANDING AND
ENFORCEABLE IN ACCORDANCE WITH ITS TERMS, EXCEPT AS SUCH ENFORCEABILITY MAY BE
LIMITED BY APPLICABLE BANKRUPTCY, INSOLVENCY, REORGANIZATION, MORATORIUM OR
OTHER SIMILAR LAWS IN EFFECT THAT LIMIT CREDITORS' RIGHTS GENERALLY, EQUITABLE
LIMITATIONS ON THE AVAILABILITY OF SPECIFIC REMEDIES AND PRINCIPLES OF EQUITY
(REGARDLESS OF WHETHER SUCH ENFORCEMENT IS CONSIDERED IN A PROCEEDING IN LAW OR
IN EQUITY); (II) NEITHER THE COMPANY NOR ANY OF ITS SUBSIDIARIES IS IN BREACH OR
DEFAULT WITH RESPECT TO ITS OBLIGATIONS THEREUNDER IN ANY MATERIAL RESPECT; AND
(III) NO PARTY TO THE POLICY HAS REPUDIATED, OR GIVEN NOTICE OF AN INTENT TO
REPUDIATE, ANY PROVISION THEREOF.
4.20
APPROVED ACQUISITIONS OF SHARES; NO ANTI-TAKEOVER PROVISIONS.
EXCEPT AS OTHERWISE SET FORTH IN SCHEDULE 4.2, AND SUBJECT TO AND CONTINGENT ON
THE BUYER'S COVENANT IN SECTION 5.7, THE COMPANY HAS TAKEN ALL NECESSARY ACTION,
IF ANY, REQUIRED UNDER THE LAWS OF THE STATE OF NEVADA OR OTHERWISE TO ALLOW THE
BUYER TO ACQUIRE THE SECURITIES PURSUANT TO THIS AGREEMENT AND FURTHER TO ALLOW
THE BUYER TO, WITHOUT FURTHER APPROVAL OF THE COMPANY'S BOARD OF DIRECTORS,
ACQUIRE IN THE FUTURE ADDITIONAL SHARES OF COMMON STOCK, UNTIL SUCH TIME AS THE
BUYER OWNS 40% OF THE THEN-OUTSTANDING COMMON STOCK ON A FULLY DILUTED BASIS.
THE COMPANY HAS NO CONTROL SHARE ACQUISITION, BUSINESS COMBINATION, POISON PILL
(INCLUDING ANY DISTRIBUTION UNDER A RIGHTS AGREEMENT) OR OTHER SIMILAR
ANTI-TAKEOVER PROVISION UNDER THE COMPANY'S ARTICLES OF INCORPORATION OR BYLAWS,
EACH AS AMENDED (OR SIMILAR CHARTER DOCUMENTS), THAT IS OR COULD BECOME
APPLICABLE TO THE BUYERS AS A RESULT OF THE BUYERS AND THE COMPANY FULFILLING
THEIR OBLIGATIONS OR EXERCISING THEIR RIGHTS UNDER THIS AGREEMENT, INCLUDING
WITHOUT LIMITATION THE COMPANY'S ISSUANCE OF THE SECURITIES AND THE BUYERS'
OWNERSHIP OF THE SECURITIES AND BUYERS' ACQUISITION IN THE FUTURE OF ADDITIONAL
SHARES OF COMMON STOCK UNTIL SUCH TIME AS THE BUYERS OWN 40% OF THE
THEN-OUTSTANDING COMMON STOCK ON A FULLY DILUTED BASIS.
IN ADDITION, THE
COMPANY HAS OPTED OUT OF THE PROVISIONS OF THE NEVADA REVISED STATUTES ("NRS")
PERTAINING TO THE ACQUISITION OF A CONTROLLING INTEREST (NRS 78.378 THROUGH
78.3793).
AS OF THE DATE HEREOF, THE COMPANY HAD LESS THAN 200