ALL THE ISSUED AND
OUTSTANDING SHARES OF CAPITAL STOCK OF EACH SUBSIDIARY OF GENAISSANCE HAVE BEEN
DULY AUTHORIZED AND VALIDLY ISSUED AND ARE OWNED BY GENAISSANCE OR A SUBSIDIARY
FREE AND CLEAR OF ALL LIENS OTHER THAN LIENS CREATED PURSUANT TO THE TRANSACTION
DOCUMENTS AND PERMITTED LIENS.
ALL OF THE OUTSTANDING SHARES OF CAPITAL STOCK,
OPTIONS AND WARRANTS OF GENAISSANCE HAVE BEEN VALIDLY ISSUED IN COMPLIANCE WITH
APPLICABLE STATE AND FEDERAL SECURITIES LAWS.
AS OF APRIL 21, 2005, THE
AUTHORIZED CAPITAL OF GENAISSANCE CONSISTED OF (A) 58,000,000 SHARES OF COMMON
STOCK, PAR VALUE $0.001 PER SHARE ("COMMON STOCK"), (B) 2,000,000 SHARES OF
NON-VOTING COMMON STOCK, PAR VALUE $0.001 PER SHARE ("NON-VOTING COMMON STOCK"),
AND (C) 1,000,000 SHARES OF PREFERRED STOCK ("PREFERRED STOCK"), OF WHICH
35,343,097 SHARES OF COMMON STOCK ARE ISSUED AND OUTSTANDING AS OF MARCH 31,
2005, NO SHARES OF NON-VOTING COMMON STOCK ARE ISSUED OR OUTSTANDING, 460,000
SHARES OF SERIES A PREFERRED STOCK ARE ISSUED AND OUTSTANDING, AND, AS OF
MARCH 31, 2005, 11,189,594 SHARES OF COMMON STOCK ARE RESERVED FOR ISSUANCE UPON
THE EXERCISE OF OUTSTANDING OPTIONS, WARRANTS AND OTHER RIGHTS TO ACQUIRE OR
SUBSCRIBE FOR SHARES OF COMMON STOCK, INCLUDING THE WARRANT SHARES.
SCHEDULE 3.2 HERETO CONTAINS A TRUE, COMPLETE, AND ACCURATE LIST OF EACH OTHER
RIGHT, WARRANT, OPTION OR AGREEMENT (INCLUDING ANY CONVERTIBLE SECURITY) TO
ACQUIRE ANY COMMON STOCK FROM GENAISSANCE OUTSTANDING AS OF APRIL 21, 2005.
EXCEPT AS DESCRIBED ON SCHEDULE 3.2, NO PERSON IS ENTITLED TO PRE-EMPTIVE OR
SIMILAR STATUTORY OR CONTRACTUAL RIGHTS WITH RESPECT TO ANY SECURITIES OF
GENAISSANCE.
EXCEPT AS DESCRIBED IN THIS SECTION 3.2 OR ON SCHEDULE 3.2, THERE
ARE NO OUTSTANDING WARRANTS, OPTIONS, CONVERTIBLE SECURITIES OR OTHER RIGHTS,
AGREEMENTS OR ARRANGEMENTS OF ANY CHARACTER UNDER WHICH GENAISSANCE OR ANY
SUBSIDIARY IS OBLIGATED TO ISSUE ANY EQUITY SECURITIES OF ANY KIND AND EXCEPT AS
CONTEMPLATED BY THIS AGREEMENT.
EXCEPT FOR THE REGISTRATION RIGHTS AGREEMENT,
THERE ARE NO VOTING AGREEMENTS, BUY-SELL AGREEMENTS, OPTION OR RIGHT OF FIRST
PURCHASE AGREEMENTS OR OTHER AGREEMENTS OF ANY KIND AMONG GENAISSANCE AND ANY OF
THE SECURITYHOLDERS OF GENAISSANCE RELATING TO THE SECURITIES OF GENAISSANCE
HELD BY THEM.
EXCEPT AS PROVIDED IN THE REGISTRATION RIGHTS AGREEMENT, NO
PERSON HAS THE RIGHT TO REQUIRE GENAISSANCE TO REGISTER ANY SECURITIES OF
GENAISSANCE UNDER THE SECURITIES ACT, WHETHER ON A DEMAND BASIS OR IN CONNECTION
WITH THE REGISTRATION OF SECURITIES OF GENAISSANCE FOR ITS OWN ACCOUNT OR FOR
THE ACCOUNT OF ANY OTHER PERSON.
THE ISSUANCE AND SALE OF THE SECURITIES
HEREUNDER WILL NOT OBLIGATE GENAISSANCE TO ISSUE SHARES OF CAPITAL STOCK OR
OTHER SECURITIES TO ANY OTHER
14
PERSON (OTHER THAN THE PURCHASERS) AND WILL NOT RESULT IN THE ADJUSTMENT OF THE
EXERCISE, CONVERSION, EXCHANGE OR RESET PRICE OF ANY OUTSTANDING SECURITY.
GENAISSANCE DOES NOT HAVE OUTSTANDING STOCKHOLDER PURCHASE RIGHTS OR "POISON
PILL" OR ANY SIMILAR ARRANGEMENT.
3.3
PROCEEDINGS, ETC.
ALL CORPORATE, LIMITED
LIABILITY COMPANY OR OTHER ACTIONS OF GENAISSANCE AND ITS SUBSIDIARIES NECESSARY
FOR THE AUTHORIZATION, EXECUTION, AND DELIVERY OF THIS AGREEMENT AND THE OTHER
TRANSACTION