PARTIES INCLUDING, BUT NOT LIMITED TO, CURRENT OR FORMER SHAREHOLDERS
OF THE COMPANY, UNDERWRITERS, BROKERS, AGENTS OR OTHER THIRD PARTIES.
(X)
INVESTMENT COMPANY.
THE COMPANY IS NOT, AND IS NOT AN AFFILIATE
OF, AND IMMEDIATELY AFTER RECEIPT OF PAYMENT FOR THE SECURITIES, WILL NOT BE OR
BE AN AFFILIATE OF, AN "INVESTMENT COMPANY" WITHIN THE MEANING OF THE INVESTMENT
COMPANY ACT OF 1940, AS AMENDED.
THE COMPANY SHALL CONDUCT ITS BUSINESS IN A
MANNER SO THAT IT WILL NOT BECOME SUBJECT TO THE INVESTMENT COMPANY ACT.
(Y)
REGISTRATION RIGHTS.
OTHER THAN EACH OF THE BUYERS PURSUANT TO
THE TRANSACTION DOCUMENTS AND PURSUANT TO OTHER OBLIGATIONS PREVIOUSLY ENTERED
INTO BETWEEN YA GLOBAL AND THE COMPANY, NO PERSON HAS ANY RIGHT TO CAUSE THE
COMPANY TO EFFECT THE REGISTRATION UNDER THE SECURITIES ACT OF ANY SECURITIES OF
THE COMPANY.
THERE ARE NO OUTSTANDING REGISTRATION STATEMENTS NOT YET DECLARED
EFFECTIVE AND THERE ARE NO OUTSTANDING COMMENT LETTERS FROM THE SEC OR ANY OTHER
REGULATORY AGENCY.
(Z)
PRIVATE PLACEMENT.
ASSUMING THE ACCURACY OF THE BUYERS'
REPRESENTATIONS AND WARRANTIES SET FORTH IN SECTION 2, NO REGISTRATION UNDER THE
SECURITIES ACT IS REQUIRED FOR THE OFFER AND SALE OF THE SECURITIES BY THE
COMPANY TO THE BUYERS AS CONTEMPLATED HEREBY. THE ISSUANCE AND SALE OF THE
SECURITIES HEREUNDER DOES NOT CONTRAVENE THE RULES AND REGULATIONS OF THE
PRIMARY MARKET.
(AA)
LISTING AND MAINTENANCE REQUIREMENTS.
THE COMPANY'S COMMON STOCK
IS REGISTERED PURSUANT TO SECTION 12(B) OR 12(G) OF THE EXCHANGE ACT, AND THE
COMPANY HAS TAKEN NO ACTION DESIGNED TO TERMINATE, OR WHICH TO ITS KNOWLEDGE IS
LIKELY TO HAVE THE EFFECT OF, TERMINATING THE REGISTRATION OF THE COMMON STOCK
UNDER THE EXCHANGE ACT NOR HAS THE COMPANY RECEIVED ANY NOTIFICATION THAT THE
SEC IS CONTEMPLATING TERMINATING SUCH REGISTRATION.
EXCEPT TO THE EXTENT
DISCLOSED IN THE SEC DOCUMENTS WITH RESPECT TO THE DELISTING OF THE COMPANY'S
SECURITIES FROM THE NASDAQ CAPITAL MARKET, THE COMPANY HAS NOT, IN THE TWELVE
(12) MONTHS
PRECEDING THE DATE HEREOF, RECEIVED NOTICE FROM ANY PRIMARY MARKET ON WHICH THE
COMMON STOCK IS OR HAS BEEN LISTED OR QUOTED TO THE EFFECT THAT THE COMPANY IS
NOT IN COMPLIANCE WITH THE LISTING OR MAINTENANCE REQUIREMENTS OF SUCH PRIMARY
MARKET.
THE COMPANY IS, AND HAS NO REASON TO BELIEVE THAT IT WILL NOT IN THE
FORESEEABLE FUTURE CONTINUE TO BE, IN COMPLIANCE WITH ALL SUCH LISTING AND
MAINTENANCE REQUIREMENTS.
(BB)
REPORTING STATUS.
WITH A VIEW TO MAKING AVAILABLE TO THE BUYER THE
BENEFITS OF RULE 144 OR ANY SIMILAR RULE OR REGULATION OF THE SEC THAT MAY AT
ANY TIME PERMIT THE BUYER TO SELL SECURITIES OF THE COMPANY TO THE PUBLIC
WITHOUT REGISTRATION, AND AS A MATERIAL INDUCEMENT TO THE BUYER'S PURCHASE OF
THE SECURITIES, THE COMPANY REPRESENTS AND WARRANTS TO THE FOLLOWING: (I) THE
COMPANY IS, AND HAS BEEN FOR A PERIOD OF AT LEAST 90 DAYS IMMEDIATELY PRECEDING
THE DATE HEREOF, SUBJECT TO THE REPORTING REQUIREMENTS OF SECTION 13 OR 15(D) OF
THE EXCHANGE ACT (II) THE COMPANY HAS FILED