FINANCIAL
STATEMENTS HAVE BEEN PREPARED IN ACCORDANCE WITH GENERALLY ACCEPTED ACCOUNTING
PRINCIPLES ("GAAP") APPLIED ON A CONSISTENT BASIS DURING THE PERIODS INVOLVED
(EXCEPT (I) AS MAY BE OTHERWISE INDICATED IN SUCH FINANCIAL STATEMENTS OR THE
NOTES THERETO OR (II) IN THE CASE OF UNAUDITED INTERIM STATEMENTS, TO THE EXTENT
THEY MAY NOT INCLUDE FOOTNOTES OR MAY BE CONDENSED) AND FAIRLY PRESENT IN ALL
MATERIAL RESPECTS THE FINANCIAL CONDITION, THE RESULTS OF OPERATIONS AND THE
CASH FLOWS OF THE COMPANY AND ITS SUBSIDIARIES, ON A CONSOLIDATED BASIS, AS OF,
AND FOR, THE PERIODS PRESENTED IN EACH SUCH SEC REPORT.
(B)
THE COMMON STOCK IS LISTED FOR TRADING ON
THE AMERICAN STOCK EXCHANGE AND SATISFIES ALL REQUIREMENTS FOR THE CONTINUATION
OF SUCH LISTING.
THE COMPANY HAS NOT RECEIVED ANY NOTICE THAT ITS COMMON STOCK
WILL BE DELISTED FROM THE AMERICAN STOCK EXCHANGE OR THAT THE COMMON STOCK DOES
NOT MEET ALL REQUIREMENTS FOR THE CONTINUATION OF SUCH LISTING.
(C)
NEITHER THE COMPANY, NOR ANY OF ITS
AFFILIATES, NOR ANY PERSON ACTING ON ITS OR THEIR BEHALF, HAS DIRECTLY OR
INDIRECTLY MADE ANY OFFERS OR SALES OF ANY SECURITY OR SOLICITED ANY OFFERS TO
BUY ANY SECURITY (OTHER THAN A CONCURRENT OFFERING TO THE PURCHASER UNDER A NOTE
PURCHASE AGREEMENT BETWEEN THE COMPANY AND THE PURCHASER DATED AS OF SEPTEMBER
11, 2003) UNDER CIRCUMSTANCES THAT WOULD CAUSE THE OFFERING OF THE SECURITIES
PURSUANT TO THE SECURITY AGREEMENT TO BE INTEGRATED WITH PRIOR OFFERINGS BY THE
COMPANY FOR PURPOSES OF THE SECURITIES ACT WHICH WOULD PREVENT THE COMPANY FROM
SELLING THE COMMON STOCK PURSUANT TO RULE 506 UNDER THE SECURITIES ACT, OR ANY
APPLICABLE EXCHANGE-RELATED STOCKHOLDER APPROVAL PROVISIONS, NOR WILL THE
COMPANY OR ANY OF ITS AFFILIATES OR SUBSIDIARIES TAKE ANY ACTION OR STEPS THAT
WOULD CAUSE THE OFFERING OF THE COMMON STOCK TO BE INTEGRATED WITH OTHER
OFFERINGS (OTHER THAN SUCH CONCURRENT OFFERING TO THE PURCHASER).
7
(D)
THE WARRANTS, THE NOTES AND THE SHARES OF
COMMON STOCK WHICH THE PURCHASER MAY ACQUIRE PURSUANT TO THE WARRANTS AND THE
NOTES ARE ALL RESTRICTED SECURITIES UNDER THE SECURITIES ACT AS OF THE DATE OF
THIS AGREEMENT.
THE COMPANY WILL NOT ISSUE ANY STOP TRANSFER ORDER OR OTHER
ORDER IMPEDING THE SALE AND DELIVERY OF ANY OF THE REGISTRABLE SECURITIES AT
SUCH TIME AS SUCH REGISTRABLE SECURITIES ARE REGISTERED FOR PUBLIC SALE OR AN
EXEMPTION FROM REGISTRATION IS AVAILABLE, EXCEPT AS REQUIRED BY FEDERAL OR STATE
SECURITIES LAWS.
(E)
THE COMPANY UNDERSTANDS THE NATURE OF THE
REGISTRABLE SECURITIES ISSUABLE UPON THE CONVERSION OF EACH NOTE AND THE
EXERCISE OF EACH WARRANT AND RECOGNIZES THAT THE ISSUANCE OF SUCH REGISTRABLE
SECURITIES MAY HAVE A POTENTIAL DILUTIVE EFFECT.
THE COMPANY SPECIFICALLY
ACKNOWLEDGES THAT ITS OBLIGATION TO ISSUE THE REGISTRABLE SECURITIES IS BINDING
UPON THE COMPANY AND ENFORCEABLE REGARDLESS OF THE DILUTION SUCH ISSUANCE MAY
HAVE ON THE OWNERSHIP INTERESTS OF OTHER SHAREHOLDERS OF THE COMPANY.
(F)
EXCEPT FOR AGREEMENTS MADE IN THE
ORDINARY COURSE OF BUSINESS, THERE IS NO AGREEMENT THAT HAS NOT BEEN FILED WITH