PURCHASE THE STOCK FROM THE COMPANY, THE COMPANY HEREBY REPRESENTS
AND WARRANTS TO SUBSCRIBER AS OF THE DATE HEREOF AND AS OF THE CLOSING DATE
FOLLOWS:
3
A.
CAPITALIZATION.
THE AUTHORIZED CAPITAL STOCK OF THE COMPANY
CONSISTS OF 10,000,000 SHARES OF STOCK AND 10,000,000 SHARES OF PREFERRED
STOCK.
IMMEDIATELY PRIOR TO THE SALE OF STOCK BY THIS AGREEMENT, THERE ARE
OUTSTANDING 7,402,916 SHARES OF COMMON STOCK AND NO SHARES OF PREFERRED STOCK.
THERE ARE NO OUTSTANDING AGREEMENTS OR PREEMPTIVE OR SIMILAR RIGHTS AFFECTING
THE STOCK OR EQUITY AND NO OUTSTANDING RIGHTS, WARRANTS OR OPTIONS TO ACQUIRE,
OR INSTRUMENTS CONVERTIBLE INTO OR EXCHANGEABLE FOR, OR AGREEMENTS OR
UNDERSTANDINGS WITH RESPECT TO THE SALE OR ISSUANCE OF ANY SHARES OF STOCK OR
EQUITY OF THE COMPANY OR OTHER EQUITY INTEREST IN THE COMPANY EXCEPT AS
DESCRIBED IN THE REPORTS OR OTHERWISE KNOWN TO SUBSCRIBER.
B.
ORGANIZATION AND AUTHORITY.
THE COMPANY IS A CORPORATION DULY
ORGANIZED, VALIDLY EXISTING AND IN GOOD STANDING UNDER THE LAWS OF MINNESOTA AND
HAS ALL REQUISITE CORPORATE POWER AND AUTHORITY TO OWN, LEASE AND OPERATE ITS
PROPERTIES AND TO CONDUCT ITS BUSINESS AS CURRENTLY CONDUCTED.
THE COMPANY IS
DULY QUALIFIED AS A FOREIGN CORPORATION TO DO BUSINESS AND IS IN GOOD STANDING
IN EACH JURISDICTION WHERE THE NATURE OF THE BUSINESS CONDUCTED OR PROPERTY
OWNED BY IT MAKES SUCH QUALIFICATION NECESSARY, OTHER THAN THOSE JURISDICTIONS
IN WHICH THE FAILURE TO SO QUALIFY WOULD NOT HAVE A MATERIAL ADVERSE EFFECT ON
THE BUSINESS, OPERATIONS OR FINANCIAL CONDITION OF THE COMPANY.
C.
DUE AUTHORIZATION.
THE COMPANY HAS ALL REQUISITE POWER AND
AUTHORITY UNDER APPLICABLE LAW TO EXECUTE AND DELIVER THIS AGREEMENT AND TO
PERFORM THE TRANSACTIONS CONTEMPLATED HEREBY.
OTHER THAN THE APPROVAL OF THE
COMPANY'S BOARD OF DIRECTORS, WHICH APPROVAL HAS BEEN OBTAINED, AND APPROVAL BY
THE SHAREHOLDERS OF AN INCREASE IN THE COMPANY AUTHORIZED COMMON STOCK, NO OTHER
APPROVAL OF ANY KIND IS NECESSARY UNDER APPLICABLE LAW FOR THE EXECUTION,
DELIVERY AND PERFORMANCE OF THIS AGREEMENT. THIS AGREEMENT CONSTITUTES A LEGAL,
VALID AND BINDING OBLIGATION OF THE COMPANY, ENFORCEABLE IN ACCORDANCE WITH ITS
TERMS, SUBJECT TO GENERAL LIMITATIONS ON THE AVAILABILITY OF EQUITABLE REMEDIES
AND THE EFFECT OF BANKRUPTCY, INSOLVENCY, REORGANIZATION AND OTHER LAWS OF
GENERAL APPLICATION AFFECTING THE ENFORCEMENT OF CREDITORS' RIGHTS.
D.
NO VIOLATION.
EXCEPT FOR THE REQUIRED APPROVAL BY THE COMPANY
SHAREHOLDERS OF AN INCREASE IN THE COMPANY'S AUTHORIZED COMMON STOCK, THE
EXECUTION AND DELIVERY OF THIS AGREEMENT AND THE CONSUMMATION OF THE
TRANSACTIONS CONTEMPLATED HEREBY DO NOT AND WILL NOT VIOLATE OR CONFLICT WITH
THE ARTICLES OF INCORPORATION OR BY-LAWS OF THE COMPANY, OR VIOLATE ANY LEGAL
REQUIREMENT OR ORDER APPLICABLE TO THE COMPANY.
THE EXECUTION AND DELIVERY OF
THIS AGREEMENT AND THE CONSUMMATION OF THE TRANSACTIONS CONTEMPLATED HEREBY DO
NOT AND WILL NOT REQUIRE ANY THIRD-PARTY ACTION WITH RESPECT TO THE COMPANY
UNDER, OR CONFLICT WITH OR CONSTITUTE A DEFAULT UNDER, OR RESULT IN THE
ACCELERATION OR RIGHT OF ACCELERATION OF ANY OBLIGATIONS, OR ANY TERMINATION OR
RIGHT OF TERMINATION UNDER, ANY AGREEMENT,