OF ALL LIENS. THE BORROWER HAS RESERVED FROM ITS
DULY AUTHORIZED CAPITAL STOCK A NUMBER OF SHARES OF COMMON STOCK TO BE ISSUED TO
THE LENDER UPON CONVERSION OR EXERCISE OF THE DEBENTURES OR WARRANT.
(G)
CAPITALIZATION.
THE NUMBER OF SHARES AND
TYPE OF ALL AUTHORIZED, ISSUED AND OUTSTANDING CAPITAL STOCK OF THE BORROWER,
AND ALL SHARES OF COMMON STOCK RESERVED FOR ISSUANCE UNDER THE BORROWER'S
VARIOUS OPTION AND INCENTIVE PLANS, IS SET FORTH IN DISCLOSURE SCHEDULE 3.1(G).
EXCEPT AS SET FORTH IN DISCLOSURE SCHEDULE 3.1(G), NO SECURITIES OF THE BORROWER
ARE ENTITLED TO PREEMPTIVE OR SIMILAR RIGHTS, AND NO PERSON HAS ANY RIGHT OF
FIRST REFUSAL, PREEMPTIVE RIGHT, RIGHT OF PARTICIPATION, OR ANY SIMILAR RIGHT TO
PARTICIPATE IN THE TRANSACTIONS CONTEMPLATED BY THE TRANSACTION DOCUMENTS.
EXCEPT AS A RESULT OF THE PURCHASE AND SALE OF THE SECURITIES AND EXCEPT AS
DISCLOSED IN DISCLOSURE SCHEDULE 3.1(G), THERE ARE NO OUTSTANDING OPTIONS,
WARRANTS, SCRIP RIGHTS TO SUBSCRIBE TO, CALLS OR COMMITMENTS OF ANY CHARACTER
WHATSOEVER RELATING TO, OR SECURITIES, RIGHTS OR OBLIGATIONS CONVERTIBLE INTO OR
EXCHANGEABLE FOR, OR GIVING ANY PERSON ANY RIGHT TO SUBSCRIBE FOR OR ACQUIRE,
ANY SHARES OF COMMON STOCK, OR CONTRACTS, COMMITMENTS, UNDERSTANDINGS OR
ARRANGEMENTS BY WHICH THE BORROWER OR ANY SUBSIDIARY IS OR MAY BECOME BOUND TO
ISSUE ADDITIONAL SHARES OF COMMON STOCK, OR SECURITIES OR RIGHTS CONVERTIBLE OR
EXCHANGEABLE INTO SHARES OF COMMON STOCK.
EXCEPT AS SET FORTH IN DISCLOSURE
SCHEDULE 3.1(G), THE ISSUE AND SALE OF THE SECURITIES WILL NOT, IMMEDIATELY OR
WITH THE PASSAGE OF TIME, OBLIGATE THE BORROWER TO ISSUE SHARES OF COMMON STOCK
OR OTHER SECURITIES TO ANY PERSON (OTHER THAN THE LENDER) AND WILL NOT RESULT IN
A RIGHT OF ANY HOLDER OF BORROWER SECURITIES TO ADJUST THE EXERCISE, CONVERSION,
EXCHANGE OR RESET PRICE UNDER SUCH SECURITIES.
7
(H)
SEC REPORTS; FINANCIAL STATEMENTS.
THE
BORROWER HAS FILED ALL REPORTS REQUIRED TO BE FILED BY IT UNDER THE EXCHANGE
ACT, INCLUDING PURSUANT TO SECTION 13(A) OR 15(D) THEREOF, FOR THE TWELVE MONTHS
PRECEDING THE DATE HEREOF (OR SUCH SHORTER PERIOD AS THE BORROWER WAS REQUIRED
BY LAW TO FILE SUCH MATERIAL) (THE FOREGOING MATERIALS BEING COLLECTIVELY
REFERRED TO HEREIN AS THE "SEC REPORTS" AND, TOGETHER WITH THIS AGREEMENT AND
THE SCHEDULES TO THIS AGREEMENT, THE "DISCLOSURE MATERIALS") ON A TIMELY BASIS
OR HAS TIMELY FILED A VALID EXTENSION OF SUCH TIME OF FILING AND HAS FILED ANY
SUCH SEC REPORTS PRIOR TO THE EXPIRATION OF ANY SUCH EXTENSION. THE BORROWER HAS
MADE AVAILABLE TO THE LENDER A COPY OF ALL SEC REPORTS FILED WITHIN THE 10 DAYS
PRECEDING THE DATE HEREOF. AS OF THEIR RESPECTIVE DATES, THE SEC REPORTS
COMPLIED IN ALL MATERIAL RESPECTS WITH THE REQUIREMENTS OF THE SECURITIES ACT
AND THE EXCHANGE ACT AND THE RULES AND REGULATIONS OF THE COMMISSION PROMULGATED
THEREUNDER, AND NONE OF THE SEC REPORTS, WHEN FILED, CONTAINED ANY UNTRUE
STATEMENT OF A MATERIAL FACT OR OMITTED TO STATE A MATERIAL FACT REQUIRED TO BE
STATED THEREIN OR NECESSARY IN ORDER TO MAKE THE