LEGAL EXPENSES OF COUNSEL TO FMSC NOT TO EXCEED $15,000, PAYABLE ON THE CLOSING
DATE.
6.
REPRESENTATIONS AND WARRANTIES OF THE
COMPANY.
(A)
THE COMPANY REPRESENTS AND WARRANTS TO, AND
AGREES WITH, THE SELLING AGENT THAT AS OF THE CLOSING DATE:
(I)
NO DOCUMENTS OR INFORMATION PROVIDED BY
THE COMPANY TO THE SUBSCRIBERS, INCLUDING, WITHOUT LIMITATION THE SEC REPORTS
(AS DEFINED IN THE PURCHASE AGREEMENT), SHALL CONTAIN ANY UNTRUE STATEMENT OF A
MATERIAL FACT OR OMIT TO STATE ANY MATERIAL FACT REQUIRED TO BE STATED THEREIN
OR NECESSARY TO MAKE THE STATEMENTS THEREIN IN LIGHT OF CIRCUMSTANCES MADE
THEREIN NOT MISLEADING.
(II)
THE COMPANY IS, AND AT ALL TIMES DURING
THE PERIOD FROM THE DATE HEREOF TO AND INCLUDING THE CLOSING DATE WILL BE, A
CORPORATION DULY ORGANIZED, VALIDLY EXISTING, AND IN GOOD STANDING UNDER THE
LAWS OF THE STATE OF DELAWARE, WITH FULL CORPORATE POWER AND AUTHORITY, AND HAS
OBTAINED ALL NECESSARY CONSENTS, AUTHORIZATIONS, APPROVALS, ORDERS, LICENSES,
CERTIFICATES, AND PERMITS AND DECLARATIONS OF AND FROM, AND HAS MADE FILINGS
WITH, ALL FEDERAL, STATE AND LOCAL AUTHORITIES, TO OWN, LEASE, LICENSE, AND USE
ITS PROPERTIES AND ASSETS AND TO CONDUCT ITS BUSINESS AS PRESENTLY CONDUCTED
AND/OR IN ANY SUCH CASE WHERE THE FAILURE TO HAVE ANY OF THE FOREGOING WOULD NOT
HAVE A MATERIAL ADVERSE EFFECT ON THE COMPANY'S PRESENTLY CONDUCTED BUSINESS.
AS OF THE DATE HEREOF, THE COMPANY IS, AND AT ALL TIMES DURING THE PERIOD FROM
THE DATE HEREOF TO AND INCLUDING THE CLOSING DATE, DULY QUALIFIED TO DO BUSINESS
AND IS IN GOOD STANDING IN EVERY JURISDICTION IN WHICH ITS OWNERSHIP, LEASING,
LICENSING, OR USE OF PROPERTY AND ASSETS OR THE CONDUCT OF ITS BUSINESS MAKES
SUCH QUALIFICATION NECESSARY EXCEPT WHERE THE FAILURE TO BE SO QUALIFIED WOULD
NOT HAVE A MATERIAL ADVERSE EFFECT ON THE COMPANY'S BUSINESS.
(III)
AS OF THE DATE HEREOF, EXCEPT AS DISCLOSED
IN THE DOCUMENTS OR THE
OR THE SEC REPORTS, THERE IS NO, AND AS OF THE CLOSING
DATE THERE SHALL NOT BE ANY, LITIGATION, ARBITRATION, CLAIM, GOVERNMENTAL OR
OTHER PROCEEDING (FORMAL OR INFORMAL), OR INVESTIGATION PENDING OR TO THE
COMPANY'S KNOWLEDGE THREATENED, WITH RESPECT TO THE COMPANY, OR ITS RESPECTIVE
OPERATIONS, BUSINESSES, PROPERTIES, OR ASSETS, EXCEPT AS DESCRIBED IN THE
SECURITIES PURCHASE AGREEMENT, THE SEC REPORTS OR WHICH INDIVIDUALLY OR IN THE
AGGREGATE DO NOT NOW HAVE AND WILL NOT IN THE FUTURE HAVE A MATERIAL ADVERSE
EFFECT UPON THE OPERATIONS, BUSINESS, PROPERTIES, OR ASSETS OF THE COMPANY.
(IV)
THE COMPANY IS NOT IN VIOLATION OR BREACH OF,
OR IN DEFAULT WITH RESPECT TO, ANY MATERIAL TERM OF ITS CERTIFICATE OF
INCORPORATION OR BY-LAWS, AS IN EFFECT AS THE DATE HEREOF AND AS OF THE CLOSING
DATE.
(V)
THE COMPANY HAS ALL REQUISITE CORPORATE
POWER AND AUTHORITY TO EXECUTE, DELIVER, AND PERFORM THIS AGREEMENT AND TO
CONSUMMATE THE TRANSACTIONS CONTEMPLATED HEREBY.
ALL NECESSARY CORPORATE
PROCEEDINGS OF THE COMPANY HAVE BEEN DULY TAKEN TO AUTHORIZE THE EXECUTION,
3
DELIVERY, AND PERFORMANCE BY THE COMPANY OF THIS AGREEMENT AND (SUBJECT TO