REQUIRED TO BE STATED THEREIN OR NECESSARY
TO MAKE THE STATEMENTS THEREIN, IN LIGHT OF THE CIRCUMSTANCES UNDER WHICH THEY
WERE MADE, NOT MISLEADING.
THE FINANCIAL STATEMENTS OF THE COMPANY INCLUDED IN
THE SEC REPORTS COMPLY AS TO FORM IN ALL MATERIAL RESPECTS WITH APPLICABLE
ACCOUNTING REQUIREMENTS AND THE PUBLISHED RULES AND REGULATIONS OF THE
COMMISSION OR OTHER APPLICABLE RULES AND REGULATIONS WITH RESPECT THERETO.
SUCH
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 NATIONAL ASSOCIATION OF SECURITIES DEALERS, INC. OVER THE COUNTER BULLETIN
BOARD ("NASD OTCBB") 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 NASD OTCBB (EXCEPT FOR PRIOR NOTICES WHICH HAVE BEEN FULLY
REMEDIED) 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 UNDER CIRCUMSTANCES
THAT WOULD CAUSE THE OFFERING OF THE SECURITIES PURSUANT TO THE SECURITIES
PURCHASE 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 SECURITIES TO BE INTEGRATED WITH OTHER OFFERINGS.
(D)
THE WARRANTS, THE NOTE AND THE SHARES OF
COMMON STOCK WHICH THE PURCHASER MAY ACQUIRE PURSUANT TO THE WARRANTS AND THE
NOTE 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 THE NOTE AND THE EXERCISE
OF THE WARRANT AND RECOGNIZES THAT THE ISSUANCE OF SUCH REGISTRABLE SECURITIES
MAY HAVE A POTENTIAL DILUTIVE EFFECT.
THE COMPANY SPECIFICALLY ACKNOWLEDGES
THAT ITS OBLIGATION TO