Common use of Basic Financial Information Clause in Contracts

Basic Financial Information. The Company will furnish the following reports to Investor: (i) As soon as practicable after the end of each fiscal year of the Company, and in any event within ninety (90) days after the end of each fiscal year of the Company, a consolidated balance sheet of the Company and its Subsidiaries as at the end of such fiscal year, and consolidated statements of income and cash flows of the Company and its Subsidiaries, if any, for such year, prepared in accordance with U.S. generally accepted accounting principles consistently applied, certified by the Company’s independent public accountants. (ii) As soon as practicable after the end of the first, second and third quarterly accounting periods in each fiscal year of the Company, and in any event within forty-five (45) days after the end of the first, second, and third quarterly accounting periods in each fiscal year of the Company, an unaudited consolidated balance sheet of the Company and its Subsidiaries as of the end of each such quarterly period, and unaudited consolidated statements of income and cash flows of the Company and its Subsidiaries, if any, for such period, prepared in accordance with U.S. generally accepted accounting principles consistently applied, subject to changes resulting from normal year-end audit adjustments. (iii) As soon as practicable after the end of each month, and in any event within thirty (30) days after the end of each month, an unaudited consolidated balance sheet of the Company and its Subsidiaries as of the end of such monthly period, and unaudited consolidated statements of income and cash flows of the Company and its Subsidiaries, if any, for such period, prepared in accordance with U.S. generally accepted accounting principles consistently applied, subject to changes resulting from normal year-end audit adjustments.

Basic Financial Information. The Company will furnish the following reports to Investoreach Investor who owns at least 100,000 Shares and/or Conversion Stock and/or Warrant Stock (as presently constituted and subject to subsequent adjustments for stock splits, stock dividends, reverse stock splits, and the like), or Bridge Notes in an aggregate principal amount of at least $400,000: (i) As soon as practicable after the end of each fiscal year of the Company, and in any event within ninety one hundred twenty (90120) days after the end of each fiscal year of the Company, a consolidated balance sheet of the Company and its Subsidiaries subsidiaries, if any, as at the end of such fiscal year, and consolidated statements of income and cash flows of the Company and its Subsidiariessubsidiaries, if any, for such year, prepared in accordance with U.S. generally accepted accounting principles consistently applied, certified by independent public accountants of recognized national standing selected by the Company’s independent public accountants. (ii) As soon as practicable after the end of the first, second and third quarterly accounting periods in each fiscal year of the Company, and in any event within forty-five (45) days after the end of the first, second, and third quarterly accounting periods in each fiscal year of the Company, an unaudited consolidated balance sheet of the Company and its Subsidiaries subsidiaries, if any, as of the end of each such quarterly period, and unaudited consolidated statements of income and cash flows of the Company and its Subsidiariessubsidiaries, if any, for such period, prepared in accordance with U.S. generally accepted accounting principles consistently applied, subject to changes resulting from normal year-end audit adjustments. (iii) As as soon as practicable after the end of each monthpracticable, and but in any event within thirty (30) days after of the end of each month, an unaudited consolidated income statement and statement of cash flows for such month, and an unaudited balance sheet and statement of the Company and its Subsidiaries stockholders’ equity as of the end of such monthly periodmonth, and unaudited consolidated statements of income and cash flows of the Company and its Subsidiaries, if any, for such period, all prepared in accordance with U.S. generally accepted accounting principles consistently applied, (except that such financial statements may (i) be subject to changes resulting from normal year-end audit adjustmentsadjustments and (ii) not contain all notes thereto that may be required in accordance with U.S. generally accepted accounting principles). (iv) as soon as practicable, but in any event forty-five (45) days before the end of each fiscal year, a comprehensive operating budget and business plan, as approved the Board, for the next fiscal year which forecasts the Company’s revenues, expenses and cash position (collectively, the “Budget”), prepared on a monthly basis, including balance sheets, income statements, and statements of cash flow for such months and, promptly after prepared, any revisions to such budgets prepared by the Company.

Basic Financial Information. The As long as at least twenty percent (20%) of the shares of Preferred Stock originally issued remain outstanding, the Company will furnish the following reports deliver to each Major Investor: (i) As as soon as practicable after the end of each fiscal year of the Company, and in any event within ninety (90) 150 days after the end of each fiscal year of the Company, Company a consolidated balance sheet of the Company and its Subsidiaries subsidiaries, if any, as at the end of such fiscal year, and consolidated statements of income and cash flows of the Company and its Subsidiariessubsidiaries, if any, for such year, prepared in accordance with U.S. generally accepted accounting principles consistently applied, and audited and certified by independent public accountants of recognized national standing selected by the Company’s independent public accountants., which audit may be waived by a vote of the Preferred Majority, in which case the Company shall deliver such unaudited statements within 60 days after the end of such fiscal year; (ii) As as soon as practicable after the end of the first, second and third quarterly accounting periods in each fiscal year of the Company, and in any event within forty-five (45) 45 days after the end of the first, second, and third quarterly accounting periods in each fiscal year of the Company, an unaudited consolidated balance sheet of the Company and its Subsidiaries subsidiaries, if any, as of the end of each such quarterly period, and unaudited consolidated statements of income and cash flows of the Company and its Subsidiariessubsidiaries, if any, for such period, prepared in accordance with U.S. generally accepted accounting principles consistently applied, subject to changes resulting from normal year-end audit adjustments.adjustments and such financial statements may not contain accompanying notes; (iii) As as soon as practicable after the end of each month, and in any event within thirty (30) 30 days after the end of each such month, an unaudited consolidated balance sheet of the Company and its Subsidiaries subsidiaries, if any, as of the end of each such monthly period, and unaudited consolidated statements of income and cash flows of the Company and its Subsidiariessubsidiaries, if any, for such period, prepared in accordance with U.S. generally accepted accounting principles consistently applied, subject to changes resulting from normal year-end audit adjustmentsadjustments and such financial statements may not contain accompanying notes, along with a comparison of such results to the Company’s operating plan; (iv) at least 30 days prior to the beginning of each of the Company’s fiscal years an annual operating plan for such fiscal year (and as soon as available, any subsequent material revisions thereto); (v) as soon as practicable after the end of each fiscal year, and in any event within 30 days thereafter, a report setting forth in detail all equity and debt holders of the Company as of the end of such year; (vi) a capitalization table promptly upon the request of a Major Investor, but no more frequently than once per calendar quarter; and (vii) such other information relating to the financial condition or business of the Company as any Major Investor may, from time to time, reasonably request related to monitoring its investment in the Company; provided, however, that the Company shall not be obligated under this Subsection 3.1(a) to provide a complete set of materials prepared by or on behalf of the Company for the purpose of distribution to the Board or any information: (i) that the Company reasonably determines in good faith to be a trade secret or confidential information (unless covered by an enforceable confidentiality agreement, in a form acceptable to the Company, and is not a trade secret described in the next clause); (ii) that the Company reasonably determines in good faith to be a technology or scientific trade secret; or (iii) the disclosure of which would adversely affect the attorney-client privilege between the Company and its counsel. Notwithstanding anything else set forth herein, the Company shall deliver to each Investor that is not a Major Investor and continues to hold at least fifty percent (50%) of the shares of Preferred Stock originally purchased by such Investor the annual financial reports set forth in Section 3.1(a)(i) above and the quarterly financial reports set forth in Section 3.1(a)(ii) above at the same time the Company delivers such reports to the Major Investors. Notwithstanding anything else in this Section 3.1 to the contrary, the Company may cease providing the information set forth in this Section 3.1 during the period starting with the date 30 days before the Company’s good-faith estimate of the date of filing of a registration statement if it reasonably concludes it must do so to comply with the SEC rules applicable to such registration statement and related offering; provided that the Company’s covenants under this Section 3.1 shall be reinstated at such time as the Company is no longer actively employing its commercially reasonable efforts to cause such registration statement to become effective.

Basic Financial Information. The Company will furnish the following reports to Investor:each Holder who owns at least 5,500,000 shares of Registrable Securities (as presently constituted and subject to subsequent adjustments for stock splits, stock dividends, reverse stock splits, and the like) (the “Significant Holders”): (i) As soon as practicable after the end of each fiscal year of the Company, and in any event within ninety one hundred and twenty (90120) days after the end of each fiscal year of the Company, a an audited consolidated balance sheet of the Company and its Subsidiaries subsidiaries, if any, as at the end of such fiscal year, and audited consolidated statements of income and cash flows of the Company and its Subsidiariessubsidiaries, if any, for such year, prepared in accordance with U.S. generally accepted accounting principles consistently applied, certified by independent public accountants of recognized national standing selected by the Company’s independent public accountants.; (ii) As soon as practicable after the end of the first, second and third quarterly accounting periods in each fiscal year of the Company, and in any event within forty-forty five (45) days after the end of the first, second, and third quarterly accounting periods in each fiscal year of the Company, an unaudited consolidated balance sheet of the Company and its Subsidiaries subsidiaries, if any, as of the end of each such quarterly period, and unaudited consolidated statements of income and cash flows of the Company and its Subsidiariessubsidiaries, if any, for such period, prepared in accordance with U.S. generally accepted accounting principles consistently applied, subject to changes resulting from normal year-end audit adjustments.; (iii) As soon as practicable after the end of each month, and but in any event within thirty (30) days after the end of each month, an unaudited consolidated balance sheet of the Company and its Subsidiaries subsidiaries, if any, as of the end of each such monthly periodmonth, and unaudited consolidated statements of income and cash flows of the Company and its Subsidiariessubsidiaries, if any, for such period, prepared in accordance with U.S. generally accepted accounting principles consistently applied, subject to changes resulting from normal year-end audit adjustments; (iv) As soon as practicable, and in any event at least thirty (30) days prior to the beginning of each fiscal year, detailed monthly financial projections, and an annual budget and business plan for such year; (v) As soon as practicable, but in any event within forty-five (45) days after the end of each of the first three (3) quarters of each fiscal year of the Company, a statement showing the number of shares of each class and series of capital stock and securities convertible into or exercisable for shares of capital stock outstanding at the end of the period, the Common Stock issuable upon conversion or exercise of any outstanding securities convertible or exercisable for Common Stock and the exchange ratio or exercise price applicable thereto, and the number of shares of issued stock options and stock options not yet issued but reserved for issuance, if any, all in sufficient detail as to permit the Significant Holders to calculate their respective percentage equity ownership in the Company; and (vi) such other information relating to the financial condition, business, prospects, or corporate affairs of the Company as any Significant Holder may from time to time reasonably request; provided, however, that the Company shall not be obligated under this Section 3.1(a)(vi) to provide information (1) that the Company reasonably determines in good faith to be a trade secret or confidential information (unless covered by an enforceable confidentiality agreement, in form acceptable to the Company) or (2) the disclosure of which would adversely affect the attorney-client privilege between the Company and its counsel.

Basic Financial Information. The Company will furnish the following reports to Investor:each Holder who owns at least 1,500,000 Shares both as of the date hereof and continues to own 1,500,000 Shares thereafter (as presently constituted and subject to subsequent adjustments for stock splits, stock dividends, reverse stock splits, and the like) (each a “Major Information Holder”): (i) As soon as practicable after the end of each fiscal year of the Company, and in any event within ninety (90) 120 days after the end of each fiscal year of the Company, a consolidated balance sheet of the Company and its Subsidiaries subsidiaries, if any, as at the end of such fiscal year, and consolidated statements of income and cash flows of the Company and its Subsidiariessubsidiaries, if any, for such year, prepared in accordance with U.S. generally accepted accounting principles consistently applied, certified by independent public accountants of recognized national standing selected by the Company’s independent public accountants.; (ii) As soon as practicable after the end of the first, second and third quarterly accounting periods in each fiscal year of the Company, and in any event within forty-five (45) 45 days after the end of the first, second, and third quarterly accounting periods in each fiscal year of the Company, an unaudited consolidated balance sheet of the Company and its Subsidiaries subsidiaries, if any, as of the end of each such quarterly period, and unaudited consolidated statements of income and cash flows of the Company and its Subsidiariessubsidiaries, if any, for such period, prepared in accordance with U.S. generally accepted accounting principles consistently applied, subject to changes resulting from normal year-end audit adjustments.; (iii) As soon as practicable after the end of each month, and in any event within thirty (30) days after the end of each month, an unaudited consolidated balance sheet of the Company and its Subsidiaries subsidiaries, if any, as of the end of each such monthly periodmonth, and unaudited consolidated statements of income and cash flows of the Company and its Subsidiariessubsidiaries, if any, for such periodmonth, prepared in accordance with U.S. generally accepted accounting principles consistently applied, subject to changes resulting from normal year-end audit adjustments. (iv) At least 30 days prior to the end of each fiscal year an operating budget forecasting the Company’s revenues, expenses and cash position on a month-to-month basis for the upcoming fiscal year that has been approved by the Board of Directors; and (v) As soon as practicable after the end of each quarterly accounting period in each fiscal year of the Company, and in any event within 45 days after the end of each quarterly accounting period in each fiscal year of the Company, a current capitalization table certified by the Chief Financial Officer or Treasurer of the Company.

Basic Financial Information. The Company will furnish the following reports to Investor:each Holder who owns at least 2,000,000 Shares and/or Conversion Stock (as presently constituted and subject to subsequent adjustments for stock splits, stock dividends, reverse stock splits, and the like): (i) As soon as practicable after the end of each fiscal year of the Company, unless otherwise approved by the Board of Directors, and in any event within ninety (90) days after the end of each fiscal year of the Company, a an audited consolidated balance sheet of the Company and its Subsidiaries subsidiaries, if any, as at the end of such fiscal year, and consolidated statements of income and cash flows of the Company and its Subsidiariessubsidiaries, if any, for such year, prepared in accordance with U.S. generally accepted accounting principles consistently applied, certified by the Company’s independent public accountants.; (ii) As soon as practicable after the end of the first, second and third quarterly accounting periods in each fiscal year of the Company, and in any event within forty-forty five (45) days after the end of the first, second, and third quarterly accounting periods in each fiscal year of the Company, an unaudited consolidated balance sheet of the Company and its Subsidiaries subsidiaries, if any, as of the end of each such quarterly period, and unaudited consolidated statements of income and cash flows of the Company and its Subsidiariessubsidiaries, if any, for such period, prepared in accordance with U.S. generally accepted accounting principles consistently applied, subject to changes resulting from normal year-end audit adjustments.; and (iii) As soon as practicable after the end of each month, and in any event within thirty (30) days after the end of each month, an unaudited consolidated balance sheet of the Company and its Subsidiaries subsidiaries, if any, as of the end of such monthly period, and unaudited consolidated statements of income and cash flows of the Company and its Subsidiariessubsidiaries, if any, for such period, prepared in accordance with U.S. generally accepted accounting principles consistently applied, subject to changes resulting from normal year-end audit adjustments.