Common use of Capitalization Clause in Contracts

Capitalization. (a) The authorized shares of stock of the Company consist of 200,000,000 shares of Company Common Stock, par value $0.001 per share, of the Company. As of the date hereof, (i) 67,066,418 shares of Company Common Stock were issued and outstanding (excluding shares of Company Common Stock held by the Company in its treasury), (ii) 15,000,000 shares of Company Common Stock have been reserved for issuance pursuant to the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”), and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities reserved for issuance or required to be reserved for issuance other than as described above. All such issued and outstanding shares of the Company and its Subsidiaries are, and all shares subject to issuance as specified above, upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable and free of any preemptive rights purchase option, call option, right of first refusal, subscription agreement, or any other similar right under the Company Charter, the Company Bylaws or any agreement to which the Company is party or by which it is bound. (b) Except for the Company Stock Options, there are no existing options, warrants, calls, subscription rights, exercisable, convertible or exchangeable securities or other rights, agreements or commitments (contingent or otherwise) that obligate the Company to issue, transfer or sell any Company Common Stock or any investment that is convertible into or exercisable or exchangeable for any such shares. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There are no agreements or understandings to which the Company is a party with respect to the voting of any securities of the Company or which restrict the transfer of any such shares, nor does the Company have knowledge of any third party agreements or understandings with respect to the voting of any such shares or which restrict the transfer of such shares.

Capitalization. (a) The Before giving effect to the transactions to be effected at the Closing, the authorized shares of capital stock of the Company consist consists of 200,000,000 (i) 50,000,000 shares of Company Common Stock, par value $0.001 per shareof which 16,036,625 shares are issued and outstanding, and 2,068,000 shares are reserved for issuance upon conversion of the Preferred Stock (subject to adjustment pursuant to the Company. As of the date hereof, (i’s covenant set forth in Section 6(h) 67,066,418 shares of Company Common Stock were issued below); and outstanding (excluding shares of Company Common Stock held by the Company in its treasury), (ii) 15,000,000 1,000,000 shares of Company Common undesignated preferred stock (517,000 of which will be designated Series A Convertible Preferred Stock have been reserved for issuance pursuant upon filing of the Amendment to the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”Articles of Incorporation), of which none are issued and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 shares of Company Common Stock were outstanding. As All of the date of this Agreement, the Company had no Company Common Stock, or any other securities reserved for issuance or required to be reserved for issuance other than as described above. All such issued and outstanding shares of the Company and its Subsidiaries capital stock are, and all shares subject to issuance as specified above, or upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable paid and free nonassessable. No shares of any capital stock of the Company are subject to preemptive rights purchase optionor any other similar rights of the shareholders of the Company or any liens or encumbrances imposed through the actions or failure to act of the Company. Except as disclosed in Schedule 5(c), call optionas of the effective date of this Agreement, right (i) there are no outstanding options, preferred stock, scrip, rights to subscribe for, puts, calls, rights of first refusal, subscription agreementagreements, understandings, claims or other commitments or rights of any character whatsoever relating to, or securities or rights convertible into or exchangeable for any other similar right under shares of capital stock of the Company Charter, the Company Bylaws or any agreement to of its Subsidiaries, or arrangements by which the Company or any of its Subsidiaries is party or by which it is bound. (b) Except for may become bound to issue additional shares of capital stock of the Company Stock Optionsor any of its Subsidiaries, (ii) there are no existing options, warrants, calls, subscription rights, exercisable, convertible or exchangeable securities or other rights, agreements or commitments arrangements under which the Company or any of its Subsidiaries is obligated to register the sale of any of its or their securities under the 1933 Act and (contingent iii) there are no anti-dilution or otherwiseprice adjustment provisions contained in any security issued by the Company (or in any agreement providing rights to security holders) that obligate will be triggered by the issuance of the Notes, the Preferred Stock, or the Conversion Shares. The Company has furnished to issuethe Buyer true and correct copies of the Company’s Articles of Incorporation as in effect on the date hereof (“Articles of Incorporation”), transfer or sell any Company Common Stock or any investment that is the Company’s Bylaws, as in effect on the date hereof (the “Bylaws”), and the terms of all securities convertible into or exercisable or exchangeable for any such shares. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There are no agreements or understandings to which the Company is a party with respect to the voting of any securities Common Stock of the Company or which restrict and the transfer material rights of any such shares, nor does the Company have knowledge of any third party agreements or understandings with holders thereof in respect to the voting of any such shares or which restrict the transfer of such sharesthereto.

Capitalization. (a) The authorized shares of stock of the Company consist of 200,000,000 shares of Company Common Stock, par value $0.001 per share, of the Company. As of the date hereof, the authorized capital stock of the Company consists of: (i) 67,066,418 200,000,000 shares of Company Common Stock were Stock, $0.001 par value per share, of which 70,864,772 shares are issued and outstanding (excluding outstanding; no shares of Company Common Stock held by the Company in its treasury), (ii) 15,000,000 shares of Company Common Stock have been are reserved for issuance pursuant to the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”)Company’s stock option plans, and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 no shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities are reserved for issuance pursuant to securities (other than the Note) exercisable for, or required to be convertible into or exchangeable for shares of Common Stock and 4,545,455 shares are reserved for issuance other than as described aboveupon conversion of the Note (subject to adjustment pursuant to the Company’s covenant set forth in Section 4(g) below). All of such issued and outstanding shares of the Company and its Subsidiaries capital stock are, and all shares subject to issuance as specified above, or upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable paid and free non-assessable. No shares of any capital stock of the Company are subject to preemptive rights purchase optionor any other similar rights of the shareholders of the Company or any liens or encumbrances imposed through the actions or failure to act of the Company. Except as disclosed in the SEC Documents and in Schedule 3(c), call optionas of the effective date of this Agreement, right (i) there are no outstanding options, warrants, scrip, rights to subscribe for, puts, calls, rights of first refusal, subscription agreementagreements, understandings, claims or other commitments or rights of any character whatsoever relating to, or securities or rights convertible into or exchangeable for any other similar right under shares of capital stock of the Company Charter, the Company Bylaws or any agreement to of its Subsidiaries, or arrangements by which the Company or any of its Subsidiaries is party or by which it is bound. (b) Except for may become bound to issue additional shares of capital stock of the Company Stock Optionsor any of its Subsidiaries, (ii) there are no existing options, warrants, calls, subscription rights, exercisable, convertible or exchangeable securities or other rights, agreements or commitments arrangements under which the Company or any of its Subsidiaries is obligated to register the sale of any of its or their securities under the 1933 Act and (contingent iii) there are no anti-dilution or otherwiseprice adjustment provisions contained in any security issued by the Company (or in any agreement providing rights to security holders) that obligate will be triggered by the issuance of the Note or the Conversion Shares. The Company to issuehas filed in its SEC Documents true and correct copies of the Company’s Certificate of Incorporation as in effect on the date hereof (“Certificate of Incorporation”), transfer or sell any Company Common Stock or any investment that is the Company’s By-laws, as in effect on the date hereof (the “By-laws”), and the terms of all securities convertible into or exercisable or exchangeable for any such shares. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There are no agreements or understandings to which the Company is a party with respect to the voting of any securities Common Stock of the Company or which restrict and the transfer material rights of any such shares, nor does the holders thereof in respect thereto. The Company shall provide the Buyer with a written update of this representation signed by the Company’s Chief Executive on behalf of the Company have knowledge as of any third party agreements or understandings with respect to the voting of any such shares or which restrict the transfer of such sharesClosing Date.

Capitalization. (a) The authorized shares of stock of the Company consist of 200,000,000 shares of Company Common Stock, par value $0.001 per share, of the Company. As of the date hereof, the authorized capital stock of the Company consists of: (i) 67,066,418 250,000,000 shares of Company Common Stock were Stock, of which approximately 154,851,540 shares are issued and outstanding (excluding shares of Company Common Stock held by the Company in its treasury), outstanding; and (ii) 15,000,000 2,000,000 shares of Company Common Stock have been preferred stock, of which 0 are issued and outstanding. Except as disclosed in the SEC Documents, no shares are reserved for issuance pursuant to the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”)Company’s stock option plans, and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 no shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities are reserved for issuance or required pursuant to be reserved for issuance securities (other than as described abovethe Note and any other convertible promissory note issued to the Buyer) exercisable for, or convertible into or exchangeable for shares of Common Stock. All of such issued and outstanding shares of the Company and its Subsidiaries capital stock are, and all shares subject to issuance as specified above, or upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable paid and free non-assessable. No shares of any capital stock of the Company are subject to preemptive rights purchase optionor any other similar rights of the shareholders of the Company or any liens or encumbrances imposed through the actions or failure to act of the Company. Except as disclosed in the SEC Documents, call optionas of the effective date of this Agreement, right (i) there are no outstanding options, warrants, scrip, rights to subscribe for, puts, calls, rights of first refusal, subscription agreementagreements, understandings, claims or other commitments or rights of any character whatsoever relating to, or any other similar right under the Company Charter, the Company Bylaws or any agreement to which the Company is party or by which it is bound. (b) Except for the Company Stock Options, there are no existing options, warrants, calls, subscription rights, exercisable, convertible or exchangeable securities or other rights, agreements or commitments (contingent or otherwise) that obligate the Company to issue, transfer or sell any Company Common Stock or any investment that is rights convertible into or exercisable or exchangeable for any such shares. shares of capital stock of the Company or any of its Subsidiaries, or arrangements by which the Company or any of its Subsidiaries is or may become bound to issue additional shares of capital stock of the Company or any of its Subsidiaries, (cii) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There there are no agreements or understandings to arrangements under which the Company or any of its Subsidiaries is a party with respect obligated to register the voting sale of any of its or their securities under the 1933 Act and (iii) there are no anti-dilution or price adjustment provisions contained in any security issued by the Company (or in any agreement providing rights to security holders) that will be triggered by the issuance of the Company Note or which restrict the transfer of any such shares, nor does the Company have knowledge of any third party agreements or understandings with respect to the voting of any such shares or which restrict the transfer of such sharesConversion Shares.

Capitalization. (a) The authorized shares of stock of the Company consist of 200,000,000 shares of Company Common Stock, par value $0.001 per share, of the Company. As of the date hereof, the authorized capital stock of the Company consists of (i) 67,066,418 [ ] shares of Company Common Stock were Stock, of which [ ] shares are issued and outstanding (excluding outstanding, [ ] shares of Company Common Stock held by the Company in its treasury), (ii) 15,000,000 shares of Company Common Stock have been are reserved for issuance pursuant to the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”)Company's stock option plans, and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 [ ] shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities are reserved for issuance pursuant to securities (other than the Notes and the Warrants) exercisable for, or required to be convertible into or exchangeable for shares of Common Stock and, [ ] shares are reserved for issuance other than as described aboveupon conversion of the Notes and exercise of the Warrants (subject to adjustment pursuant to the Company's covenant set forth in Section 4(h) below); and (ii) 5,000,000 shares of preferred stock, of which 44,630 shares are issued and outstanding. All of such issued and outstanding shares of the Company and its Subsidiaries capital stock are, and all shares subject to issuance as specified above, or upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable paid and free nonassessable. No shares of any capital stock of the Company are subject to preemptive rights purchase optionor any other similar rights of the shareholders of the Company or any liens or encumbrances imposed through the actions or failure to act of the Company. Except as disclosed in Schedule 3(c), call optionas of the effective date of this Agreement, right (i) there are no outstanding options, warrants, scrip, rights to subscribe for, puts, calls, rights of first refusal, subscription agreementagreements, understandings, claims or other commitments or rights of any character whatsoever relating to, or securities or rights convertible into or exchangeable for any other similar right under shares of capital stock of the Company Charter, the Company Bylaws or any agreement to of its Subsidiaries, or arrangements by which the Company or any of its Subsidiaries is party or by which it is bound. (b) Except for may become bound to issue additional shares of capital stock of the Company Stock Optionsor any of its Subsidiaries, (ii) there are no existing options, warrants, calls, subscription rights, exercisable, convertible or exchangeable securities or other rights, agreements or commitments arrangements under which the Company or any of its Subsidiaries is obligated to register the sale of any of its or their securities under the 1933 Act (contingent except the Registration Rights Agreement) and (iii) there are no anti-dilution or otherwiseprice adjustment provisions contained in any security issued by the Company (or in any agreement providing rights to security holders) that obligate will be triggered by the issuance of the Notes, the Warrants, the Conversion Shares or Warrant Shares. The Company has furnished to issuethe Buyer true and correct copies of the Company's Articles of Incorporation as in effect on the date hereof ("Articles of Incorporation"), transfer or sell any Company Common Stock or any investment that is the Company's By-laws, as in effect on the date hereof (the "By-laws"), and the terms of all securities convertible into or exercisable or exchangeable for any such shares. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There are no agreements or understandings to which the Company is a party with respect to the voting of any securities Common Stock of the Company and the material rights of the holders thereof in respect thereto. The Company shall provide the Buyer with a written update of this representation signed by the Company's Chief Executive or which restrict the transfer Chief Financial Officer on behalf of any such shares, nor does the Company have knowledge as of any third party agreements or understandings with respect to the voting of any such shares or which restrict the transfer of such sharesClosing Date.

Capitalization. (a) The authorized shares of capital stock of the Company consist consists of 200,000,000 (1) 30,000,000 shares of Company Common Stock, par value $0.001 per share, of the Company. As of the date hereof, and (i2) 67,066,418 5,000,000 shares of Company Common Stock were issued and outstanding (excluding shares of Company Common Stock held by the Company in its treasury), (ii) 15,000,000 shares of Company Common Stock have been reserved for issuance pursuant to the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”), and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 shares of Company Common Stock were outstandingPreferred Stock. As of the date of this Agreement, 14,995,000 shares of Common Stock and no shares of Preferred Stock (together with the Company had no Company Common Stock, or any other securities reserved for issuance or required to be reserved for issuance other than as described abovethe "Company Stock") are outstanding. All such issued and outstanding shares of the Company and its Subsidiaries are, and all shares subject to issuance as specified above, upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, Shares have been duly authorized, validly issued, issued and are fully paid, nonassessable paid and free of any preemptive rights purchase option, call option, right of first refusal, subscription agreement, or any other similar right under nonassessable. Except for the Company CharterStock, there are no shares of capital stock or other equity securities of the Company Bylaws or any agreement to which the Company is party or by which it is boundoutstanding. (b) Except for the Company warrants to purchase 790,000 shares of Common Stock Optionsand as contemplated by the Related Agreements, (i) there are no existing preemptive or similar rights on the part of any holder of any class of securities of the Company, and (ii) no options, warrants, calls, subscription rights, exercisable, convertible or exchangeable securities conversion or other rights, agreements or commitments (contingent or otherwise) of any kind are outstanding that obligate the Company Company, contingently or otherwise, to issue, transfer sell, purchase, return or sell redeem any Company Common Stock shares of its capital stock of any class or any investment that is securities convertible into or exercisable or exchangeable for any such shares, and no authorization therefor has been given. No shares of capital stock of the Company are held in the Company's treasury and except in respect of the warrants described above no shares of capital stock of the Company are reserved for issuance. There are no voting trusts, stockholder agreements, proxies or other agreements or understandings in effect with respect to the voting or transfer of any of the Shares. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There are no agreements or understandings to which the Company is a party with respect Notwithstanding anything to the voting contrary set forth herein, the sole remedy for any breach of any securities the representations and warranties set forth in subparagraph (b) above shall be a purchase price adjustment (the "Purchase Price Adjustment") on a retrospective basis so that either (i) the number of Shares transferred to the Purchaser is increased or (ii) the Purchase Price is decreased so that, in either such event, the Purchaser shall have as of the Closing Date the economic equivalent of 15.74% of the capital stock of the Company or which restrict (on a fully diluted basis) in consideration of the transfer Purchase Price. The Indirect Stockholder shall cause the Stockholders to effect the Purchase Price Adjustment in any such event, and the parties agree that an interest factor of ten percent (10%) from the Closing Date until the effective date of any such shares, nor does Purchase Price Adjustment shall be included in the Company have knowledge of any third party agreements or understandings with respect Purchase Price Adjustment to compensate the voting of any Purchaser for the delay in obtaining such shares or which restrict the transfer of such shareseconomic equivalent.

Capitalization. (a) The authorized shares of stock of the Company consist of 200,000,000 shares of Company Common Stock, par value $0.001 per share, of the Company. As of the date hereof, the authorized capital stock of the Company consists of 20,000,000 shares of Common Stock, of which (i) 67,066,418 8,632,826 shares of Company Common Stock were are validly issued and outstanding (excluding shares of Company Common Stock held by the Company in its treasury)outstanding, (ii) 15,000,000 no shares of Company Common Stock have been reserved for issuance pursuant to the 2001 Stock Option Plan are issued and the 2005 Stock Option Plan (“Incentive Plans”)held in treasury, and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 915,190 shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities are reserved for issuance or required to be reserved for issuance other than upon exercise of existing Company Options (as described abovedefined below). All such issued and outstanding No shares of the Company and its Subsidiaries are, and all shares subject to issuance as specified above, upon issuance on the terms and conditions specified in the instruments pursuant to which they Common Stock are issuable, will be, when issued, held by any Subsidiary. Each outstanding share of Common Stock is duly authorized, validly issued, fully paidpaid and nonassessable, nonassessable and free has not been issued in violation of any preemptive rights purchase option, call option, right of first refusal, subscription agreement, or any other similar right under rights. Other than as set forth in Schedule 2.3 and as contemplated by the Company Charter, the Company Bylaws or any agreement to which the Company is party or by which it is bound. Option Agreements: (bi) Except for the Company Stock Options, there are no existing outstanding subscriptions, options, warrants, puts, calls, subscription rightsagreements, exercisableunderstandings, convertible or exchangeable securities claims or other rightscommitments of any type relating to the issuance, agreements sale, repurchase or commitments (contingent or otherwise) that obligate transfer by the Company to issue, transfer or sell of any Company Common Stock or other securities of the Company (the "Company Options"), or by the Company or any investment that is Subsidiary of any securities of a Subsidiary, (ii) there are no outstanding securities which are convertible into or exercisable or exchangeable for any such shares. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted shares of capital stock unit awards or “phantom” shares. (d) There are no agreements or understandings to which the Company is a party with respect to the voting of any other securities of the Company or which restrict any Subsidiary, and (iii) neither the transfer Company nor any Subsidiary has any obligation of any such shares, nor does the Company have knowledge kind to issue any additional shares of capital stock or other securities to pay for or repurchase any shares of capital stock or other securities of any third party agreements Subsidiary or understandings any predecessor thereof. The Primary Shares being delivered herewith have been duly authorized, validly issued, fully paid and nonassessable, are being delivered free and clear of all claims, liens, encumbrances and security interests, and are eligible for NASDAQ NMS trading without further consents or actions other than registration with respect the Securities and Exchange Commission (the "Commission") thereof pursuant to the voting Registration Rights Agreement. The shares of any such shares Common Stock which will be issued upon exercise of the Options have been authorized and reserved for issuance, and when issued and delivered in accordance with the terms of the applicable Option Agreement, will be validly issued, fully paid and nonassessable and will be eligible for NASDAQ NMS trading without further consents or which restrict actions other than registration thereof pursuant to the transfer of such sharesRegistration Rights Agreement.

Capitalization. (a) The authorized shares of stock capital of the Company consist consists of 200,000,000 an unlimited number of Company Shares. As of December 21, 2004, there were: (i) 54,796,531 Company Shares issued and outstanding; (ii) Company Options outstanding, entitling the holders thereof to acquire an aggregate of 2,281,018 Company Shares; (iii) 299,433 RSUs granted by the Company; and (iv) 167,443 DSUs granted by the Company. Except for the Company Options, RSUs and DSUs described in the immediately preceding sentence, there are no options, warrants, conversion privileges or other rights, agreements, arrangements or commitments (pre-emptive, contingent or otherwise) obligating the Company or any Subsidiary of the Company to issue or sell any shares of the Company Common Stockor of any such Subsidiary or securities or obligations of any kind convertible into or exchangeable for any shares of the Company or any Subsidiary of the Company, par or to make any payment which is contingent on the value $0.001 per share, of any shares of the Company. As of the date hereof, (i) 67,066,418 shares of All outstanding Company Common Stock were Shares have been duly authorized and are validly issued and outstanding (excluding shares as fully paid and non-assessable shares, free of Company Common Stock held by the Company in its treasury)pre-emptive rights. There are no outstanding bonds, (ii) 15,000,000 shares debentures or other evidences of Company Common Stock have been reserved for issuance pursuant to the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”), and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities reserved for issuance or required to be reserved for issuance other than as described above. All such issued and outstanding shares indebtedness of the Company and or any of its Subsidiaries are, and all shares subject having the right to issuance vote (or that are convertible for or exercisable into securities having the right to vote) with the holders of the Company Shares on any matter. Except as specified above, upon issuance on the terms and conditions specified set forth in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable and free of any preemptive rights purchase option, call option, right of first refusal, subscription agreement, or any other similar right under the Company Charter, the Company Bylaws or any agreement to which the Company is party or by which it is bound. (b) Except for the Company Stock OptionsDisclosure Letter, there are no existing options, warrants, calls, subscription rights, exercisable, convertible or exchangeable securities or other rights, agreements or commitments (contingent or otherwise) that obligate outstanding obligations of the Company to issue, transfer or sell any Company Common Stock or any investment that is convertible into of its Subsidiaries to repurchase, redeem or exercisable otherwise acquire any outstanding Company Shares or exchangeable for any such shares. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There are no agreements or understandings to which the Company is a party with respect to the voting or disposition of any outstanding securities of the Company or which restrict the transfer any of any such shares, nor does its Subsidiaries. No holder of securities issued by the Company have knowledge or any Subsidiary of the Company has any third party agreements right to compel the Company to register or understandings with respect to otherwise qualify securities for public sale in Canada, the voting of any such shares United States or which restrict the transfer of such shareselsewhere.

Capitalization. (a) The authorized Except as disclosed in the SEC Documents, no shares of stock of the Company consist of 200,000,000 shares of Company Common Stock, par value $0.001 per share, of the Company. As of the date hereof, (i) 67,066,418 shares of Company Common Stock were issued and outstanding (excluding shares of Company Common Stock held by the Company in its treasury), (ii) 15,000,000 shares of Company Common Stock have been are reserved for issuance pursuant to the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”)Company’s stock option plans, and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 no shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities are reserved for issuance pursuant to securities (other than the Note) exercisable for, or required to convertible into or exchangeable for shares of Common Stock and sufficient shares shall be reserved for issuance other than upon conversion of the Note (as described aboverequired by the Note and transfer agent share reserve letter). All of such issued and outstanding shares of the Company and its Subsidiaries capital stock are, and all shares subject to issuance as specified above, or upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paidpaid and non-assessable. Except as set forth in the SEC Documents, nonassessable and free no shares of any capital stock of the Company are subject to preemptive rights purchase optionor any other similar rights of the shareholders of the Company or any liens or encumbrances imposed through the actions or failure to act of the Company. Except as disclosed in the SEC Documents, call optionas of the effective date of this Agreement, right (i) there are no outstanding options, warrants, scrip, rights to subscribe for, puts, calls, rights of first refusal, subscription agreementagreements, understandings, claims or other commitments or rights of any character whatsoever relating to, or securities or rights convertible into or exchangeable for any other similar right under shares of capital stock of the Company Charter, the Company Bylaws or any agreement to of its Subsidiaries, or arrangements by which the Company or any of its Subsidiaries is party or by which it is bound. (b) Except for may become bound to issue additional shares of capital stock of the Company Stock Optionsor any of its Subsidiaries, (ii) there are no existing options, warrants, calls, subscription rights, exercisable, convertible or exchangeable securities or other rights, agreements or commitments arrangements under which the Company or any of its Subsidiaries is obligated to register the sale of any of its or their securities under the 1933 Act and (contingent iii) there are no anti-dilution or otherwiseprice adjustment provisions contained in any security issued by the Company (or in any agreement providing rights to security holders) that obligate will be triggered by the issuance of the Note or the Conversion Shares. The Company to issuehas filed in its SEC Documents true and correct copies of the Company’s Certificate of Incorporation as in effect on the date hereof (“Certificate of Incorporation”), transfer or sell any Company Common Stock or any investment that is the Company’s By-laws, as in effect on the date hereof (the “By-laws”), and the terms of all securities convertible into or exercisable or exchangeable for any such shares. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There are no agreements or understandings to which the Company is a party with respect to the voting of any securities Common Stock of the Company or which restrict and the transfer material rights of any such shares, nor does the holders thereof in respect thereto. The Company shall provide the Buyer with a written update of this representation signed by the Company’s Chief Executive on behalf of the Company have knowledge as of any third party agreements or understandings with respect to the voting of any such shares or which restrict the transfer of such sharesClosing Date.

Capitalization. (a) The As of August 7, 2019, the authorized shares of capital stock of the Company consist consists of 200,000,000 500,000,000 shares of Company Common Stock, par value $0.001 per share, of the Company. As of the date hereof, (i) 67,066,418 which approximately 121,241,213 shares of Company Common Stock were are issued and outstanding (excluding and 0 shares of Company Common Preferred Stock held by authorized. Except as disclosed in the Company in its treasury)SEC Documents, (ii) 15,000,000 no shares of Company Common Stock have been are reserved for issuance pursuant to the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”)Company’s stock option plans, and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 no shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities are reserved for issuance pursuant to securities (other than the Note) exercisable for, or required to be convertible into or exchangeable for shares of Common Stock and 6,000,000 shares are reserved for issuance other than as described aboveupon conversion of the Note. All of such issued and outstanding shares of the Company and its Subsidiaries capital stock are, and all shares subject to issuance as specified above, or upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable paid and free non-assessable. No shares of any capital stock of the Company are subject to preemptive rights purchase optionor any other similar rights of the shareholders of the Company or any liens or encumbrances imposed through the actions or failure to act of the Company. Except as disclosed in the SEC Documents, call optionas of the effective date of this Agreement, right (i) there are no outstanding options, warrants, scrip, rights to subscribe for, puts, calls, rights of first refusal, subscription agreementagreements, understandings, claims or other commitments or rights of any character whatsoever relating to, or securities or rights convertible into or exchangeable for any other similar right under shares of capital stock of the Company Charter, the Company Bylaws or any agreement to of its Subsidiaries, or arrangements by which the Company or any of its Subsidiaries is party or by which it is bound. (b) Except for may become bound to issue additional shares of capital stock of the Company Stock Optionsor any of its Subsidiaries, (ii) there are no existing options, warrants, calls, subscription rights, exercisable, convertible or exchangeable securities or other rights, agreements or commitments arrangements under which the Company or any of its Subsidiaries is obligated to register the sale of any of its or their securities under the 1933 Act and (contingent iii) there are no anti- dilution or otherwiseprice adjustment provisions contained in any security issued by the Company (or in any agreement providing rights to security holders) that obligate will be triggered by the issuance of the Note or the Conversion Shares. The Company to issuehas filed in its SEC Documents true and correct copies of the Company’s Certificate of Incorporation as in effect on the date hereof (“Certificate of Incorporation”), transfer or sell any Company Common Stock or any investment that is the Company’s By-laws, as in effect on the date hereof (the “By-laws”), and the terms of all securities convertible into or exercisable or exchangeable for any such shares. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There are no agreements or understandings to which the Company is a party with respect to the voting of any securities Common Stock of the Company or which restrict and the transfer material rights of any such shares, nor does the holders thereof in respect thereto. The Company shall provide the Buyer with a written update of this representation signed by the Company’s Chief Executive on behalf of the Company have knowledge as of any third party agreements or understandings with respect to the voting of any such shares or which restrict the transfer of such sharesClosing Date.

Capitalization. (a) The authorized stock capital of the Parent will be on or immediately following to the SEA Closing, as set forth in the Restated Articles, and such number of Common Stock as set forth in the Capitalization Table are or shall be (immediately following the SEA Closing) issued and outstanding. (b) Prior to the SEA Closing, the Board shall reserve 4,626,619 shares of stock Common Stock prior to the SEA Closing for issuance of, and grant of options or other equity awards exercisable into, Common Stock to directors, officers, employees, consultants and service providers of the Company consist of 200,000,000 shares of Company Common Stock, par value $0.001 per share, of Parent or its subsidiaries (the Company. As of the date hereof, (i) 67,066,418 shares of Company Common Stock were issued and outstanding (excluding shares of Company Common Stock held by the Company in its treasury), (ii) 15,000,000 shares of Company Common Stock have been reserved for issuance pursuant to the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive PlansESOP Pool”), and . (iiic) Company Stock Options entitling the owners thereof to purchase 7,960,000 shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities reserved for issuance or required to be reserved for issuance other than as described above. All such The issued and outstanding shares of the Company Parent were duly and its Subsidiaries are, validly authorized and all shares subject to issuance as specified above, upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paidpaid and non-assessable, nonassessable and free offered and issued in compliance with the provisions of any preemptive rights purchase option, call option, right the Parent’s Articles of first refusal, subscription agreement, or any other similar right under Incorporation as in effect at the Company Charter, the Company Bylaws or any agreement to which the Company is party or by which it is boundtime of each such issuance and in compliance with all applicable corporate and securities laws. (bd) Except for Immediately prior to the Company Stock OptionsSEA Closing, there are no existing shares, options, warrants, callsrights (including conversion, subscription preemptive rights, exercisablerights of first refusal or similar rights) or agreements for the purchase from the Parent of any of its stock capital, or any securities convertible into or exchangeable for stock of the Parent shall be outstanding, other than as set forth in Section ‎2.2(d) of the Disclosure Schedule, or that could require the Parent to issue, sell, transfer or otherwise cause to be outstanding any of the Parent’s stock capital or securities convertible or exchangeable securities exercisable into shares thereof. (e) Immediately prior to the SEA Closing, no option, security or other rightsequity award convertible or exercisable into stock of the Parent shall contain a provision for acceleration of vesting (or lapse of a repurchase right) or other changes in the vesting provisions or other terms of such option, agreements security or commitments other equity award upon the occurrence of any event or combination of events, other than as set forth in Section 2.2(e)‎ of the Disclosure Schedule. No share, option, security or other equity award convertible or exercisable into shares of the Parent is subject to repurchase or redemption (contingent or otherwise) that obligate by the Company to issueParent, transfer and the Parent has not repurchased or sell redeemed any Company Common Stock of the Parent’s shares of stock, options, security or any investment that is convertible into or exercisable or exchangeable for any such sharesother equity awards. (cf) The Company Parent has not issued declared or paid any share appreciation rightsdividends, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There are no agreements authorized or understandings to which the Company is a party made any distribution upon or with respect to the voting any class or series of any securities of the Company or which restrict the transfer of any such shares, nor does the Company have knowledge of any third party agreements or understandings with respect to the voting of any such shares or which restrict the transfer of such sharesits stock capital.

Capitalization. (a) The authorized shares There are 100 Membership Units issued and outstanding, all of stock which are duly subscribed for and fully paid. Except as described in this Section 5.3 or in Section 5.3 of the Company consist of 200,000,000 shares of Company Common StockCYL Disclosure Schedule, par value $0.001 per share, of the Company. As as of the date hereofof this Agreement, no Membership Units are reserved for any other purpose. Except as set forth in Section 5.3 of the CYL Disclosure Schedule, CYL has not granted any options in, or any other rights to purchase, Membership Units and there are no such options or rights outstanding. Each CYL Member is the owner of record and beneficially of the number of Membership Units set forth in Schedule 4.1, which total amount equals all outstanding Membership Units. Set forth in Section 5.3 of the CYL Disclosure Schedule is a schedule showing in sufficient detail the amounts expended to date by Development Holdings in the organization of CYL, including a description of the uses of such expended amounts, which schedule shall also be updated through and delivered at the Closing. (ib) 67,066,418 shares Except as set forth in Section 5.3(a) above or otherwise contemplated hereby, as of Company Common Stock were issued and outstanding the date of this Agreement, there are no options, warrants or other rights (excluding shares of Company Common Stock held by the Company in its treasuryincluding registration rights), (ii) 15,000,000 shares agreements, arrangements or commitments of Company Common Stock have been reserved for issuance pursuant any character to which CYL is a party relating to the 2001 Stock Option Plan and issued or unissued Membership Units or other securities of CYL, or obligating CYL to grant, issue or sell any Membership Units or other securities of CYL, by sale, lease, license or otherwise. There are no obligations, contingent or otherwise, of CYL to (x) repurchase, redeem or otherwise acquire any Membership Units; or (y) provide funds to, or make any investment in (in the 2005 Stock Option Plan (“Incentive Plans”form of a loan, capital contribution or otherwise), and (iii) Company Stock Options entitling or provide any guarantee with respect to the owners thereof to purchase 7,960,000 shares obligations of Company Common Stock were outstandingCYL or any other person. As of the date of this Agreement, the Company had no Company Common StockCYL neither owns nor has agreed to purchase or otherwise acquire, any capital stock of, or any other securities reserved for issuance interest convertible into or required to be reserved for issuance other than as described above. All such issued and outstanding shares of the Company and its Subsidiaries areexchangeable or exercisable for, and all shares subject to issuance as specified above, upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable and free any capital stock of any preemptive rights purchase optioncorporation, call optionpartnership, right joint venture or other business association or entity. Except as set forth in Section 5.3 of first refusal, subscription agreement, or any other similar right under the Company Charter, the Company Bylaws or any agreement to which the Company is party or by which it is bound. (b) Except for the Company Stock OptionsCYL Disclosure Schedule, there are no existing optionsagreements, warrants, calls, subscription rights, exercisable, convertible or exchangeable securities or other rights, agreements arrangements or commitments of any character (contingent or otherwise) that obligate pursuant to which any person is or may be entitled to receive any payment based on the Company to issuerevenues or earnings, transfer or sell any Company Common Stock or any investment that is convertible into or exercisable or exchangeable for any such shares. (c) The Company has not issued any share appreciation rightscalculated in accordance therewith, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) of CYL. There are no voting trusts, proxies or other agreements or understandings to which the Company CYL is a party or relating to CYL with respect to the voting of any securities of the Company or which restrict the transfer of any such shares, nor does the Company have knowledge of any third party agreements or understandings with respect to the voting of any such shares or which restrict the transfer of such sharesMembership Units.

Capitalization. (a) The authorized shares of stock capitalization of the Company consist of 200,000,000 shares of Company Common Stock, par value $0.001 per share, of the Company. As as of the date hereof, (i) 67,066,418 shares of Company Common Stock were issued and outstanding (excluding shares of Company Common Stock held by the Company hereof is as set forth on Schedule 3(c). Except as disclosed in its treasurySchedule 3(c), (ii) 15,000,000 no shares of Company Common Stock have been are reserved for issuance pursuant to the 2001 Stock Option Plan Company’s stock option plans and the 2005 Stock Option Plan (“Incentive Plans”), and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 no shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities are reserved for issuance pursuant to securities exercisable for, or required to be reserved convertible into or exchangeable for issuance other than as described aboveshares of Common Stock. All of such issued and outstanding shares of the Company and its Subsidiaries capital stock are, and all shares subject to issuance as specified above, or upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable paid and free non-assessable. No shares of any capital stock of the Company are subject to preemptive rights purchase optionor any other similar rights of the shareholders of the Company or any liens or encumbrances imposed through the actions or failure to act of the Company. Except as disclosed in Schedule 3(c), call optionas of the effective date of this Agreement, right (i) there are no outstanding options, warrants, scrip, rights to subscribe for, puts, calls, rights of first refusal, subscription agreementagreements, understandings, claims or other commitments or rights of any character whatsoever relating to, or securities or rights convertible into or exchangeable for any other similar right under shares of capital stock of the Company Charter, the Company Bylaws or any agreement to of its Subsidiaries, or arrangements by which the Company or any of its Subsidiaries is party or by which it is bound. (b) Except for may become bound to issue additional shares of capital stock of the Company Stock Optionsor any of its Subsidiaries, (ii) there are no existing options, warrants, calls, subscription rights, exercisable, convertible or exchangeable securities or other rights, agreements or commitments arrangements under which the Company or any of its Subsidiaries is obligated to register the sale of any of its or their securities under the 1933 Act and (contingent iii) there are no anti-dilution or otherwiseprice adjustment provisions contained in any security issued by the Company (or in any agreement providing rights to security holders) that obligate will be triggered by the issuance of the Shares or the Warrants. The Company to issuehas filed in its SEC Documents true and correct copies of the Company’s Certificate of Incorporation as in effect on the date hereof (“Certificate of Incorporation”), transfer or sell any Company Common Stock or any investment that is the Company’s By-laws, as in effect on the date hereof (the “By-laws”), and the terms of all securities convertible into or exercisable or exchangeable for any such shares. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There are no agreements or understandings to which the Company is a party with respect to the voting of any securities Common Stock of the Company or which restrict and the transfer material rights of any such shares, nor does the holders thereof in respect thereto. The Company shall provide each Buyer with a written update of this representation signed by the Company’s Chief Executive Officer on behalf of the Company have knowledge as of any third party agreements or understandings with respect to the voting of any such shares or which restrict the transfer of such shareseach Closing Date.

Capitalization. (a) The authorized shares of stock of the Company consist of 200,000,000 shares of Company Common Stock, par value $0.001 per share, of the Company. As of the date hereof, the authorized capital stock of the Company consists of (i) 67,066,418 75,000,000 shares of Company Common Stock were Stock, of which 25,198,270 shares are issued and outstanding (excluding outstanding, 3,643,405 shares of Company Common Stock held by the Company in its treasury), (ii) 15,000,000 shares of Company Common Stock have been are reserved for issuance pursuant to the 2001 Stock Option Plan and Company's stock option plans, 3,461,091 shares are reserved for issuance pursuant to securities (other than the 2005 Stock Option Plan (“Incentive Plans”)Warrants) exercisable for, and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 or convertible into or exchangeable for shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities 3,958,418 shares are reserved for issuance or required to be reserved for issuance other than as described aboveupon exercise of the Warrants; and (ii) 2,000,000 shares of preferred stock, of which no shares are issued and outstanding. All of such issued and outstanding shares of the Company and its Subsidiaries capital stock are, and all shares subject to issuance as specified above, or upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable paid and free nonassessable. No shares of any capital stock of the Company are subject to preemptive rights purchase optionor any other similar rights of the stockholders of the Company or any liens or encumbrances imposed through the actions or failure to act of the Company. Except as disclosed in Schedule 3.3, call optionas of the date of this Agreement, right (i) there are no outstanding options, warrants, scrip, rights to subscribe for, puts, calls, rights of first refusal, subscription agreementagreements, understandings, claims or other commitments or rights of any character whatsoever relating to, or securities or rights convertible into or exchangeable for any other similar right under shares of capital stock of the Company Charter, the Company Bylaws or any agreement to of its Subsidiaries, or arrangements by which the Company or any of its Subsidiaries is party or by which it is bound. (b) Except for may become bound to issue additional shares of capital stock of the Company Stock Optionsor any of its Subsidiaries, (ii) there are no existing options, warrants, calls, subscription rights, exercisable, convertible or exchangeable securities or other rights, agreements or commitments arrangements under which the Company or any of its Subsidiaries is obligated to register the sale of any of its or their securities under the Securities Act (contingent except the Registration Rights Agreement) and (iii) there are no anti-dilution or otherwiseprice adjustment provisions contained in any security issued by the Company (or in any agreement providing rights to security holders) that obligate will be triggered by the issuance of the Shares, the Warrants or Warrant Shares. The Company has made available to issuecounsel for the Investors true and correct copies of the Company's Restated Certificate of Incorporation as in effect on the date hereof ("Certificate of Incorporation"), transfer or sell any Company Common Stock or any investment that is the Company's Bylaws, as in effect on the date hereof (the "Bylaws"), and the terms of all securities convertible into or exercisable or exchangeable for any such shares. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There are no agreements or understandings to which the Company is a party with respect to the voting of any securities Common Stock of the Company or which restrict and the transfer material rights of the holders thereof in respect thereto except for stock options granted under any such shares, nor does benefit plan of the Company have knowledge of any third party agreements or understandings with respect to the voting of any such shares or which restrict the transfer of such sharesCompany.

Capitalization. (a) The authorized shares of capital stock of the Company consist Company, immediately prior to the Closing and after giving effect to the Company’s Certificate of 200,000,000 Incorporation attached hereto as Exhibit C (the “Certificate of Incorporation”), consists of (i) 100,000,000 shares of Company Common Stock, par value $0.001 per share, of the Company. As of the date hereof, (i) 67,066,418 no shares of Company Common Stock were which are issued and outstanding (excluding shares of Company the “Common Stock held by the Company in its treasuryShares”), and (ii) 15,000,000 18,000,000 shares of Preferred Stock, par value $0.001 per share, 9,500,000 of which are designated as Series A Convertible Preferred Stock, none of which are issued and outstanding, and 8,500,000 of which are designated as Series B Convertible Preferred Stock, none of which are issued and outstanding. (b) The Company shall assume the PC Plan, pursuant to which 4,511,970 Common Stock Shares have been reserved for issuance pursuant to the 2001 Stock Option Plan officers, directors, employees and the 2005 Stock Option Plan (“Incentive Plans”), and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities reserved for issuance or required to be reserved for issuance other than as described above. All such issued and outstanding shares consultants of the Company and its Subsidiaries are, and all shares subject to issuance as specified above, upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable and free awards thereunder. The PC Plan is the only plan adopted or assumed by the Board of any preemptive rights purchase option, call option, right Directors and/or stockholders of first refusal, subscription agreement, or any other similar right under the Company Charter, providing for the Company Bylaws issuance of capital stock or any agreement rights to which the Company is party or by which it is boundacquire capital stock. (bc) Except for Other than as contemplated by the Company Stock Assigned Contracts and the assumed PC Options, there are (1) no existing optionssubscription, warrantswarrant, calls, subscription rights, exercisableoption, convertible or exchangeable securities security, or other rights, agreements or commitments right (contingent or otherwise) that obligate to purchase or otherwise acquire equity securities of the Company is authorized or outstanding, and (2) there is no commitment by the Company to issueissue shares, transfer subscriptions, warrants, options, convertible securities, or sell other such rights or to distribute to holders of any of its equity securities any evidence of indebtedness or asset. Other than as provided for in the Certificate of Incorporation, the Company Common Stock has no obligation (contingent or otherwise) to purchase, redeem or otherwise acquire any of its equity securities or any investment that is convertible into interest therein or exercisable to pay any dividend or exchangeable for make any such shares. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” sharesother distribution in respect thereof. (d) There Except as provided for in the Assigned Contracts, there are no agreements voting trusts or understandings agreements, stockholders’ agreements, registration rights agreements, pledge agreements, buy-sell agreements, rights of first refusal, preemptive rights or proxies relating to any securities of the Company to which the Company is a party or, to the Company’s Knowledge, to which any other Person is a party. (e) There are no outstanding or authorized stock appreciation, phantom stock, profit participation or other similar rights with respect to the voting Company or which otherwise permit the holder thereof to participate in the proceeds of any securities a sale of the Company (regardless of how structured). (f) The rights, preferences, privileges and restrictions of the Replacement Shares are as stated in the Certificate of Incorporation and such rights, preferences, privileges and restrictions are valid, binding and enforceable and are in accordance with all applicable laws. (g) Except as contemplated by the Assigned Contracts, no stock plan (including the assumed PC Plan), stock purchase, restricted stock, stock option, employment agreement or which restrict other agreement or understanding between the transfer Company and any holder of any equity securities or rights to purchase equity securities provides for mandatory acceleration or other changes in the vesting provisions or other terms of such sharesagreement or understanding as the result of (i) termination of employment (whether actual or constructive); (ii) any merger, nor does consolidated sale of stock or assets, change in control or any other transaction(s) by the Company have knowledge Company; (iii) the transactions contemplated by this Agreement; or (iv) the occurrence of any third party agreements other event or understandings with respect to the voting combination of any such shares or which restrict the transfer of such sharesevents.

Capitalization. (a) The authorized shares of capital stock of the ---------------------------- Company consist consists of 200,000,000 17,000,000 shares of Company Common Stock, par value $0.001 per share, of the Company. As of the date hereofNovember 10, 1998, (ia) 67,066,418 6,010,795 shares of Company Common Stock were issued and outstanding outstanding, all of which were validly issued, fully paid and nonassessable and were issued free of preemptive (excluding shares of Company Common Stock held by the Company in its treasury), (iior similar) 15,000,000 shares of Company Common Stock have been reserved for issuance pursuant to the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”), rights and (iiib) Company Stock Options entitling the owners thereof to purchase 7,960,000 1,105,300 shares of Company Common Stock were outstandingheld in the treasury of the Company. As Except for options issued pursuant to the Stock Option Agreement, no Options have been granted and no Shares have been issued and the total number of Options outstanding as of the date of this AgreementAgreement is 153,500. Except (i) as set forth above and (ii) as a result of the exercise of Options, there are outstanding (A) no shares of capital stock or other voting or non-voting securities of the Company, (B) no securities of the Company had convertible into or exchangeable for shares of capital stock or voting or non-voting securities of the Company, (C) no options, warrants or other rights to acquire from the Company, and no obligation of the Company Common Stockto issue, any capital stock, non-voting securities, voting securities or any other securities reserved convertible into or exchangeable for issuance capital stock or required to be reserved for issuance other than as described above. All such issued and outstanding shares voting securities of the Company and (D) no equity equivalents, interests in the ownership or earnings of the Company or other similar rights (collectively, "Company Securities"). Except as set forth above, there are no outstanding obligations of the Company or any of its Subsidiaries aresubsidiaries to repurchase, and all redeem or otherwise acquire any Company Securities. There are no other options, calls, warrants or other rights, agreements, arrangements or commitments of any character relating to the issued or unissued capital stock of the Company or any of its subsidiaries to which the Company or any of its subsidiaries is a party. All shares of Company Common Stock subject to issuance as specified aboveaforesaid, upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, shall be duly authorized, validly issued, fully paid, paid and nonassessable and free of any preemptive rights purchase option, call option, right of first refusal, subscription agreement, (or any other similar right under similar) rights. Except as disclosed in Schedule 3.3 to the Company Charter, the Company Bylaws or any agreement to which the Company is party or by which it is bound. (b) Except for the Company Stock OptionsDisclosure Letter, there are no existing options, warrants, calls, subscription rights, exercisable, convertible or exchangeable securities or other rights, agreements or commitments (contingent or otherwise) that obligate the Company to issue, transfer or sell any Company Common Stock or any investment that is convertible into or exercisable or exchangeable for any such shares. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There are no agreements or understandings to which the Company is a party with respect to the voting of any securities outstanding contractual obligations of the Company or which restrict any of its subsidiaries to provide funds to or make any investment (in the transfer form of a loan, capital contribution or otherwise) in any such subsidiary or any other entity. Each of the outstanding shares of capital stock of each of the Company's subsidiaries is duly authorized, validly issued, fully paid and nonassessable and all such shares are owned by the Company or another wholly owned subsidiary of the Company as set forth in Schedule 3.3 to the Company Disclosure Letter and are owned free and clear of all security interests, liens, claims, pledges, agreements, limitations in voting rights, charges or other encumbrances of any nature whatsoever, except where the failure to own such sharesshares free and clear is not, nor does individually or in the aggregate, likely to have a Material Adverse Effect. Disclosed in Schedule 3.3 to the Company have knowledge Disclosure Letter is a list of any third party agreements the subsidiaries and affiliates of the Company which evidences, among other things, the percentage of capital stock or understandings with respect to other equity interests owned by the voting of any Company, directly or indirectly, in such shares subsidiaries or which restrict the transfer of such sharesassociated entities.

Capitalization. (a) The authorized shares of capital stock of the Company consist consists of 200,000,000 shares of Company Common Stock, par value $0.001 per share, of the Company. As of the date hereof, (i) 67,066,418 20,000,000 shares of Company Common Stock and 1,000,000 shares of preferred stock, par value $1.00 per share (the "Company Preferred Stock"). As of November 12, 1999, there were issued outstanding: (i) 7,192,264 shares of Company Common Stock and outstanding (excluding 2,575,811 shares of Company Common Stock held by the Company in its treasury), ; (ii) 15,000,000 no shares of Company Preferred Stock; and (iii) Company Options to purchase an aggregate of 443,003 shares of Company Common Stock. The items in clauses (i) through (iii) above are herein referred to collectively as the "Company Securities." All outstanding shares of Company Common Stock have been reserved duly authorized and validly issued and are fully paid and nonassessable and free from any preemptive rights. Except as set forth in this Section 4.6, there are outstanding (i) no shares of capital stock or other voting securities of the Company, (ii) no securities issued by the Company convertible into or exchangeable for issuance pursuant to shares of capital stock or voting securities of the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”)Company, and (iii) Company Stock Options entitling no options or other rights to acquire from the owners thereof to purchase 7,960,000 shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities reserved for issuance or required to be reserved for issuance other than as described above. All such issued and outstanding shares of the Company and its Subsidiaries areCompany, and all shares subject to issuance as specified above, upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable and free no obligation of any preemptive rights purchase option, call option, right of first refusal, subscription agreement, or any other similar right under the Company Charter, the Company Bylaws or any agreement to which the Company is party or by which it is bound. (b) Except for the Company Stock Options, there are no existing options, warrants, calls, subscription rights, exercisable, convertible or exchangeable securities or other rights, agreements or commitments (contingent or otherwise) that obligate the Company to issue, transfer any capital stock, voting securities or sell any Company Common Stock or any investment that is securities convertible into or exercisable or exchangeable for any such shares. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted capital stock unit awards or “phantom” shares. (d) There are no agreements or understandings to which the Company is a party with respect to the other voting of any securities of the Company and (iv) no equity equivalents, or which restrict interests in the transfer ownership or earnings of the Company or its subsidiaries to repurchase, redeem or otherwise acquire any of the Company Securities or ownership interest of the Subsidiaries. Except as provided in Section 2.4, there are no outstanding obligations of the Company or any Company Subsidiaries to repurchase, redeem or otherwise acquire any Company Securities or ownership interests of the Subsidiaries. No holder of Company Securities has, as of the date hereof, any contractual right to require the Company to file any registration statement under the Securities Act or to include any such securities in any registration statement proposed to be filed by the Company under the Securities Act. Except as disclosed in written information made available to Parent, all of the outstanding capital stock of the Company's Subsidiaries is owned by the Company, directly or indirectly, free and clear of any such sharesLien or any other limitation or restriction (including any restriction on the right to vote or sell the same, nor does the Company have knowledge except as may be provided as a matter of any third party agreements or understandings with respect to the voting of any such shares or which restrict the transfer of such shareslaw).

Capitalization. (a) The authorized shares of stock share capital of the Company consist consists of 200,000,000 600,000 ordinary shares each with a par value of €1, of which 600,000 ordinary shares have been issued and are outstanding as at the date of this Agreement. Except as set forth in Part 3.3(a) of the Disclosure Schedule, the Company has not declared or paid any dividends on any shares of Company Common Stockthe Company’s share capital since April 1999 and until the date of this Agreement. All of the Shares have been duly authorized and validly issued, par value $0.001 per shareand are fully paid and nonassessable, and none of the Shares is subject to any repurchase option, forfeiture provision or restriction on transfer. (b) The Selling Shareholders together own, of record and beneficially, 100% of the share capital of the Company. As of There is no and as at the date hereof, Closing will be no: (i) 67,066,418 shares outstanding subscription, option, call, convertible note, warrant or right (whether or not currently exercisable) to acquire any share capital of Company Common Stock were issued and outstanding (excluding shares of Company Common Stock held by the Company in its treasury), or other securities of the Company; (ii) 15,000,000 outstanding security, instrument or obligation that is or may become convertible into or exchangeable for any shares of Company Common Stock have been reserved for issuance the Company’s share capital (or cash based on the value of such shares, including pursuant to any share appreciation rights) or other securities of the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”), and Company; (iii) Contract under which the Company Stock Options entitling the owners thereof is or may become obligated to purchase 7,960,000 sell or otherwise issue any shares of Company Common Stock the Company’s share capital or any other securities; or (iv) condition or circumstance that may give rise to or provide a basis for the assertion of a claim by any Person to the effect that such Person is entitled to acquire or receive any shares of the Company’s share capital or other securities of the Company. (c) All of the Shares have been issued and granted in compliance with: (i) all applicable Legal Requirements; and (ii) all requirements set forth in all applicable Contracts. None of the Shares were outstanding. As issued in violation of any preemptive rights or other rights to subscribe for or purchase securities of the Company. (d) Except as set forth in Part 3.3(d) of the Disclosure Schedule, as at the date of this Agreement, all of the Company had no Company Common Stock, or any other securities reserved for issuance or required to be reserved for issuance other than as described above. All such issued and outstanding shares of capital stock of the Subsidiary are owned, of record and beneficially, by the Company free and its Subsidiaries areclear of any Encumbrance, and as at the Closing, all of the issued and outstanding shares of capital stock of the Subsidiary will be owned, of record and beneficially, by the Company free and clear of any Encumbrance. The outstanding shares of the Subsidiary have been duly authorized and validly issued and are fully paid and nonassessable, have been issued in compliance with all applicable securities laws and other applicable Legal Requirements and were not issued in violation of or subject to issuance as specified above, upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable and free of any preemptive rights purchase option, call option, right of first refusal, subscription agreement, or any other similar right under the Company Charter, the Company Bylaws or any agreement to which the Company is party or by which it is bound. (b) Except for the Company Stock Options, there are no existing options, warrants, calls, subscription rights, exercisable, convertible or exchangeable securities or other rights, agreements rights to subscribe for or commitments (contingent or otherwise) that obligate purchase securities of the Company to issue, transfer or sell any Company Common Stock or any investment that is convertible into or exercisable or exchangeable for any such shares. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) Subsidiary. There are no agreements options, warrants or understandings other rights outstanding to which the Company is a party with respect to the voting of subscribe for or purchase any shares or other securities of the Company Subsidiary and the Subsidiary is not subject to any Contract or order, writ, injunction, judgment or decree under which restrict the transfer of Subsidiary is or may become obligated to sell or otherwise issue any such shares, nor does the Company have knowledge of any third party agreements or understandings with respect to the voting of any such shares or which restrict other securities. There are no preemptive rights applicable to any shares of the transfer of such sharesSubsidiary.

Capitalization. (a) The authorized shares of stock of the Company consist of 200,000,000 shares of Company Common Stock, par value $0.001 per share, of the Company. As of the date hereof, (i) 67,066,418 the authorized capital stock of the Company consists of 150,000,000 shares of Company Common Stock were Stock, of which 74,162,895 shares are issued and outstanding (excluding outstanding, 9,300,000 shares of Company Common Stock held by the Company in its treasury), (ii) 15,000,000 shares of Company Common Stock have been are reserved for issuance pursuant to the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”)Company’s stock option plans, and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 and, 66,537,105 shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities are reserved for issuance or required upon conversion of the Notes and exercise of the Warrants (subject to be reserved for issuance other than as described aboveadjustment pursuant to the Company’s covenant set forth in Section 4(h) below). All of such issued and outstanding shares of the Company and its Subsidiaries capital stock are, and all shares subject to issuance as specified above, or upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable paid and free nonassessable. No shares of any capital stock of the Company are subject to preemptive rights purchase optionor any other similar rights of the shareholders of the Company or any liens or encumbrances imposed through the actions or failure to act of the Company. Except as disclosed in Schedule 3(c), call optionas of the effective date of this Agreement, right (i) there are no outstanding options, warrants, scrip, rights to subscribe for, puts, calls, rights of first refusal, subscription agreementagreements, understandings, claims or other commitments or rights of any character whatsoever relating to, or securities or rights convertible into or exchangeable for any other similar right under shares of capital stock of the Company Charter, the Company Bylaws or any agreement to of its Subsidiaries, or arrangements by which the Company or any of its Subsidiaries is party or by which it is bound. (b) Except for may become bound to issue additional shares of capital stock of the Company Stock Optionsor any of its Subsidiaries, (ii) there are no existing options, warrants, calls, subscription rights, exercisable, convertible or exchangeable securities or other rights, agreements or commitments arrangements under which the Company or any of its Subsidiaries is obligated to register the sale of any of its or their securities under the 1933 Act (contingent except the Registration Rights Agreement) and (iii) there are no anti-dilution or otherwiseprice adjustment provisions contained in any security issued by the Company (or in any agreement providing rights to security holders) that obligate will be triggered by the issuance of the Notes, the Warrants, the Conversion Shares or Warrant Shares. The Company has furnished to issuethe Buyer true and correct copies of the Company’s Articles of Incorporation as in effect on the date hereof (“Articles of Incorporation”), transfer or sell any Company Common Stock or any investment that is the Company’s By-laws, as in effect on the date hereof (the “By-laws”), and the terms of all securities convertible into or exercisable or exchangeable for any such shares. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There are no agreements or understandings to which the Company is a party with respect to the voting of any securities Common Stock of the Company and the material rights of the holders thereof in respect thereto. The Company shall provide the Buyer with a written update of this representation signed by the Company’s Chief Executive or which restrict the transfer Chief Financial Officer on behalf of any such shares, nor does the Company have knowledge as of any third party agreements or understandings with respect to the voting of any such shares or which restrict the transfer of such sharesClosing Date.

Capitalization. (a) The Its authorized shares of stock share capital and issued and outstanding share capital as of the Company consist date set forth in ‎Section 3.02(a) of 200,000,000 shares the PRE Disclosure Letter, including any capital reserved for issuance upon the exercise or payments of Company outstanding warrants, share options, share appreciation rights or other equity-related securities or awards (such share option and other equity-related award plans, agreements and programs, each an “Equity Award”), are described in ‎Section 3.02(a) of the PRE Disclosure Letter. None of its share capital, equity-related securities or warrants are held by it or by its Subsidiaries. ‎Section 3.02(a) of the PRE Disclosure Letter also sets forth a true and complete list of all outstanding Equity Awards outstanding as of the date of this Agreement and the name of each holder thereof and the number of PRE Common StockShares for which any such warrant, par value $0.001 per option, share appreciation right, restricted share, restricted share unit or other equity-related security or award is exercisable for as of the Company. As date of this Agreement (without regard to any vesting or other limitations with respect thereof). (b) Except as described in this ‎Section 3.02, as of the date hereof, there are: (i) 67,066,418 no shares of Company Common Stock were issued and outstanding (excluding shares of Company Common Stock held by the Company in its treasury)or securities of, or other equity or voting interests in, it; (ii) 15,000,000 shares of Company Common Stock have been reserved for issuance pursuant to the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”), and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities reserved for issuance or required to be reserved for issuance other than as described above. All such issued and outstanding shares or securities of it that are convertible into or exchangeable for share capital of, or other equity or voting interests in, it; (iii) no outstanding options, warrants, rights or other commitments or agreements to acquire from it, or that obligate it to issue, any shares or securities, or other equity or voting interests in, it; (iv) no obligations of it to grant, extend or enter into any subscription, warrant, right, convertible or exchange security or other similar agreement or commitment relating to any shares or securities of, or other equity or voting interests in it (the items in clauses ‎(i), ‎(ii), ‎(iii) and ‎(iv) being referred to, collectively, as its “Securities”); and (v) no other obligations by it or any of its Subsidiaries to make any payments based on the price or value of any of its Securities, or dividends paid thereon. (c) With respect to the Equity Awards: (i) each grant of an Equity Award was duly authorized no later than the date on which the grant of such Equity Award was by its terms to be effective (the “Grant Date”) by all necessary corporate action, including, as applicable, approval by the PRE Board, or a committee thereof or such committee’s designee (as the case may be) and any required approval by its shareholders; (ii) each such grant was made in accordance with all applicable Laws, including the rules of the Company NYSE; (iii) the per share exercise price of each PRE Option was not less than the fair market value of a respective PRE Common Share on the applicable Grant Date; (iv) each such grant qualifies in all material respects for the Tax and accounting treatment afforded to such Equity Awards in its Tax Returns and its Subsidiaries areSEC Reports, respectively; and (v) no material modifications have been made to any such grants after the Grant Date and all shares such grants either comply in all material respects with or are exempt from Section 409A of the Code. The treatment of the Equity Awards provided in ‎Section 2.03 will comply with all applicable Laws and the terms and conditions of the PRE Share Plans and the applicable Equity Award agreements. (d) All PRE Common Shares and PRE Preferred Shares that are issued and outstanding or that are subject to issuance as specified above, prior to the Effective Time upon issuance on the terms and subject to the conditions specified in the instruments pursuant to under which they are issuable: (i) are, or, in the case of shares issued after the date hereof, will be, when issued, duly authorized, validly issued, fully paidpaid and non-assessable, nonassessable and free issued in compliance with applicable Law and the terms and provisions of its applicable Organizational Documents; and (ii) are not, or, in the case of shares issued after the date hereof, will not be, subject to any preemptive rights pre-emptive or similar rights, purchase option, option call option, or right of first refusal, subscription agreement, refusal or any other similar right under the Company Charter, the Company Bylaws or any agreement to which the Company is party or by which it is boundrights. (b) Except for the Company Stock Options, there are no existing options, warrants, calls, subscription rights, exercisable, convertible or exchangeable securities or other rights, agreements or commitments (contingent or otherwise) that obligate the Company to issue, transfer or sell any Company Common Stock or any investment that is convertible into or exercisable or exchangeable for any such shares. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (de) There are no agreements outstanding contractual obligations of it or understandings any of its Subsidiaries: (i) to which the Company is a party with respect to the voting repurchase, redeem or otherwise acquire any PRE Common Shares, PRE Preferred Shares, bonds, debentures, notes or other indebtedness of it or share capital, bonds, debentures, notes or other indebtedness of any Subsidiary of it; or (ii) to provide any funds to or make any investment in (A) any Subsidiary of it that is not wholly owned by it or (B) any other Person. No holder of securities in it or any of its Subsidiaries has any right to have such securities registered by it or any of its Subsidiaries under the Exchange Act. (f) The PRE Common Shares and PRE Preferred Shares constitute the only issued and outstanding classes of securities of it or its Subsidiaries registered under the Company Exchange Act. (g) ‎Section 3.02(g) of the PRE Disclosure Letter contains a list of all insurance linked securities, sidecars, catastrophe bonds or which restrict weather-related bonds or similar instruments issued, guaranteed or sponsored by it or any of its Subsidiaries. (h) It has not guaranteed the transfer obligations of any such shares, nor does the Company have knowledge of any third party agreements or understandings with respect to the voting of any such shares or which restrict the transfer of such sharesits Subsidiaries.

Capitalization. (a) The authorized shares of stock share capital of the Company consist consists of 200,000,000 shares (i) an unlimited number of Company Common Stock, par value $0.001 per shareShares, of the Company. As of which, as at the date hereof, (i) 67,066,418 shares of Company Common Stock were 119,411,077 Shares are validly issued and outstanding (excluding as fully paid and non-assessable shares in the capital of Company Common Stock held by the Company in its treasury), Company; and (ii) 15,000,000 shares an unlimited number of Company Common Stock preferred shares, issuable in series, of which none have been reserved for issuance pursuant to issued or are outstanding. As at the 2001 date hereof, there are outstanding Options issued under the Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”), and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 shares an aggregate of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities reserved for issuance or required to be reserved for issuance other than as described above. All such issued and outstanding shares of the Company and its Subsidiaries are, and all shares subject to issuance as specified above, upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable and free of any preemptive rights purchase option, call option, right of first refusal, subscription agreement, or any other similar right under the Company Charter, the Company Bylaws or any agreement to which the Company is party or by which it is bound7,468,700 Shares. (b) Except for as set out in the Company Stock OptionsDisclosure Letter, there are no existing options, warrants, calls, subscription rights, exercisablewarrants or other Contracts of any character whatsoever requiring the issuance, sale or transfer by the Company or any Subsidiary of the Company of any securities of the Company or such Subsidiary (including Shares) or any securities convertible into, or exchangeable or exercisable for, or otherwise evidencing a right to acquire, any securities of the Company or such Subsidiary (including Shares). No Shareholder is entitled to any pre-emptive or similar right granted by the Company or any of its Subsidiaries to acquire any Shares or other rights, agreements or commitments (contingent or otherwise) that obligate securities of the Company to issue, transfer or sell any Company Common Stock or any investment that is convertible into or exercisable or exchangeable for any such sharesof its Subsidiaries. (c) The A list of all of the holders of all outstanding Options, the number of Options held by each of them, and the exercise prices and expiration date of each grant to such holders is set out in the Company has not Disclosure Letter. All Shares issuable upon exercise of outstanding Options in accordance with their respective terms will be duly authorized and validly issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” sharesas fully paid and non-assessable Shares. (d) There are no agreements outstanding bonds, debentures or understandings to which other evidences of indebtedness of the Company is a party or any of its Subsidiaries that carry the right to vote or are convertible into Shares of the Company or any of its Subsidiaries. (e) There are no outstanding obligations of the Company or any of its Subsidiaries to repurchase, redeem or otherwise acquire any outstanding shares or with respect to the voting or disposition of any outstanding securities of the Company or which restrict the transfer any its Subsidiaries. No holder of any such shares, nor does securities issued by the Company have knowledge or any of its Subsidiaries has any third right to compel the Company to register or otherwise qualify securities for public sale in Canada, the United States, Peru or elsewhere. (f) The Company has never adopted a Rights Plan and is not a party agreements or understandings with respect to the voting of any such shares or which restrict the transfer of such sharesagreement that relates to a Rights Plan.

Capitalization. (a) The authorized shares of capital stock of the Company consist consists of 200,000,000 300,000,000 shares of Common Stock and 10,000,000 shares of preferred stock. Immediately before giving effect to the Merger and the initial Closing of the Offering, the Company has 900,000 shares of Common Stock, par value $0.001 per share, Stock and no preferred stock issued and outstanding. All of the outstanding shares of Common Stock and of the stock of each of the Company’s subsidiaries have been duly authorized, validly issued and are fully paid and nonassessable. As Immediately after giving effect to the Merger and the Closing of the date hereofMinimum Offering or the Maximum Offering, the pro forma outstanding capitalization of the Company will be as set forth under “Pro Forma Capitalization” in Schedule 4c. After giving effect to the Merger: (i) 67,066,418 no shares of capital stock of the Company Common Stock were issued and or any of its subsidiaries will be subject to preemptive rights or any other similar rights or any liens or encumbrances suffered or permitted by the Company; (ii) except as set forth on Schedule 4c(ii) there will be no outstanding (excluding options, warrants, scrip, rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities or rights convertible into, any shares of Company Common Stock held by capital stock of the Company or any of its subsidiaries, or contracts, commitments, understandings or arrangements by which the Company or any of its subsidiaries is or may become bound to issue additional shares of capital stock of the Company or any of its subsidiaries, (iii) there will be no outstanding debt securities other than indebtedness as set forth in its treasurySchedule 4c(iii), (iiiv) 15,000,000 shares of Company Common Stock have been reserved for issuance other than pursuant to the 2001 Stock Option Plan Registration Rights Agreement or as set forth in Schedule 4c(iv), there will be no agreements or arrangements under which the Company or any of its subsidiaries is obligated to register the sale of any of their securities under the Securities Act, (v) there will be no outstanding registration statements, and there will be no outstanding comment letters from the 2005 Stock Option Plan SEC or any other regulatory agency; (vi) except as provided in this Agreement or as set forth in Schedule 4c(vi), there will be no securities or instruments containing anti-dilution or similar provisions, including the right to adjust the exercise, exchange or reset price under such securities, that will be triggered by the issuance of the Shares as described in this Agreement; and (vii) no co-sale right, right of first refusal or other similar right will exist with respect to the Shares or the issuance and sale thereof. Upon request, the Company will make available to the Purchaser true and correct copies of the Company’s Certificate of Incorporation, and as in effect on the date hereof (the “Incentive PlansCertificate of Incorporation”), and the Company’s By-laws, as in effect on the date hereof (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 shares “By-laws”), and the terms of Company all securities exercisable for Common Stock were outstanding. As and the material rights of the date of this Agreement, the Company had no Company Common Stock, or any other securities reserved for issuance or required to be reserved for issuance holders thereof in respect thereto other than as described above. All such stock options issued to officers, directors, employees and outstanding shares of the Company and its Subsidiaries are, and all shares subject to issuance as specified above, upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable and free of any preemptive rights purchase option, call option, right of first refusal, subscription agreement, or any other similar right under the Company Charter, the Company Bylaws or any agreement to which the Company is party or by which it is boundconsultants. (b) Except for the Company Stock Options, there are no existing options, warrants, calls, subscription rights, exercisable, convertible or exchangeable securities or other rights, agreements or commitments (contingent or otherwise) that obligate the Company to issue, transfer or sell any Company Common Stock or any investment that is convertible into or exercisable or exchangeable for any such shares. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There are no agreements or understandings to which the Company is a party with respect to the voting of any securities of the Company or which restrict the transfer of any such shares, nor does the Company have knowledge of any third party agreements or understandings with respect to the voting of any such shares or which restrict the transfer of such shares.

Capitalization. (a) The authorized shares of and outstanding capital stock of the Company consist of 200,000,000 shares of Company Common Stock, par value $0.001 per share, Companies is set forth in Section 4.4(a) of the CompanyDisclosure Schedule. As All of the date hereof, (i) 67,066,418 shares of Company Common Stock were Companies' issued and outstanding (excluding shares of Company Common Stock held by the Company in its treasury), (ii) 15,000,000 shares of Company Common Stock have been reserved for issuance pursuant to the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”), and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities reserved for issuance or required to be reserved for issuance other than as described above. All such issued and outstanding shares of the Company and its Subsidiaries are, and all shares subject to issuance as specified above, upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, stock is duly authorized, validly issued, fully paid, nonassessable and nonassessable, free of any preemptive rights purchase optionrights, call optionhave been issued in compliance with applicable Law and is held of record and beneficially by Seller, right free and clear of first refusal, subscription agreement, or any other similar right under Encumbrance. The Shares constitute all of the Company Charter, issued and outstanding capital stock of the Company Bylaws or any agreement to which the Company is party or by which it is boundCompanies. (b) Except as set forth in Section 4.4(b) of the Disclosure Schedule, there are (i) no outstanding obligations, options, warrants, convertible securities or other rights, agreements, arrangements or commitments of any kind relating to the capital stock of the Companies or obligating the Companies to issue or sell or otherwise transfer any shares of capital stock of, or any other interest in, the Companies, (ii) no outstanding obligations of the Companies to repurchase, redeem or otherwise acquire any shares of their respective capital stock or to provide funds to, or make any investment (in the form of a loan, capital contribution or otherwise) in, any other Person or (iii) no voting trusts, stockholder agreements, proxies or other agreements or understandings in effect with respect to the voting or transfer of any of their respective capital stock. (c) Section 4.4(c) of the Disclosure Schedule sets forth a true and complete list of all Subsidiaries of the Companies, listing for each Subsidiary its name, its jurisdiction of organization, the Company Stock Optionspercentage of stock or other equity interest of each subsidiary owned by the Companies or a Subsidiary and the authorized and outstanding capital stock of each such Subsidiary. Other than the Subsidiaries or as otherwise set forth in Section 4.4(c) of the Disclosure Schedule, there are no existing other corporations, partnerships, joint ventures, associations or other similar entities in which the Companies own, of record or beneficially, any direct or indirect equity or other similar interest or any right (contingent or otherwise) to acquire the same. All of the issued and outstanding shares (or voting securities) of each of the Subsidiaries are validly issued, fully paid, nonassessable, and free of any preemptive rights. Except as set forth in Section 4.4(c) of the Disclosure Schedule, (i) the Companies own beneficially and of record all of the outstanding shares of capital stock (or voting securities) of each Subsidiary free and clear of any Encumbrances, (ii) there are no outstanding obligations, options, warrants, calls, subscription rights, exercisable, convertible or exchangeable securities or other rights, agreements or commitments of any kind relating to the capital stock of any Subsidiary or obligating the Companies or any Subsidiary to issue or sell or otherwise transfer any shares of capital stock of, or any other interest in, any Subsidiary, (contingent iii) there are no outstanding obligations of the Subsidiaries to repurchase, redeem or otherwise acquire any shares of their respective capital stock or to provide funds to, or make any investment (in the form of a loan, capital contribution or otherwise) that obligate in, any other Person, and (iv) there are no voting trusts, stockholder agreements, proxies or other agreements or understandings in effect with respect to the Company to issue, voting or transfer or sell of any Company Common Stock or any investment that is convertible into or exercisable or exchangeable for any such shares. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” sharesof their respective capital stock. (d) There are no agreements or understandings to which the Company is a party with respect to the voting of any securities Except as set forth on Section 4.4(d) of the Company or which restrict Disclosure Schedule, the transfer "Fresh Cut" business of any Seller as such sharesbusiness is described in Seller's public filings with the United States Securities and Exchange Commission (the "Business") is conducted exclusively by the Companies and the Subsidiaries. At Closing, nor does the Company have knowledge assets and properties of any third party agreements or understandings with respect to the voting Companies and the Subsidiaries will constitute substantially all of any such shares or which restrict the transfer of such sharestangible and intangible property historically used by them.

Capitalization. (a) The authorized shares of capital stock of the Company consist consists of 200,000,000 shares of Company Common Stock, par value $0.001 per share, of the Company. As of the date hereof, (i) 67,066,418 shares of Company Common Stock were issued and outstanding (excluding shares of Company Common Stock held by the Company in its treasury), (ii) 15,000,000 shares of Company Common Stock have been reserved for issuance pursuant to the 2001 Stock Option Plan of which as of May 31, 2000 there were 9,679,001 shares issued and the 2005 Stock Option Plan (“Incentive Plans”), outstanding and (iiiii) Company Stock Options entitling the owners thereof to purchase 7,960,000 3,000,000 shares of Company Common Preferred Stock were of which as of the date hereof there are no shares issued and outstanding. As of the date May 31, 2000 there were outstanding Options to purchase an aggregate of this Agreement, the Company had no Company 367,977 shares of Common Stock, or any other securities reserved for issuance or required to be reserved for issuance other than as described aboveStock (all of which Options were vested and exercisable). All such issued and outstanding shares of capital stock of the Company have been duly authorized and its Subsidiaries are, validly issued and all shares subject to issuance as specified above, upon issuance on the terms are fully paid and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable and free of any preemptive rights purchase option, call option, right of first refusal, subscription agreement, or any other similar right under the Company Charter, the Company Bylaws or any agreement to which the Company is party or by which it is boundnonassessable. (b) Except for the Company Stock OptionsRights Agreement, except as set forth in this SECTION 5.5 and except for changes since May 31, 2000 resulting from the exercise of Options outstanding on such date, there are no existing optionsoutstanding (i) shares of capital stock or other voting securities of the Company, warrants, calls, subscription rights, exercisable, (ii) securities of the Company convertible into or exchangeable for shares of capital stock or voting securities of the Company or its Subsidiaries, (iii) options or other rights, agreements or commitments (contingent or otherwise) that obligate rights to acquire from the Company or its Subsidiaries, or obligations of the Company or its Subsidiaries to issue, transfer any shares of capital stock, voting securities or sell any Company Common Stock or any investment that is securities convertible into or exercisable or exchangeable for shares of capital stock or voting securities of the Company or any such shares. Subsidiary, and (civ) The no equity equivalent interests in the ownership or earnings of the Company has not issued or its Subsidiaries or other similar rights (the items in clauses (b)(i), (ii), (iii) and (iv) being referred to collectively as the "COMPANY SECURITIES"). Except as set forth on SECTION 5.5 of the Disclosure Letter, there are no outstanding obligations of the Company or any share appreciation rightsSubsidiary to repurchase, dividend equivalent rights, performance awards, restricted stock unit awards redeem or “phantom” shares. (d) otherwise acquire any Company Securities. There are no stockholder agreements, voting trusts or other agreements or understandings to which the Company or any of its Subsidiaries is a party with respect or by which it is bound relating to the voting or registration of any securities shares of capital stock of the Company or which restrict the transfer any of its Subsidiaries or any such shares, nor does the Company have knowledge of any third party agreements or understandings preemptive rights with respect to the voting of any such shares or which restrict the transfer of such sharesthereto.

Capitalization. (a) The authorized shares of stock of Except as disclosed in the Company consist of 200,000,000 shares of Company Common Stock, par value $0.001 per share, of the Company. As of the date hereof, (i) 67,066,418 shares of Company Common Stock were issued SEC Documents and outstanding (excluding shares of Company Common Stock held by the Company in its treasurySchedule 3(c), (ii) 15,000,000 no shares of Company Common Stock have been are reserved for issuance pursuant to the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”)Company’s stock option plans, and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 no shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities are reserved for issuance pursuant to securities (other than the Note) exercisable for, or required to be convertible into or exchangeable for shares of Common Stock and sufficient shares are reserved for issuance other than upon conversion of the Note (as described aboverequired by the Note and transfer agent share reserve letter). All of such issued and outstanding shares of the Company and its Subsidiaries capital stock are, and all shares subject to issuance as specified above, or upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable paid and free non-assessable. No shares of any capital stock of the Company are subject to preemptive rights purchase optionor any other similar rights of the shareholders of the Company or any liens or encumbrances imposed through the actions or failure to act of the Company. Except as disclosed in the SEC Documents and in Schedule 3(c), call optionas of the effective date of this Agreement, right (i) there are no outstanding options, warrants, scrip, rights to subscribe for, puts, calls, rights of first refusal, subscription agreementagreements, understandings, claims or other commitments or rights of any character whatsoever relating to, or securities or rights convertible into or exchangeable for any other similar right under shares of capital stock of the Company Charter, the Company Bylaws or any agreement to of its Subsidiaries, or arrangements by which the Company or any of its Subsidiaries is party or by which it is bound. (b) Except for may become bound to issue additional shares of capital stock of the Company Stock Optionsor any of its Subsidiaries, (ii) there are no existing options, warrants, calls, subscription rights, exercisable, convertible or exchangeable securities or other rights, agreements or commitments arrangements under which the Company or any of its Subsidiaries is obligated to register the sale of any of its or their securities under the 1933 Act and (contingent iii) there are no anti-dilution or otherwiseprice adjustment provisions contained in any security issued by the Company (or in any agreement providing rights to security holders) that obligate will be triggered by the issuance of the Note or the Conversion Shares. The Company to issuehas filed in its SEC Documents true and correct copies of the Company’s Certificate of Incorporation as in effect on the date hereof (“Certificate of Incorporation”), transfer or sell any Company Common Stock or any investment that is the Company’s By-laws, as in effect on the date hereof (the “By-laws”), and the terms of all securities convertible into or exercisable or exchangeable for any such shares. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There are no agreements or understandings to which the Company is a party with respect to the voting of any securities Common Stock of the Company or which restrict and the transfer material rights of any such shares, nor does the holders thereof in respect thereto. The Company shall provide the Buyer with a written update of this representation signed by the Company’s Chief Executive on behalf of the Company have knowledge as of any third party agreements or understandings with respect to the voting of any such shares or which restrict the transfer of such sharesClosing Date.

Capitalization. (a) The authorized shares of stock of the Company consist of 200,000,000 shares of Company Common Stock, par value $0.001 per share, of the Company. As of the date hereof, (i) 67,066,418 shares of Company Common Stock were issued and outstanding (excluding shares of Company Common Stock held by the Company in its treasury), (ii) 15,000,000 shares of Company Common Stock have been reserved for issuance pursuant to the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”), and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company PubCo’s authorized capital stock consists solely of (i) 100,000,000 shares of PubCo Common Stock, and (ii) 10,000,000 shares of PubCo Preferred Stock. (b) Except as set forth in Section 4.06(a) of the PubCo Disclosure Letter, to the extent expressly permitted under Section 5.02 (including as required by applicable Law) or as set forth in Section 4.06(g) of the PubCo Disclosure Letter, (i) there are no outstanding shares of capital stock of any PubCo Entity (subject to any exercise of PubCo Stock Options after the date of this Agreement each in accordance with their terms), (ii) there are no outstanding subscriptions, options, warrants, calls, convertible securities, rights of first refusal, preemptive rights, or other similar rights (whether or not currently exercisable), agreements or commitments (other than this Agreement) relating to the issuance or acquisition of capital stock to which any of the PubCo Entities or any of their respective Subsidiaries is a party obligating the PubCo Entities or any of their respective Subsidiaries to (A) issue, transfer or sell any shares of capital stock or other equity interests of any of the PubCo Entities or any of their respective Subsidiaries or securities convertible into or exchangeable for such shares or equity interests, or (B) grant, extend or enter into any such subscription, option, warrant, call, convertible securities or other similar right, agreement or arrangement, (C) redeem, repurchase or otherwise acquire any such shares of capital stock or other equity interests, or (D) provide an amount of funds to, or make any investment (in the form of a loan, capital contribution or otherwise) in PubCo or any of its Subsidiaries or any other securities reserved for issuance or required to be reserved for issuance Person, and (iii) other than as described abovepursuant to this Agreement, there is no condition or circumstance that could be reasonably likely to give rise to or provide a basis for the assertion of a claim by any Person to the effect that such Person is entitled to acquire or receive any shares of PubCo Capital Stock. There are no outstanding or authorized stock appreciation, phantom stock, profit participation or other similar rights with respect to the Company or its Subsidiaries. (c) All such issued and outstanding shares of the Company PubCo Common Stock have been duly authorized and its Subsidiaries areare validly issued, fully paid and all shares non-assessable and not subject to issuance as specified aboveany pre-emptive rights, upon issuance on right of participation, right of maintenance or any similar right. All outstanding shares of PubCo Common Stock and PubCo Stock Options were offered, sold and issued in compliance in all material respects with applicable securities Laws and were not issued in violation in any material respect of (i) the terms and conditions specified in PubCo Organizational Documents or (ii) any Contract. (d) Each outstanding share of capital stock or other equity interests of each Subsidiary of the instruments pursuant to which they are issuable, will be, when issued, PubCo Entities is duly authorized, validly issued, fully paidpaid and non-assessable, nonassessable in each case, to the extent such concepts are applicable to such capital stock or other equity interests, and free of not subject to any preemptive rights purchase option, call optionpre-emptive rights, right of first refusalparticipation, subscription agreementright of maintenance, or any other similar right under the Company Charter, the Company Bylaws or any agreement to which the Company is party or by which it is boundright. (be) Except for the Company Stock Optionsas set forth in this Section 4.06, there are no existing options, warrants, calls, subscription rights, exercisable, convertible or exchangeable securities or other rights, agreements or commitments (contingent or otherwise) that obligate outstanding contractual obligations of the Company to issue, transfer or sell any Company Common Stock PubCo Entities or any investment that is convertible into of their respective Subsidiaries to repurchase, redeem or exercisable otherwise acquire any capital stock of the PubCo Entities, including shares of PubCo Common Stock, or exchangeable for capital stock of any such sharesSubsidiary of PubCo. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (df) There are no agreements voting trusts, proxies or understandings similar agreements, arrangements or commitments to which the Company PubCo Entities or any of their respective Subsidiaries is a party with respect to the voting of any securities shares of capital stock of any of the Company PubCo Entities or which restrict any of their respective Subsidiaries. There are no bonds, debentures, notes or other instruments of indebtedness of the transfer PubCo Entities or any of their respective Subsidiaries that entitle the holder of such instruments of indebtedness to vote together with stockholders of the PubCo Entities on any such shares, nor does the Company have knowledge of any third party agreements or understandings matters with respect to the voting PubCo Entities or any of their respective Subsidiaries. (g) Except for the PubCo Equity Plans, PubCo does not have any stock option plan or any other plan, program, agreement or arrangement providing for any equity-based compensation for any Person. Section 4.06(g) of the PubCo Disclosure Letter sets forth the following information with respect to each PubCo Stock Option outstanding as of the date of this Agreement: (i) the name of the optionee; (ii) the number of shares of PubCo Common Stock subject to such PubCo Stock Option at the time of grant; (iii) the number of shares or which restrict of PubCo Common Stock subject to such PubCo Stock Option as of the transfer date of this Agreement; (iv) the exercise price of such sharesPubCo Stock Option; (v) the date on which such PubCo Stock Option was granted; (vi) the applicable vesting schedule, including the number of vested and unvested shares as of the date of this Agreement and any acceleration provisions; (vii) the date on which such PubCo Stock Option expires; and (viii) whether such PubCo Stock Option is intended to constitute an “incentive stock option” (as defined in the Code) or a non-qualified stock option. PubCo has made available to the Company an accurate and complete copy of the PubCo Equity Plan and a form of stock option agreement that is consistent in all material respects with the stock option agreements evidencing outstanding options granted thereunder.

Capitalization. (a) The authorized shares of stock of the Company consist of 200,000,000 shares of Company Common Stock, par value $0.001 per share, of the Company. As of the date hereof, the authorized capital stock of the Company consists of: (i) 67,066,418 230,000,000 shares of Company Common Stock were Stock, of which approximately 72,302,937 shares are issued and outstanding (excluding shares of Company Common Stock held by the Company in its treasury), outstanding; and (ii) 15,000,000 nil shares of Company Common Stock have been preferred stock, of which nil are issued and outstanding. Except as disclosed in the SEC Documents, no shares are reserved for issuance pursuant to the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”)Company’s stock option plans, and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 no shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities are reserved for issuance pursuant to securities (other than the Note) exercisable for, or required to be convertible into or exchangeable for shares of Common Stock and 31,000,000 shares are reserved for issuance other than as described aboveupon conversion of the Note. All of such issued and outstanding shares of the Company and its Subsidiaries capital stock are, and all shares subject to issuance as specified above, or upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable paid and free non-assessable. No shares of any capital stock of the Company are subject to preemptive rights purchase optionor any other similar rights of the shareholders of the Company or any liens or encumbrances imposed through the actions or failure to act of the Company. Except as disclosed in the SEC Documents, call optionas of the effective date of this Agreement, right (i) there are no outstanding options, warrants, scrip, rights to subscribe for, puts, calls, rights of first refusal, subscription agreementagreements, understandings, claims or other commitments or rights of any character whatsoever relating to, or securities or rights convertible into or exchangeable for any other similar right under shares of capital stock of the Company Charter, the Company Bylaws or any agreement to of its Subsidiaries, or arrangements by which the Company or any of its Subsidiaries is party or by which it is bound. (b) Except for may become bound to issue additional shares of capital stock of the Company Stock Optionsor any of its Subsidiaries, (ii) there are no existing options, warrants, calls, subscription rights, exercisable, convertible or exchangeable securities or other rights, agreements or commitments arrangements under which the Company or any of its Subsidiaries is obligated to register the sale of any of its or their securities under the 1933 Act and (contingent iii) there are no anti-dilution or otherwiseprice adjustment provisions contained in any security issued by the Company (or in any agreement providing rights to security holders) that obligate will be triggered by the issuance of the Note or the Conversion Shares. The Company to issuehas filed in its SEC Documents true and correct copies of the Company’s Certificate of Incorporation as in effect on the date hereof (“Certificate of Incorporation”), transfer or sell any Company Common Stock or any investment that is the Company’s By-laws, as in effect on the date hereof (the “By-laws”), and the terms of all securities convertible into or exercisable or exchangeable for any such shares. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There are no agreements or understandings to which the Company is a party with respect to the voting of any securities Common Stock of the Company or which restrict and the transfer material rights of any such shares, nor does the holders thereof in respect thereto. The Company shall provide the Buyer with a written update of this representation signed by the Company’s Chief Executive on behalf of the Company have knowledge as of any third party agreements or understandings with respect to the voting of any such shares or which restrict the transfer of such sharesClosing Date.

Capitalization. (a) The authorized shares of stock As of the Company consist of 200,000,000 shares of Company Common StockOriginal Effective Date, par value $0.001 per share, the authorized and outstanding Equity Interests of the CompanyBorrower are set forth on Schedule 3.21. All of the outstanding Equity Interests of the Borrower are validly issued, fully paid and non-assessable and are owned as of the Original Effective Date by the equity holders and in the amounts set forth on Schedule 3.21. As of the date hereofOriginal Effective Date, (i) 67,066,418 shares of Company Common Stock were issued and outstanding (excluding shares of Company Common Stock held by the Company in its treasury), (ii) 15,000,000 shares of Company Common Stock have been reserved for issuance pursuant to the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”), and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 shares of Company Common Stock were outstanding. As none of the date of this Agreement, the Company had no Company Common Stock, or any other securities reserved for issuance or required to be reserved for issuance other than as described above. All such issued and outstanding shares Equity Interests of the Company and its Subsidiaries are, and all shares subject to issuance as specified above, upon issuance on the terms and conditions specified Borrower was issued in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable and free violation of any preemptive rights purchase optionlaw (including, call optionwithout limitation, right of first refusal, subscription agreement, state and federal securities laws) and there are no Liens on or with respect to any other similar right under the Company Charter, the Company Bylaws or any agreement to which the Company is party or by which it is boundsuch Equity Interests. (b) Except for As of the Company Stock OptionsOriginal Effective Date, except as set forth on Schedule 3.21, there are no existing options, warrants, calls, subscription rights, exercisable, convertible or exchangeable outstanding (i) securities or other rights, agreements or commitments (contingent or otherwise) that obligate the Company to issue, transfer or sell any Company Common Stock or any investment that is convertible into or exercisable or exchangeable for Equity Interests of the Borrower; (ii) options, warrants or other rights to purchase or subscribe for Equity Interests of the Borrower or (iii) contracts, commitments, agreements, understandings or arrangements of any kind relating to the issuance of any Equity Interests of the Borrower. As of the Original Effective Date, except as set forth on Schedule 3.21, there is no outstanding right, option or other agreement of any kind to purchase or otherwise to receive from the Borrower or any equity holder of the Borrower, any ownership interest in the Borrower, and there is no outstanding right or security of any kind convertible into such shares. (c) The Company has not issued any share appreciation rightsownership interest. As of the Original Effective Date, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There there are no agreements voting trusts, proxies or understandings to which the Company is a party with respect to the voting of any securities of the Company or which restrict the transfer of any such shares, nor does the Company have knowledge of any third party other similar agreements or understandings with respect to the voting Equity Interests of any such shares or which restrict the transfer of such sharesBorrower.

Capitalization. (a) The authorized shares of capital stock of the Company consist consists of 200,000,000 shares of Company Common Stock, par value $0.001 per share, of the Company. As of the date hereof, (i) 67,066,418 shares of Company Common Stock were issued and outstanding (excluding shares of Company Common Stock held by the Company in its treasury), (ii) 15,000,000 shares of Company Common Stock have been of which at the date hereof: (A) 5,920,500 shares are issued and outstanding; (B) no shares are held in the treasury of the Company; and (C) 127,500 shares are reserved for future issuance pursuant to stock options (the 2001 "Stock Options") granted pursuant to the Company's Incentive Stock Option Plan and the 2005 1996 Stock Option Plan (“Incentive the "Option Plans”") and 185,000 are reserved for future issuance pursuant to stock options available for grant under the Option Plans; and (ii) 5,000,000 shares of preferred stock, par value $.01 per share, of the Company ("COMPANY PREFERRED STOCK"), and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 of which no shares are issued or outstanding. No shares of Company Common Stock were outstanding. As capital stock of the date Company are reserved for any other purpose. Each of this Agreementthe outstanding shares of capital stock of, or other equity interests in, the Company had no and Subsidiary has been duly authorized and validly issued, and, in the case of shares of capital stock, are fully paid and nonassessable, and such shares or other equity interests owned by the Company Common Stockare owned free and clear of all security interests, liens, claims, pledges, agreements, limitations on the Company's voting rights, charges or other encumbrances of any other securities reserved for issuance or required nature whatsoever, except that PNC Bank and Von Roll hold security interests in all of the Company's assets pursuant to be reserved for issuance other than as described above. All such issued and outstanding shares the provisions of the Company and its Subsidiaries are, and all shares subject to issuance as specified above, upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable and free of any preemptive rights purchase option, call option, right of first refusal, subscription agreement, or any other similar right under the Company Charter, the Company Bylaws or any agreement to which the Company is party or by which it is boundDebt. (b) Except for the Company Stock Optionsas set forth in Section 4.03(a) above, there are no existing options, warrants, calls, subscription rights, exercisable, convertible or exchangeable securities warrants or other rights (including registration rights), agreements agreements, arrangements or commitments (contingent or otherwise) that obligate the Company to issue, transfer or sell of any Company Common Stock or any investment that is convertible into or exercisable or exchangeable for any such shares. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There are no agreements or understandings character to which the Company or Subsidiary is a party with respect relating to the voting of any securities issued or unissued capital stock of the Company or which restrict the transfer of any such shares, nor does Subsidiary or obligating the Company have knowledge or Subsidiary to grant, issue or sell any shares of the capital stock of the Company or Subsidiary, by sale, lease, license or otherwise. There are no obligations, contingent or otherwise, of the Company or Subsidiary to (x) repurchase, redeem or otherwise acquire any third party agreements or understandings with respect to the voting of any such shares or which restrict the transfer of such shares.capital stock 7

Capitalization. The authorized capital stock of Percon consists entirely of 25,000,000 shares consisting of 20,000,000 shares of Percon Common Stock, of which 3,807,711 shares are issued and outstanding and 210,000 shares are held in treasury, and 5,000,000 shares of preferred stock of which no shares are issued and outstanding or held in treasury. All such issued shares of Percon Common Stock and all issued shares of capital stock of Percon's subsidiaries are validly issued, fully paid and nonassessable. Except as set forth on Schedule 3.2, there are no (a) The authorized shares securities convertible into or exchangeable for any of Percon's or any of its subsidiary's capital stock or other securities, (b) options, warrants or other rights to purchase or subscribe to capital stock or other securities of Percon or any of its subsidiaries or securities that are convertible into or exchangeable for capital stock or other securities of Percon or any of its subsidiaries, or (c) commitments, understandings, arrangements, agreements, licenses, leases or other contracts ("Contracts") of any kind relating to the issuance, sale or transfer of any capital stock or other equity securities of Percon or any of its subsidiaries, any such convertible or exchangeable securities or any such options, warrants or other rights. Except as set forth on Schedule 3.2, Percon owns, directly or indirectly, all of the Company consist of 200,000,000 shares of Company Common Stock, par value $0.001 per share, of the Company. As of the date hereof, (i) 67,066,418 shares of Company Common Stock were issued and outstanding (excluding shares of Company Common Stock held by the Company in its treasury), (ii) 15,000,000 shares of Company Common Stock have been reserved for issuance pursuant to the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”), and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities reserved for issuance or required to be reserved for issuance other than as described above. All such issued and outstanding shares of the Company capital stock of its subsidiaries, free and its Subsidiaries are, and all shares subject to issuance as specified above, upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable and free clear of any preemptive rights purchase optionliens, call optionpledges, right of first refusalcharges, subscription agreementencumbrances and interests whatever. There are no outstanding or authorized stock appreciation, phantom stock, profit participation, or any other similar right under the Company Charter, the Company Bylaws rights with respect to Percon or any agreement to which the Company is party or by which it is bound. (b) Except for the Company Stock Options, there are no existing options, warrants, calls, subscription rights, exercisable, convertible or exchangeable securities or other rights, agreements or commitments (contingent or otherwise) that obligate the Company to issue, transfer or sell any Company of its subsidiaries. No shares of Percon Common Stock or the capital stock of any investment that is convertible into of its subsidiaries have been reserved for issuance, other than the shares of Percon Common Stock reserved for issuance under the Option Plan or exercisable the warrants set forth on Schedule 3.2. Except as set forth on Schedule 3.2, neither Percon nor any of its subsidiaries has redeemed or exchangeable for repurchased, directly or indirectly, any such shares. (c) of its capital stock since January 1, 1997. The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There are no agreements or understandings to which persons executing the Company is a party with respect Voting Agreements own of record the shares of Percon Common Stock subject to the voting of any securities of Voting Agreements ("Voting Agreement Shares"), and the Company or which restrict certificates representing such shares include a restrictive legend to the effect that the shares may not be transferred unless the transfer is registered under the Securities Act of any such shares1933, nor does as amended (the Company have knowledge of any third party agreements "Securities Act"), or understandings with respect to Percon is satisfied that an exemption from registration under the voting of any such shares or which restrict Securities Act is available (the transfer of such shares"Securities Act Legend").

Capitalization. (a) The authorized shares of stock of the Company consist of 200,000,000 shares of Company Common Stock, par value $0.001 per share, of the Company. As of the date hereof, the authorized capital stock of the Company consists of (i) 67,066,418 100,000,000 shares of Company Common Stock were Stock, of which { } shares are issued and outstanding (excluding outstanding, { } shares of Company Common Stock held by the Company in its treasury), (ii) 15,000,000 shares of Company Common Stock have been are reserved for issuance pursuant to the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”)Company's stock option plans, and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 { } shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities are reserved for issuance pursuant to securities (other than the Notes and the Warrants) exercisable for, or required to be convertible into or exchangeable for shares of Common Stock and, 24,476,923 shares are reserved for issuance other than as described aboveupon conversion of the Notes and exercise of the Warrants (subject to adjustment pursuant to the Company's covenant set forth in Section 4(h) below); and (ii) { } shares of preferred stock of which { } shares are issued and outstanding. All of such issued and outstanding shares of the Company and its Subsidiaries capital stock are, and all shares subject to issuance as specified above, or upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable paid and free nonassessable. No shares of any capital stock of the Company are subject to preemptive rights purchase optionor any other similar rights of the shareholders of the Company or any liens or encumbrances imposed through the actions or failure to act of the Company. Except as disclosed in Schedule 3(c), call optionas of the effective date of this Agreement, right (i) there are no outstanding options, warrants, scrip, rights to subscribe for, puts, calls, rights of first refusal, subscription agreementagreements, understandings, claims or other commitments or rights of any character whatsoever relating to, or securities or rights convertible into or exchangeable for any other similar right under shares of capital stock of the Company Charter, the Company Bylaws or any agreement to of its Subsidiaries, or arrangements by which the Company or any of its Subsidiaries is party or by which it is bound. (b) Except for may become bound to issue additional shares of capital stock of the Company Stock Optionsor any of its Subsidiaries, (ii) there are no existing options, warrants, calls, subscription rights, exercisable, convertible or exchangeable securities or other rights, agreements or commitments arrangements under which the Company or any of its Subsidiaries is obligated to register the sale of any of its or their securities under the 1933 Act (contingent except the Registration Rights Agreement) and (iii) there are no anti-dilution or otherwiseprice adjustment provisions contained in any security issued by the Company (or in any agreement providing rights to security holders) that obligate will be triggered by the issuance of the Notes, the Warrants, the Conversion Shares or Warrant Shares. The Company has furnished to issuethe Buyer true and correct copies of the Company's Certificate of Incorporation as in effect on the date hereof ("Certificate of Incorporation"), transfer or sell any Company Common Stock or any investment that is the Company's By-laws, as in effect on the date hereof (the "By-laws"), and the terms of all securities convertible into or exercisable or exchangeable for any such shares. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There are no agreements or understandings to which the Company is a party with respect to the voting of any securities Common Stock of the Company and the material rights of the holders thereof in respect thereto. The Company shall provide the Buyer with a written update of this representation signed by the Company's Chief Executive or which restrict the transfer Chief Financial Officer on behalf of any such shares, nor does the Company have knowledge as of any third party agreements or understandings with respect to the voting of any such shares or which restrict the transfer of such sharesClosing Date.

Capitalization. (a) The As of June 7, 2019, the authorized shares of capital stock of the Company consist consists of 200,000,000 500,000,000 shares of Company Common Stock, par value $0.001 per share, of the Company. As of the date hereof, (i) 67,066,418 which approximately 114,813,022 shares of Company Common Stock were are issued and outstanding (excluding and 0 shares of Company Common Preferred Stock held by authorized. Except as disclosed in the Company in its treasury)SEC Documents, (ii) 15,000,000 no shares of Company Common Stock have been are reserved for issuance pursuant to the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”)Company’s stock option plans, and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 no shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities are reserved for issuance pursuant to securities (other than the Note) exercisable for, or required to be convertible into or exchangeable for shares of Common Stock and 2,500,000 shares are reserved for issuance other than as described aboveupon conversion of the Note. All of such issued and outstanding shares of the Company and its Subsidiaries capital stock are, and all shares subject to issuance as specified above, or upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable paid and free non-assessable. No shares of any capital stock of the Company are subject to preemptive rights purchase optionor any other similar rights of the shareholders of the Company or any liens or encumbrances imposed through the actions or failure to act of the Company. Except as disclosed in the SEC Documents, call optionas of the effective date of this Agreement, right (i) there are no outstanding options, warrants, scrip, rights to subscribe for, puts, calls, rights of first refusal, subscription agreementagreements, understandings, claims or other commitments or rights of any character whatsoever relating to, or securities or rights convertible into or exchangeable for any other similar right under shares of capital stock of the Company Charter, the Company Bylaws or any agreement to of its Subsidiaries, or arrangements by which the Company or any of its Subsidiaries is party or by which it is bound. (b) Except for may become bound to issue additional shares of capital stock of the Company Stock Optionsor any of its Subsidiaries, (ii) there are no existing options, warrants, calls, subscription rights, exercisable, convertible or exchangeable securities or other rights, agreements or commitments arrangements under which the Company or any of its Subsidiaries is obligated to register the sale of any of its or their securities under the 1933 Act and (contingent iii) there are no anti-dilution or otherwiseprice adjustment provisions contained in any security issued by the Company (or in any agreement providing rights to security holders) that obligate will be triggered by the issuance of the Note or the Conversion Shares. The Company to issuehas filed in its SEC Documents true and correct copies of the Company’s Certificate of Incorporation as in effect on the date hereof (“Certificate of Incorporation”), transfer or sell any Company Common Stock or any investment that is the Company’s By-laws, as in effect on the date hereof (the “By-laws”), and the terms of all securities convertible into or exercisable or exchangeable for any such shares. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There are no agreements or understandings to which the Company is a party with respect to the voting of any securities Common Stock of the Company or which restrict and the transfer material rights of any such shares, nor does the holders thereof in respect thereto. The Company shall provide the Buyer with a written update of this representation signed by the Company’s Chief Executive on behalf of the Company have knowledge as of any third party agreements or understandings with respect to the voting of any such shares or which restrict the transfer of such sharesClosing Date.

Capitalization. (a) The authorized shares of capital stock of the Company consist consists of 200,000,000 (i) 34,000,000 shares of Company Common Stockcommon stock, $0.01 par value $0.001 per share, of the Company. As of the date hereof, (i) 67,066,418 which 12,484,644 shares of Company Common Stock were issued and outstanding (excluding shares of Company Common Stock held by the Company in its treasury)on June 30, 2001, and (ii) 15,000,000 23,000,000 shares of Company Common Stock have been reserved for issuance pursuant to preferred stock, $0.01 par value per share, none of which are issued or outstanding. All of the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”), and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 outstanding shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities reserved for issuance or required to be reserved for issuance other than as described above. All such issued and outstanding shares capital stock of the Company and its Subsidiaries arehave been duly authorized and validly issued and are fully paid and nonassessable. The Company has no outstanding stock appreciation rights, phantom stock or similar rights. All outstanding shares of capital stock or other equity interests of the Subsidiaries of the Company are owned by the Company or a direct or indirect wholly-owned Subsidiary of the Company, free and clear of all shares subject liens, pledges, charges, encumbrances, claims and options of any nature. Except for options to issuance as specified above, upon issuance on the terms and conditions specified in the instruments purchase 2,457,706 Company Shares issued pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable and free of any preemptive rights purchase option, call option, right of first refusal, subscription agreement, or any other similar right under the Company Charter1997 Stock Incentive Plan, the Amended and Restated 1998 Stock Incentive Plan and the 1999 Non-Employee Director Stock Option Plan and 801,220 Company Bylaws or any agreement Shares to which be issued pursuant to the 1999 Employee Stock Purchase Plan (collectively, the "Company is party or by which it is bound. (bOption Plans") Except for the and warrants to purchase 1,370,056 Company Stock OptionsShares, there are no existing outstanding or authorized options, warrants, calls, subscription rights (including preemptive rights), exercisable, convertible commitments or exchangeable securities or any other rights, agreements or commitments (contingent or otherwise) that obligate of any character which the Company or any of its Subsidiaries is a party to, or may be bound by, requiring it to issue, transfer transfer, grant, sell, purchase, redeem or sell acquire any Company Common Stock shares of capital stock or any investment that is of its securities or rights convertible into, exchangeable for, or evidencing the right to subscribe for, any shares of capital stock of the Company or any of its Subsidiaries. Upon consummation of the Merger, the Company Warrants shall convert into or exercisable or exchangeable for any such shares. (c) The Substitute Warrants which will entitle the holder to purchase a number of Parent Shares equal to the number of Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) Shares issuable upon exercise of the Company Warrants immediately prior to the Effective Time multiplied by the Exchange Ratio. There are no stockholder agreements, voting trusts or other agreements or understandings to which the Company is a party with respect or to which it is bound relating to the voting of any securities shares of the Company or which restrict capital stock of the transfer of any such shares, nor does the Company have knowledge of any third party agreements or understandings Company. No existing rights with respect to the voting registration of Company Shares under the Securities Act, including, but not limited to, demand rights or piggy-back registration rights, shall apply with respect to any such shares Parent Shares issuable in connection with the Merger or which restrict upon exercise of Substitute Options or Substitute Warrants. The Company has provided to Parent a list, as of June 30, 2001 of the transfer outstanding options and warrants to acquire Company Shares, the name of the holder of such sharesoption or warrant, the exercise price of such option or warrant, the number of shares as to which such option or warrant will have vested at such date and whether the exercisability of such option or warrant will be accelerated in any way by the transactions contemplated by this Agreement and the extent of acceleration, if any, and any adjustments to such options or warrants resulting from the consummation of the transactions contemplated by this Agreement. Since June 30, 2001 no options or warrants have been issued or accelerated or had their terms modified.

Capitalization. (a) The Section 2.05(a) of the XC Disclosure Letter sets forth the authorized shares of and outstanding capital stock of XC as of December 31, 2017 (the Company consist of 200,000,000 shares of Company Common Stock, par value $0.001 per share, of the Company. As of the date hereof, (i) 67,066,418 shares of Company Common Stock were issued and outstanding (excluding shares of Company Common Stock held by the Company in its treasury), (ii) 15,000,000 shares of Company Common Stock have been reserved for issuance pursuant to the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive PlansCapitalization Date”), and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities reserved for issuance or required to be reserved for issuance other than as described above. All such issued and outstanding shares of the Company and its Subsidiaries arecapital stock of XC have been, and all shares subject to issuance as specified above, upon issuance on the terms and conditions specified in the instruments that may be issued pursuant to which they are issuable, any XC Stock Plan or arrangement will be, when issuedissued in accordance with the respective terms thereof, duly authorized, authorized and validly issued, issued and are fully paid, paid and nonassessable and free have not been issued in violation of any preemptive rights purchase option, call option, right of first refusal, subscription agreement, or any other similar right under the Company Charter, the Company Bylaws or any agreement to which the Company is party or by which it is boundrights. (b) Except as set forth in this Section 2.05, and for changes since the Company Capitalization Date resulting from the exercise of XC Stock OptionsOptions or vesting of XC Awards outstanding on such date or from actions permitted pursuant to, or taken in accordance with, Section 4.01, there are no existing optionsissued, reserved for issuance or outstanding (i) shares of capital stock of or other voting securities of or ownership interests in XC, (ii) securities of XC convertible into or exchangeable for shares of capital stock or other voting securities of or ownership interests in XC, (iii) warrants, calls, subscription rights, exercisable, convertible or exchangeable securities options or other rightsrights to acquire from XC, agreements or commitments (contingent or otherwise) that obligate the Company other obligation of XC to issue, transfer any capital stock or sell any Company Common Stock other voting securities or ownership interests in or any investment that is securities convertible into or exercisable or exchangeable for capital stock or other voting securities or ownership interests in XC or (iv) restricted shares, stock appreciation rights, performance units, conversion rights, contingent value rights, “phantom” stock or similar securities or rights that are derivative of, or provide economic benefits based, directly or indirectly, on the value or price of, any such sharescapital stock or voting securities of XC (the items in clauses (i) through (iv) being referred to collectively as the “XC Securities”). Except as set forth in the Organizational Documents of XC, there are no outstanding obligations of XC or any of its Subsidiaries to repurchase, redeem or otherwise acquire any XC Securities. (c) The Company has not issued Upon completion of the SA Closing in accordance with the terms of this Agreement, good and marketable title to the Subscribed Shares will be transferred to FH, free and clear of all Liens (other than any share appreciation rightsLiens arising under any applicable securities Laws, dividend equivalent rights, performance awards, restricted stock unit awards the Organizational Documents of XC or “phantom” sharesthe Shareholders Agreement). (d) There are no agreements voting agreements, shareholder agreements, voting trusts, proxies or understandings similar agreements, arrangements or commitments to which the Company XC or any of its Subsidiaries is a party with respect to the voting of any securities shares of capital stock or other equity interest of XC or any of its Subsidiaries. There are no bonds, debentures, notes or other instruments of indebtedness of XC or any of its Subsidiaries that entitle the Company or which restrict the transfer holder of such instruments of indebtedness to vote together with shareholders of XC on any such shares, nor does the Company have knowledge of any third party agreements or understandings matters with respect to the voting of XC or any such shares or which restrict the transfer of such sharesSubsidiary.

Capitalization. (a) The authorized shares of stock Equity Interests of the Company consist consists of 200,000,000 shares 12,500,000 Class A Units, 2,000,000 Class B Units and 0 Class C Units, of which 11,982,748 Class A Units, 890,422 Class B Units and 0 Class C Units are issued and outstanding and none of which are held in treasury. All of the Company Common StockInterests (i) have been duly authorized, par value $0.001 per shareare validly issued, fully paid (to the extent such concept is applicable) and non-assessable (to the extent such concept is applicable), with no personal liability attaching to the ownership thereof and (ii) are owned of record and beneficially by the Company Members as set forth in the Member Allocation Schedule. The Company Interests constitute all of the issued and outstanding Equity Interests of the Company. As of the date hereof, (i) 67,066,418 shares of Company Common Stock were issued and outstanding (excluding shares of Company Common Stock held by the Company in its treasury), (ii) 15,000,000 shares of Company Common Stock have been reserved for issuance pursuant to the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”), and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities reserved for issuance or required to be reserved for issuance other than as described above. All such issued and outstanding shares of the Company and its Subsidiaries are, and all shares subject to issuance as specified above, upon issuance on Interests was issued in compliance with applicable Law. None of the terms and conditions specified Company Interests was issued in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable and free violation of any preemptive rights purchase optionagreements, call option, right of first refusal, subscription agreement, arrangements or any other similar right under the Company Charter, the Company Bylaws or any agreement commitment to which the Company or any equityholder is a party or is subject to or in violation of any preemptive or similar rights granted by which it is boundthe Company or any Person. (b) Except for as set forth on the Member Allocation Schedule or on Section 4.4(b) of the Company Stock OptionsDisclosure Schedule, there are no existing securities, options, warrants, rights, calls, subscription subscriptions, agreements, commitments or understandings of any nature whatsoever, fixed or contingent, that directly or indirectly (i) calls for the issuance, redemption, sale, pledge or other disposition of any Equity Interests or other equity awards of the Company or any securities convertible into, or other rights to acquire, any Equity Interests or other equity awards of the Company, (ii) obligates the Company to grant, offer or enter into any of the foregoing, or (iii) relates to the voting or control of such Equity Interests, securities or rights. The Company has not granted to any Person the right to demand or request that the Company effect a registration under the Securities Act of any securities held by such Person or to include any securities of such Person in any such registration by the Company. (c) Except for the Company Interests, exercisablethere are no outstanding (i) equity securities or interests or voting debt or equity securities of the Company, (ii) securities convertible or exchangeable into equity securities or other rightsinterests of the Company, agreements (iii) any debt or commitments (contingent debt instruments, options or otherwise) warrants that obligate require the Company to issue, transfer sell or sell any otherwise cause to become outstanding or to acquire, repurchase or redeem equity securities or interests of the Company Common Stock or (iv) “phantom stock,” stock appreciation rights or other similar rights with respect to the Company. No Company Member or any investment that other Person is convertible into entitled to any preemptive or exercisable or exchangeable similar rights to subscribe for any such shares. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” sharesEquity Interests of the Company. (d) There are no agreements or understandings to which the Company is a party with respect to the voting of any securities None of the Company Members or which restrict Key Persons are or were at the transfer time of any such shares, nor does their investment in the Company have knowledge persons resident in India for the purpose of any third party agreements or understandings with respect to the voting of any such shares or which restrict the transfer of such sharesapplicable Laws in India.

Capitalization. (a) The authorized shares of capital stock of the Company consist consists of 200,000,000 (i) 100,000,000 shares of Company Common Stock, and (ii) 10,000,000 shares of Preferred Stock, par value $0.001 .01 per share, of share (the Company"Preferred Stock"). As of the date hereof, (iv) 67,066,418 26,951,712 shares of Company Common Stock were are issued and outstanding outstanding, (excluding w) 4,060,000 shares of Company Common Stock held by are reserved for issuance upon exercise of outstanding Options (whether or not exercisable and granted under the Company in its treasuryOption Plans), (iix) 15,000,000 300,000 shares of Company Common Stock have been are reserved for issuance pursuant to under the 2001 Stock Option Plan Purchase Plan, (y) no shares of Preferred Stock are issued and the 2005 Stock Option Plan (“Incentive Plans”), outstanding and (iiiz) Company Stock Options entitling the owners thereof to purchase 7,960,000 1,637,160 shares of Company Common Stock were outstanding. As of are held in the date of this Agreement, the Company had no Company Common Stock, or any other securities reserved for issuance or required to be reserved for issuance other than as described aboveCompany's treasury. All such issued and the outstanding shares of the Company and its Subsidiaries Common Stock are, and all shares subject to issuance as specified above, upon issuance on the terms and conditions specified in the instruments which may be issued pursuant to which they are issuable, will the exercise of outstanding Options when issued in accordance with the respective terms thereof shall be, when issued, duly authorized, validly issued, fully paid, nonassessable paid and non-assessable and free of any preemptive rights. There are no bonds, debentures, notes or other indebtedness having general voting rights purchase option, call option, right (or convertible into securities having such rights) ("Voting Debt") of first refusal, subscription agreement, the Company or any other similar right under of its Subsidiaries issued and outstanding. Except (a) as set forth above,(b) for the transactions contemplated by this Agreement, as of the date hereof, and (c) as set forth in Schedule 3.2(a), (i) there are no shares of capital stock of the Company Charterauthorized, the Company Bylaws issued or any agreement to which the Company is party or by which it is bound. outstanding, (bii) Except for the Company Stock Options, there are no existing options, warrants, calls, subscription pre-emptive rights, exercisable, convertible or exchangeable securities subscriptions or other rights, agreements agreements, arrangements or commitments (contingent of any character, relating to the issued or otherwise) that obligate unissued capital stock of the Company or any of its Subsidiaries, obligating the Company or any of its Subsidiaries to issue, transfer or sell or cause to be issued, transferred or sold any shares of capital stock or Voting Debt of, or other equity interest in, the Company Common Stock or any investment that is of its Subsidiaries or securities convertible into or exercisable or exchangeable for such shares or equity interests, or obligating the Company or any of its Subsidiaries to grant, extend or enter into any such shares. option, warrant, call, subscription or other right, agreement, arrangement or commitment, and (ciii) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There there are no agreements or understandings to which the Company is a party with respect to the voting of any securities outstanding contractual obligations of the Company or which restrict the transfer any of its Subsidiaries to repurchase, redeem or otherwise acquire any such sharesShares, nor does or capital stock of the Company or any Subsidiary or affiliate of the Company. The Company has provided Parent and Purchaser with a true and complete list, as of the date hereof, of (i) all Options to purchase Company Common Stock that have knowledge been granted by the Company, (ii) the holder of any third party agreements or understandings with respect to each of the voting Options, (iii) the Option Plan under which each Option was issued, (iv) the number of any Options held by each such shares or which restrict holder, (v) the transfer exercise prices of each such Option, (vi) the date of grant of such sharesOption, (vii) the expiration date of such Option, (viii) whether such Option has vested as of the date hereof, and (ix) whether such Option is a non-qualified stock option or an "incentive stock option" within the meaning of Section 422(b) of the Code. No shares of restricted stock or other equity-based awards have been granted under the Option Plans or otherwise. (b) Except as set forth on Schedule 3.2

Capitalization. (a) The authorized shares of stock capitalization of the Company consist of 200,000,000 shares of Company Common Stock, par value $0.001 per share, of the Company. As as of the date hereof, (i) 67,066,418 including the authorized capital stock, the number of shares of Company Common Stock were issued and outstanding (excluding outstanding, the number of shares of Company Common Stock held by the Company in its treasury), (ii) 15,000,000 shares of Company Common Stock have been issuable and reserved for issuance pursuant to the 2001 Stock Option Plan Company's stock option plans, the number of shares issuable and reserved for issuance pursuant to securities (other than the Preferred Shares and Warrants) exercisable or exchangeable for, or convertible into, any shares of capital stock and the 2005 Stock Option Plan number of shares to be reserved for issuance upon conversion of the Preferred Shares and exercise of the Warrants is set forth on SCHEDULE 3(D). All of such outstanding shares of capital stock have been, or upon issuance in accordance with the terms of any such warrants, options or preferred stock, will be, validly issued, fully paid and non-assessable. No shares of capital stock of the Company (“Incentive Plans”including the Preferred Shares, the Conversion Shares and the Warrant Shares) are subject to preemptive rights or any other similar rights of the stockholders of the Company or any liens or encumbrances. Except for the Securities and as set forth on SCHEDULE 3(D), and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 shares of Company Common Stock were outstanding. As as of the date of this Agreement, the Company had no Company Common Stock, or any other securities reserved for issuance or required to be reserved for issuance other than as described above. All such issued and outstanding shares of the Company and its Subsidiaries are, and all shares subject to issuance as specified above, upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable and free of any preemptive rights purchase option, call option, right of first refusal, subscription agreement, or any other similar right under the Company Charter, the Company Bylaws or any agreement to which the Company is party or by which it is bound. (bi) Except for the Company Stock Options, there are no existing outstanding options, warrants, callsscrip, subscription rightsrights to subscribe to, exercisablecalls or commitments of any character whatsoever relating to, or securities or rights convertible into or exercisable or exchangeable for, any shares of capital stock of the Company or any of its subsidiaries, or arrangements by which the Company or any of its subsidiaries is or may become bound to issue additional shares of capital stock of the Company or any of its subsidiaries, and (ii) there are no agreements or arrangements under which the Company or any of its subsidiaries is obligated to register the sale of any of its or their securities under the Securities Act (except the Registration Rights Agreement). Except as set forth on SCHEDULE 3(D), (i) there are no securities or other rightsinstruments containing Antidilution or similar provisions that will be triggered by the issuance of the Securities in accordance with the terms of this Agreement, the Statement of Designation or the Warrants, (ii) there are no outstanding securities or instruments of the Company or any of its subsidiaries which contain any redemption or similar provisions, and there are no contracts, commitments, understandings or arrangements by which the Company or any of its subsidiaries is or may become bound to redeem a security of the Company or any of its subsidiaries, and (iii) the Company does not have any stock appreciation rights or "phantom stock" plans or agreements or commitments any similar plan or agreement. The Company has furnished to the Purchasers true and correct copies of the Company's Certificate of Incorporation as in effect on the date hereof (contingent or otherwise) that obligate "CERTIFICATE OF INCORPORATION"), the Company to issueCompany's By-laws as in effect on the date hereof (the "BY-LAWS"), transfer or sell any Company Common Stock or any investment that is and all other instruments and agreements governing securities convertible into or exercisable or exchangeable for any such shares. (c) capital stock of the Company. The Company has not issued any share appreciation rightsStatement of Designation, dividend equivalent rightsin the form attached hereto, performance awardswill be duly filed prior to Closing with the Secretary of State of the State of Texas and, restricted stock unit awards or “phantom” shares. (d) There are no agreements or understandings to which upon the Company is a party issuance of the Preferred Shares in accordance with respect the terms hereof, each Purchaser shall be entitled to the voting of any securities of the Company or which restrict the transfer of any such shares, nor does the Company have knowledge of any third party agreements or understandings with respect to the voting of any such shares or which restrict the transfer of such sharesrights set forth therein.

Capitalization. (a) The authorized capitalization of MTN consists of 50,000,000 shares of common stock, $0.001 par value, of which approximately 640,000 shares, including 176,602 shares post-split, approximately 60,000 shares required to be issued so that no shareholder who holds in excess of 100 shares pre-split holds less than 100 shares post-split, and 400,000 shares registered under Form S-8, shall be issued and outstanding, prior to issuance and cancellation of shares as set forth in Section 1.01 of this Agreement. All issued and outstanding shares of MTN are legally issued, fully paid, and nonassessable and not issued in violation of the preemptive or other right of any person. There are no dividends or other amounts due or payable with respect to any of the shares of capital stock of the Company consist of 200,000,000 shares of Company Common Stock, par value $0.001 per share, of the CompanyMTN. As of the date hereofhereof and at Closing, (i) 67,066,418 there are no outstanding options, warrants, convertible securities, scrip, rights to subscribe for, puts, calls, rights of first refusal, tag-along agreements, nor any other agreements, understandings, claims or other commitments or rights of any character whatsoever relating to, or securities or rights convertible into or exchangeable for any shares of Company Common Stock were issued and outstanding (excluding capital stock of MTN, or arrangements by which MTN is or may become bound to issue additional shares of Company Common Stock held by the Company in its treasury)capital stock of MTN, and (ii) 15,000,000 shares with the exception of Company Common Stock have been reserved for issuance pursuant the Registration Rights Agreement, there are no agreements or arrangements under which MTN is obligated to register the 2001 Stock Option Plan and sale of any of its securities under the 2005 Stock Option Plan Securities Act of 1933, as amended (“Incentive Plans”), the "Securities Act") and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities reserved for issuance or required to be reserved for issuance other than as described above. All such issued and outstanding shares of the Company and its Subsidiaries are, and all shares subject to issuance as specified above, upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable and free of any preemptive rights purchase option, call option, right of first refusal, subscription agreement, or any other similar right under the Company Charter, the Company Bylaws or any agreement to which the Company is party or by which it is bound. (b) Except for the Company Stock Options, there are no existing options, warrants, calls, subscription rights, exercisable, convertible anti-dilution or exchangeable securities price adjustment provisions contained in any security issued by MTN (or other rights, agreements in MTN's articles of incorporation or commitments (contingent by-laws or otherwisein any agreement providing rights to security holders) that obligate will be triggered by the Company transactions contemplated by this Agreement. MTN has furnished to issue, transfer or sell any Company Common Stock or any investment that is convertible into or exercisable or exchangeable for any such sharesAGIL true and correct copies of MTN's articles of incorporation and by-laws. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There are no agreements or understandings to which the Company is a party with respect to the voting of any securities of the Company or which restrict the transfer of any such shares, nor does the Company have knowledge of any third party agreements or understandings with respect to the voting of any such shares or which restrict the transfer of such shares.

Capitalization. (a) The authorized shares of stock As of the date of this Agreement and immediately prior to the Effective Time, the Company consist of 200,000,000 has and will have 1,000 outstanding shares of Company Common Stock, par value $0.001 per sharewhich shares are and will be duly authorized, validly issued, fully paid and nonassessable and free of the Company. As of the date hereof, preemptive rights. (ib) 67,066,418 shares of Company Common Stock were issued and outstanding (excluding shares of Company Common Stock held by the Company in its treasury), (ii) 15,000,000 shares of Company Common Stock have been reserved for issuance pursuant to the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”), and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 shares of Company Common Stock were outstanding. As of the date of this Agreement, except as set forth above in this Section 5.02 and set forth in the Company had Company’s equity plans or grant documents issued thereunder, (i) there are no Company Common Stockpartnership interests, limited liability company interests or any other equity securities reserved for issuance or required to be reserved for issuance other than as described above. All such issued and outstanding shares of the Company issued or authorized and its Subsidiaries arereserved for issuance, and all shares subject to issuance as specified above, upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable and free of any preemptive rights purchase option, call option, right of first refusal, subscription agreement, or any other similar right under the Company Charter, the Company Bylaws or any agreement to which the Company is party or by which it is bound. (bii) Except for the Company Stock Options, there are no existing outstanding options, profits interest units, phantom units, restricted units, unit appreciation rights, warrants, calls, subscription preemptive rights, exercisablesubscriptions, calls or other Rights, convertible or securities, exchangeable securities or other rightssecurities, agreements or commitments (contingent or otherwise) that obligate of any character obligating the Company to issue, transfer or sell any equity interest of the Company Common Stock or any investment that is securities convertible into or exercisable or exchangeable for such equity interests, or any commitment to authorize, issue or sell the same or any such sharesequity securities, except pursuant to this Agreement, and (iii) there are no contractual obligations of the Company to repurchase, redeem or otherwise acquire any other equity interest in the Company or any such securities or agreements listed in clause (ii) of this sentence. (c) The Neither the Company nor any of its Subsidiaries has not issued outstanding bonds, debentures, notes or other indebtedness, the holders of which have the right to vote (or which are convertible or exchangeable into or exercisable for securities having the right to vote) with Company Stockholders on any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” sharesmatter. (d) There are no voting trusts or other agreements or understandings to which the Company or any of its Subsidiaries is a party with respect to the voting or registration of capital stock or other equity interest of the Company. (e) When issued pursuant to the terms of this Agreement, all Company Shares constituting any part of the Merger Consideration will be duly authorized, validly issued, fully paid and nonassessable and free of preemptive rights. (f) All of the issued and outstanding limited liability company interests of Merger Sub are beneficially owned by the Company. Merger Sub was formed solely for the purpose of engaging in the transactions contemplated by this Agreement. Except for obligations and liabilities incurred in connection with its formation and the transactions contemplated by this Agreement, Merger Sub has not and will not have incurred, directly or indirectly, any obligations or engaged in any business activities of any securities of the Company type or which restrict the transfer of kind whatsoever or entered into any such shares, nor does the Company have knowledge of any third party agreements or understandings arrangements with respect to the voting of any such shares or which restrict the transfer of such sharesPerson.

Capitalization. (a) The authorized capital stock of -------------- Acquiror consists of 650,000,000 Acquiror Common Shares of which, as of August 3, 1996, approximately 274,235,794 Acquiror Common Shares were issued and outstanding. All of the outstanding shares of capital stock of the Company consist of 200,000,000 Acquiror have been duly authorized and validly issued and are fully paid and nonassessable. All outstanding shares of Company Common Stock, par value $0.001 per share, capital stock or other equity interests of the Companysubsidiaries of Acquiror are owned by Acquiror or a direct or indirect wholly owned subsidiary of Acquiror, free and clear of all liens, charges, encumbrances, claims and options of any nature. As Except as set forth in the Acquiror SEC Reports (as defined in Section 5.2(f)) or as contemplated by this Agreement, there are not, as of the date hereof, (i) 67,066,418 shares of Company Common Stock were issued and any outstanding (excluding shares of Company Common Stock held by the Company in its treasury), (ii) 15,000,000 shares of Company Common Stock have been reserved for issuance pursuant to the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”), and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities reserved for issuance or required to be reserved for issuance other than as described above. All such issued and outstanding shares of the Company and its Subsidiaries are, and all shares subject to issuance as specified above, upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable and free of any preemptive rights purchase option, call option, right of first refusal, subscription agreement, or any other similar right under the Company Charter, the Company Bylaws or any agreement to which the Company is party or by which it is bound. (b) Except for the Company Stock Options, there are no existing authorized options, warrants, calls, subscription rights (including preemptive rights), exercisablecommitments or any other agreements of any character which Acquiror or any of its subsidiaries is a party to, convertible or exchangeable securities or other rightsmay be bound by, agreements or commitments (contingent or otherwise) that obligate the Company requiring it to issue, transfer transfer, sell, purchase, redeem or sell acquire any Company Acquiror Common Stock Shares or any investment that is shares of capital stock or any of its securities or rights convertible into into, exchangeable for, or exercisable evidencing the right to subscribe for, any shares of capital stock of Acquiror or exchangeable for any such shares. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) of its subsidiaries. There are no not as of the date hereof and there will not be at the Effective Time any stockholder agreements, voting trusts or other agreements or understandings to which the Company Acquiror is a party with respect or to which it is bound relating to the voting of any securities shares of the Company capital stock of Acquiror. Acquiror has reserved for issuance under a stock option plan or which restrict plans of Acquiror a sufficient number of Acquiror Common Shares to cover the transfer exercise of any such shares, nor does the Company have knowledge of any third party agreements or understandings Options and Warrants to be assumed by Acquiror in accordance with respect to the voting of any such shares or which restrict the transfer of such sharesSection 4.1(d).

Capitalization. (aA) The authorized All outstanding shares of capital stock of the Company consist of 200,000,000 shares every class and series have been duly authorized and validly issued, free of any preemptive or similar rights except such as have been fully complied with, and are fully paid and nonassessable, with no liability attaching to the ownership thereof. (B) Except as set forth in the (x) Certificate of Incorporation, or (y) the Registration Rights Agreement, the Investor Rights Agreement, the Right of First Refusal Agreement, or the Voting Agreement (all of which were entered into by the Company Common Stockand the various other parties thereto as of March 4, par value $0.001 per share2004, as they may have been amended), there are no outstanding (i) rights of first offer or first refusal, "drag-along" rights, "tag-along" rights or other similar rights or agreements, arrangements or commitments of any character which obligate the Company or any of its subsidiaries, or, to the knowledge of the Company. As , any stockholder of the date hereofCompany or other person, to transfer, sell or vote any Company Securities (i) 67,066,418 shares of Company Common Stock were issued and outstanding (excluding shares of Company Common Stock held by the Company in its treasuryas defined below), (ii) 15,000,000 obligations on the part of the Company or any of its subsidiaries to repurchase, redeem or otherwise acquire any Company Securities, (iii) liabilities on the part of the Company or any of its subsidiaries for dividends declared or accumulated but unpaid with respect to Company Securities, (iv) obligations on the part of the Company or any of its subsidiaries to register for public sale any Company Securities, and (v) obligations on the part of the Company or any of its subsidiaries or, to the knowledge of the Company, of any stockholder of the Company or other person for the voting of Company Securities in any manner whatsoever. "Company Securities" means (i) shares of capital stock or other voting securities of the Company, (ii) securities of the Company Common Stock have been reserved or any of its subsidiaries convertible into or exchangeable for issuance pursuant to shares of capital stock or voting securities of the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”)Company, and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities reserved for issuance or required to be reserved for issuance other than as described above. All such issued and outstanding shares of the Company and its Subsidiaries are, and all shares subject to issuance as specified above, upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable and free of any preemptive rights purchase option, call option, right of first refusal, subscription agreement, or any other similar right under the Company Charter, the Company Bylaws or any agreement to which the Company is party or by which it is bound. (b) Except for the Company Stock Options, there are no existing options, warrants, calls, subscription rights, exercisable, convertible or exchangeable securities warrants or other rights, agreements or commitments (contingent or otherwise) that obligate the Company rights to issue, transfer or sell any Company Common Stock or any investment that is convertible into or exercisable or exchangeable for any such shares. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There are no agreements or understandings to which the Company is a party with respect to the voting of any securities of acquire from the Company or which restrict the transfer any of any such shares, nor does the Company have knowledge of any third party agreements or understandings with respect to the voting of any such shares or which restrict the transfer of such sharesits subsidiaries.

Capitalization. (a) The authorized shares of stock of the Company consist of 200,000,000 shares of Company Common Stock, par value $0.001 per share, of the Company. As of the date hereof, the authorized capital stock of the Company consists of: (i) 67,066,418 750,000,000 shares of Company Common Stock were Stock, of which approximately 49,209,761 shares are issued and outstanding (excluding shares of Company Common Stock held by the Company in its treasury), outstanding; and (ii) 15,000,000 5,000,000 shares of Company Common Stock have been preferred stock, of which 1,000,100 are issued and outstanding. Except as disclosed in the SEC Documents, no shares are reserved for issuance pursuant to the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”)Company’s stock option plans, and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 no shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities are reserved for issuance or required pursuant to be reserved for issuance securities (other than as described abovethe Note and any other convertible promissory note issued to the Buyer) exercisable for, or convertible into or exchangeable for shares of Common Stock. All of such issued and outstanding shares of the Company and its Subsidiaries capital stock are, and all shares subject to issuance as specified above, or upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable paid and free non-assessable. No shares of any capital stock of the Company are subject to preemptive rights purchase optionor any other similar rights of the shareholders of the Company or any liens or encumbrances imposed through the actions or failure to act of the Company. Except as disclosed in the SEC Documents, call optionas of the effective date of this Agreement, right (i) there are no outstanding options, warrants, scrip, rights to subscribe for, puts, calls, rights of first refusal, subscription agreementagreements, understandings, claims or other commitments or rights of any character whatsoever relating to, or any other similar right under the Company Charter, the Company Bylaws or any agreement to which the Company is party or by which it is bound. (b) Except for the Company Stock Options, there are no existing options, warrants, calls, subscription rights, exercisable, convertible or exchangeable securities or other rights, agreements or commitments (contingent or otherwise) that obligate the Company to issue, transfer or sell any Company Common Stock or any investment that is rights convertible into or exercisable or exchangeable for any such shares. shares of capital stock of the Company or any of its Subsidiaries, or arrangements by which the Company or any of its Subsidiaries is or may become bound to issue additional shares of capital stock of the Company or any of its Subsidiaries, (cii) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There there are no agreements or understandings to arrangements under which the Company or any of its Subsidiaries is a party with respect obligated to register the voting sale of any of its or their securities under the 1933 Act and (iii) there are no anti-dilution or price adjustment provisions contained in any security issued by the Company (or in any agreement providing rights to security holders) that will be triggered by the issuance of the Company Note or which restrict the transfer of any such shares, nor does the Company have knowledge of any third party agreements or understandings with respect to the voting of any such shares or which restrict the transfer of such sharesConversion Shares.

Capitalization. (a) The authorized shares As of the date hereof, the authorized, issued and outstanding capital stock of the Company consist of 200,000,000 is as set forth on Schedule 4.3 hereto and no other shares of capital stock of the Company Common Stockwill be outstanding as of the Closing Date. All of such outstanding shares of capital stock are, par value $0.001 per shareor upon issuance will be, duly authorized, validly issued, fully paid and non-assessable. No shares of capital stock of the Company are subject to preemptive rights or similar rights of the stockholders of the Company or any liens or encumbrances imposed through the actions or failure to act of the Company. As Other than as set forth on Schedule 4.3 hereto, as of the date hereof, (i) 67,066,418 there are no outstanding options, warrants, scrip, rights to subscribe for, puts, calls, rights of first refusal, agreements, understandings, claims or other commitments or rights of any character whatsoever relating to, or securities or rights convertible into or exchangeable for any shares of capital stock of the Company Common Stock were issued and outstanding (excluding or any of its Subsidiaries, or arrangements by which the Company or any of its Subsidiaries is or may become bound to issue additional shares of Company Common Stock held by capital stock of the Company in or any of its treasury)Subsidiaries, and (ii) 15,000,000 shares there are no agreements or arrangements under which the Company or any of Company Common Stock have been reserved for issuance its Subsidiaries are obligated to register the sale of any of its or their securities under the Securities Act (except pursuant to the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”), Registration Rights Agreement) and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities reserved for issuance or required to be reserved for issuance other than as described above. All such issued and outstanding shares of the Company and its Subsidiaries are, and all shares subject to issuance as specified above, upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable and free of any preemptive rights purchase option, call option, right of first refusal, subscription agreement, or any other similar right under the Company Charter, the Company Bylaws or any agreement to which the Company is party or by which it is bound. (b) Except for the Company Stock Options, there are no existing options, warrants, calls, subscription rights, exercisable, convertible anti-dilution or exchangeable securities price adjustment provisions contained in any security issued by the Company (or other rights, agreements or commitments (contingent or otherwisein any agreement providing rights to security holders) that obligate will be triggered by the Company to issue, transfer or sell any Company Common Stock or any investment that is convertible into or exercisable or exchangeable for any such shares. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There are no agreements or understandings to which the Company is a party with respect to the voting of any securities issuance of the Company or which restrict the transfer of any such shares, nor does the Company have knowledge of any third party agreements or understandings with respect to the voting of any such shares or which restrict the transfer of such shares.Convertible Notes,

Capitalization. (ai) The authorized capital stock of GeoMet consists of 6,000 shares of stock of the Company consist of 200,000,000 shares of Company GeoMet Common Stock, par value $0.001 .01 per share, all of the Companywhich shares are classified as Series B Voting Common Stock. As of the date hereof, (i) 67,066,418 shares of Company Common Stock were There are issued and outstanding (excluding 1,250 shares of Company GeoMet Common Stock. No shares of GeoMet Common Stock are held by the Company in its treasury), (ii) 15,000,000 as treasury shares. A total of 62.5 shares of Company GeoMet Common Stock have been reserved for issuance pursuant to the stock option plans described in Section 2.1(c)(ii). All issued shares of GeoMet Common Stock are validly issued, fully paid and nonassessable and no holder thereof is entitled to preemptive rights. Except for the Stockholders’ Agreement dated as of December 8, 2000, GeoMet is not a party to, and is not aware of, any voting agreement, voting trust or similar agreement or arrangement relating to any class or series of its capital stock, or any agreement or arrangement providing for registration rights with respect to any capital stock or other securities of GeoMet. (ii) There are outstanding GeoMet Options to purchase an aggregate of 49.625 shares of GeoMet Common Stock under the 2001 Stock Option Plan and (the 2005 Stock Option Plan (“Incentive Plans”2001 Plan“), and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities reserved for issuance or required to be reserved for issuance other Other than as described above. All such issued set forth in Section 2.1(c)(i) and outstanding shares of the Company and its Subsidiaries are, and all shares subject to issuance as specified above, upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable and free of any preemptive rights purchase option, call option, right of first refusal, subscription agreement, or any other similar right under the Company Charter, the Company Bylaws or any agreement to which the Company is party or by which it is bound. (b) Except for the Company Stock Optionsthis Section 2.1(c)(ii), there are no existing not now, and at the Effective Time there will not be, any (A) shares of capital stock or other equity securities of GeoMet outstanding other than GeoMet Common Stock issued pursuant to the exercise of GeoMet Options or (B) outstanding options, warrants, callsscrip, subscription rightsrights to subscribe for, exercisablecalls or commitments of any character whatsoever relating to, convertible or exchangeable securities or other rights, agreements or commitments (contingent or otherwise) that obligate the Company to issue, transfer or sell any Company Common Stock or any investment that is rights convertible into or exercisable exchangeable for, shares of any class of capital stock of GeoMet, or contracts, understandings or arrangements to which GeoMet is a party, or by which GeoMet is or may be bound, to issue additional shares of capital stock or equity interests or options, warrants, scrip or rights to subscribe for, or securities or rights convertible into or exchangeable for for, any such sharesadditional shares of capital stock or equity interests. (ciii) The Company has Other than shares of capital stock or partnership interests of the GeoMet Subsidiaries owned by GeoMet, there are not issued now, and at the Effective Time there will not be, any share appreciation rights(A) shares of capital stock, dividend equivalent rights, performance awards, restricted stock unit awards partnership interest or “phantom” shares. (d) There are no agreements or understandings to which the Company is a party with respect to the voting of any other equity securities of the Company GeoMet Subsidiaries outstanding or which restrict the transfer (B) outstanding options, warrants, scrip, rights to subscribe for, calls or commitments of any such sharescharacter whatsoever relating to, nor does the Company have knowledge or securities or rights convertible into or exchangeable for, shares of any third party agreements class of capital stock or partnership interest of the GeoMet Subsidiaries, or contracts, understandings with respect or arrangements to which GeoMet or any of the voting GeoMet Subsidiaries is a party, or by which GeoMet or any of the GeoMet Subsidiaries is or may be bound, to issue additional shares of capital stock, partnership interest or equity interests or options, warrants, scrip or rights to subscribe for, or securities or rights convertible into or exchangeable for, any such additional shares of capital stock, partnership interest or which restrict the transfer of such sharesequity interests.

Capitalization. (a) The authorized shares of stock of the Company consist of 200,000,000 shares of Company Common Stock, par value $0.001 per share, of the Company. As of the date hereof, the authorized capital stock of the Company consists of (i) 67,066,418 [ ] shares of Company Common Stock were Stock, of which [ ] shares are issued and outstanding (excluding outstanding, [ ] shares of Company Common Stock held by the Company in its treasury), (ii) 15,000,000 shares of Company Common Stock have been are reserved for issuance pursuant to the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”)Company’s stock option plans, and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 [ ] shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities are reserved for issuance pursuant to securities (other than the Notes and the Warrants) exercisable for, or required to be convertible into or exchangeable for shares of Common Stock and, [ ] shares are reserved for issuance other than as described aboveupon conversion of the Notes and exercise of the Warrants (subject to adjustment pursuant to the Company’s covenant set forth in Section 4(h) below); and (ii) [ ] shares of preferred stock of which no shares are issued and outstanding. All of such issued and outstanding shares of the Company and its Subsidiaries capital stock are, and all shares subject to issuance as specified above, or upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable paid and free nonassessable. No shares of any capital stock of the Company are subject to preemptive rights purchase optionor any other similar rights of the shareholders of the Company or any liens or encumbrances imposed through the actions or failure to act of the Company. Except as disclosed in Schedule 3(c), call optionas of the effective date of this Agreement, right (i) there are no outstanding options, warrants, scrip, rights to subscribe for, puts, calls, rights of first refusal, subscription agreementagreements, understandings, claims or other commitments or rights of any character whatsoever relating to, or securities or rights convertible into or exchangeable for any other similar right under shares of capital stock of the Company Charter, the Company Bylaws or any agreement to of its Subsidiaries, or arrangements by which the Company or any of its Subsidiaries is party or by which it is bound. (b) Except for may become bound to issue additional shares of capital stock of the Company Stock Optionsor any of its Subsidiaries, (ii) there are no existing options, warrants, calls, subscription rights, exercisable, convertible or exchangeable securities or other rights, agreements or commitments arrangements under which the Company or any of its Subsidiaries is obligated to register the sale of any of its or their securities under the 1933 Act (contingent except the Registration Rights Agreement) and (iii) there are no anti-dilution or otherwiseprice adjustment provisions contained in any security issued by the Company (or in any agreement providing rights to security holders) that obligate will be triggered by the issuance of the Notes, the Warrants, the Conversion Shares or Warrant Shares. The Company has furnished to issuethe Buyer true and correct copies of the Company’s Certificate of Incorporation as in effect on the date hereof (“Certificate of Incorporation”), transfer or sell any Company Common Stock or any investment that is the Company’s By-laws, as in effect on the date hereof (the “By-laws”), and the terms of all securities convertible into or exercisable or exchangeable for any such shares. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There are no agreements or understandings to which the Company is a party with respect to the voting of any securities Common Stock of the Company and the material rights of the holders thereof in respect thereto. The Company shall provide the Buyer with a written update of this representation signed by the Company’s Chief Executive or which restrict the transfer Chief Financial Officer on behalf of any such shares, nor does the Company have knowledge as of any third party agreements or understandings with respect to the voting of any such shares or which restrict the transfer of such sharesClosing Date.

Capitalization. (a) The authorized shares of stock Section 4.4(a) of the Company consist Disclosure Schedule sets forth a true, correct and complete list, as of 200,000,000 shares of Company Common Stock, par value $0.001 per sharethe Execution Date, of the Company. As of the date hereof, (i) 67,066,418 shares of Company Common Stock were issued and outstanding (excluding shares of Company Common Stock held by the Company in its treasury), (ii) 15,000,000 shares of Company Common Stock have been reserved for issuance pursuant to the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”), and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities reserved for issuance or required to be reserved for issuance other than as described above. All such issued and outstanding shares authorized share capital of the Company and its Subsidiaries are, the number and all shares subject to issuance as specified above, upon issuance on class of Shares issued and outstanding and the terms beneficial and conditions specified in record holders of such Shares. (b) All issued and outstanding Shares of the instruments pursuant to which they are issuable, will be, when issued, Company (i) have been duly authorized, validly issued, fully paid, nonassessable paid and free are non-assessable (to the extent applicable as a legal concept) and (ii) have not been issued in violation of (x) any preemptive rights purchase optionright, call option, right of first refusalrefusal or first offer, subscription agreementright, transfer restrictions or any other similar right under the Company Charterright, the Company Bylaws (y) any applicable Law (including securities Laws) or applicable Constitutive Documents or (z) any agreement to which the Company is party or by which it is bound. (b) Except for the Company Stock Options, there are no existing options, warrants, calls, subscription rights, exercisable, convertible or exchangeable securities or other rights, agreements or commitments (contingent or otherwise) that obligate the Company to issue, transfer or sell any Company Common Stock or any investment that is convertible into or exercisable or exchangeable for any such shares. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There are no agreements or understandings Contract to which the Company is a party or by which it is bound and (iii) as of the Effective Time, will be owned by the Securityholders free and clear of all Encumbrances (other than transfer restrictions under applicable securities Laws and restrictions under such Subsidiary’s Constitutive Documents). There are no declared and unpaid dividends on any share of capital stock of any of the Company. The Company does not have any bonds, notes, debentures or other debt securities outstanding that have voting rights or are exercisable or convertible into, or exchangeable or redeemable for, or that give any Person a right to subscribe for or acquire, shares of capital stock or any other Equity Securities of the Company. There are no obligations, contingent or otherwise, to repurchase, redeem (or establish a sinking fund with respect to redemption) or otherwise acquire any shares of capital stock or other Equity Securities of the Company. Except for the Shares, the Equity Awards set forth on Section 4.4(c) of the Company Disclosure Schedule or granted in accordance with Section 6.2(b), the Warrants set forth on Section 4.4(f) of the Company Disclosure Schedule, the Existing Top-Up Rights and, as of the Effective Time, the Post-Closing Top-Up Rights, the Company does not have any other Equity Securities that are issued and outstanding. Except as set forth in Section 4.4(b) of the Company Disclosure Schedule, there are no (A) agreements pursuant to which registration rights in Equity Securities of the Company have been granted, (B) shareholder agreements among any current or former shareholders of the Company, (C) Contracts of the Company or, to the Company’s Knowledge, between any of the Securityholders with respect to the voting or transfer of shares of capital stock or any securities other Equity Securities of the Company, or (D) statutory or contractual preemptive rights or rights of first refusal with respect to Equity Securities of the Company. Pursuant to and in accordance with the Company’s Constitutive Documents, each Preference Share is convertible into one Common Share. (c) Section 4.4(c) of the Company Disclosure Schedule sets forth a true and complete list, (to the extent permitted by applicable Law and subject to such anonymization or other redactions as required to comply with applicable Law relating to data protection), as of the Execution Date, of each outstanding Equity Award, including (i) the Equity Award Holder, (ii) the number of Common Shares subject to such Equity Award, (iii) with respect to each Option, the exercise price or purchase price (if applicable), (iv) the grant date, (v) the vesting commencement date, (vi) the vesting schedule (including any acceleration provisions), (vii) whether performance targets have been satisfied, if applicable, (viii) with respect to each Option, and if applicable RSU, the expiration date, (ix) the jurisdiction in which restrict the transfer Equity Award Holder resides, (x) whether any Option is intended to qualify as an “incentive stock option” (as defined in Section 422 of the Code), and (xii) whether early exercise is permitted with respect to any such Option. (d) Each Option (i) was duly and validly authorized by the Company Board as of the applicable date of grant, including approval of the exercise price per share of such Option, and (ii) was granted in compliance in all material respects with all applicable Laws and all the terms and conditions of the Company Stock Plan pursuant to which it was issued. No Options have been retroactively granted or the exercise price of any such shares, nor does Option determined retroactively in contravention of applicable Law. Each RSU was granted in compliance in all material respects with all applicable Laws and all the terms and conditions of the Company Stock Plan pursuant to which it was issued. Each Option and RSU may, by its terms, be treated at the Effective Time pursuant to the terms of this Agreement. No Option is exercisable for any class or series of Shares other than Common Shares. Nothing in this clause (d) shall constitute a representation or warranty regarding any matter with respect to Section 409A of the Code, which is addressed exclusively in Section 4.4(e). (e) Each Option has an exercise price per Common Share equal to or greater than the fair market value, as determined in accordance with Section 409A of the Code, of a Common Share on the date of such grant and is otherwise exempt from Section 409A of the Code. None of the Options or RSUs constitute “deferred compensation” subject to Section 409A of the Code. The treatment of the Equity Awards under this Agreement does not violate the terms of the Company Stock Plan or any Contract governing the terms of such awards and will not cause adverse Tax consequences under Section 409A of the Code. (f) Section 4.4(f) of the Company Disclosure Schedule sets forth a true, correct and complete list, as of the Execution Date, of each outstanding Warrant, including (i) the Warrant Holder, (ii) the number of Common Shares issuable under such Warrant, (iii) with respect to each Warrant, the exercise price, (iv) the issuance date and (v) with respect to each Warrant, the expiration date. (g) No claim has been made or, to the Company’s Knowledge, threatened against the Company asserting that any Person other than a Person listed in Section 4.4(a), 4.4(c), 4.4(f) (including, for the avoidance of doubt, any holder of Existing Top-Up Rights or any Person to whom Equity Awards have knowledge been issued in accordance with Section 6.2(b)) is the holder or beneficial owner of, or has the right to acquire beneficial ownership of, any Share, or any other voting right or Equity Securities in the Company. (h) The Consideration Spreadsheet once delivered pursuant to Section 3.6(b) shall be prepared in accordance with, and shall allocate the Merger Consideration in accordance with, the Company’s Constitutive Documents, applicable Law, this Agreement and, in the case of Equity Awards, the Company Stock Plan and any third party agreements applicable grant or understandings similar agreement with respect to such Equity Awards (it being understood that the Consideration Spreadsheet shall be based on the estimates contained in the Estimated Closing Date Statement and that such estimates are subject to post-Closing adjustments pursuant to Section 3.10 and that no representations or warranties are made with respect to the voting of any such shares or which restrict the transfer accuracy of such sharesestimates). No past or present holder of Equity Securities in the Company shall be entitled to any consideration as a result of the Transactions in respect of Equity Securities in the Company from and after the Closing, except as set forth in the Consideration Spreadsheet or, with respect to any Post-Closing Payment, any Post-Closing Payment Spreadsheet delivered pursuant to the terms of this Agreement.

Capitalization. (a) The authorized shares of capital stock of the Company consist consists of 200,000,000 80,000,000 shares of Company Common Stock, without par value, and 30,000,000 shares of preferred stock, without par value $0.001 per share(the "Preferred Stock"). There were, as of the close of business on November 30, 2002, (i) 56,175,750 shares of Common Stock issued and outstanding, (ii) no shares of Preferred Stock issued and outstanding and (iii) no shares of Common Stock held in the treasury of the Company. As of the date hereofNovember 30, (i) 67,066,418 2002, there were 4,087,357 shares of Company Common Stock were issued and outstanding (excluding shares of Company Common Stock held by the Company in its treasury), (ii) 15,000,000 shares of Company Common Stock have been reserved for issuance pursuant to the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”), and (iii) upon exercise of outstanding Company Stock Options entitling the owners thereof to purchase 7,960,000 shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities reserved for issuance or required to be reserved for issuance other than as described aboveOptions. All such issued and outstanding shares of the capital stock of the Company and its Subsidiaries are, and all shares subject to issuance as specified above, upon issuance on the terms and conditions specified in the instruments which may be issued pursuant to which they are issuable, the exercise of the Company Options will be, when issuedissued in accordance with the respective terms thereof, duly authorized, validly issued, fully paid, nonassessable paid and free non-assessable and not subject to or issued in violation of any preemptive rights purchase option, call option, right of first refusal, preemptive right, subscription agreement, right or any other similar right under any provision of the Company CharterDGCL, the Company Bylaws Company's certificate of incorporation, the Company's by-laws or any agreement to which the Company is party or by which it is bound. (b) Except for the Company Stock Options, there are no existing options, warrants, calls, subscription rights, exercisable, convertible or exchangeable securities or other rights, agreements or commitments (contingent or otherwise) that obligate the Company to issue, transfer or sell any Company Common Stock or any investment that is convertible into or exercisable or exchangeable for any such shares. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There are no agreements or understandings contract to which the Company is a party with respect to or otherwise bound. (b) As of the date hereof, except as described in Section 4.5(a) herein, there are no outstanding (i) shares of capital stock or other voting securities of any the Company, (ii) securities of the Company convertible into or exchangeable for shares of capital stock or voting securities of the Company or which restrict (iii) options or other rights to acquire from the transfer Company, or obligations of any such shares, nor does the Company have knowledge to issue, any capital stock, voting securities or securities convertible into or exchangeable for capital stock or voting securities of the Company. Except as disclosed on Section 4.5(b) of the Company Disclosure Schedule, there are no outstanding obligations of the Company or any third party agreements Company Subsidiary to repurchase, redeem or understandings with respect otherwise acquire any Common Stock or other capital stock of the Company or any Company Subsidiary or to provide funds to make any investment (in the voting form of a loan, capital contribution or otherwise) in any such shares Company Subsidiary or which restrict other entity, other than loans to Subsidiaries in the transfer ordinary course of such sharesbusiness.

Capitalization. (a) The As of June 4, 2019, the authorized shares of capital stock of the Company consist consists of 200,000,000 500,000,000 shares of Company Common Stock, par value $0.001 per share, of the Company. As of the date hereof, (i) 67,066,418 which approximately 33,316,861 shares of Company Common Stock were are issued and outstanding (excluding outstanding, and 100,000,000 shares of Company Common Stock held by the Company in its treasury), (ii) 15,000,000 preferred stock authorized of which 0 shares of Company Common Stock have been preferred stock are issued and outstanding. Except as disclosed in the SEC Documents, no shares are reserved for issuance pursuant to the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”)Company’s stock option plans, and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 no shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities are reserved for issuance pursuant to securities (other than the Note) exercisable for, or required to be convertible into or exchangeable for shares of Common Stock and 6,000,000 shares are reserved for issuance other than as described aboveupon conversion of the Note. All of such issued and outstanding shares of the Company and its Subsidiaries capital stock are, and all shares subject to issuance as specified above, or upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable paid and free non-assessable. No shares of any capital stock of the Company are subject to preemptive rights purchase optionor any other similar rights of the shareholders of the Company or any liens or encumbrances imposed through the actions or failure to act of the Company. Except as disclosed in the SEC Documents, call optionas of the effective date of this Agreement, right (i) there are no outstanding options, warrants, scrip, rights to subscribe for, puts, calls, rights of first refusal, subscription agreementagreements, understandings, claims or other commitments or rights of any character whatsoever relating to, or securities or rights convertible into or exchangeable for any other similar right under shares of capital stock of the Company Charter, the Company Bylaws or any agreement to of its Subsidiaries, or arrangements by which the Company or any of its Subsidiaries is party or by which it is bound. (b) Except for may become bound to issue additional shares of capital stock of the Company Stock Optionsor any of its Subsidiaries, (ii) there are no existing options, warrants, calls, subscription rights, exercisable, convertible or exchangeable securities or other rights, agreements or commitments arrangements under which the Company or any of its Subsidiaries is obligated to register the sale of any of its or their securities under the 1933 Act and (contingent iii) there are no anti-dilution or otherwiseprice adjustment provisions contained in any security issued by the Company (or in any agreement providing rights to security holders) that obligate will be triggered by the issuance of the Note or the Conversion Shares. The Company to issuehas filed in its SEC Documents true and correct copies of the Company’s Certificate of Incorporation as in effect on the date hereof (“Certificate of Incorporation”), transfer or sell any Company Common Stock or any investment that is the Company’s By-laws, as in effect on the date hereof (the “By-laws”), and the terms of all securities convertible into or exercisable or exchangeable for any such shares. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There are no agreements or understandings to which the Company is a party with respect to the voting of any securities Common Stock of the Company or which restrict and the transfer material rights of any such shares, nor does the holders thereof in respect thereto. The Company shall provide the Buyer with a written update of this representation signed by the Company’s Chief Executive on behalf of the Company have knowledge as of any third party agreements or understandings with respect to the voting of any such shares or which restrict the transfer of such sharesClosing Date.

Capitalization. (a) The authorized shares of stock of the Company consist of 200,000,000 shares of Company Common Stock, par value $0.001 per share, of the Company. As of the date hereof, (i) 67,066,418 the authorized capital stock of the Company consists of 200,000,000 shares of Company Common Stock were Stock, of which 75,000,000 shares are issued and outstanding (excluding outstanding, 0 shares of Company Common Stock held by the Company in its treasury), (ii) 15,000,000 shares of Company Common Stock have been are reserved for issuance pursuant to the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”)Company's stock option plans, and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 5,761,904 shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities are reserved for issuance pursuant to securities (other than the Notes and the Warrants) exercisable for, or required to be convertible into or exchangeable for shares of Common Stock and 116,111,111 shares are reserved for issuance other than as described aboveupon conversion of the Notes and exercise of the Warrants (subject to adjustment pursuant to the Company's covenant set forth in Section 4(h) below). All of such issued and outstanding shares of the Company and its Subsidiaries capital stock are, and all shares subject to issuance as specified above, or upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable paid and free nonassessable. No shares of any capital stock of the Company are subject to preemptive rights purchase optionor any other similar rights of the shareholders of the Company or any liens or encumbrances imposed through the actions or failure to act of the Company. Except as disclosed in Schedule 3(c), call optionas of the effective date of this Agreement, right (i) there are no outstanding options, warrants, scrip, rights to subscribe for, puts, calls, rights of first refusal, subscription agreementagreements, understandings, claims or other commitments or rights of any character whatsoever relating to, or securities or rights convertible into or exchangeable for any other similar right under shares of capital stock of the Company Charter, the Company Bylaws or any agreement to of its Subsidiaries, or arrangements by which the Company or any of its Subsidiaries is party or by which it is bound. (b) Except for may become bound to issue additional shares of capital stock of the Company Stock Optionsor any of its Subsidiaries, (ii) there are no existing options, warrants, calls, subscription rights, exercisable, convertible or exchangeable securities or other rights, agreements or commitments arrangements under which the Company or any of its Subsidiaries is obligated to register the sale of any of its or their securities under the 1933 Act (contingent except the Registration Rights Agreement) and (iii) there are no anti-dilution or otherwiseprice adjustment provisions contained in any security issued by the Company (or in any agreement providing rights to security holders) that obligate will be triggered by the issuance of the Notes, the Warrants, the Conversion Shares or Warrant Shares. The Company has furnished to issuethe Buyer true and correct copies of the Company's Articles of Incorporation as in effect on the date hereof ("Articles of Incorporation"), transfer or sell any Company Common Stock or any investment that is the Company's By-laws, as in effect on the date hereof (the "By-laws"), and the terms of all securities convertible into or exercisable or exchangeable for any such shares. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There are no agreements or understandings to which the Company is a party with respect to the voting of any securities Common Stock of the Company and the material rights of the holders thereof in respect thereto. The Company shall provide the Buyer with a written update of this representation signed by the Company's Chief Executive or which restrict the transfer Chief Financial Officer on behalf of any such shares, nor does the Company have knowledge as of any third party agreements or understandings with respect to the voting of any such shares or which restrict the transfer of such sharesClosing Date.

Capitalization. (a) The authorized shares of stock of the Company consist of 200,000,000 shares of Company Common Stock, par value $0.001 per share, of the Company. As of the date hereof, the authorized capital stock of the Company consists of: (i) 67,066,418 750,000,000 shares of Company Common Stock were Stock, of which approximately 11,603,840 shares are issued and outstanding (excluding shares of Company Common Stock held by the Company in its treasury), outstanding; and (ii) 15,000,000 5,000,000 shares of Company Common Stock have been preferred stock, of which 1,000,100 are issued and outstanding. Except as disclosed in the SEC Documents, no shares are reserved for issuance pursuant to the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”)Company’s stock option plans, and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 no shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities are reserved for issuance or required pursuant to be reserved for issuance securities (other than as described abovethe Note and any other convertible promissory note issued to the Buyer) exercisable for, or convertible into or exchangeable for shares of Common Stock. All of such issued and outstanding shares of the Company and its Subsidiaries capital stock are, and all shares subject to issuance as specified above, or upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable paid and free non-assessable. No shares of any capital stock of the Company are subject to preemptive rights purchase optionor any other similar rights of the shareholders of the Company or any liens or encumbrances imposed through the actions or failure to act of the Company. Except as disclosed in the SEC Documents, call optionas of the effective date of this Agreement, right (i) there are no outstanding options, warrants, scrip, rights to subscribe for, puts, calls, rights of first refusal, subscription agreementagreements, understandings, claims or other commitments or rights of any character whatsoever relating to, or any other similar right under the Company Charter, the Company Bylaws or any agreement to which the Company is party or by which it is bound. (b) Except for the Company Stock Options, there are no existing options, warrants, calls, subscription rights, exercisable, convertible or exchangeable securities or other rights, agreements or commitments (contingent or otherwise) that obligate the Company to issue, transfer or sell any Company Common Stock or any investment that is rights convertible into or exercisable or exchangeable for any such shares. shares of capital stock of the Company or any of its Subsidiaries, or arrangements by which the Company or any of its Subsidiaries is or may become bound to issue additional shares of capital stock of the Company or any of its Subsidiaries, (cii) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There there are no agreements or understandings to arrangements under which the Company or any of its Subsidiaries is a party with respect obligated to register the voting sale of any of its or their securities under the 1933 Act and (iii) there are no anti-dilution or price adjustment provisions contained in any security issued by the Company (or in any agreement providing rights to security holders) that will be triggered by the issuance of the Company Note or which restrict the transfer of any such shares, nor does the Company have knowledge of any third party agreements or understandings with respect to the voting of any such shares or which restrict the transfer of such sharesConversion Shares.

Capitalization. (a) The As of the date hereof, the authorized shares of capital stock of the Company consist consists of 200,000,000 (A) 30,000,000 Common Shares and (B) 5,000,000 shares of Company Common Stock, par value $0.001 per share, of preferred stock (the Company"Preferred Shares"). As of the date hereof, (i) 67,066,418 shares of Company 5,745,599 Common Stock were Shares are issued and outstanding (excluding shares of Company Common Stock held by the Company in its treasury)outstanding, (ii) 15,000,000 no shares of Company Common Stock have been reserved for issuance pursuant to the 2001 Stock Option Plan Preferred Shares are issued and the 2005 Stock Option Plan (“Incentive Plans”)outstanding, and (iii) no more than 1,400,000 Common Shares are reserved for future issuance pursuant to outstanding Company Stock Options entitling the owners thereof Options, pursuant to which options to purchase 7,960,000 733,000 shares of Company Common Stock were outstanding. As are exercisable as of the date hereof and options to purchase zero (0) shares become exercisable on or after that date at prices below the Per Share Price. No other capital stock of this Agreement, the Company had no Company Common Stock, is authorized or any other securities reserved for issuance or required to be reserved for issuance issued other than as described aboveshares that may be issued upon the exercise of options granted under the 1994 Plan. All such issued and outstanding shares of the Company and its Subsidiaries are, and all shares subject to issuance as specified above, upon issuance on the terms and conditions specified in the instruments pursuant to which they Common Shares are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable paid and free of any preemptive rights purchase option, call option, right of first refusal, subscription agreement, or any other similar right under non-assessable. Except as set forth in the Company CharterSecurities Filings (as hereinafter defined) filed prior to the date of this Agreement or as otherwise contemplated by this Agreement, as of the Company Bylaws or any agreement to which the Company is party or by which it is bound. (b) Except for the Company Stock Optionsdate hereof, there are no existing optionsoutstanding rights, subscriptions, warrants, puts, calls, subscription unsatisfied preemptive rights, exercisable, convertible or exchangeable securities options or other rightsagreements of any kind relating to any of the outstanding, agreements or commitments (contingent or otherwise) that obligate authorized but unissued shares of the Company to issue, transfer or sell any Company Common Stock capital stock or any investment that other security of the Company, and there is no authorized or outstanding security of any kind convertible into or exercisable or exchangeable for any such shares. (c) The capital stock or other security. Except as disclosed in the Company has not issued any share appreciation rightsSecurities Filings filed prior to the date of this Agreement, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There there are no agreements obligations, contingent or understandings to which the Company is a party with respect to the voting of any securities other, of the Company or which restrict any Company Subsidiary to repurchase, redeem or otherwise acquire any shares of Common Shares or the transfer capital stock of any such sharesCompany Subsidiary or to provide funds to or make any investment (in the form of a loan, nor does the Company have knowledge of any third party agreements capital contribution or understandings with respect to the voting of otherwise) in any such shares Company Subsidiary or which restrict the transfer of such sharesany other entity.

Capitalization. (a) The authorized shares of stock of the Company consist of 200,000,000 shares of Company Common Stock, par value $0.001 per share, of the Company. As of the date hereof, the authorized capital stock of the Company consists of: (i) 67,066,418 14,991,000,000 shares of Company Common Stock were Stock, of which approximately 12,189,293,609 shares are issued and outstanding (excluding shares of Company Common Stock held by the Company in its treasury), outstanding; and (ii) 15,000,000 5,000,000 shares of Company Common Stock have been preferred stock, of which 13 are issued and outstanding. Except as disclosed in the SEC Documents, no shares are reserved for issuance pursuant to the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”)Company’s stock option plans, and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 no shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities are reserved for issuance or required pursuant to be reserved for issuance securities (other than as described abovethe Note and any other convertible promissory note issued to the Buyer) exercisable for, or convertible into or exchangeable for shares of Common Stock. All of such issued and outstanding shares of the Company and its Subsidiaries capital stock are, and all shares subject to issuance as specified above, or upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable paid and free non-assessable. No shares of any capital stock of the Company are subject to preemptive rights purchase optionor any other similar rights of the shareholders of the Company or any liens or encumbrances imposed through the actions or failure to act of the Company. Except as disclosed in the SEC Documents, call optionas of the effective date of this Agreement, right (i) there are no outstanding options, warrants, scrip, rights to subscribe for, puts, calls, rights of first refusal, subscription agreementagreements, understandings, claims or other commitments or rights of any character whatsoever relating to, or any other similar right under the Company Charter, the Company Bylaws or any agreement to which the Company is party or by which it is bound. (b) Except for the Company Stock Options, there are no existing options, warrants, calls, subscription rights, exercisable, convertible or exchangeable securities or other rights, agreements or commitments (contingent or otherwise) that obligate the Company to issue, transfer or sell any Company Common Stock or any investment that is rights convertible into or exercisable or exchangeable for any such shares. shares of capital stock of the Company or any of its Subsidiaries, or arrangements by which the Company or any of its Subsidiaries is or may become bound to issue additional shares of capital stock of the Company or any of its Subsidiaries, (cii) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There there are no agreements or understandings to arrangements under which the Company or any of its Subsidiaries is a party with respect obligated to register the voting sale of any of its or their securities under the 1933 Act and (iii) there are no anti-dilution or price adjustment provisions contained in any security issued by the Company (or in any agreement providing rights to security holders) that will be triggered by the issuance of the Company Note or which restrict the transfer of any such shares, nor does the Company have knowledge of any third party agreements or understandings with respect to the voting of any such shares or which restrict the transfer of such sharesConversion Shares.

Capitalization. (a) The As of the date hereof, the authorized shares of capital stock of the Company consist consists of 200,000,000 (i) 30,000,000 shares of Company Common Stock, par value $0.001 .01 per share, of which 12,273,636 shares are issued and outstanding and no shares are held in the Company. As of the date hereof's treasury, and (iii) 67,066,418 1,000,000 shares of Company Common Stock were Preferred Stock, par value $.01 per share, none of which are issued or outstanding. All issued and outstanding (excluding shares of Company Common Stock held capital stock of each Subsidiary are owned, beneficially and of record, by the Company in its treasuryCompany, free and clear of any mortgage, pledge, security interest, encumbrance, lien or other charge of any kind ("Lien"), (ii) 15,000,000 other than Liens granted in connection with the Company's credit facility. All issued and outstanding shares of Company Common Stock have been reserved for issuance pursuant to the 2001 Stock Option Plan validly issued, are fully paid and the 2005 Stock Option Plan (“Incentive Plans”)nonassessable, and (iii) Company Stock Options entitling the owners thereof have not been issued in violation of and are not currently subject to any preemptive rights. Except for options to purchase 7,960,000 an aggregate 1,710,764 shares of Company Common Stock were outstanding. As granted pursuant to the Company's Third Amended and Restated 1996 Stock Option Plan (the "Company Option Plan") listed, together with their respective exercise prices, in the Company Disclosure Schedule, and for Liens granted in connection with the Company's credit facility, as of the date of this Agreement, the Company had no Company Common Stock, or any other securities reserved for issuance or required to be reserved for issuance other than as described above. All such issued and outstanding shares of the Company and its Subsidiaries are, and all shares subject to issuance as specified above, upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable and free of any preemptive rights purchase option, call option, right of first refusal, subscription agreement, or any other similar right under the Company Charter, the Company Bylaws or any agreement to which the Company is party or by which it is bound. (b) Except for the Company Stock Options, there are no existing not any outstanding or authorized subscriptions, options, warrants, calls, subscription rights, exercisableconvertible securities, convertible commitments, restrictions, arrangements, or exchangeable securities any other agreements of any character to which the Company or other rightsany Subsidiary is a party that, agreements directly or commitments indirectly, (contingent or otherwisei) that obligate the Company to issue, transfer or sell any Company Common Stock or any investment that is Subsidiary to issue any shares of capital stock or any securities convertible into into, or exercisable or exchangeable for, or evidencing the right to subscribe for, any shares of capital stock, (ii) call for any such shares. (c) The Company has not issued any share appreciation rightsor relate to the sale, dividend equivalent rightspledge, performance awardstransfer, restricted stock unit awards or “phantom” shares. (d) There are no agreements other disposition or understandings to which encumbrance by the Company is a party with respect or any Subsidiary of any shares of its capital stock, or (iii) to the knowledge of the Company, relate to the voting or control of any securities such capital stock. The Company Disclosure Schedule sets forth a complete and accurate list of all stock options, warrants, and other rights to acquire Company Common Stock, including the name of the holder, the date of grant, acquisition price, number of shares, exercisability schedule, and, in the case of options, the type of option under the Code. No consent of holders or participants under the Company Option Plan is required to carry out the provisions of Section 1.7. All actions, if any, required on the part of the Company or which restrict the transfer of any such shares, nor does under the Company have knowledge Option Plan to allow for the treatment of any third party agreements Company Options as is provided in Section 1.7, has been, or understandings with respect prior to the voting Closing will be, validly taken by the Company. In no event will the aggregate number of shares of Company Common Stock outstanding at the Effective Time (including all shares subject to then outstanding Company Options or other rights to acquire or commitments to issue shares of Company stock, other than the Stock Option Agreement referenced in Section 5.13) exceed by more than 1,000 shares the sum of the outstanding shares of Company Common Stock described in the first sentence of this Section 3.3, plus any such shares or which restrict of Company Common Stock issued upon the transfer exercise of such sharesoutstanding options to purchase Company Common Stock identified in Section 3.3.

Capitalization. (a) The authorized shares of capital stock of the Company consist consists of 200,000,000 (i) 25,000,000 shares of Company Common Stock, $0.001 par value per share and (ii) 5,000,000 shares of Preferred Stock, $0.001 par value per share, of the Company. As of the date hereofClosing Date, there are (iy) 67,066,418 3,160,000 shares of Company Common Stock were issued and outstanding (excluding shares outstanding, all of Company Common Stock held by the Company in its treasury), (ii) 15,000,000 shares of Company Common Stock have been reserved for issuance pursuant to the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”), and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities reserved for issuance or required to be reserved for issuance other than as described above. All such issued and outstanding shares of the Company and its Subsidiaries are, and all shares subject to issuance as specified above, upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paidpaid and non-assessable and (z) no shares of Preferred Stock issued and outstanding. In addition, nonassessable there are 925,000 shares of Common Stock reserved for issuance pursuant to outstanding options and free warrants. There are no shares of any preemptive rights purchase option, call option, right class or series of first refusal, subscription agreement, preferred stock issued or any other similar right under outstanding. All of the securities issued by the Company Charter, the Company Bylaws or any agreement to which the Company is party or by which it is bound. (b) Except for the Company Stock Optionshave been issued in accordance with all applicable federal and state securities laws. Other than as set forth above, there are no existing other options, warrants, calls, subscription rights, exercisable, convertible commitments or exchangeable securities or other rights, agreements or commitments (contingent or otherwise) that obligate the Company to issue, transfer or sell of any Company Common Stock or any investment that is convertible into or exercisable or exchangeable for any such shares. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There are no agreements or understandings character to which the Company is a party or by which the Company is bound or obligating the Company to issue, deliver, sell, repurchase or redeem, or cause to be issued, delivered, sold, repurchased or redeemed, any shares of the capital stock of the Company or obligating the Company to grant, extend or enter into any such option, warrant, call, right, commitment or agreement. There are no preemptive rights or rights of first refusal or similar rights which are binding on the Company permitting any person to subscribe for or purchase from the Company shares of its capital stock pursuant to any provision of law, the Company’s Certificate of Incorporation as in effect on the date hereof (the “Certificate of Incorporation”) or the Company’s By-laws, as in effect on the date hereof (the “By-laws”) or by agreement or otherwise. There are no securities or instruments containing anti-dilution or similar provisions that will be triggered by the issuance of the Securities as described in this Agreement and the Offering Memo. True and correct copies of the Company’s Certificate of Incorporation and By-laws are available to the Subscriber upon request. (b) The Securities (including upon exercise of the Warrant, the Warrant Shares, and upon conversion of the Note, the securities issuable therefor), have been (or, with respect to the voting Warrant Shares and the securities issuable upon conversion of any securities the Note, will be) duly authorized and, when issued, delivered and paid for in the manner set forth in this Agreement, the Note and/or the Warrant, will be duly authorized, validly issued, fully paid and non-assessable. No stockholder of the Company has any right to request or which restrict require the transfer Company to register the sale of any shares owned by such shares, nor does stockholder under the Act. No further approval or authority of the stockholders or the Board of Directors of the Company have knowledge will be required for the issuance and sale of any third party agreements or understandings with respect the Securities to be sold by the voting of any such shares or which restrict the transfer of such sharesCompany as contemplated herein.

Capitalization. (a) The authorized shares of stock of the Company consist of 200,000,000 shares of Company Common Stock, par value $0.001 per share, of the Company. As of the date hereof, the authorized capital stock of the Company consists of: (i) 67,066,418 500,000,000 shares of Company Common Stock were Stock, of which approximately 125,199,633 shares are issued and outstanding; and (ii) 1,000,000 shares of preferred stock, of which 262,908 are issued and outstanding (excluding consisting of 262,800 shares of Company Common Stock held by the Company in its treasury), (ii) 15,000,000 Series A and 108 shares of Company Common Stock have been Series B). Except as disclosed in the SEC Documents and for up to 78,222,222 reserved for third parties, no shares are reserved for issuance pursuant to the 2001 Stock Option Plan Company’s stock option plans, no shares are reserved for issuance pursuant to securities exclusive of the shares reserved for the Buyer and for securities issued by the 2005 Stock Option Plan (“Incentive Plans”), and (iii) Company Stock Options entitling the owners thereof prior to purchase 7,960,000 shares of Company Common Stock were outstanding. As of the date of this Agreement, Agreement (other than the Company had no Company Common StockNote and any other convertible promissory note issued to the Buyer) exercisable for, or any other securities convertible into or exchangeable for shares of Common Stock and 28,833,967 shares are reserved for issuance or required to be reserved for issuance other than as described aboveupon conversion of the Note. All of such issued and outstanding shares of the Company and its Subsidiaries capital stock are, and all shares subject to issuance as specified above, or upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable paid and free non-assessable. No shares of any capital stock of the Company are subject to preemptive rights purchase optionor any other similar rights of the shareholders of the Company or any liens or encumbrances imposed through the actions or failure to act of the Company. Except as disclosed in the SEC Documents, call optionas of the effective date of this Agreement, right (i) there are no outstanding options, warrants, scrip, rights to subscribe for, puts, calls, rights of first refusal, subscription agreementagreements, understandings, claims or other commitments or rights of any character whatsoever relating to, or securities or rights convertible into or exchangeable for any other similar right under shares of capital stock of the Company Charter, the Company Bylaws or any agreement to of its Subsidiaries, or arrangements by which the Company or any of its Subsidiaries is party or by which it is bound. (b) Except for may become bound to issue additional shares of capital stock of the Company Stock Optionsor any of its Subsidiaries, (ii) there are no existing options, warrants, calls, subscription rights, exercisable, convertible or exchangeable securities or other rights, agreements or commitments arrangements under which the Company or any of its Subsidiaries is obligated to register the sale of any of its or their securities under the 1933 Act and (contingent iii) there are no anti-dilution or otherwiseprice adjustment provisions contained in any security issued by the Company (or in any agreement providing rights to security holders) that obligate will be triggered by the issuance of the Note or the Conversion Shares. The Company to issuehas filed in its SEC Documents true and correct copies of the Company’s Certificate of Incorporation as in effect on the date hereof (“Certificate of Incorporation”), transfer or sell any Company Common Stock or any investment that is the Company’s By-laws, as in effect on the date hereof (the “By-laws”), and the terms of all securities convertible into or exercisable or exchangeable for any such shares. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There are no agreements or understandings to which the Company is a party with respect to the voting of any securities Common Stock of the Company or which restrict and the transfer material rights of any such shares, nor does the holders thereof in respect thereto. The Company shall provide the Buyer with a written update of this representation signed by the Company’s Chief Executive on behalf of the Company have knowledge as of any third party agreements or understandings with respect to the voting of any such shares or which restrict the transfer of such sharesClosing Date.

Capitalization. (a) The authorized shares of stock of the Company consist of 200,000,000 shares of Company Common Stock, par value $0.001 per share, of the Company. As of the date hereof, the authorized capital stock of the Company consists of (i) 67,066,418 300,000,000 shares of Company Common Stock were Stock, of which [ ] shares are issued and outstanding (excluding outstanding, [ ] shares of Company Common Stock held by the Company in its treasury), (ii) 15,000,000 shares of Company Common Stock have been are reserved for issuance pursuant to the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”)Company’s stock option plans, and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 [ ] shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities are reserved for issuance pursuant to securities (other than the Notes and the Warrants) exercisable for, or required to be convertible into or exchangeable for shares of Common Stock and, 42,500,000 shares are reserved for issuance other than as described aboveupon conversion of the Notes and exercise of the Warrants (subject to adjustment pursuant to the Company’s covenant set forth in Section 4(h) below); and (ii) [ ] shares of preferred stock of which [ ] shares are issued and outstanding. All of such issued and outstanding shares of the Company and its Subsidiaries capital stock are, and all shares subject to issuance as specified above, or upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable paid and free nonassessable. No shares of any capital stock of the Company are subject to preemptive rights purchase optionor any other similar rights of the shareholders of the Company or any liens or encumbrances imposed through the actions or failure to act of the Company. Except as disclosed in Schedule 3(c), call optionas of the effective date of this Agreement, right (i) there are no outstanding options, warrants, scrip, rights to subscribe for, puts, calls, rights of first refusal, subscription agreementagreements, understandings, claims or other commitments or rights of any character whatsoever relating to, or securities or rights convertible into or exchangeable for any other similar right under shares of capital stock of the Company Charter, the Company Bylaws or any agreement to of its Subsidiaries, or arrangements by which the Company or any of its Subsidiaries is party or by which it is bound. (b) Except for may become bound to issue additional shares of capital stock of the Company Stock Optionsor any of its Subsidiaries, (ii) there are no existing options, warrants, calls, subscription rights, exercisable, convertible or exchangeable securities or other rights, agreements or commitments arrangements under which the Company or any of its Subsidiaries is obligated to register the sale of any of its or their securities under the 1933 Act (contingent except the Registration Rights Agreement) and (iii) there are no anti-dilution or otherwiseprice adjustment provisions contained in any security issued by the Company (or in any agreement providing rights to security holders) that obligate will be triggered by the issuance of the Notes, the Warrants, the Conversion Shares or Warrant Shares. The Company has furnished to issuethe Buyer true and correct copies of the Company’s Certificate of Incorporation as in effect on the date hereof (“Certificate of Incorporation”), transfer or sell any Company Common Stock or any investment that is the Company’s By-laws, as in effect on the date hereof (the “By-laws”), and the terms of all securities convertible into or exercisable or exchangeable for any such shares. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There are no agreements or understandings to which the Company is a party with respect to the voting of any securities Common Stock of the Company and the material rights of the holders thereof in respect thereto. The Company shall provide the Buyer with a written update of this representation signed by the Company’s Chief Executive or which restrict the transfer Chief Financial Officer on behalf of any such shares, nor does the Company have knowledge as of any third party agreements or understandings with respect to the voting of any such shares or which restrict the transfer of such sharesClosing Date.

Capitalization. (a) The authorized shares As of the date hereof, the authorized, issued and outstanding capital stock of the Company consist of 200,000,000 is as set forth on Schedule 4.3 hereto and except as set forth on Schedule 4.3 no other shares of capital stock of the Company Common will be outstanding as of the Closing Date. All of such outstanding shares of capital stock are, or upon issuance will be, duly authorized, validly issued, fully paid and nonassessable. No shares of capital stock of the Company are subject to preemptive rights or similar rights of the stockholders of the Company (other than those rights in favor of holders of the Preferred Stock, par value $0.001 per share, ) or any liens or encumbrances imposed through the actions or failure to act of the Company. As Other than as set forth on Schedule 4.3 hereto, as of the date hereof, (i) 67,066,418 there are no outstanding options, warrants, scrip, rights to subscribe for, puts, calls, rights of first refusal, agreements, understandings, claims or other commitments or rights of any character whatsoever relating to, or securities or rights convertible into or exchangeable for any shares of capital stock of the Company Common Stock were issued and outstanding (excluding or any of its Subsidiaries, or arrangements by which the Company or any of its Subsidiaries is or may become bound to issue additional shares of Company Common Stock held by capital stock of the Company in or any of its treasury)Subsidiaries, and (ii) 15,000,000 shares there are no agreements or arrangements under which the Company or any of Company Common Stock have been reserved for issuance its Subsidiaries are obligated to register the sale of any of its or their securities under the Securities Act (except pursuant to the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”), Registration Rights Agreement) and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities reserved for issuance or required to be reserved for issuance other than as described above. All such issued and outstanding shares of the Company and its Subsidiaries are, and all shares subject to issuance as specified above, upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable and free of any preemptive rights purchase option, call option, right of first refusal, subscription agreement, or any other similar right under the Company Charter, the Company Bylaws or any agreement to which the Company is party or by which it is bound. (b) Except for the Company Stock Options, there are no existing options, warrants, calls, subscription rights, exercisable, convertible anti-dilution or exchangeable securities price adjustment provisions contained in any security issued by the Company (or other rights, agreements or commitments (contingent or otherwisein any agreement providing rights to security holders) that obligate will be triggered by the issuance of the Securities. The Company has furnished to issuePurchaser true and correct copies of the Company’s Corporate Documents, transfer or sell any Company Common Stock or any investment that is and the terms of all securities convertible into or exercisable or exchangeable for any such shares. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There are no agreements or understandings to which Common Stock and the Company is a party with respect to the voting of any securities material rights of the Company or which restrict the transfer of any such shares, nor does the Company have knowledge of any third party agreements or understandings with holders thereof in respect to the voting of any such shares or which restrict the transfer of such sharesthereto.

Capitalization. (a) The authorized shares of stock of the Company consist of 200,000,000 shares of Company Common Stock, par value $0.001 per share, of the Company. As of the date hereof, (i) 67,066,418 the authorized capital stock of the Company consists of 1 billion shares of Company Common Stock were Stock, of which 31,077,356 shares are issued and outstanding (excluding outstanding, no shares of Company Common Stock held by the Company in its treasury), (ii) 15,000,000 shares of Company Common Stock have been are reserved for issuance pursuant to securities (other than the 2001 Stock Option Plan Notes and the 2005 Stock Option Plan (“Incentive Plans”)Warrants) exercisable for, and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 or convertible into or exchangeable for shares of Company Common Stock were outstanding. As of the date of this Agreementaside from one certificate (#P2) for 10,000 preferred shares, the Company had no Company Common Stock, or any other securities convertible to 60,000 free trading shares and are reserved for issuance or required upon conversion of the Notes and exercise of the Warrants (subject to be reserved for issuance other than as described aboveadjustment pursuant to the Company’s covenant set forth in Section 4(h) below). All of such issued and outstanding shares of the Company and its Subsidiaries capital stock are, and all shares subject to issuance as specified above, or upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable paid and free nonassessable. No shares of any capital stock of the Company are subject to preemptive rights purchase optionor any other similar rights of the shareholders of the Company or any liens or encumbrances imposed through the actions or failure to act of the Company. Except as disclosed in Schedule 3(c), call optionas of the effective date of this Agreement, right (i) there are no outstanding options, warrants, scrip, rights to subscribe for, puts, calls, rights of first refusal, subscription agreementagreements, understandings, claims or other commitments or rights of any character whatsoever relating to, or securities or rights convertible into or exchangeable for any other similar right under shares of capital stock of the Company Charter, the Company Bylaws or any agreement to of its Subsidiaries, or arrangements by which the Company or any of its Subsidiaries is party or by which it is bound. (b) Except for may become bound to issue additional shares of capital stock of the Company Stock Optionsor any of its Subsidiaries, (ii) there are no existing options, warrants, calls, subscription rights, exercisable, convertible or exchangeable securities or other rights, agreements or commitments arrangements under which the Company or any of its Subsidiaries is obligated to register the sale of any of its or their securities under the 1933 Act (contingent except the Registration Rights Agreement) and (iii) there are no anti-dilution or otherwiseprice adjustment provisions contained in any security issued by the Company (or in any agreement providing rights to security holders) that obligate will be triggered by the issuance of the Notes, the Warrants, the Conversion Shares or Warrant Shares. The Company has furnished to issuethe Buyer true and correct copies of the Company’s Articles of Incorporation as in effect on the date hereof (“Articles of Incorporation”), transfer or sell any Company Common Stock or any investment that is the Company’s By-laws, as in effect on the date hereof (the “By-laws”), and the terms of all securities convertible into or exercisable or exchangeable for any such shares. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There are no agreements or understandings to which the Company is a party with respect to the voting of any securities Common Stock of the Company and the material rights of the holders thereof in respect thereto. The Company shall provide the Buyer with a written update of this representation signed by the Company’s Chief Executive or which restrict the transfer Chief Financial Officer on behalf of any such shares, nor does the Company have knowledge as of any third party agreements or understandings with respect to the voting of any such shares or which restrict the transfer of such sharesClosing Date.

Capitalization. (a) The As of August 10, 2020, the authorized shares of capital stock of the Company consist of 200,000,000 consists of: (i) 150,000,000 shares of Company Common Stock, par value $0.001 per share, of the Company. As of the date hereof, (i) 67,066,418 which approximately 120,932,409 shares of Company Common Stock were are issued and outstanding (excluding shares of Company Common Stock held by the Company in its treasury), outstanding; and (ii) 15,000,000 50,000,000 shares of Company Common Stock have been preferred stock, of which 632,477 are issued and outstanding. Except as disclosed in the SEC Documents, no shares are reserved for issuance pursuant to the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”)Company’s stock option plans, and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 no shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities are reserved for issuance pursuant to securities (other than the Note) exercisable for, or required to be convertible into or exchangeable for shares of Common Stock and 8,000,000 shares are reserved for issuance other than as described aboveupon conversion of the Note. All of such issued and outstanding shares of the Company and its Subsidiaries capital stock are, and all shares subject to issuance as specified above, or upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable paid and free non-assessable. No shares of any capital stock of the Company are subject to preemptive rights purchase optionor any other similar rights of the shareholders of the Company or any liens or encumbrances imposed through the actions or failure to act of the Company. Except as disclosed in the SEC Documents, call optionas of the effective date of this Agreement, right (i) there are no outstanding options, warrants, scrip, rights to subscribe for, puts, calls, rights of first refusal, subscription agreementagreements, understandings, claims or other commitments or rights of any character whatsoever relating to, or securities or rights convertible into or exchangeable for any other similar right under shares of capital stock of the Company Charter, the Company Bylaws or any agreement to of its Subsidiaries, or arrangements by which the Company or any of its Subsidiaries is party or by which it is bound. (b) Except for may become bound to issue additional shares of capital stock of the Company Stock Optionsor any of its Subsidiaries, (ii) there are no existing options, warrants, calls, subscription rights, exercisable, convertible or exchangeable securities or other rights, agreements or commitments arrangements under which the Company or any of its Subsidiaries is obligated to register the sale of any of its or their securities under the 1933 Act and (contingent iii) there are no anti-dilution or otherwiseprice adjustment provisions contained in any security issued by the Company (or in any agreement providing rights to security holders) that obligate will be triggered by the issuance of the Note or the Conversion Shares. The Company to issuehas filed in its SEC Documents true and correct copies of the Company’s Certificate of Incorporation as in effect on the date hereof (“Certificate of Incorporation”), transfer or sell any Company Common Stock or any investment that is the Company’s By-laws, as in effect on the date hereof (the “By-laws”), and the terms of all securities convertible into or exercisable or exchangeable for any such shares. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There are no agreements or understandings to which the Company is a party with respect to the voting of any securities Common Stock of the Company or which restrict and the transfer material rights of any such shares, nor does the holders thereof in respect thereto. The Company shall provide the Buyer with a written update of this representation signed by the Company’s Chief Executive on behalf of the Company have knowledge as of any third party agreements or understandings with respect to the voting of any such shares or which restrict the transfer of such sharesClosing Date.

Capitalization. (a) The authorized shares of stock of the Company consist of 200,000,000 shares of Company Common Stock, par value $0.001 per share, of the Company. As of the date hereof, the authorized capital stock of the Company consists of (i) 67,066,418 [ ] shares of Company Common Stock were Stock, of which [ ] shares are issued and outstanding (excluding outstanding, no shares of Company Common Stock held by the Company in its treasury), (ii) 15,000,000 shares of Company Common Stock have been are reserved for issuance pursuant to the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”)Company’s stock option plans, and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 1,500,000 shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities are reserved for issuance pursuant to securities (other than the Notes and the Warrants) exercisable for, or required to be convertible into or exchangeable for shares of Common Stock and [ ] shares are reserved for issuance other than as described aboveupon conversion of the Notes and exercise of the Warrants (subject to adjustment pursuant to the Company’s covenant set forth in Section 4(h) below); and (ii) 50,000,000 shares of preferred stock, of which no shares are issued and outstanding. All of such issued and outstanding shares of the Company and its Subsidiaries capital stock are, and all shares subject to issuance as specified above, or upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable paid and free nonassessable. No shares of any capital stock of the Company are subject to preemptive rights purchase optionor any other similar rights of the stockholders of the Company or any liens or encumbrances imposed through the actions or failure to act of the Company. Except as disclosed in Schedule 3(c), call optionas of the effective date of this Agreement, (i) there are no outstanding options, right warrants, scrip, rights to subscribe for, puts, calls, rights of first refusal, subscription agreementagreements, understandings, claims or other commitments or rights of any character whatsoever relating to, or securities or rights convertible into or exchangeable for any other similar right under shares of capital stock of the Company Charter, the Company Bylaws or any agreement to of its Subsidiaries, or arrangements by which the Company or any of its Subsidiaries is party or by which it is bound. (b) Except for may become bound to issue additional shares of capital stock of the Company Stock Optionsor any of its Subsidiaries, (ii) there are no existing options, warrants, calls, subscription rights, exercisable, convertible or exchangeable securities or other rights, agreements or commitments arrangements under which the Company or any of its Subsidiaries is obligated to register the sale of any of its or their securities under the 1933 Act (contingent except the Registration Rights Agreement) and (iii) there are no anti-dilution or otherwiseprice adjustment provisions contained in any security issued by the Company (or in any agreement providing rights to security holders) that obligate will be triggered by the issuance of the Notes, the Warrants, the Conversion Shares or Warrant Shares. The Company has furnished to issuethe Buyer true and correct copies of the Company’s Articles of Incorporation as in effect on the date hereof (“Articles of Incorporation”), transfer or sell any Company Common Stock or any investment that is the Company’s By-laws, as in effect on the date hereof (the “By-laws”), and the terms of all securities convertible into or exercisable or exchangeable for any such shares. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There are no agreements or understandings to which the Company is a party with respect to the voting of any securities Common Stock of the Company and the material rights of the holders thereof in respect thereto. The Company shall provide the Buyer with a written update of this representation signed by the Company’s Chief Executive or which restrict the transfer Chief Financial Officer on behalf of any such shares, nor does the Company have knowledge as of any third party agreements or understandings with respect to the voting of any such shares or which restrict the transfer of such sharesClosing Date.

Capitalization. (a) The authorized shares of stock of the Company consist of 200,000,000 shares of Company Common Stock, par value $0.001 per share, of the Company. As of the date hereof, the authorized capital stock of the Company consists of (i) 67,066,418 [ ] shares of Company Common Stock were Stock, of which [ ] shares are issued and outstanding (excluding outstanding, no shares of Company Common Stock held by the Company in its treasury), (ii) 15,000,000 shares of Company Common Stock have been are reserved for issuance pursuant to the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”)Company’s stock option plans, and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 1,500,000 shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities are reserved for issuance pursuant to securities (other than the Notes and the Warrants) exercisable for, or required to be convertible into or exchangeable for shares of Common Stock and [ ] shares are reserved for issuance other than as described aboveupon conversion of the Notes and exercise of the Warrants (subject to adjustment pursuant to the Company’s covenant set forth in Section 4(h) below); and (ii) 50,000,000 shares of preferred stock, of which no shares are issued and outstanding. All of such issued and outstanding shares of the Company and its Subsidiaries capital stock are, and all shares subject to issuance as specified above, or upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable paid and free nonassessable. No shares of any capital stock of the Company are subject to preemptive rights purchase optionor any other similar rights of the stockholders of the Company or any liens or encumbrances imposed through the actions or failure to act of the Company. Except as disclosed in Schedule 3(c), call optionas of the effective date of this Agreement, right (i) there are no outstanding options, warrants, scrip, rights to subscribe for, puts, calls, rights of first refusal, subscription agreementagreements, understandings, claims or other commitments or rights of any character whatsoever relating to, or securities or rights convertible into or exchangeable for any other similar right under shares of capital stock of the Company Charter, the Company Bylaws or any agreement to of its Subsidiaries, or arrangements by which the Company or any of its Subsidiaries is party or by which it is bound. (b) Except for may become bound to issue additional shares of capital stock of the Company Stock Optionsor any of its Subsidiaries, (ii) there are no existing options, warrants, calls, subscription rights, exercisable, convertible or exchangeable securities or other rights, agreements or commitments arrangements under which the Company or any of its Subsidiaries is obligated to register the sale of any of its or their securities under the 1933 Act (contingent except the Registration Rights Agreement) and (iii) there are no anti-dilution or otherwiseprice adjustment provisions contained in any security issued by the Company (or in any agreement providing rights to security holders) that obligate will be triggered by the issuance of the Notes, the Warrants, the Conversion Shares or Warrant Shares. The Company has furnished to issuethe Buyer true and correct copies of the Company’s Articles of Incorporation as in effect on the date hereof (“Articles of Incorporation”), transfer or sell any Company Common Stock or any investment that is the Company’s By-laws, as in effect on the date hereof (the “By-laws”), and the terms of all securities convertible into or exercisable or exchangeable for any such shares. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There are no agreements or understandings to which the Company is a party with respect to the voting of any securities Common Stock of the Company and the material rights of the holders thereof in respect thereto. The Company shall provide the Buyer with a written update of this representation signed by the Company’s Chief Executive or which restrict the transfer Chief Financial Officer on behalf of any such shares, nor does the Company have knowledge as of any third party agreements or understandings with respect to the voting of any such shares or which restrict the transfer of such sharesClosing Date.

Capitalization. (a) The authorized Except as disclosed in the SEC Documents, no shares of stock of the Company consist of 200,000,000 shares of Company Common Stock, par value $0.001 per share, of the Company. As of the date hereof, (i) 67,066,418 shares of Company Common Stock were issued and outstanding (excluding shares of Company Common Stock held by the Company in its treasury), (ii) 15,000,000 shares of Company Common Stock have been are reserved for issuance pursuant to the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”)Company’s stock option plans, and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 no shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities are reserved for issuance pursuant to securities (other than the Note) exercisable for, or required to be convertible into or exchangeable for shares of Common Stock and sufficient shares are reserved for issuance other than upon conversion of the Note (as described aboverequired by the Note and transfer agent share reserve letter). All of such issued and outstanding shares of the Company and its Subsidiaries capital stock are, and all shares subject to issuance as specified above, or upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable paid and free non-assessable. No shares of any capital stock of the Company are subject to preemptive rights purchase optionor any other similar rights of the shareholders of the Company or any liens or encumbrances imposed through the actions or failure to act of the Company. Except as disclosed in the SEC Documents, call optionas of the effective date of this Agreement, right (i) except as disclosed on Schedule 3(c), there are no outstanding options, warrants, scrip, rights to subscribe for, puts, calls, rights of first refusal, subscription agreementagreements, understandings, claims or other commitments or rights of any character whatsoever relating to, or securities or rights convertible into or exchangeable for any other similar right under shares of capital stock of the Company Charter, the Company Bylaws or any agreement to of its Subsidiaries, or arrangements by which the Company or any of its Subsidiaries is party or by which it is bound. (b) Except for may become bound to issue additional shares of capital stock of the Company Stock Optionsor any of its Subsidiaries, (ii) there are no existing options, warrants, calls, subscription rights, exercisable, convertible or exchangeable securities or other rights, agreements or commitments arrangements under which the Company or any of its Subsidiaries is obligated to register the sale of any of its or their securities under the 1933 Act and (contingent iii) there are no anti-dilution or otherwiseprice adjustment provisions contained in any security issued by the Company (or in any agreement providing rights to security holders) that obligate will be triggered by the issuance of the Note or the Conversion Shares. The Company to issuehas filed in its SEC Documents true and correct copies of the Company’s Certificate of Incorporation as in effect on the date hereof (“Certificate of Incorporation”), transfer or sell any Company Common Stock or any investment that is the Company’s By-laws, as in effect on the date hereof (the “By-laws”), and the terms of all securities convertible into or exercisable or exchangeable for any such shares. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There are no agreements or understandings to which the Company is a party with respect to the voting of any securities Common Stock of the Company or which restrict and the transfer material rights of any such shares, nor does the holders thereof in respect thereto. The Company shall provide the Buyer with a written certification of this representation signed by the Company’s Chief Executive on behalf of the Company have knowledge as of any third party agreements or understandings with respect to the voting of any such shares or which restrict the transfer of such sharesClosing Date.

Capitalization. (a) The authorized shares of stock capitalization of the Company consist of 200,000,000 shares of Company Common Stock, par value $0.001 per share, of the Company. As as of the date -------------- hereof, (i) 67,066,418 including the authorized capital stock, the number of shares of Company Common Stock were issued and outstanding (excluding outstanding, the number of shares of Company Common Stock held by the Company in its treasury), (ii) 15,000,000 shares of Company Common Stock have been issuable and reserved for issuance pursuant to the 2001 Stock Option Plan Company's stock option plans, the number of shares issuable and reserved for issuance pursuant to securities exercisable for, or convertible into or exchangeable for any shares of capital stock and the 2005 Stock Option Plan (“Incentive Plans”number of Adjustment Shares to be reserved for issuance as required by Section 1(c) hereof and the number of Warrant Shares to be issued upon the exercise of the Warrants is set forth on Schedule 3(c). All of such outstanding shares of capital stock have been, or ------------- upon issuance will be, validly issued, fully paid and nonassessable. Except as set forth on Schedule 3(c), and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 no shares of capital stock of the Company Common Stock were outstanding(including ------------ the Initial Shares, the Adjustment Shares and the Warrant Shares) are subject to preemptive rights or any other similar rights of the stockholders of the Company or any liens or encumbrances. As Except for the Securities and as disclosed in Schedule 3(c), as of the date of this Agreement, the Company had (i) there are no Company Common Stockoutstanding ------------- options, warrants, scrip, rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities or rights convertible into or exercisable or exchangeable for, any other securities reserved for issuance or required to be reserved for issuance other than as described above. All such issued and outstanding shares of capital stock of the Company and or any of its Subsidiaries are, and all shares subject to issuance as specified above, upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable and free of any preemptive rights purchase option, call option, right of first refusal, subscription agreementsubsidiaries, or any other similar right under the Company Charter, the Company Bylaws or any agreement to arrangements by which the Company or any of its subsidiaries is party or by which it is bound. (b) Except for may become bound to issue additional shares of capital stock of the Company Stock Optionsor any of its subsidiaries, and (ii) there are no agreements or arrangements under which the Company or any of its subsidiaries is obligated to register the sale of any of its or their securities under the Securities Act (except the Registration Rights Agreement). Except as set forth on Schedule -------- 3(c), there are no existing options, warrants, calls, subscription rights, exercisable, convertible or exchangeable securities or instruments containing antidilution or similar ---- provisions that will be triggered by the issuance of the Securities in accordance with the terms of this Agreement or the Warrants and the holders of the securities and instruments listed on such Schedule 3(c) have waived any ------------- rights they may have under such antidilution or similar provisions in connection with the issuance of the Securities in accordance with the terms of this Agreement or the Warrants. The Company has made available to the Purchaser true and correct copies of the Company's Certificate of Incorporation as in effect on the date hereof ("CERTIFICATE OF INCORPORATION"), the Company's By-laws as in effect on the date hereof (the "BY-LAWS"), and all other rights, instruments and agreements or commitments (contingent or otherwise) that obligate the Company to issue, transfer or sell any Company Common Stock or any investment that is governing securities convertible into or exercisable or exchangeable for any such shares. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted capital stock unit awards or “phantom” shares. (d) There are no agreements or understandings to which the Company is a party with respect to the voting of any securities of the Company Company, except for stock options granted under any employee benefit plan or which restrict director stock option plan of the transfer of any such shares, nor does the Company have knowledge of any third party agreements or understandings with respect to the voting of any such shares or which restrict the transfer of such sharesCompany.

Capitalization. (a) The As of the date hereof, the authorized shares of capital stock of the Company consist consists of 200,000,000 950,000,000 shares of Company Common Stock, par value $0.001 per 0.001per share, of the Company. As which as of the date hereofhereof 793,266,046 shares are issued and outstanding, (i) 67,066,418 1,000,000 shares of Company Common Stock were Series A Preferred Stock, of which 1,000,000 shares are issued and outstanding (excluding outstanding, and 789,474 shares of Series E Preferred Stock, of which 789,474 shares are outstanding. All of such outstanding shares have been, or upon issuance will be, validly issued and are fully paid and nonassessable. The Company Common Stock held by is in the Company in process of amending its treasury)Articles of Incorporation to increase its authorized common stock to 4,000,000 shares. Upon the effectiveness of such amendment, (ii) 15,000,000 all shares of Company Common Series E Preferred Stock have been reserved for issuance pursuant will be converted to common stock on a 1:1 basis. Except as disclosed in the 2001 Stock Option Plan and Company’s publicly available filings with the 2005 Stock Option Plan (“Incentive Plans”), and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had SEC or as otherwise set forth on Schedule 4.3: i. no Company Common Stock, or any other securities reserved for issuance or required to be reserved for issuance other than as described above. All such issued and outstanding shares of the Company and its Subsidiaries are, and all shares Company’s capital stock are subject to issuance as specified above, upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable and free of any preemptive rights purchase option, call option, right of first refusal, subscription agreement, or any other similar right under the Company Charter, the Company Bylaws rights or any agreement to which liens or encumbrances suffered or permitted by the Company is party or by which it is bound.Company; (b) Except for the Company Stock Options, ii. there are no existing outstanding debt securities; iii. there are no outstanding shares of capital stock, options, warrants, callsscrip, subscription rightsrights to subscribe to, exercisablecalls or commitments of any character whatsoever relating to, convertible or exchangeable securities or other rightsrights convertible into, agreements any shares of capital stock of the Company or any of its Subsidiaries, or contracts, commitments, understandings or arrangements by which the Company or any of its Subsidiaries is or may become bound to issue additional shares of capital stock of the Company or any of its Subsidiaries or options, warrants, scrip, rights to subscribe to, calls or commitments (contingent of any character whatsoever relating to, or otherwise) that obligate securities or rights convertible into, any shares of capital stock of the Company to issue, transfer or sell any Company Common Stock or any investment that is convertible into or exercisable or exchangeable for any such shares.of its Subsidiaries; (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There iv. there are no agreements or understandings to arrangements under which the Company or any of its Subsidiaries is a party with respect obligated to register the voting sale of any of their securities under the 1933 Act (except the Registration Rights Agreement); v. there are no outstanding securities of the Company or any of its Subsidiaries which restrict the transfer of contain any such sharesredemption or similar provisions, nor does and there are no contracts, commitments, understandings or arrangements by which the Company or any of its Subsidiaries is or may become bound to redeem a security of the Company or any of its Subsidiaries; there are no securities or instruments containing anti-dilution or similar provisions that will be triggered by the issuance of the Securities as described in this Agreement vi. the Company does not have knowledge of any third party stock appreciation rights or “phantom stock” plans or agreements or understandings with respect to the voting of any such shares similar plan or which restrict the transfer of such shares.agreement; and

Capitalization. (a) The authorized shares of stock of the Company consist of 200,000,000 shares of Company Common Stock, par value $0.001 per share, of the Company. As of the date hereof, the authorized capital stock of the Company consists of: (i) 67,066,418 500,000,000 shares of Company Common Stock were Stock, of which approximately 24,666,182 shares are issued and outstanding (excluding shares of Company Common Stock held by the Company in its treasury), outstanding; and (ii) 15,000,000 10,000,000 shares of Company Common Stock have been blank check preferred stock, of which -0- are issued and outstanding. Except as disclosed in the SEC Documents (plus EMA shares), no shares are reserved for issuance pursuant to the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”)Company’s stock option plans, and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 773,020 shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities are reserved for issuance pursuant to securities (other than the Note and any other convertible promissory note issued to the Buyer) exercisable for, or required to be convertible into or exchangeable for shares of Common Stock and 1,600,000 shares are reserved for issuance other than as described aboveupon conversion of the Note. All of such issued and outstanding shares of the Company and its Subsidiaries capital stock are, and all shares subject to issuance as specified above, or upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable paid and free non-assessable. No shares of any capital stock of the Company are subject to preemptive rights purchase optionor any other similar rights of the shareholders of the Company or any liens or encumbrances imposed through the actions or failure to act of the Company. Except as disclosed in the SEC Documents, call optionas of the date of this Agreement, right (i) there are no outstanding options, warrants, scrip, rights to subscribe for, puts, calls, rights of first refusal, subscription agreementagreements, understandings, claims or other commitments or rights of any character whatsoever relating to, or securities or rights convertible into or exchangeable for any other similar right under shares of capital stock of the Company Charter, the Company Bylaws or any agreement to of its Subsidiaries, or arrangements by which the Company or any of its Subsidiaries is party or by which it is bound. (b) Except for may become bound to issue additional shares of capital stock of the Company Stock Optionsor any of its Subsidiaries, (ii) there are no existing options, warrants, calls, subscription rights, exercisable, convertible or exchangeable securities or other rights, agreements or commitments arrangements under which the Company or any of its Subsidiaries is obligated to register the sale of any of its or their securities under the 1933 Act and (contingent iii) there are no anti-dilution or otherwiseprice adjustment provisions contained in any security issued by the Company (or in any agreement providing rights to security holders) that obligate will be triggered by the issuance of the Note or the Conversion Shares. The Company to issuehas filed in its SEC Documents true and correct copies of the Company’s Certificate of Incorporation as in effect on the date hereof (“Certificate of Incorporation”), transfer or sell any Company Common Stock or any investment that is the Company’s By-laws, as in effect on the date hereof (the “By-laws”), and the terms of all securities convertible into or exercisable or exchangeable for any such shares. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There are no agreements or understandings to which the Company is a party with respect to the voting of any securities Common Stock of the Company or which restrict and the transfer material rights of any such shares, nor does the holders thereof in respect thereto. The Company shall provide the Buyer with a written update of this representation signed by the Company’s Chief Executive on behalf of the Company have knowledge as of any third party agreements or understandings with respect to the voting of any such shares or which restrict the transfer of such sharesClosing Date.

Capitalization. (a) The authorized shares of capital stock of the Company consist of 200,000,000 shares of Company Common Stock, par value $0.001 per share, of the Company. As of on the date hereof, (i) 67,066,418 consists of 250,000,000 shares of Company Common Stock were Stock, 121,082,543 shares of which are issued and outstanding, 825,000 shares of Series A convertible preferred stock, 21,645 shares of which are issued and outstanding, 825,000 shares of series B convertible preferred stock, no shares of which are issued and outstanding, 625,000 shares of Series C convertible preferred stock, 614,177 are issued and outstanding (excluding and 100,000 shares of Company Common Stock held by the Company in its treasury)series D junior participating preferred stock, (ii) 15,000,000 no shares of Company Common Stock have been reserved for issuance pursuant to the 2001 Stock Option Plan which are issued and the 2005 Stock Option Plan (“Incentive Plans”)outstanding, and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities reserved for issuance or required to be reserved for issuance other than as described abovecapital stock. All such issued and outstanding shares of the Company Company’s Common Stock (a) have been duly authorized and its Subsidiaries are, and all shares subject to issuance as specified above, upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, and (b) are fully paidpaid and non-assessable. The rights, nonassessable preferences, privileges and free restrictions of the Common Stock are as stated in the Certificate of Incorporation currently on file with the Delaware Secretary of State and the Registration Rights Agreement. Except as set forth in the periodic reports that the Company has filed on or prior to the date hereof with the U.S. Securities and Exchange Commission (the “SEC”) (including the exhibits incorporated by reference) in accordance with its obligations under the Exchange Act and the rules and regulations promulgated thereunder (the “SEC Reports”), as of the date hereof, no other capital stock, options, units, warrants, rights to purchase (including any preemptive rights, calls or commitments of any preemptive rights purchase optioncharacter whatsoever) or otherwise acquire or securities that are exercisable, call option, right exchangeable or convertible into any shares of first refusal, subscription agreement, Common Stock or any other similar right under ownership interests in the Company Charterare authorized, issued, reserved for issuance or outstanding (other than herein and pursuant to the Warrant Purchase Agreement). Except as set forth in the SEC Reports, the Company Bylaws has no authorized or outstanding bonds, debentures, notes or other indebtedness the holders of which have the right to vote (or which are convertible into, exchangeable for, or evidence the right to subscribe for or acquire securities having the right to vote) with the holders of capital stock of the Company on any agreement matter. Except as set forth in the SEC Reports, there are no contracts to which the Company is party or by which it is bound. bound to (bx) Except for repurchase, redeem or otherwise acquire any shares of capital stock of the Company Stock Options, there are no existing options, warrants, calls, subscription rights, exercisable, convertible or exchangeable securities (y) vote or other rights, agreements or commitments (contingent or otherwise) that obligate dispose of any capital stock of the Company to issue, transfer or sell any Company Common Stock or any investment that is convertible into or exercisable or exchangeable for any such shares. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) Company. There are no irrevocable proxies and no voting agreements with respect to any capital stock of the Company. Except as set forth in the SEC Reports, other than the Registration Rights Agreement, the Company has no agreement, arrangement or understandings to which the Company is a party with respect to the voting of register any securities of the Company under the Securities Act or which restrict the transfer of under any such sharesstate securities law and has not granted registration rights to any person (other than agreements, nor does the Company have knowledge of any third party agreements arrangements or understandings with respect to registration rights that are no longer in effect as of the voting date of any such this Agreement). Immediately following the Closing, and notwithstanding anything contained herein to the contrary, the shares or which restrict of Common Stock issued pursuant to this Agreement will represent 4.99% of the transfer issued and outstanding Common Stock of such sharesthe Company on a non-diluted basis.

Capitalization. (a) The authorized shares of capital stock of the Company consist at the date hereof consists of 200,000,000 (a) 10,000,000 shares of Company Common Stock, par value $0.001 per share, 4,606,184 of the Company. As of the date hereof, (i) 67,066,418 which shares of Company Common Stock were are issued and outstanding (excluding shares of Company Common Stock held by the Company in its treasury), (ii) 15,000,000 shares of Company Common Stock have been reserved for issuance pursuant to the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”)outstanding, and (iiib) Company Stock Options entitling the owners thereof to purchase 7,960,000 5,000,000 shares of Company Common Stock were Preferred Stock, of which 500,000 are issued and outstanding. As All of the date of this Agreement, the Company had no Company Common Stock, or any other securities reserved for issuance or required to be reserved for issuance other than as described above. All such issued and outstanding shares of the Company's capital stock have been duly authorized and validly issued and are fully paid and non-assessable and all securities previously issued and sold by the Company were issued and sold in compliance with applicable Federal and state securities laws. Except as set forth in the Disclosure Schedule, no other shares of capital stock of the Company or any of its Subsidiaries aresubsidiaries or securities convertible into or exchangeable for such shares have been issued or reserved for issuance, and all shares subject to issuance except as specified abovecontemplated by the Financing Documents, upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable(a) no subscription, will bewarrant, when issued, duly authorized, validly issued, fully paid, nonassessable and free of any preemptive rights purchase option, call option, right of first refusal, subscription agreement, or any other similar right under the Company Charter, the Company Bylaws or any agreement to which the Company is party or by which it is bound. (b) Except for the Company Stock Options, there are no existing options, warrants, calls, subscription rights, exercisable, convertible or exchangeable securities security or other rights, agreements or commitments right (contingent or otherwise) that obligate to purchase or acquire any shares of capital stock of the Company to issue, transfer or sell any Company Common Stock or any investment that of its subsidiaries is authorized or outstanding, (b) there is not any commitment or offer of the Company or any of its subsidiaries to issue any subscription, warrant (other than the Warrants), option, convertible into security or exercisable other such right to issue or exchangeable for distribute to holders of any such shares. shares of its indebtedness or assets of the Company or any of its subsidiaries, (c) The neither the Company nor any of its subsidiaries has not issued any share appreciation rightsobligation (contingent or otherwise) to purchase, redeem or otherwise acquire any shares of its capital stock or any interest therein or to pay any dividend equivalent rightsor make any other distribution in respect thereof, performance awards, restricted stock unit awards or “phantom” shares. and (d) There there are no agreements restrictions on the transfer of the Company's capital stock other than those arising from Federal and state securities laws. Except as contemplated by this Agreement, no person or understandings entity is entitled to which (x) any preemptive or similar right with respect to issuance of any capital stock of the Company is a party Company, or (y) any rights with respect to the voting registration of any securities capital stock of the Company or which restrict under the transfer Securities Act of any such shares1933, nor does as amended (the Company have knowledge of any third party agreements or understandings with respect to the voting of any such shares or which restrict the transfer of such shares"Securities Act").

Capitalization. (a) The authorized shares of stock of the Company consist of 200,000,000 shares of Company Common Stock, par value $0.001 per share, of the Company. As of the date hereof, the authorized capital stock of the Company consists of (i) 67,066,418 75,000,000 shares of Company Common Stock were Stock, of which 29,058,366 shares are issued and outstanding (excluding outstanding, no shares of Company Common Stock held by the Company in its treasury), (ii) 15,000,000 shares of Company Common Stock have been are reserved for issuance pursuant to the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”)Company's stock option plans, and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 14,741,250 shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities are reserved for issuance pursuant to securities (other than the Notes and the Warrants) exercisable for, or required to be convertible into or exchangeable for shares of Common Stock and 45,000,000 shares are reserved for issuance other than as described aboveupon conversion of the Notes and exercise of the Warrants (subject to adjustment pursuant to the Company's covenant set forth in Section 4(h) below); and (ii) 100,000 shares of preferred stock, of which no shares are issued and outstanding. All of such issued and outstanding shares of the Company and its Subsidiaries capital stock are, and all shares subject to issuance as specified above, or upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable paid and free nonassessable. No shares of any capital stock of the Company are subject to preemptive rights purchase optionor any other similar rights of the shareholders of the Company or any liens or encumbrances imposed through the actions or failure to act of the Company. Except as disclosed in Schedule 3(c), call optionas of the effective date of this Agreement, right (i) there are no outstanding options, warrants, scrip, rights to subscribe for, puts, calls, rights of first refusal, subscription agreementagreements, understandings, claims or other commitments or rights of any character whatsoever relating to, or securities or rights convertible into or exchangeable for any other similar right under shares of capital stock of the Company Charter, the Company Bylaws or any agreement to of its Subsidiaries, or arrangements by which the Company or any of its Subsidiaries is party or by which it is bound. (b) Except for may become bound to issue additional shares of capital stock of the Company Stock Optionsor any of its Subsidiaries, (ii) there are no existing options, warrants, calls, subscription rights, exercisable, convertible or exchangeable securities or other rights, agreements or commitments arrangements under which the Company or any of its Subsidiaries is obligated to register the sale of any of its or their securities under the 1933 Act (contingent except the Registration Rights Agreement) and (iii) there are no anti-dilution or otherwiseprice adjustment provisions contained in any security issued by the Company (or in any agreement providing rights to security holders) that obligate will be triggered by the issuance of the Notes, the Warrants, the Conversion Shares or Warrant Shares. The Company has furnished to issuethe Buyer true and correct copies of the Company's Articles of Incorporation as in effect on the date hereof ("Articles of Incorporation"), transfer or sell any Company Common Stock or any investment that is the Company's By-laws, as in effect on the date hereof (the "By-laws"), and the terms of all securities convertible into or exercisable or exchangeable for any such shares. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There are no agreements or understandings to which the Company is a party with respect to the voting of any securities Common Stock of the Company and the material rights of the holders thereof in respect thereto. The Company shall provide the Buyer with a written update of this representation signed by the Company's Chief Executive or which restrict the transfer Chief Financial Officer on behalf of any such shares, nor does the Company have knowledge as of any third party agreements or understandings with respect to the voting of any such shares or which restrict the transfer of such sharesClosing Date.

Capitalization. (a) The authorized shares of stock of the Company consist of 200,000,000 shares of Company Common Stock, par value $0.001 per share, of the Company. As of the date hereof, the authorized capital stock of the Company consists of: (i) 67,066,418 6 billion shares of Company Common Stock were Stock, $0.001 par value per share, of which approximately 4,581,060,559 shares are issued and outstanding (excluding shares of Company Common Stock held by the Company in its treasury), outstanding; and (ii) 15,000,000 0 shares of Company Common Stock have been Preferred Stock, no par value per share, of which no shares are issued and outstanding. Except as disclosed on Schedule 3(c) hereof, no shares are reserved for issuance pursuant to the 2001 Stock Option Plan and Company’s stock option plans. Except as disclosed in the 2005 Stock Option Plan (“Incentive Plans”), and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 SEC Documents no shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities are reserved for issuance pursuant to securities exercisable for, or required to be reserved convertible into or exchangeable for issuance other than as described aboveshares of Common Stock. All of such issued and outstanding shares of the Company and its Subsidiaries capital stock are, and all shares subject to issuance as specified above, or upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable paid and free non-assessable. No shares of any capital stock of the Company are subject to preemptive rights purchase optionor any other similar rights of the shareholders of the Company or any liens or encumbrances imposed through the actions or failure to act of the Company. As of the effective date of this Agreement, call optionand except as disclosed in the SEC Documents, right (i) there are no outstanding options, warrants, scrip, rights to subscribe for, puts, calls, rights of first refusal, subscription agreementagreements, understandings, claims or other commitments or rights of any character whatsoever relating to, or securities or rights convertible into or exchangeable for any other similar right under shares of capital stock of the Company Charter, the Company Bylaws or any agreement to of its Subsidiaries, or arrangements by which the Company or any of its Subsidiaries is party or by which it is bound. (b) Except for may become bound to issue additional shares of capital stock of the Company Stock Optionsor any of its Subsidiaries, (ii) there are no existing options, warrants, calls, subscription rights, exercisable, convertible or exchangeable securities or other rights, agreements or commitments arrangements under which the Company or any of its Subsidiaries is obligated to register the sale of any of its or their securities under the 1933 Act and (contingent iii) there are no anti-dilution or otherwiseprice adjustment provisions contained in any security issued by the Company (or in any agreement providing rights to security holders) that obligate will be triggered by the issuance of the Note or the Conversion Shares. The Company has furnished to issuethe Buyer true and correct copies of the Company’s Certificate of Incorporation as in effect on the date hereof (“Certificate of Incorporation”), transfer or sell any Company Common Stock or any investment that is the Company’s By-laws, as in effect on the date hereof (the “By-laws”), and the terms of all securities convertible into or exercisable or exchangeable for any such shares. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There are no agreements or understandings to which the Company is a party with respect to the voting of any securities Common Stock of the Company or which restrict and the transfer material rights of any such shares, nor does the holders thereof in respect thereto. The Company shall provide the Buyer with a written update of this representation signed by the Company’s Chief Executive on behalf of the Company have knowledge as of any third party agreements or understandings with respect to the voting of any such shares or which restrict the transfer of such sharesClosing Date.

Capitalization. (a) The authorized shares of stock of the Company consist of 200,000,000 shares of Company Common Stock, par value $0.001 per share, of the Company. As of the date hereof, the authorized capital stock of the Company consists of (i) 67,066,418 ___________ shares of Company Common Stock were Stock, of which __________ shares are issued and outstanding (excluding outstanding, __________ shares of Company Common Stock held by the Company in its treasury), (ii) 15,000,000 shares of Company Common Stock have been are reserved for issuance pursuant to the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”)Company's stock option plans, and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 __________ shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities are reserved for issuance pursuant to securities (other than the Notes and the Warrants) exercisable for, or required to be convertible into or exchangeable for shares of Common Stock and __________ shares are reserved for issuance other than as described aboveupon conversion of the Notes and exercise of the Warrants (subject to adjustment pursuant to the Company's covenant set forth in Section 4(h) below); and (ii) ______ shares of preferred stock, of which _______ shares are issued and outstanding. All of such issued and outstanding shares of the Company and its Subsidiaries capital stock are, and all shares subject to issuance as specified above, or upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable paid and free nonassessable. No shares of any capital stock of the Company are subject to preemptive rights purchase optionor any other similar rights of the shareholders of the Company or any liens or encumbrances imposed through the actions or failure to act of the Company. Except as disclosed in SCHEDULE 3(C), call optionas of the effective date of this Agreement, right (i) there are no outstanding options, warrants, scrip, rights to subscribe for, puts, calls, rights of first refusal, subscription agreementagreements, understandings, claims or other commitments or rights of any character whatsoever relating to, or securities or rights convertible into or exchangeable for any other similar right under shares of capital stock of the Company Charter, the Company Bylaws or any agreement to of its Subsidiaries, or arrangements by which the Company or any of its Subsidiaries is party or by which it is bound. (b) Except for may become bound to issue additional shares of capital stock of the Company Stock Optionsor any of its Subsidiaries, (ii) there are no existing options, warrants, calls, subscription rights, exercisable, convertible or exchangeable securities or other rights, agreements or commitments arrangements under which the Company or any of its Subsidiaries is obligated to register the sale of any of its or their securities under the 1933 Act (contingent except the Registration Rights Agreement) and (iii) there are no anti-dilution or otherwiseprice adjustment provisions contained in any security issued by the Company (or in any agreement providing rights to security holders) that obligate will be triggered by the issuance of the Notes, the Warrants, the Conversion Shares or Warrant Shares. The Company has furnished to issuethe Buyer true and correct copies of the Company's Articles of Incorporation as in effect on the date hereof ("ARTICLES OF INCORPORATION"), transfer or sell any Company Common Stock or any investment that is the Company's By-laws, as in effect on the date hereof (the "BY-LAWS"), and the terms of all securities convertible into or exercisable or exchangeable for any such shares. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There are no agreements or understandings to which the Company is a party with respect to the voting of any securities Common Stock of the Company and the material rights of the holders thereof in respect thereto. The Company shall provide the Buyer with a written update of this representation signed by the Company's Chief Executive or which restrict the transfer Chief Financial Officer on behalf of any such shares, nor does the Company have knowledge as of any third party agreements or understandings with respect to the voting of any such shares or which restrict the transfer of such sharesClosing Date.

Capitalization. (a) The authorized shares of capital stock of the Company consist consists solely of 200,000,000 Company Common Shares and 2,000,000 shares of preferred stock. As of May 31, 2003, there were outstanding (i) 39,775,611 Company Common Shares, (ii) no shares of Company preferred stock, (iii) stock options (or binding obligations to issue stock options) to purchase an aggregate of up to 4,931,287 Company Common StockShares, par value $0.001 per share(iv) warrants (or binding obligations to issue warrants) to purchase an aggregate of up to 969,346 Company Common Shares (of which warrants to purchase an aggregate of 969,346 Company Common Shares were currently exercisable), and (v) rights to purchase Company Common Shares pursuant to the Company ESPP. All outstanding shares of capital stock of the Company. Company have been duly authorized and validly issued and are fully paid and nonassessable. (b) As of the date hereof, except (i) 67,066,418 shares of Company Common Stock were issued and outstanding (excluding shares of Company Common Stock held by the Company as set forth in its treasury)this Section 3.2, (ii) 15,000,000 shares for changes after the date of this Agreement resulting from the grant of stock options in the ordinary course of business consistent with past practice and the exercise of Company Common Stock have been reserved for issuance pursuant to the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”), and (iii) Options or Company Stock Options entitling the owners thereof to purchase 7,960,000 shares of Company Common Stock were outstanding. As of Warrants outstanding on the date of this Agreement, or (iii) for issuances of Company Common Shares after the date of this Agreement pursuant to the Company had no Company Common Stock, or ESPP in accordance with its terms (subject to any other securities reserved for issuance or required to be reserved for issuance other than as described above. All amendments of such issued and outstanding shares terms in accordance with the terms of the Company and its Subsidiaries are, and all shares subject to issuance as specified above, upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable and free of any preemptive rights purchase option, call option, right of first refusal, subscription agreement, or any other similar right under the Company Charter, the Company Bylaws or any agreement to which the Company is party or by which it is bound. (b) Except for the Company Stock OptionsESPP), there are no existing optionsoutstanding (x) shares of capital stock or other voting securities of the Company, warrants, calls, subscription rights, exercisable, (y) securities of the Company convertible into or exchangeable for shares of capital stock or voting securities of the Company or its subsidiaries, or (z) options or other rightsrights to acquire from the Company, agreements or commitments (contingent or otherwise) that obligate and there is no obligation of the Company to issue, transfer any capital stock, voting securities or sell any Company Common Stock or any investment that is securities convertible into or exercisable or exchangeable for capital stock or voting securities of the Company (the items in clauses (x), (y) and (z) being referred to collectively as the “Company Securities”). There are no outstanding obligations of the Company or any such sharesof its subsidiaries to repurchase, redeem or otherwise acquire any Company Securities. There are no preemptive or other similar rights available to the holders of any Company Securities. Except as otherwise contemplated by this Agreement, neither the execution and delivery of this Agreement, nor the consummation of the transactions contemplated herein, shall result in the acceleration of vesting of any Company Option or Company Warrant or otherwise result in any change to the terms of any Company Option or Company Warrant other than the conversion set forth in Section 2.4 or 2.5, as the case may be. (c) The All of the outstanding shares of capital stock of, or other ownership interest in, each subsidiary of the Company has not have been duly authorized and validly issued and are fully paid and nonassessable. All of the outstanding capital stock of, or other ownership interest which is owned, directly or indirectly, by the Company in, each of its subsidiaries is owned free and clear of any share appreciation rightsmortgage, dividend equivalent rightslien, performance awardspledge, restricted charge, security interest or encumbrance of any kind (including any limitation or restriction on the right to vote, sell or otherwise dispose of such capital stock unit awards or “phantom” shares. (d) other ownership interests). There are no agreements outstanding (i) securities of the Company’s subsidiaries convertible into or understandings exchangeable or exercisable for shares of capital stock or other voting securities or ownership interests in any of its subsidiaries, (ii) options, warrants or other rights to which acquire from the Company is a party with respect to the voting or any of any securities its subsidiaries, and no other obligation of the Company or which restrict any of its subsidiaries to issue, any capital stock, voting securities or other ownership interests in, or any securities convertible into or exchangeable or exercisable for any capital stock, voting securities or ownership interests in, any of its subsidiaries or (iii) obligations of the transfer Company or any of its subsidiaries to repurchase, redeem or otherwise acquire any outstanding securities of any such sharesof its subsidiaries or any capital stock of, nor does the Company have knowledge or other ownership interests in, any of any third party agreements or understandings with respect to the voting of any such shares or which restrict the transfer of such sharesits subsidiaries.

Capitalization. (a) The authorized shares of stock of the Company consist of 200,000,000 shares of Company Common Stock, par value $0.001 per share, of the Company. As of the date hereof, (i) 67,066,418 the authorized capital stock of the Company consists of 10,000,000 shares of Company Common Stock were preferred stock, $0.001 par value per share, none of which is issued and outstanding (excluding outstanding, and 90,000,000 shares of Company Common Stock held by Stock, of which as of the Company in its treasury)date hereof, (ii) 15,000,000 35,026,384 shares of Company Common Stock have been are issued and outstanding, 4,831,900 shares are reserved for issuance pursuant to the 2001 Stock Option Plan Company’s stock option and the 2005 Stock Option Plan (“Incentive Plans”), purchase plans and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 10,750,000 shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities are reserved for issuance or required pursuant to be reserved warrants exercisable for issuance other than as described aboveshares of Common Stock (subject to increase to cover the anti-dilution provisions associated therewith). All of such outstanding shares are duly authorized and have been, or upon issuance will be, validly issued and outstanding shares are fully paid and nonassessable. Except as specified in Section 3.1(g) of the Disclosure Letter, no securities of the Company and its Subsidiaries areare entitled to preemptive or similar rights, and all shares subject to issuance as specified above, upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable and free of no Person has any preemptive rights purchase option, call option, right of first refusal, subscription agreementpreemptive right, right of participation, or any other similar right under to participate in the Company Charter, transactions contemplated by the Company Bylaws or any agreement to which Transaction Documents. Except as specified in Section 3.1(g) of the Company is party or by which it is bound. (b) Except for the Company Stock OptionsDisclosure Letter, there are no existing outstanding options, warrants, callsscrip rights to subscribe to, subscription rightscalls or commitments of any character whatsoever relating to, exercisableor 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 Company or any Subsidiary is or may become bound to issue additional shares of Common Stock, or securities or rights convertible or exchangeable securities into shares of Common Stock. Except as specified in Section 3.1(g) of the Disclosure Letter, the issue and sale of the Securities will not, immediately or other rightswith the passage of time, agreements or commitments (contingent or otherwise) that obligate the Company to issue, transfer or sell any Company issue shares of Common Stock or other securities to any investment that is convertible into or exercisable or exchangeable for any such shares. Person (cother than the Investors) The Company has and will not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There are no agreements or understandings to which the Company is result in a party with respect to the voting right of any holder of Company securities of to adjust the Company exercise, conversion, exchange or which restrict the transfer of reset price under such securities (including, without limitation, under any such shares, nor does the Company have knowledge of any third party agreements anti-dilution or understandings with respect to the voting of any such shares or which restrict the transfer of such sharessimilar provisions).

Capitalization. (a) The Set forth on SCHEDULE 4.3 hereto is the authorized shares of and outstanding capital stock of the Company consist and each of 200,000,000 shares of Company Common Stock, par value $0.001 per share, its Subsidiaries. All of the Company. As of the date hereof, (i) 67,066,418 shares of Company Common Stock were issued and outstanding (excluding shares of Company Common Stock held by the Company in its treasury), (ii) 15,000,000 shares of Company Common Stock have been reserved for issuance pursuant to the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”), and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities reserved for issuance or required to be reserved for issuance other than as described above. All such issued and outstanding shares of Company Capital Stock and of the capital stock of each Subsidiary of the Company and its Subsidiaries are, and all shares subject to issuance as specified above, upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable non-assessable and free of any preemptive rights purchase optionor similar rights created by statute, call option, right the Articles of first refusal, subscription agreement, Incorporation or any other similar right under Bylaws of the Company Charter, the Company Bylaws or any agreement to which the Company is a party or by which it the Company is bound. (b) Except for . SCHEDULE 4.3 hereto lists all the holders of Company Capital Stock Options, there and the amount of shares of Company Capital Stock held by each. There are no existing options, warrants, subscriptions, calls, subscription claims, rights, exercisable, convertible or exchangeable securities or other rights, agreements or commitments (contingent or otherwise) that obligate obligating the Company to issue, sell or transfer any securities, whether written or sell any Company Common Stock or any investment that is convertible into or exercisable or exchangeable for any such shares. oral (c) The Company has not issued any share appreciation rightscollectively, dividend equivalent rights"STOCK EQUIVALENTS"), performance awardsoutstanding as of the date hereof. Except as set forth on SCHEDULE 4.3 hereto, restricted stock unit awards or “phantom” shares. (d) There there are no agreements or understandings to which the Company is a party with respect to the voting of any securities outstanding contractual obligations of the Company or which restrict the transfer any of its Subsidiaries to repurchase, redeem or otherwise acquire any capital stock of any such sharesof the Company's Subsidiaries or to provide funds to, nor does or make any investment (in the Company have knowledge form of a loan, capital contribution or otherwise) in, any third party agreements of the Company's Subsidiaries or any other person. There are no shareholders' agreements, voting trusts or other agreements, arrangements or understandings applicable to the exercise of voting or any other rights with respect to any of the voting share capital of the Company. The Company Capital Stock was not issued in violation of any such shares preemptive, subscription or which restrict other right of any person to acquire securities and constitutes in the transfer aggregate all the issued and outstanding capital stock of such sharesall classes of the Company.

Capitalization. (a) The authorized shares of stock of the Company consist of 200,000,000 shares of Company Common Stock, par value $0.001 per share, of the Company. As of the date hereof, the authorized capital stock of the Company consists of: (i) 67,066,418 290,000,000 shares of Company Common Stock were Stock, of which approximately 28,575,440 shares are issued and outstanding (excluding shares of Company Common Stock held by the Company in its treasury), outstanding; and (ii) 15,000,000 10,000,000 shares of Company Common Stock have been preferred stock, of which 0 are issued and outstanding. Except as disclosed in the SEC Documents, no shares are reserved for issuance pursuant to the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”)Company’s stock option plans, and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 no shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities are reserved for issuance pursuant to securities (other than the Note and any other convertible promissory note issued to the Buyer) exercisable for, or required to be convertible into or exchangeable for shares of Common Stock and 20,000,000 shares are reserved for issuance other than as described aboveupon conversion of the Note. All of such issued and outstanding shares of the Company and its Subsidiaries capital stock are, and all shares subject to issuance as specified above, or upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable paid and free non-assessable. No shares of any capital stock of the Company are subject to preemptive rights purchase optionor any other similar rights of the shareholders of the Company or any liens or encumbrances imposed through the actions or failure to act of the Company. Except as disclosed in the SEC Documents, call optionas of the effective date of this Agreement, right (i) there are no outstanding options, warrants, scrip, rights to subscribe for, puts, calls, rights of first refusal, subscription agreementagreements, understandings, claims or other commitments or rights of any character whatsoever relating to, or securities or rights convertible into or exchangeable for any other similar right under shares of capital stock of the Company Charter, the Company Bylaws or any agreement to of its Subsidiaries, or arrangements by which the Company or any of its Subsidiaries is party or by which it is bound. (b) Except for may become bound to issue additional shares of capital stock of the Company Stock Optionsor any of its Subsidiaries, (ii) there are no existing options, warrants, calls, subscription rights, exercisable, convertible or exchangeable securities or other rights, agreements or commitments arrangements under which the Company or any of its Subsidiaries is obligated to register the sale of any of its or their securities under the 1933 Act and (contingent iii) there are no anti-dilution or otherwiseprice adjustment provisions contained in any security issued by the Company (or in any agreement providing rights to security holders) that obligate will be triggered by the issuance of the Note or the Conversion Shares. The Company to issuehas filed in its SEC Documents true and correct copies of the Company’s Certificate of Incorporation as in effect on the date hereof (“Certificate of Incorporation”), transfer or sell any Company Common Stock or any investment that is the Company’s By-laws, as in effect on the date hereof (the “By-laws”), and the terms of all securities convertible into or exercisable or exchangeable for any such shares. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There are no agreements or understandings to which the Company is a party with respect to the voting of any securities Common Stock of the Company or which restrict and the transfer material rights of any such shares, nor does the holders thereof in respect thereto. The Company shall provide the Buyer with a written update of this representation signed by the Company’s Chief Executive on behalf of the Company have knowledge as of any third party agreements or understandings with respect to the voting of any such shares or which restrict the transfer of such sharesClosing Date.

Capitalization. (a) The authorized shares of stock of the Company consist of 200,000,000 shares of Company Common Stock, par value $0.001 per share, of the Company. As of the date hereof, (i) 67,066,418 shares of Company Common Stock were issued and outstanding (excluding shares of Company Common Stock held by the Company in its treasury), (ii) 15,000,000 shares of Company Common Stock have been reserved for issuance pursuant to the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”), and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 shares of Company Common Stock were outstanding. As of At the date of this Agreement, the Company had no Company authorized capital stock of the Buyer consists of (i) 500,000,000 shares of Common Stock, of which 198,300,000 shares are issued and outstanding, and (ii) 100,000,000 shares of preferred stock, par value of $0.001 per share (“Preferred Stock”), of which no shares are issued and outstanding. The Buyer has no other class or any other series of equity securities authorized, issued, reserved for issuance or required to be reserved for issuance other than as described aboveoutstanding. All such issued and There are (x) no outstanding shares of the Company and its Subsidiaries areoptions, and all shares subject to issuance as specified above, upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable and free of any preemptive rights purchase option, call option, right of first refusal, subscription agreement, or any other similar right under the Company Charter, the Company Bylaws or any agreement to which the Company is party or by which it is bound. (b) Except for the Company Stock Options, there are no existing optionsoffers, warrants, calls, subscription conversion rights, exercisable, convertible or exchangeable securities contracts or other rightsrights to subscribe for or to purchase from the Buyer, or agreements or commitments (contingent or otherwise) that obligate obligating the Company Buyer to issue, transfer transfer, or sell any Company Common Stock (whether formal or any investment that is convertible informal, written or oral, firm or contingent), shares of capital stock or other securities of the Buyer (whether debt, equity, or a combination thereof) or obligating the Buyer to grant, extend, or enter into or exercisable or exchangeable for any such shares. agreement and (cy) The Company has not issued no agreements or other understandings (whether formal or informal, written or oral, firm or contingent) which require or may require the Buyer to repurchase any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) of its Common Stock. There are no agreements preemptive or understandings to which similar rights granted by the Company is a party Buyer with respect to the Buyer’s capital stock. There are no anti-dilution or price adjustment provisions contained in any security issued by the Buyer. Except as set forth on Schedule 6(c) hereto and the registration rights provided to the Seller, the Buyer is not a party to any registration rights agreements, voting of agreements, voting trusts, proxies or any securities of the Company or which restrict the transfer of any such sharesother agreements, nor does the Company have knowledge of any third party agreements instruments or understandings with respect to the voting of any shares of the capital stock of the Buyer, or any agreement with respect to the transferability, purchase or redemption of any shares of the capital stock of the Buyer. The sale of the Shares to the Purchaser does not obligate the Buyer to issue any shares of capital stock or other securities to any Person (other than the Purchaser) and will not result in a right of any holder of Buyer securities, by agreement with the Buyer, to adjust the exercise, conversion, exchange or reset price under such shares securities. The outstanding Common Stock is all duly and validly authorized and issued, fully paid and nonassessable. The Primary Sellers will cause the Buyer not to issue, or which restrict resolve or agree to issue, any securities to any party, other than the transfer of such sharesPurchaser, prior to the Closing.

Capitalization. (a) The authorized shares of capital stock of the Company consist consists of 200,000,000 (i) an unlimited number of shares of Company Common Stock and (ii) an unlimited number of shares of preferred stock (the "Preferred Stock, par value $0.001 per share, of the Company"). As of the date hereofOf such authorized capital stock, (i) 67,066,418 7,196,627 shares of Company Common Stock were are issued and outstanding (excluding shares outstanding, all of Company Common Stock held by the Company in its treasury), (ii) 15,000,000 shares of Company Common Stock have been reserved for issuance pursuant to the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”), and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities reserved for issuance or required to be reserved for issuance other than as described above. All such which are validly issued and outstanding shares of the Company and its Subsidiaries are, and all shares subject to issuance as specified above, upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable and free of any preemptive rights rights, (ii) no shares of Preferred Stock are issued and outstanding and (iii) 2,104,340 shares of Common Stock are reserved for issuance pursuant to the exercise of outstanding options and warrants to purchase optionCommon Stock. Assuming the exercise of all outstanding options and warrants to purchase Common Stock and the issuance of the Shares pursuant to this Agreement, call option, right there would be 25,800,967 shares of first refusal, subscription agreement, or any other similar right under Common Stock issued and outstanding as of the Company Charter, the Company Bylaws or any agreement to which the Company is party or by which it is bounddate hereof. (b) Except for Other than as set forth in subsection 2.2(a) above, certain rights issued pursuant to the Rights Agreement between the Company and American Stock OptionsTransfer & Trust Company (the "Rights Agreement") and certain entitlements of each independent director to receive options under the terms of the Company's 1999 Stock Option Plan on January 1 of each year, there are no existing outstanding options, warrants, subscriptions, calls, subscription rights, exercisable, convertible or exchangeable securities or other rights, agreements agreements, arrangements or commitments (contingent or otherwise) that obligate (including any right of conversion or exchange under any outstanding security, instrument or other agreement) obligating the Company or any of its direct or indirect subsidiaries to issue, transfer deliver or sell sell, or cause to be issued, delivered or sold, any Company Common Stock shares of their capital stock or any investment that is convertible obligating them to grant, extend or enter into or exercisable or exchangeable for any such shares. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards agreement or “phantom” shares. (d) commitment. There are no agreements or understandings to which the Company is a party with respect to the voting of any securities outstanding contractual obligations of the Company or which restrict any of its direct or indirect subsidiaries to repurchase, redeem or otherwise acquire any shares of their capital stock or make any investment (in the transfer form of a loan, capital contribution or otherwise) in any such sharesother Person other than a subsidiary of the Company. Upon consummation of the Closing as contemplated hereby, nor does including receipt by the Company have knowledge of any third party agreements or understandings with respect the Purchase Price payable pursuant to Section 1.2 hereof, the voting of any such shares or which restrict the transfer of such sharesShares owned by each Investor will be validly issued, fully paid and nonassessable.

Capitalization. (a) The authorized stock of the Company consists of 100,000,000 shares of Common Stock. As of April 14, 2010, there were 16,940,109 shares of Common Stock outstanding. All outstanding shares of stock of the Company consist have been duly authorized and validly issued, are fully paid and nonassessable and are free of 200,000,000 shares of Company Common Stockpreemptive rights, par value $0.001 per share, whether arising under Maryland Law or the charter or bylaws of the Company. As of the date hereof, (i) 67,066,418 shares of Company Common Stock were issued and outstanding (excluding shares of Company Common Stock held by the Company in its treasury), (ii) 15,000,000 shares of Company Common Stock have been reserved for issuance pursuant to the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”), and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stockas amended or restated, or any other securities reserved for issuance Contract to which or required by which the Company or any of its Subsidiaries is a party or otherwise subject or bound or to be reserved for issuance other than as described above. All such issued and outstanding shares which or by which any property, business, operation or right of the Company and or any of its Subsidiaries are, and all shares is subject to issuance as specified above, upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable and free of any preemptive rights purchase option, call option, right of first refusal, subscription agreement, or any other similar right under the Company Charter, the Company Bylaws or any agreement to which the Company is party or by which it is bound. (b) Except for as set forth on Section 5.05(b) of the Company Stock OptionsDisclosure Schedule, (i) there are no existing optionsoutstanding bonds, debentures, notes or other indebtedness for borrowed money of the Company, and (ii) there are no issued, reserved for issuance or outstanding (A) shares of stock or other voting securities of or ownership interests in the Company other than the Common Stock, (B) securities of the Company convertible into or exchangeable for shares of stock or other voting securities of or ownership interests in the Company, (C) warrants, calls, subscription rights, exercisable, convertible or exchangeable securities options or other rightsrights to acquire from the Company, agreements or commitments (contingent or otherwise) that obligate other obligation of the Company to issue, transfer any stock, voting securities or sell any Company Common Stock or any investment that is securities convertible into or exercisable or exchangeable for any such shares. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There are no agreements or understandings to which the Company is a party with respect to the voting of any securities of the Company or which restrict the transfer of any such (D) restricted shares, nor does stock appreciation rights, performance units, contingent value rights, “phantom” stock or similar securities or rights that are derivative of, or provide economic benefits based, directly or indirectly, on the value or price of, any stock of or voting securities of the Company have knowledge (the items in the foregoing clauses (i) and (ii), together with the Common Stock, being referred to collectively as the “Company Securities”). There are no outstanding obligations of the Company to repurchase, redeem or otherwise acquire any third party agreements or understandings with respect to the voting of any such shares or which restrict the transfer of such shares.the

Capitalization. (a) The authorized shares of stock of the Company consist of 200,000,000 shares of Company Common Stock, par value $0.001 per share, of the Company. As of the date hereof, the authorized capital stock of the Company consists of (i) 67,066,418 300,000,000 shares of Company Common Stock were Stock, of which 21,809,158 shares are issued and outstanding (excluding outstanding, 1,200,000 shares of Company Common Stock held by the Company in its treasury), (ii) 15,000,000 shares of Company Common Stock have been are reserved for issuance pursuant to the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”)Company’s stock option plans, and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 85,000,000 shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, or any other securities are reserved for issuance pursuant to securities (other than the Notes and the Warrants) exercisable for, or required to be convertible into or exchangeable for shares of Common Stock and, 143,333,333 shares are reserved for issuance other than as described above. All such upon conversion of the Notes and exercise of the Warrants (subject to adjustment pursuant to the Company’s covenant set forth in Section 4(h) below); and (ii) 10,000,000 shares of preferred stock of which –NIL- shares are issued and outstanding. 239,533,333 of such outstanding shares of the Company and its Subsidiaries capital stock are, and all shares subject to issuance as specified above, or upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable paid and free nonassessable. No shares of any capital stock of the Company are subject to preemptive rights purchase optionor any other similar rights of the shareholders of the Company or any liens or encumbrances imposed through the actions or failure to act of the Company. Except as disclosed in Schedule 3(c), call optionas of the effective date of this Agreement, right (i) there are no outstanding options, warrants, scrip, rights to subscribe for, puts, calls, rights of first refusal, subscription agreementagreements, understandings, claims or other commitments or rights of any character whatsoever relating to, or securities or rights convertible into or exchangeable for any other similar right under shares of capital stock of the Company Charter, the Company Bylaws or any agreement to of its Subsidiaries, or arrangements by which the Company or any of its Subsidiaries is party or by which it is bound. (b) Except for may become bound to issue additional shares of capital stock of the Company Stock Optionsor any of its Subsidiaries, (ii) there are no existing options, warrants, calls, subscription rights, exercisable, convertible or exchangeable securities or other rights, agreements or commitments arrangements under which the Company or any of its Subsidiaries is obligated to register the sale of any of its or their securities under the 1933 Act (contingent except the Registration Rights Agreement) and (iii) there are no anti-dilution or otherwiseprice adjustment provisions contained in any security issued by the Company (or in any agreement providing rights to security holders) that obligate will be triggered by the issuance of the Notes, the Warrants, the Conversion Shares or Warrant Shares. The Company has furnished to issuethe Buyer true and correct copies of the Company’s Certificate of Incorporation as in effect on the date hereof (“Certificate of Incorporation”), transfer or sell any Company Common Stock or any investment that is the Company’s By-laws, as in effect on the date hereof (the “By-laws”), and the terms of all securities convertible into or exercisable or exchangeable for any such shares. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There are no agreements or understandings to which the Company is a party with respect to the voting of any securities Common Stock of the Company and the material rights of the holders thereof in respect thereto. The Company shall provide the Buyer with a written update of this representation signed by the Company’s Chief Executive or which restrict the transfer Chief Financial Officer on behalf of any such shares, nor does the Company have knowledge as of any third party agreements or understandings with respect to the voting of any such shares or which restrict the transfer of such sharesClosing Date.

Capitalization. (a) The authorized shares of stock of the Company consist of 200,000,000 shares of Company Common Stock, par value $0.001 per share, of the Company. As of the date hereof, (i) 67,066,418 shares of Company Common Stock were issued and outstanding (excluding shares of Company Common Stock held by the Company in its treasury), (ii) 15,000,000 shares of Company Common Stock have been reserved for issuance pursuant to the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”), and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 shares of Company Common Stock were outstanding. As of the date of this Agreement, Driven’s authorized capital stock consists of 110,000,000 shares, par value $0.001 per share of which 100,000,000 shares are designate Common Stock and 10,000,000 shares are designated Preferred Stock (the Company had “Driven Shares”). As of the date hereof, there are 31,190,000 shares of Common Stock and no Company Common Stock, or any other securities reserved for issuance or required to be reserved for issuance other than as described aboveshares of Preferred Stock issued and outstanding. All such of the issued and outstanding shares of the Company and its Subsidiaries are, and all shares subject to issuance as specified above, upon issuance on the terms and conditions specified in the instruments pursuant to which they Driven Shares are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable and free of any all preemptive rights purchase optionrights. There are no other classes of equity, call option, right of first refusal, subscription agreementnotes, or other indebtedness convertible into Driven Common Stock, outstanding or authorized options, warrants, rights, agreements or commitments to which Driven is a party or which are binding upon Driven providing for the issuance or redemption of any other similar right under the Company Charterof its membership interests. Except as set forth on Schedule 2.2 hereto, the Company Bylaws or any agreement there are no agreements to which the Company Driven is a party or by which it is bound. (b) Except for the Company Stock Options, there are no existing options, warrants, calls, subscription rights, exercisable, convertible or exchangeable securities or other rights, agreements or commitments (contingent or otherwise) that obligate the Company to issue, transfer or sell any Company Common Stock or any investment that is convertible into or exercisable or exchangeable for any such shares. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There are no agreements or understandings to which the Company is a party bound with respect to the voting (including without limitation voting trusts or proxies), registration under the Securities Act, or sale or transfer (including without limitation agreements relating to pre-emptive rights, rights of first refusal, co-sale rights or “drag-along” rights) of any securities of Driven. To the Company or which restrict the transfer of any such shares, nor does the Company have knowledge of any third Driven, there are no agreements among other parties to which Driven is a party agreements or understandings and by which it is bound with respect to the voting (including without limitation voting trusts or proxies) or sale or transfer (including without limitation agreements relating to rights of first refusal, co-sale rights or “drag-along” rights) of any such shares or which restrict securities of Driven. All of the transfer of such sharesissued and outstanding Driven Shares were issued in compliance with applicable federal and state securities laws.

Capitalization. (a) The Company has an authorized shares capitalization as set forth on Schedule 3.5. All the Equity Interests have been duly authorized and validly issued, are fully paid and non-assessable and have not been issued in violation of any preemptive or similar rights of any Person. All of the issued and outstanding capital stock of the Company consist is owned of 200,000,000 record and beneficially by the Member. Upon the Closing, Buyer shall receive good, valid and marketable title to all Equity Interests, free and clear of all Liens. The only Equity Interests that will be outstanding immediately after the Closing will be the Equity Interests owned by Buyer. No other class of capital stock of the Company is authorized or outstanding. Except as set forth on Schedule 3.5(a), there are no: (a) outstanding subscriptions, options, warrants, rights (including “phantom stock rights”), calls, commitments, understandings, conversion rights, rights of exchange, plans or other agreements of any kind providing for the purchase, issuance or sale of any shares of Company Common Stock, par value $0.001 per share, the capital stock of the Company. As , or (b) agreements by the Member with respect to any of the date hereofEquity Interests, (i) 67,066,418 shares of Company Common Stock were issued and outstanding (excluding shares of Company Common Stock held by the Company in its treasury)including any voting trust, (ii) 15,000,000 shares of Company Common Stock have been reserved for issuance pursuant to the 2001 Stock Option Plan and the 2005 Stock Option Plan (“Incentive Plans”), and (iii) Company Stock Options entitling the owners thereof to purchase 7,960,000 shares of Company Common Stock were outstanding. As of the date of this Agreement, the Company had no Company Common Stock, other voting agreement or any other securities reserved for issuance or required to be reserved for issuance other than as described above. All such issued and outstanding shares of the Company and its Subsidiaries are, and all shares subject to issuance as specified above, upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be, when issued, duly authorized, validly issued, fully paid, nonassessable and free of any preemptive rights purchase option, call option, right of first refusal, subscription agreement, or any other similar right under the Company Charter, the Company Bylaws or any agreement to which the Company is party or by which it is boundproxy with respect thereto. (b) Except for The capitalization of each Subsidiary of the Company Stock Optionsis listed on Schedule 3.5(b). Except as set forth on Schedule 3.5(b) with respect to each Subsidiary, there are no existing no: (a) outstanding shares of capital stock, (b) subscriptions, options, warrants, rights (including “phantom stock rights”), calls, subscription commitments, understandings, conversion rights, exercisablerights of exchange, convertible or exchangeable securities plans or other rightsagreements of any kind providing for the purchase, agreements issuance or commitments (contingent sale of any shares of the capital stock of such Subsidiary, or otherwise) that obligate the Company to issue, transfer or sell any Company Common Stock or any investment that is convertible into or exercisable or exchangeable for any such shares. (c) The Company has not issued any share appreciation rights, dividend equivalent rights, performance awards, restricted stock unit awards or “phantom” shares. (d) There are no agreements or understandings to which by the Company is a party Member with respect to the voting of any securities of the Company shares of such Subsidiary, including any voting trust, other voting agreement or which restrict the transfer of any such shares, nor does the Company have knowledge of any third party agreements or understandings proxy with respect to the voting of any such shares or which restrict the transfer of such sharesthereto.