Common use of Equity Structure Clause in Contracts

Equity Structure. (a) The authorized capital stock of the Seller consists solely of (i) 100,000,000 shares of Common Stock of which, as of the date of the Agreement, 16,871,557 shares were issued and outstanding and (ii) 25,000,000 shares of Series A Voting Cumulative Preferred Stock, none of which is issued or outstanding. All of the outstanding shares of Common Stock have been validly issued and are fully paid, nonassessable and free of preemptive rights. As of the date of this Agreement, 10,189,523 shares of Common Stock were reserved for issuance and issuable upon or otherwise deliverable in connection with the exercise of outstanding options, warrants or other rights or securities convertible into shares of Common Stock ("Company Options"), which Company Options are listed (including type and amount of Company Option, option holder's name and option price) in Exhibit 3.16 (a). Except as set forth above, there are outstanding: (i) no shares of capital stock or other voting securities of the Company, (ii) no securities of the Company or its subsidiaries convertible into or exchangeable for shares of capital stock or voting securities of the Company, (iii) no options, warrants, subscriptions, calls, rights or other agreements to acquire from the Company or its subsidiaries, and no obligations of the Company or its subsidiaries to issue, any capital stock, voting securities or securities of the Company and (iv) no equity equivalent interests or rights to acquire equity equivalent interests in the ownership or earnings of the Company or its subsidiaries other similar rights (collectively "Company Securities"). As of the date hereof, there are no outstanding obligations of the Company or its subsidiaries to repurchase, redeem or otherwise acquire any Company Securities. There are no stockholder agreements, voting trusts or other agreements or understandings to which the Company is a party or by which it is bound relating to the voting or registration of any shares of capital stock of the Company or other Company Securities, and to the knowledge of the Company, no such agreements have been entered into by shareholders of the Company. (b) All of the outstanding capital stock of the Company's direct and indirect subsidiaries (except for Secutron Corporation, approximately sixty percent (60%) of which is owned by the Company) is owned by the Company, directly or indirectly, free and clear of any Lien (as defined below) or any other limitation or restriction (including any restriction on the right to vote or sell the same except as may be provided as a matter of law). There are no securities of the Company or its subsidiaries convertible into or exchangeable for, options or other rights to acquire from the Company or its subsidiaries and no other contract, understanding, arrangement or obligation (whether or not contingent) providing for, the issuance or sale, directly or indirectly, of any capital stock or other ownership interests in or any other securities of any subsidiary of the Company. There are no outstanding contractual obligations of the Company or its subsidiaries to repurchase, redeem or otherwise acquire any outstanding shares of capital stock or other ownership interests in any subsidiary of the Company. For purposes of this Agreement, "Lien" means, with respect to any asset (including without limitation any security), any mortgage, lien, pledge, charge, security interest or encumbrance of any kind in respect of such asset. For purposes of this Agreement, a "subsidiary" means a corporation over fifty percent (50%) of the outstanding voting securities of which are owned by Seller.