Common use of Representations by the Undersigned Clause in Contracts

Representations by the Undersigned. The undersigned represents and warrants as follows (please select only one from (i) through (iii) below [selecting more than one from (i) though (iii) below will invalidate this subscription]): (i) __X__ I am an Accredited Investor because I meet one of the following items: · is a natural person who has an individual net worth, or joint net worth with that person's spouse of more than $1,000,000; or · is a natural person who had an individual income in excess of $200,000 in each of the two most recent years or joint income with that person's spouse in excess of $300,000 in each of those years and has a reasonable expectation of reaching the same income level in the current year; or · is a bank as defined in Section 3(a)(2) of the 1933 Act or any savings and loan association or other institution as defined in Section 3(a)(5)(A) of the 1933 Act whether acting in its individual or fiduciary capacity; or · any broker or dealer registered pursuant to Section 15 of the Securities Exchange Act of 1934; or · is an insurance company as defined in Section 2(13) of the 1933 Act; or · is an investment company registered under the Investment Company Act of 1940; or · a business development company as defined in Section 2(a)(48) of the Investment Company Act of 1940; or · is a Small Business Investment Company licensed by the U. S. Small Business Administration under Section 301(c) or (d) of the Small Business Investment Act of 1958; or · is an employee benefit plan within the meaning of Title I of the Employee Retirement Income Security Act of 1974, if the invest­ment decision is made by a "plan fiduciary" (as defined in Section 3(21) of such act) which is either a bank, insurance company, or registered investment advisor, or if the employee benefit plan has total assets in excess of $5,000,000, or, if a self-directive plan, its investment decisions are made solely by persons that are accredited investors; or · is a "private business development company" as defined in Section 202(a)(22) of the Investment Advisors Act of 1940; or · is an organization described in Section 501(c)(3) of the Internal Revenue Code, corporation, Massachusetts or similar business trust, or partnership, not formed for the specific purpose of acquiring the securities offered, with total assets in excess of $5,000,000; or · any trust, with total assets in excess of $5,000,000, not formed for the specific purpose of acquiring the Units, whose purchase is directed by a sophisticated person as defined in the rules and regulations of the 1933 Act; or · is an entity in which all of the equity owners fall within one of the categories set forth above; or · is otherwise an Accredited Investor as defined in Section 501 of Regulation D as adopted by the Securities and Exchange Commission. (ii) I am not an Accredited Investor. In the event the Investor is not an Accredited Investor, such Investor will not be able to purchase any shares in the Company’s offering, and this Subscription and the Investor’s funds (if any) shall be returned to Investor and this Subscription and all rights associated therewith shall be cancelled by the Company. (iii) I reside outside of the United States and am not a “U.S. person” as such term is defined under Regulation S as promulgated by the Securities and Exchange Commission (“SEC”) under authority of the Securities Act of 1933, as amended (the “1933 Act”). (1) A “U.S. person” is defined by Regulation S as: · Any natural person resident in the United States; · Any partnership or corporation organized or incorporated under the laws of the United States; · Any estate of which any executor or administrator is a U.S. person; · Any trust of which any trustee is a U.S. person; · Any agency or branch of a foreign entity located in the United States; · Any non-discretionary account or similar account (other than an estate or trust) held by a dealer or other fiduciary for the benefit or account of a U.S. person; · Any discretionary account or similar account (other than an estate or trust) held by a dealer or other fiduciary organized, incorporated, or (if an individual) resident in the United States; and · Any partnership or corporation if organized or incorporated under the laws of any foreign jurisdiction; and formed by a U.S. person principally for the purpose of investing in securities not registered under the Act, unless it is organized or incorporated, and owned, by accredited investors (as defined in Rule 501(a)) who are not natural persons, estates or trusts. (2) At the time the buy order for the Units was originated, Purchaser was outside the United States; (3) Purchaser is purchasing the Shares for his, her or its own account and not on behalf of any U.S. person, and the sale has not been pre-arranged with a purchaser in the United States; and (4) All offering documents received by the Purchaser include statements to the affect that the securities have not been registered under the 1933 Act and may not be offered or sold in the United States or to U.S. persons unless the securities are registered under the 1933 Act or an exemption from the registration requirement is available. (a) Subscriber represents and warrants that it is in receipt of and that it has carefully read and reviewed the following items: (i) The Company’s Form 10-KSB for the period ended December 31, 2006 (the “Form 10-K”); which discloses that the Company is currently under Chapter 11 protection of the U.S. Bankruptcy Code; and (ii) All other documents filed by the Company with the SEC subsequent to the Company’s Form 10-K and prior to the date of this Agreement, including without limitation, the “Risk Factors” in the Form 10-K (collectively the “SEC Filings”). The Form 10-K and Risk Factors are accessible on the ▇▇▇▇▇ website on ▇▇▇.▇▇▇.▇▇▇; (iii) The Company’s Series A Convertible Preferred Stock Designation (the “Designation”); and