As of the date hereof, the authorized capital stock of the Company consists of: (i) 900,000,000 shares of Common Stock, of which 49,369,591shares are issued and outstanding; and (ii) 100,000,000 shares of preferred stock, of which 3,000 shares have been designated as “Series A Preferred Stock” of which 930 shares are issued and outstanding. Except as set forth in Schedule 3(c), no shares of Common Stock have been reserved for issuance pursuant to the Company’s stock option plans, and, except for shares of Common Stock issuable upon conversion of the Notes, no shares of Common Stock have been reserved for issuance pursuant to any securities exercisable for, or convertible into or exchangeable for shares of Common Stock. Subject to Schedule 3(c), the Company has reserved a sufficient number of shares of Common Stock for issuance upon conversion of the Notes (subject to adjustment pursuant to the Company’s covenant set forth in Section 4(g) below). All of such outstanding shares of Common Stock have been duly authorized, validly issued, fully paid and non-assessable and have been issued in material compliance with all federal and state securities laws. No shares of capital stock of the Company are subject to preemptive rights or 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, except as set forth in the SEC Documents (as defined below) (i) 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 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, (ii) except as set forth on Schedule 3(c), 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 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 Note or the Conversion Shares. The Company has furnished (or made available on the SEC website) to the Investor true and correct copies of the Company’s Amended and Restated Articles of Incorporation as in effect on the date hereof (“Articles of Incorporation”), the Company’s Bylaws, as in effect on the date hereof (the “By-laws”), and the terms of all securities convertible into or exercisable for Common Stock of the Company and the material rights of the holders thereof in respect thereto. The Company shall provide the Investor with a written update of this representation signed by the Company’s Chief Executive on behalf of the Company as of the Closing Date.