The Company has five Subsidiaries: Leomotors Korea, Inc., LGM Co. Ltd., Leo Trading, Inc., Leo Motors Factory 1, Inc. and Leo Motors Factory 2, Inc.  The Company owns, directly or indirectly, the capital stock or other equity interests of each Subsidiary, in the amounts set forth on Schedule 3.1(a), free and clear of any Liens, and all of the issued and outstanding shares of capital stock of each Subsidiary are validly issued and are fully paid, non-assessable and free of preemptive and similar rights to subscribe for or purchase securities.  If the Company shall at any time in which no Debentures remain outstanding have no subsidiaries, all other references to the Subsidiaries or any of them in the Transaction Documents shall be disregarded.