Exhibit 2.0
STANDBY EQUITY DISTRIBUTION
AGREEMENT
THIS AGREEMENT dated as of the 25 th day of April
2005 (the “ Agreement ”) between CORNELL
CAPITAL PARTNERS, LP , a Delaware limited partnership (the
“ Investor ”), and AIMS WORLDWIDE, INC. ,
a corporation organized and existing under the laws of the State of
Nevada (the “ Company ”).
WHEREAS , the parties desire that, upon the terms and subject
to the conditions contained herein, the Company shall issue and
sell to the Investor, from time to time as provided herein, and the
Investor shall purchase from the Company up to Thirty Five Million
U.S. Dollars ($35,000,000) of the Company’s common
stock, par value $0.001 per share (the “ Common Stock
”); and
WHEREAS , such investments will be made in reliance upon the
provisions of Regulation D (“ Regulation D ”) of
the Securities Act of 1933, as amended, and the regulations
promulgated thereunder (the “ Securities Act ”),
and or upon such other exemption from the registration requirements
of the Securities Act as may be available with respect to any or
all of the investments to be made hereunder.
WHEREAS , the Company has engaged Sloan Securities
Corporation (the “ Placement Agent ”), to
act as the Company’s exclusive placement agent in connection
with the sale of the Company’s Common Stock to the Investor
hereunder pursuant to the Placement Agent Agreement dated the date
hereof by and among the Company, the Placement Agent and the
Investor (the “ Placement Agent Agreement
”).
NOW , THEREFORE , the parties hereto agree as
follows:
ARTICLE I.
Certain Definitions
Section 1.1
“ Advance ” shall mean
the portion of the Commitment Amount requested by the Company in
the Advance Notice.
Section 1.2
“ Advance Date ” shall
mean the date the David Gonzalez Attorney Trust Account is in
receipt of the funds from the Investor and David Gonzalez, Esq., is
in possession of free trading shares from the Company and therefore
an Advance by the Investor to the Company can be made and David
Gonzalez, Esq. can release the free trading shares to the Investor.
The Advance Date shall be the first (1 st ) Trading Day
after expiration of the applicable Pricing Period for each
Advance.
Section 1.3
“ Advance Notice ”
shall mean a written notice to the Investor setting forth the
Advance amount that the Company requests from the Investor and the
Advance Date.
Section 1.4
“ Advance Notice Date
” shall mean each date the Company delivers to the Investor
an Advance Notice requiring the Investor to advance funds to the
Company, subject to the terms of this Agreement. No Advance
Notice Date shall be less than five (5) Trading Days after the
prior Advance Notice Date.
Section 1.5
“ Bid Price ” shall
mean, on any date, the closing bid price (as reported by Bloomberg
L.P.) of the Common Stock on the Principal Market or if the Common
Stock is not traded on a Principal Market, the highest reported bid
price for the Common Stock, as furnished by the National
Association of Securities Dealers, Inc.
Section 1.6
“ Closing ” shall mean
one of the closings of a purchase and sale of Common Stock pursuant
to Section 2.3.
Section 1.7
“ Commitment Amount ”
shall mean the aggregate amount of up to Thirty Five Million U.S.
Dollars ($35,000,000) which the Investor has agreed to provide to
the Company in order to purchase the Company’s Common Stock
pursuant to the terms and conditions of this Agreement.
Section 1.8
“ Commitment Period ”
shall mean the period commencing on the earlier to occur of (i) the
Effective Date, or (ii) such earlier date as the Company and the
Investor may mutually agree in writing, and expiring on the
earliest to occur of (x) the date on which the Investor shall have
made payment of Advances pursuant to this Agreement in the
aggregate amount of Thirty Five Million U.S. Dollars ($35,000,000),
(y) the date this Agreement is terminated pursuant to Section 2.4,
or (z) the date occurring twenty-four (24) months after the
Effective Date.
Section 1.9
“ Common Stock ” shall
mean the Company’s common stock, par value $0.001 per
share.
Section 1.10
“ Condition Satisfaction
Date ” shall have the meaning set forth in
Section 7.2.
Section 1.11
“ Damages ” shall mean
any loss, claim, damage, liability, costs and expenses (including,
without limitation, reasonable attorney’s fees and
disbursements and costs and expenses of expert witnesses and
investigation).
Section 1.12
“ Effective Date ”
shall mean the date on which the SEC first declares effective a
Registration Statement registering the resale of the Registrable
Securities as set forth in Section 7.2(a).
Section 1.13
“ Escrow Agreement ”
shall mean the escrow agreement among the Company, the Investor,
and David Gonzalez, Esq., dated the date hereof.
Section 1.14
“ Exchange Act ” shall
mean the Securities Exchange Act of 1934, as amended, and the rules
and regulations promulgated thereunder.
Section 1.15
“ Material Adverse Effect
” shall mean any condition, circumstance, or situation that
would prohibit or otherwise materially interfere with the ability
of the Company to enter into and perform any of its obligations
under this Agreement or the Registration Rights Agreement in any
material respect.
Section 1.16
“ Market Price ” shall
mean the lowest VWAP of the Common Stock during the Pricing
Period.
Section 1.17
“ Maximum Advance Amount
” shall be Three Million Five Hundred Thousand U.S.
Dollars (US$3,500,000) per Advance Notice.
Section 1.18
“ NASD ” shall mean
the National Association of Securities Dealers, Inc.
Section 1.19
“ Person ” shall mean
an individual, a corporation, a partnership, an association, a
trust or other entity or organization, including a government or
political subdivision or an agency or instrumentality
thereof.
Section 1.20
“ Placement Agent ”
shall mean Sloan Securities Corporation, a registered
broker-dealer.
Section 1.21
“ Pricing Period ”
shall mean the five (5) consecutive Trading Days after the Advance
Notice Date.
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Section 1.22
“ Principal Market ”
shall mean the Nasdaq National Market, the Nasdaq SmallCap Market,
the American Stock Exchange, the OTC Bulletin Board or the New York
Stock Exchange, whichever is at the time the principal trading
exchange or market for the Common Stock.
Section 1.23
“ Purchase Price ”
shall be set at ninety nine percent (99%) of the Market Price
during the Pricing Period.
Section 1.24
“ Registrable Securities
” shall mean the shares of Common Stock to be issued
hereunder (i) in respect of which
the Registration Statement has not been declared effective by the
SEC, (ii) which have not been sold under circumstances meeting all
of the applicable conditions of Rule 144 (or any similar provision
then in force) under the Securities Act (“ Rule 144
”) or (iii) which have not been otherwise transferred to a
holder who may trade such shares without restriction under the
Securities Act, and the Company has delivered a new certificate or
other evidence of ownership for such securities not bearing a
restrictive legend.
Section 1.25
“ Registration Rights
Agreement ” shall mean the Registration Rights Agreement
dated the date hereof, regarding the filing of the Registration
Statement for the resale of the Registrable Securities, entered
into between the Company and the Investor.
Section 1.26
“ Registration Statement
” shall mean a registration statement on Form S-1 or SB-2 (if
use of such form is then available to the Company pursuant to the
rules of the SEC and, if not, on such other form promulgated by the
SEC for which the Company then qualifies and which counsel for the
Company shall deem appropriate, and which form shall be available
for the resale of the Registrable Securities to be registered
thereunder in accordance with the provisions of this Agreement and
the Registration Rights Agreement, and in accordance with the
intended method of distribution of such securities), for the
registration of the resale by the Investor of the Registrable
Securities under the Securities Act.
Section 1.27
“ Regulation D ” shall
have the meaning set forth in the recitals of this
Agreement.
Section 1.28
“ SEC ” shall mean the
Securities and Exchange Commission.
Section 1.29
“ Securities Act ”
shall have the meaning set forth in the recitals of this
Agreement.
Section 1.30
“ SEC Documents ”
shall mean Annual Reports on Form 10-KSB, Quarterly Reports on Form
10-QSB, Current Reports on Form 8-K and Proxy Statements of the
Company as supplemented to the date hereof, filed by the Company
for a period of at least twelve (12) months immediately preceding
the date hereof or the Advance Date, as the case may be, until such
time as the Company no longer has an obligation to maintain the
effectiveness of a Registration Statement as set forth in the
Registration Rights Agreement.
Section 1.31
“ Trading Day ” shall
mean any day during which the New York Stock Exchange shall be open
for business.
Section 1.32
“ VWAP ” shall mean
the volume weighted average price of the Company’s Common
Stock as quoted by Bloomberg, LP.
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ARTICLE II.
Advances
Section 2.1
Investments .
(a)
Advances . Upon the terms and conditions set forth
herein (including, without limitation, the provisions of Article
VII hereof), on any Advance Notice Date the Company may request an
Advance by the Investor by the delivery of an Advance Notice.
The number of shares of Common Stock that the Investor shall
receive for each Advance shall be determined by dividing the amount
of the Advance by the Purchase Price. No fractional shares
shall be issued. Fractional shares shall be rounded to the next
higher whole number of shares. The aggregate maximum amount
of all Advances that the Investor shall be obligated to make under
this Agreement shall not exceed the Commitment Amount.
Section 2.2
Mechanics .
(a)
Advance Notice . At any time during the Commitment Period, the
Company may deliver an Advance Notice to the Investor, subject to
the conditions set forth in Section 7.2; provided, however,
the amount for each Advance as designated by the Company in the
applicable Advance Notice, shall not be more than the Maximum
Advance Amount. The aggregate amount of the Advances pursuant
to this Agreement shall not exceed the Commitment Amount. The
Company acknowledges that the Investor may sell shares of the
Company’s Common Stock corresponding with a particular
Advance Notice on the day the Advance Notice is received by the
Investor. There shall be a minimum of five (5) Trading Days
between each Advance Notice Date.
(b)
Date of Delivery of Advance
Notice . An Advance
Notice shall be deemed delivered on (i) the Trading Day it is
received by facsimile or otherwise by the Investor if such notice
is received prior to 12:00 noon Eastern Time, or (ii) the
immediately succeeding Trading Day if it is received by facsimile
or otherwise after 12:00 noon Eastern Time on a Trading Day or at
any time on a day which is not a Trading Day. No Advance
Notice may be deemed delivered on a day that is not a Trading
Day.
Section 2.3
Closings . On each Advance Date, which shall be the
first (1 st ) Trading Day after expiration of the
applicable Pricing Period for each Advance, (i) the Company shall
deliver to David Gonzalez, Esq. (the “ Escrow Agent
”) shares of the Company’s Common Stock, representing
the amount of the Advance by the Investor pursuant to Section 2.1
herein, registered in the name of the Investor which shall be
delivered to the Investor, or otherwise in accordance with the
Escrow Agreement and (ii) the Investor shall deliver to Escrow
Agent the amount of the Advance specified in the Advance Notice by
wire transfer of immediately available funds which shall be
delivered to the Company, or otherwise in accordance with the
Escrow Agreement. In addition, on or prior to the Advance
Date, each of the Company and the Investor shall deliver to the
other through the Investor’s counsel, all documents,
instruments and writings required to be delivered by either of them
pursuant to this Agreement in order to implement and effect the
transactions contemplated herein. Payment of funds to the
Company and delivery of the Company’s Common Stock to the
Investor shall occur in accordance with the conditions set forth
above and those contained in the Escrow Agreement; provided
, however , that to the extent the Company has not paid the
fees, expenses, and disbursements of the Investor, the
Investor’s counsel, or the Company’s counsel in
accordance with Section 12.4, the amount of such fees, expenses,
and disbursements may be deducted by the Investor (and shall be
paid to the relevant party) from the amount of the Advance with no
reduction in the amount of shares of the Company’s Common
Stock to be delivered on such Advance Date.
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Section 2.4
Termination of Investment
. The obligation of the Investor to
make an Advance to the Company pursuant to this Agreement shall
terminate permanently (including with respect to an Advance Date
that has not yet occurred) in the event that (i) there shall occur
any stop order or suspension of the effectiveness of the
Registration Statement for an aggregate of fifty (50) Trading Days,
other than due to the acts of the Investor, during the Commitment
Period, and (ii) the Company shall at any time fail materially to
comply with the requirements of Article VI and such failure is not
cured within thirty (30) days after receipt of written notice from
the Investor, provided , however , that this
termination provision shall not apply to any period commencing upon
the filing of a post-effective amendment to such Registration
Statement and ending upon the date on which such post effective
amendment is declared effective by the SEC.
Section 2.5
Agreement to Advance Funds
. The Investor agrees to advance the
amount specified in the Advance Notice to the Company after the
completion of each of the following conditions and the other
conditions set forth in this Agreement:
(a)
the execution and delivery by the
Company, and the Investor, of this Agreement and the Exhibits
hereto;
(b)
the Escrow Agent shall have received the
shares of Common Stock applicable to the Advance in accordance with
Section 2.3. Such shares shall be free of restrictive
legends.
(c)
the Company’s Registration
Statement with respect to the resale of the Registrable Securities
in accordance with the terms of the Registration Rights Agreement
shall have been declared effective by the SEC;
(d)
the Company shall have obtained all
material permits and qualifications required by any applicable
state for the offer and sale of the Registrable Securities, or
shall have the availability of exemptions therefrom. The sale
and issuance of the Registrable Securities shall be legally
permitted by all laws and regulations to which the Company is
subject;
(e)
the Company shall have filed with the
Commission in a timely manner all reports, notices and other
documents required of a “reporting company” under the
Exchange Act and applicable Commission regulations;
(f)
the fees as set forth in Section 12.4
below shall have been paid or can be withheld as provided in
Section 2.3; and
(g)
the conditions set forth in Section 7.2
shall have been satisfied.
(h)
The Company’s transfer agent shall
be DWAC eligible.
Section 2.6.
Lock Up Period.
(i)
During the Commitment Period, the Company
shall not issue or sell (i) any Common Stock or Preferred Stock
without consideration or for a consideration per share less than
the Bid Price on the date of issuance or (ii) issue or sell
any warrant, option, right, contract, call, or other security or
instrument granting the holder thereof the right to acquire Common
Stock without consideration or for a consideration per share less
than the Bid Price on the date of issuance.
(ii)
On the date hereof, the Company shall
obtain from each officer and director a lock-up agreement, as
defined below, in the form annexed hereto as Schedule 2.6
agreeing to only sell in compliance with the volume limitation of
Rule 144.
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Section 2.7.
Hardship . In the event the Investor sells shares of the
Company’s Common Stock after receipt of an Advance Notice and
the Company fails to perform its obligations as mandated in Section
2.3, and specifically the Company fails to deliver to the Escrow
Agent on the Advance Date the shares of Common Stock corresponding
to the applicable Advance, the Company acknowledges that the
Investor shall suffer financial hardship and therefore shall be
liable for any and all losses, commissions, fees, or financial
hardship caused to the Investor.
ARTICLE III.
Representations and Warranties of Investor
Investor hereby represents and warrants
to, and agrees with, the Company that the following are true and as
of the date hereof and as of each Advance Date:
Section 3.1
Organization and
Authorization . The
Investor is duly incorporated or organized and validly existing in
the jurisdiction of its incorporation or organization and has all
requisite power and authority to purchase and hold the securities
issuable hereunder. The decision to invest and the execution
and delivery of this Agreement by such Investor, the performance by
such Investor of its obligations hereunder and the consummation by
such Investor of the transactions contemplated hereby have been
duly authorized and requires no other proceedings on the part of
the Investor. The undersigned has the right, power and
authority to execute and deliver this Agreement and all other
instruments (including, without limitations, the Registration
Rights Agreement), on behalf of the Investor. This Agreement
has been duly executed and delivered by the Investor and, assuming
the execution and delivery hereof and acceptance thereof by the
Company, will constitute the legal, valid and binding obligations
of the Investor, enforceable against the Investor in accordance
with its terms.
Section 3.2
Evaluation of Risks
. The Investor has such knowledge
and experience in financial tax and business matters as to be
capable of evaluating the merits and risks of, and bearing the
economic risks entailed by, an investment in the Company and of
protecting its interests in connection with this transaction.
It recognizes that its investment in the Company involves a
high degree of risk.
Section 3.3
No Legal Advice From the
Company . The Investor
acknowledges that it had the opportunity to review this Agreement
and the transactions contemplated by this Agreement with his or its
own legal counsel and investment and tax advisors. The
Investor is relying solely on such counsel and advisors and not on
any statements or representations of the Company or any of its
representatives or agents for legal, tax or investment advice with
respect to this investment, the transactions contemplated by this
Agreement or the securities laws of any jurisdiction.
Section 3.4
Investment Purpose
. The securities are being purchased by
the Investor for its own account, for investment and without any
view to the distribution, assignment or resale to others or
fractionalization in whole or in part. The Investor agrees
not to assign or in any way transfer the Investor’s rights to
the securities or any interest therein and acknowledges that the
Company will not recognize any purported assignment or transfer
except in accordance with applicable Federal and state securities
laws. No other person has or will have a direct or indirect
beneficial interest in the securities. The Investor agrees
not to sell, hypothecate or otherwise transfer the Investor’s
securities unless the securities are registered under Federal and
applicable state securities laws or unless, in the opinion of
counsel satisfactory to the Company, an exemption from such laws is
available.
Section 3.5
Accredited Investor
. The Investor is an “
Accredited Investor ” as that term is defined in Rule
501(a)(3) of Regulation D of the Securities Act.
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Section 3.6
Information . The Investor and its advisors (and its
counsel), if any, have been furnished with all materials relating
to the business, finances and operations of the Company and
information it deemed material to making an informed investment
decision. The Investor and its advisors, if any, have been
afforded the opportunity to ask questions of the Company and its
management. Neither such inquiries nor any other due
diligence investigations conducted by such Investor or its
advisors, if any, or its representatives shall modify, amend or
affect the Investor’s right to rely on the Company’s
representations and warranties contained in this Agreement.
The Investor understands that its investment involves a high
degree of risk. The Investor is in a position regarding the
Company, which, based upon employment, family relationship or
economic bargaining power, enabled and enables such Investor to
obtain information from the Company in order to evaluate the merits
and risks of this investment. The Investor has sought such
accounting, legal and tax advice, as it has considered necessary to
make an informed investment decision with respect to this
transaction.
Section 3.7
Receipt of Documents
. The Investor and its counsel have
received and read in their entirety: (i) this Agreement and
the Exhibits annexed hereto; (ii) all due diligence and other
information necessary to verify the accuracy and completeness of
such representations, warranties and covenants; (iii) the
Company’s Form 10-KSB for the year ended December 31, 2004
and Form 10-QSB for the period ended September 30, 2004; and
(iv) answers to all questions the Investor submitted to the
Company regarding an investment in the Company; and the Investor
has relied on the information contained therein and has not been
furnished any other documents, literature, memorandum or
prospectus.
Section 3.8
Registration Rights Agreement and
Escrow Agreement . The
parties have entered into the Registration Rights Agreement and the
Escrow Agreement, each dated the date hereof.
Section 3.9
No General Solicitation
. Neither the Company, nor any of
its affiliates, nor any person acting on its or their behalf, has
engaged in any form of general solicitation or general advertising
(within the meaning of Regulation D under the Securities Act) in
connection with the offer or sale of the shares of Common Stock
offered hereby.
Section 3.10
Not an Affiliate
. The Investor is not an officer,
director or a person that directly, or indirectly through one or
more intermediaries, controls or is controlled by, or is under
common control with the Company or any “ Affiliate
” of the Company (as that term is defined in Rule 405 of the
Securities Act).
Section 3.11
Trading Activities
. The Investor’s trading
activities with respect to the Company’s Common Stock shall
be in compliance with all applicable federal and state securities
laws, rules and regulations and the rules and regulations of the
Principal Market on which the Company’s Common Stock is
listed or traded. Neither the Investor nor its affiliates has an
open short position in the Common Stock of the Company, the
Investor agrees that it shall not, and that it will cause its
affiliates not to, engage in any short sales of or hedging
transactions with respect to the Common Stock, provided that
the Company acknowledges and agrees that upon receipt of an Advance
Notice the Investor is permitted to sell the shares to be issued to
the Investor pursuant to the Advance Notice during the applicable
Pricing Period.
ARTICLE IV.
Representations and Warranties of the Company
Except as stated below, on the disclosure
schedules attached hereto or in the SEC Documents (as defined
herein), the Company hereby represents and warrants to, and
covenants with, the Investor that the following are true and
correct as of the date hereof:
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Section 4.1
Organization and
Qualification . The
Company is duly incorporated or organized and validly existing in
the jurisdiction of its incorporation or organization and has all
requisite power and authority corporate power to own its properties
and to carry on its business as now being conducted. Each of
the Company and its subsidiaries is duly qualified as a foreign
corporation to do business and is in good standing in every
jurisdiction in which the nature of the business conducted by it
makes such qualification necessary, except to the extent that the
failure to be so qualified or be in good standing would not have a
Material Adverse Effect on the Company and its subsidiaries taken
as a whole.
Section 4.2
Authorization, Enforcement, Compliance
with Other Instruments .
(i) The Company has the requisite corporate power and
authority to enter into and perform this Agreement, the
Registration Rights Agreement, the Escrow Agreement, the Placement
Agent Agreement and any related agreements, in accordance with the
terms hereof and thereof, (ii) the execution and delivery of this
Agreement, the Registration Rights Agreement, the Escrow Agreement,
the Placement Agent Agreement and any related agreements by the
Company and the consummation by it of the transactions contemplated
hereby and thereby, have been duly authorized by the
Company’s Board of Directors and no further consent or
authorization is required by the Company, its Board of Directors or
its stockholders, (iii) this Agreement, the Registration
Rights Agreement, the Escrow Agreement, the Placement Agent
Agreement and any related agreements have been duly executed and
delivered by the Company, (iv) this Agreement, the Registration
Rights Agreement, the Escrow Agreement, the Placement Agent
Agreement and assuming the execution and delivery thereof and
acceptance by the Investor and any related agreements constitute
the valid and binding obligations of the Company enforceable
against the Company in accordance with their terms, except as such
enforceability may be limited by general principles of equity or
applicable bankruptcy, insolvency, reorganization, moratorium,
liquidation or similar laws relating to, or affecting generally,
the enforcement of creditors’ rights and remedies.
Section 4.3
Capitalization . As of the date hereof, the authorized capital
stock of the Company consists of 100,000,000 shares of Common
Stock, par value $0.001 per share and 10,000,000 shares of
Preferred Stock of which 26,429,802 shares of Common Stock and no
shares of Preferred Stock were issued and outstanding. All of
such outstanding shares have been validly issued and are fully paid
and nonassessable. Except as disclosed in the SEC Documents,
no shares of Common Stock are subject to preemptive rights or any
other similar rights or any liens or encumbrances suffered or
permitted by the Company. Except as disclosed in the SEC
Documents, as of the date hereof, (i) there are no outstanding
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 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 of
any character whatsoever relating to, or securities or rights
convertible into, any shares of capital stock of the Company or any
of its subsidiaries, (ii) there are no outstanding debt securities
( iii) there are no outstanding registration statements
other than on Form S-8 and (iv) there are 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 (except pursuant to the Registration Rights
Agreement). There are no securities or instruments containing
anti-dilution or similar provisions that will be triggered by this
Agreement or any related agreement or the consummation of the
transactions described herein or therein. The Company has
furnished to the Investor true and correct copies of the
Company’s Certificate of Incorporation, as amended and as in
effect on the date hereof (the “ Certificate of
Incorporation ”), and 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 for
Common Stock and the material rights of the holders thereof in
respect thereto.
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Section 4.4
No Conflict . The execution, delivery and performance of
this Agreement by the Company and the consummation by the Company
of the transactions contemplated hereby will not (i) result in a
violation of the Certificate of Incorporation, any certificate of
designations of any outstanding series of preferred stock of the
Company or By-laws or (ii) conflict with or constitute a default
(or an event which with notice or lapse of time or both would
become a default) under, or give to others any rights of
termination, amendment, acceleration or cancellation of, any
agreement, indenture or instrument to which the Company or any of
its subsidiaries is a party, or result in a violation of any law,
rule, regulation, order, judgment or decree (including federal and
state securities laws and regulations and the rules and regulations
of the Principal Market on which the Common Stock is quoted)
applicable to the Company or any of its subsidiaries or by which
any material property or asset of the Company or any of its
subsidiaries is bound or affected and which would cause a Material
Adverse Effect. Except as disclosed in the SEC Documents,
neither the Company nor its subsidiaries is in violation of any
term of or in default under its Articles of Incorporation or
By-laws or their organizational charter or by-laws, respectively,
or any material contract, agreement, mortgage, indebtedness,
indenture, instrument, judgment, decree or order or any statute,
rule or regulation applicable to the Company or its subsidiaries.
The business of the Company and its subsidiaries is not being
conducted in violation of any material law, ordinance, regulation
of any governmental entity. Except as specifically
contemplated by this Agreement and as required under the Securities
Act and any applicable state securities laws, the Company is not
required to obtain any consent, authorization or order of, or make
any filing or registration with, any court or governmental agency
in order for it to execute, deliver or perform any of its
obligations under or contemplat
