STANDBY EQUITY
DISTRIBUTION AGREEMENT
THIS AGREEMENT dated as of the ___ day of March 2005 (the
"Agreement") between CORNELL CAPITAL PARTNERS, LP, a Delaware
limited partnership (the "Investor"), and AMERICANA
PUBLISHING, INC., a corporation organized and existing under the
laws of the
State of Colorado (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 Ten Million
U.S.
Dollars ($10,000,000) 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 Newbridge 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 (1st) 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 Ten Million U.S. Dollars ($10,000,000)
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 Ten Million
U.S. Dollars ($10,000,000), (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 Two
Hundred Fifty Thousand U.S. Dollars (US$250,000) 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 Newbridge
Securities Corporation, a registered broker-dealer.
Section 1.21. "Pricing Period" shall mean the five (5)
consecutive Trading Days after the Advance Notice Date.
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
five percent (95%) 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.
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 (1st) 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.
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 shall have provided to the
Investor an acknowledgement, from White & Associates as to
its
ability to provide all consents required in order to file a
registration statement in connection with this transaction;
(i) 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.
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.
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,
2003
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:
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 500,000,000
shares of Common Stock, par value $0.001 per share and 20,000,000
shares of Preferred Stock, no par value, of which 29,638,084
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.
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
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