Exhibit 10.08
SECURITIES PURCHASE AGREEMENT
SECURITIES PURCHASE AGREEMENT (this “ Agreement
”), dated as of November 16, 2007, by and among
Motivnation, Inc., a Nevada corporation, with headquarters located
at 18101 Von Karman Avenue, Suite 330, Irvine, CA 92612 (the
“ Company ”), and each of the
purchasers set forth on the signature pages hereto (the
“ Buyers ”).
WHEREAS:
The Company and the Buyers are executing and delivering this
Agreement in reliance upon the exemption from securities
registration afforded by the rules and regulations as promulgated
by the United States Securities and Exchange Commission (the
“SEC”) under the Securities Act of 1933, as amended
(the “1933 Act”);
Buyers desire to purchase and the Company desires to issue and
sell, upon the terms and conditions set forth in this
Agreement
(i)
8% secured convertible notes of the Company, in the form
attached hereto as Exhibit
“A”
, in the aggregate principal amount of One Hundred Seventy Five
Thousand Dollars ($175,000) (together with any note(s) issued in
replacement thereof or as a dividend thereon or otherwise with
respect thereto in accordance with the terms thereof, the
“ Notes
”), convertible into shares of common stock, par value $.001
per share, of the Company (the “ Common
Stock
”), upon the terms and subject to the limitations and
conditions set forth in such Notes and
(ii)
warrants, in the form attached hereto as
Exhibit
“B”
, to purchase 15,000,000 shares of Common Stock
(the “Warrants”
).
Each Buyer wishes to purchase, upon the terms and conditions stated
in this Agreement, such principal amount of Notes and number of
Warrants as is set forth immediately below its name on the
signature pages hereto; and
Contemporaneous with the execution and delivery of this Agreement,
the parties hereto are executing and delivering a Registration
Rights Agreement, in the form attached hereto as
Exhibit
“C”
(the “ Registration
Rights Agreement
”), pursuant to which the Company has agreed to provide
certain registration rights under the 1933 Act and the rules and
regulations promulgated thereunder, and applicable state securities
laws.
NOW
THEREFORE , the Company and each of the Buyers
severally (and not jointly) hereby agree as
follows:
PURCHASE AND SALE OF NOTES AND WARRANTS
.
Purchase of Notes and Warrants .
On the Closing Date (as defined below), the Company shall issue and
sell to each Buyer and each Buyer severally agrees to purchase from
the Company such principal amount of Notes and number of Warrants
as is set forth immediately below such Buyer’s name on the
signature pages hereto.
Form of Payment .
On the Closing Date (as defined below), (i)
each
Buyer shall pay the purchase price for the Notes and the Warrants
to be issued and sold to it at the Closing (as defined below) (the
“
Purchase Price ”)
by wire transfer of immediately available funds to the Company, in
accordance with the Company’s written wiring instructions,
against delivery of the Notes in the principal amount equal to the
Purchase Price and the number of Warrants as is set forth
immediately below such Buyer’s name on the signature pages
hereto, and (ii)
the
Company shall deliver such Notes and Warrants duly executed on
behalf of the Company, to such Buyer, against delivery of such
Purchase Price.
Closing Date .
Subject to the satisfaction (or written waiver) of the conditions
thereto set forth in Section 6 and Section 7 below, the date and
time of the issuance and sale of the Notes and the Warrants
pursuant to this Agreement (the “
Closing Date ”)
shall be 12:00 noon, Eastern Standard Time on November 16, 2007, or
such other mutually agreed upon time. The closing of the
transactions contemplated by this Agreement (the “
Closing ”)
shall occur on the Closing Date at such location as may be agreed
to by the parties.
BUYERS’ REPRESENTATIONS AND WARRANTIES
.
Each Buyer severally (and not jointly) represents and warrants to
the Company solely as to such Buyer that:
Investment Purpose .
As of the date hereof, the Buyer is purchasing the Notes and the
shares of Common Stock issuable upon conversion of or otherwise
pursuant to the Notes (including, without limitation, such
additional shares of Common Stock, if any, as are issuable
(i)
on
account of interest on the Notes, (ii)
as
a result of the events described in Sections 1.3 and 1.4(g) of the
Notes and Section 2(c) of the Registration Rights Agreement
or (iii)
in
payment of the Standard Liquidated Damages Amount (as defined in
Section 2(f) below) pursuant to this Agreement, such shares of
Common Stock being collectively referred to herein as the
“
Conversion Shares ”)
and the Warrants and the shares of Common Stock issuable upon
exercise thereof (the “
Warrant Shares ”
and, collectively with the Notes, Warrants and Conversion Shares,
the “
Securities ”)
for its own account and not with a present view towards the public
sale or distribution thereof, except pursuant to sales registered
or exempted from registration under the 1933 Act;
provided ,
however ,
that by making the representations herein, the Buyer does not agree
to hold any of the Securities for any minimum or other specific
term and reserves the right to dispose of the Securities at any
time in accordance with or pursuant to a registration statement or
an exemption under the 1933 Act.
Accredited Investor Status .
The Buyer is an “accredited investor” as that term is
defined in Rule 501(a) of Regulation D (an “
Accredited Investor ”).
Reliance on Exemptions .
The Buyer understands that the Securities are being offered and
sold to it in reliance upon specific exemptions from the
registration requirements of United States federal and state
securities laws and that the Company is relying upon the truth and
accuracy of, and the Buyer’s compliance with, the
representations, warranties, agreements, acknowledgments and
understandings of the Buyer set forth herein in order to determine
the availability of such exemptions and the eligibility of the
Buyer to acquire the Securities.
Information .
The Buyer and its advisors, if any, have been, and for so long as
the Notes and Warrants remain outstanding will continue to be,
furnished with all materials relating to the business, finances and
operations of the Company and materials relating to the offer and
sale of the Securities which have been requested by the Buyer or
its advisors. The Buyer and its advisors, if any, have been, and
for so long as the Notes and Warrants remain outstanding will
continue to be, afforded the opportunity to ask questions of the
Company. Notwithstanding the foregoing, the Company has not
disclosed to the Buyer any material nonpublic information and will
not disclose such information unless such information is disclosed
to the public prior to or promptly following such disclosure to the
Buyer. Neither such inquiries nor any other due diligence
investigation conducted by Buyer or any of its advisors or
representatives shall modify, amend or affect Buyer’s right
to rely on the Company’s representations and warranties
contained in Section 3 below. The Buyer understands that its
investment in the Securities involves a significant degree of
risk.
Governmental Review .
The Buyer understands that no United States federal or state agency
or any other government or governmental agency has passed upon or
made any recommendation or endorsement of the
Securities.
Transfer or Re-sale .
The Buyer understands that (i)
except
as provided in the Registration Rights Agreement, the sale or
re-sale of the Securities has not been and is not being registered
under the 1933 Act or any applicable state securities laws, and the
Securities may not be transferred unless (a)
the
Securities are sold pursuant to an effective registration statement
under the 1933 Act, (b)
the
Buyer shall have delivered to the Company an opinion of counsel
that shall be in form, substance and scope customary for opinions
of counsel in comparable transactions to the effect that the
Securities to be sold or transferred may be sold or transferred
pursuant to an exemption from such registration, which opinion
shall be accepted by the Company, (c)
the
Securities are sold or transferred to an “affiliate”
(as defined in Rule 144 promulgated under the 1933 Act (or a
successor rule) (“
Rule 144 ”))
of the Buyer who agrees to sell or otherwise transfer the
Securities only in accordance with this Section 2(f) and who is an
Accredited Investor, (d)
the
Securities are sold pursuant to Rule 144, or (e)
the
Securities are sold pursuant to Regulation S under the 1933 Act (or
a successor rule) (“
Regulation S ”),
and the Buyer shall have delivered to the Company an opinion of
counsel that shall be in form, substance and scope customary for
opinions of counsel in corporate transactions, which opinion shall
be accepted by the Company; (ii) any sale of such Securities made
in reliance on Rule 144 may be made only in accordance with the
terms of said Rule and further, if said Rule is not applicable, any
re-sale of such Securities under circumstances in which the seller
(or the person through whom the sale is made) may be deemed to be
an underwriter (as that term is defined in the 1933 Act) may
require compliance with some other exemption under the 1933 Act or
the rules and regulations of the SEC thereunder; and (iii) neither
the Company nor any other person is under any obligation to
register such Securities under the 1933 Act or any state securities
laws or to comply with the terms and conditions of any exemption
thereunder (in each case, other than pursuant to the Registration
Rights Agreement). Notwithstanding the foregoing or anything else
contained herein to the contrary, the Securities may be pledged as
collateral in connection with a
bona
fide margin
account or other lending arrangement. In the event that the Company
does not accept the opinion of counsel provided by the Buyer with
respect to the transfer of Securities pursuant to an exemption from
registration, such as Rule 144 or Regulation S, within three (3)
business days of delivery of the opinion to the Company, the
Company shall pay to the Buyer liquidated damages of three percent
(3%) of the outstanding amount of the Notes per month plus accrued
and unpaid interest on the Notes, prorated for partial months, in
cash or shares at the option of the Company (“
Standard Liquidated Damages Amount ”).
If the Company elects to be pay the Standard Liquidated Damages
Amount in shares of Common Stock, such shares shall be issued at
the Conversion Price at the time of payment.
Legends .
The Buyer understands that the Notes and the Warrants and, until
such time as the Conversion Shares and Warrant Shares have been
registered under the 1933 Act as contemplated by the Registration
Rights Agreement or otherwise may be sold pursuant to Rule 144 or
Regulation S without any restriction as to the number of securities
as of a particular date that can then be immediately sold, the
Conversion Shares and Warrant Shares may bear a restrictive legend
in substantially the following form (and a stop-transfer order may
be placed against transfer of the certificates for such
Securities):
“The
securities represented by this certificate have not been
registered under the Securities Act of 1933, as amended. The
securities may not be sold, transferred or assigned in the
absence of an effective registration statement for the
securities under said Act, or an opinion of counsel, in form,
substance and scope customary for opinions of counsel in
comparable transactions, that registration is not required
under said Act or unless sold pursuant to Rule 144 or
Regulation S under said Act.”
The legend set forth above shall be removed and the Company shall
issue a certificate without such legend to the holder of any
Security upon which it is stamped, if, unless otherwise required by
applicable state securities laws, (a) such Security is registered
for sale under an effective registration statement filed under the
1933 Act or otherwise may be sold pursuant to Rule 144 or
Regulation S without any restriction as to the number of securities
as of a particular date that can then be immediately sold, or (b)
such holder provides the Company with an opinion of counsel, in
form, substance and scope customary for opinions of counsel in
comparable transactions, to the effect that a public sale or
transfer of such Security may be made without registration under
the 1933 Act, which opinion shall be accepted by the Company so
that the sale or transfer is effected or (c) such holder provides
the Company with reasonable assurances that such Security can be
sold pursuant to Rule 144 or Regulation S. The Buyer agrees to sell
all Securities, including those represented by a certificate(s)
from which the legend has been removed, in compliance with
applicable prospectus delivery requirements, if
any.
Authorization; Enforcement . This Agreement and the
Registration Rights Agreement have been duly and validly
authorized. This Agreement has been duly executed and delivered on
behalf of the Buyer, and this Agreement constitutes, and upon
execution and delivery by the Buyer of the Registration Rights
Agreement, such agreement will constitute, valid and binding
agreements of the Buyer enforceable in accordance with their
terms.
Residency .
The Buyer is a resident of the jurisdiction set forth immediately
below such Buyer’s name on the signature pages
hereto.
REPRESENTATIONS AND WARRANTIES OF THE
COMPANY .
The Company represents and warrants to each Buyer
that:
Organization and Qualification .
The Company and each of its Subsidiaries (as defined below), if
any, is a corporation duly organized, validly existing and in good
standing under the laws of the jurisdiction in which it is
incorporated, with full power and authority (corporate and other)
to own, lease, use and operate its properties and to carry on its
business as and where now owned, leased, used, operated and
conducted.
Schedule 3(a) sets
forth a list of all of the Subsidiaries of the Company and the
jurisdiction in which each is incorporated. The Company and each of
its Subsidiaries is duly qualified as a foreign corporation to do
business and is in good standing in every jurisdiction in which its
ownership or use of property or the nature of the business
conducted by it makes such qualification necessary except where the
failure to be so qualified or in good standing would not have a
Material Adverse Effect. “
Material Adverse Effect ”
means any of (i) a material and adverse effect on the legality,
validity or enforceability of any document executed in connection
with this financing, (ii) a material and adverse effect on the
results of operations, assets, prospects, business or condition
(financial or otherwise) of the Company and the Subsidiaries, taken
as a whole, or (iii) an adverse impairment to the Company’s
ability to perform under any of the documents executed in
connection with this financing. “
Subsidiaries ”
means any corporation or other organization, whether incorporated
or unincorporated, in which the Company owns, directly or
indirectly, any equity or other ownership interest.
Authorization; Enforcement .
(i) The Company has all requisite corporate power and authority to
enter into and perform this Agreement, the Registration Rights
Agreement, the Notes and the Warrants and to consummate the
transactions contemplated hereby and thereby and to issue the
Securities, in accordance with the terms hereof and thereof, (ii)
the execution and delivery of this Agreement, the Registration
Rights Agreement, the Notes and the Warrants by the Company and the
consummation by it of the transactions contemplated hereby and
thereby (including without limitation, the issuance of the Notes
and the Warrants and the issuance and reservation for issuance of
the Conversion Shares and Warrant Shares issuable upon conversion
or exercise thereof) have been duly authorized by the
Company’s Board of Directors and no further consent or
authorization of the Company, its Board of Directors, or its
shareholders is required, (iii) this Agreement has been duly
executed and delivered by the Company by its authorized
representative, and such authorized representative is the true and
official representative with authority to sign this Agreement and
the other documents executed in connection herewith and bind the
Company accordingly, and (iv) this Agreement constitutes, and upon
execution and delivery by the Company of the Registration Rights
Agreement, the Notes and the Warrants, each of such instruments
will constitute, a legal, valid and binding obligation of the
Company enforceable against the Company in accordance with its
terms.
Capitalization .
As of the date hereof, the authorized capital stock of the Company
consists of (i) 300,000,000 shares of Common Stock, of which
[ ]
shares
are issued and outstanding, [ ] shares are
reserved for issuance pursuant to the Company’s stock option
plans, [ ] shares are reserved for issuance
pursuant to securities (other than the Notes and the Warrants)
exercisable for, or convertible into or exchangeable for shares of
Common Stock and, 42,500,000 shares are reserved for issuance upon
conversion of the Notes and exercise of the Warrants (subject to
adjustment pursuant to the Company’s covenant set forth in
Section 4(h) below); and (ii) [ ] shares of
preferred stock of which [ ] shares are issued
and outstanding. All of such outstanding shares of capital stock
are, or upon issuance will be, duly authorized, validly issued,
fully paid and nonassessable. 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. Except as disclosed in
Schedule 3(c) ,
as of the effective date of this Agreement, (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)
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 (except the Registration
Rights Agreement) 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 Notes, the Warrants,
the Conversion Shares or Warrant Shares. The Company has furnished
to the Buyer true and correct copies of the Company’s
Certificate of Incorporation as in effect on the date hereof
(“
Certificate of Incorporation ”),
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 of the Company and the material rights of the holders
thereof in respect thereto. The Company shall provide the Buyer
with a written update of this representation signed by the
Company’s Chief Executive or Chief Financial Officer on
behalf of the Company as of the Closing Date.
Issuance of Shares .
The Conversion Shares and Warrant Shares are duly authorized and
reserved for issuance and, upon conversion of the Notes and
exercise of the Warrants in accordance with their respective terms,
will be validly issued, fully paid and non-assessable, and free
from all taxes, liens, claims and encumbrances with respect to the
issue thereof and shall not be subject to preemptive rights or
other similar rights of shareholders of the Company and will not
impose personal liability upon the holder thereof.
Acknowledgment of Dilution .
The Company understands and acknowledges the potentially dilutive
effect to the Common Stock upon the issuance of the Conversion
Shares and Warrant Shares upon conversion of the Note or exercise
of the Warrants. The Company further acknowledges that its
obligation to issue Conversion Shares and Warrant Shares upon
conversion of the Notes or exercise of the Warrants in accordance
with this Agreement, the Notes and the Warrants is absolute and
unconditional regardless of the dilutive effect that such issuance
may have on the ownership interests of other shareholders of the
Company.
No Conflicts .
The execution, delivery and performance of this Agreement, the
Registration Rights Agreement, the Notes and the Warrants by the
Company and the consummation by the Company of the transactions
contemplated hereby and thereby (including, without limitation, the
issuance and reservation for issuance of the Conversion Shares and
Warrant Shares) will not (i) conflict with or result in a violation
of any provision of the Certificate of Incorporation or By-laws or
(ii) violate or conflict with, or result in a breach of any
provision of, or constitute a default (or an event which with
notice or lapse of time or both could become a default) under, or
give to others any rights of termination, amendment, acceleration
or cancellation of, any agreement, indenture, patent, patent
license or instrument to which the Company or any of its
Subsidiaries is a party, or (iii) result in a violation of any law,
rule, regulation, order, judgment or decree (including federal and
state securities laws and regulations and regulations of any
self-regulatory organizations to which the Company or its
securities are subject) applicable to the Company or any of its
Subsidiaries or by which any property or asset of the Company or
any of its Subsidiaries is bound or affected (except for such
conflicts, defaults, terminations, amendments, accelerations,
cancellations and violations as would not, individually or in the
aggregate, have a Material Adverse Effect). Neither the Company nor
any of its Subsidiaries is in violation of its Certificate of
Incorporation, By-laws or other organizational documents and
neither the Company nor any of its Subsidiaries is in default (and
no event has occurred which with notice or lapse of time or both
could put the Company or any of its Subsidiaries in default) under,
and neither the Company nor any of its Subsidiaries has taken any
action or failed to take any action that would 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 by which any property or assets
of the Company or any of its Subsidiaries is bound or affected,
except for possible defaults as would not, individually or in the
aggregate, have a Material Adverse Effect. The businesses of the
Company and its Subsidiaries, if any, are not being conducted, and
shall not be conducted so long as a Buyer owns any of the
Securities, in violation of any law, ordinance or regulation of any
governmental entity. Except as specifically contemplated by this
Agreement and as required under the 1933 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, governmental agency, regulatory
agency, self regulatory organization or stock market or any third
party in order for it to execute, deliver or perform any of its
obligations under this Agreement, the Registration Rights
Agreement, the Notes or the Warrants in accordance with the terms
hereof or thereof or to issue and sell the Notes and Warrants in
accordance with the terms hereof and to issue the Conversion Shares
upon conversion of the Notes and the Warrant Shares upon exercise
of the Warrants. Except as disclosed in
Schedule 3(f) ,
all consents, authorizations, orders, filings and registrations
which the Company is required to obtain pursuant to the preceding
sentence have been obtained or effected on or prior to the date
hereof. The Company is not in violation of the quotation
requirements of the Over-the-Counter Bulletin Board (the
“
OTCBB ”)
and does not reasonably anticipate that the Common Stock will be
delisted by the OTCBB in the foreseeable future. The Company and
its Subsidiaries are unaware of any facts or circumstances which
might give rise to any of the foregoing.
SEC Documents; Financial Statements
.
Except as disclosed in
Schedule 3(g) ,
the Company has timely filed all reports, schedules, forms,
statements and other documents required to be filed by it with the
SEC pursuant to the reporting requirements of the Securities
Exchange Act of 1934, as amended (the “
1934 Act ”)
(all of the foregoing filed prior to the date hereof and all
exhibits included therein and financial statements and schedules
thereto and documents (other than exhibits to such documents)
incorporated by reference therein, being hereinafter referred to
herein as the “
SEC Documents ”).
The Company has delivered to each Buyer true and complete copies of
the SEC Documents, except for such exhibits and incorporated
documents. As of their respective dates, the SEC Documents complied
in all material respects with the requirements of the 1934 Act and
the rules and regulations of the SEC promulgated thereunder
applicable to the SEC Documents, and none of the SEC Documents, at
the time they were filed with the SEC, contained any untrue
statement of a material fact or omitted to state a material fact
required to be stated therein or necessary in order to make the
statements therein, in light of the circumstances under which they
were made, not misleading. None of the statements made in any such
SEC Documents is, or has been, required to be amended or updated
under applicable law (except for such statements as have been
amended or updated in subsequent filings prior the date hereof). As
of their respective dates, the financial statements of the Company
included in the SEC Documents complied as to form in all material
respects with applicable accounting requirements and the published
rules and regulations of the SEC with respect thereto. Such
financial statements have been prepared in accordance with United
States generally accepted accounting principles, consistently
applied, during the periods involved (except (i) as may be
otherwise indicated in such financial statements or the notes
thereto, or (ii) in the case of unaudited interim statements, to
the extent they may not include footnotes or may be condensed or
summary statements) and fairly present in all material respects the
consolidated financial position of the Company and its consolidated
Subsidiaries as of the dates thereof and the consolidated results
of their operations and cash flows for the periods then ended
(subject, in the case of unaudited statements, to normal year-end
audit adjustments). Except as set forth in the financial statements
of the Company included in the SEC Documents, the Company has no
liabilities, contingent or otherwise, other than (i) liabilities
incurred in the ordinary course of business subsequent to December
31, 2004 and (ii) obligations under contracts and commitments
incurred in the ordinary course of business and not required under
generally accepted accounting principles to be reflected in such
financial statements, which, individually or in the aggregate, are
not material to the financial condition or operating results of the
Company.
Absence of Certain Changes .
Since December 31, 2004, there has been no material adverse change
and no material adverse development in the assets, liabilities,
business, properties, operations, financial condition, results of
operations or prospects of the Company or any of its
Subsidiaries.
Absence of Litigation .
There is no action, suit, claim, proceeding, inquiry or
investigation before or by any court, public board, government
agency, self-regulatory organization or body pending or, to the
knowledge of the Company or any of its Subsidiaries, threatened
against or affecting the Company or any of its Subsidiaries, or
their officers or directors in their capacity as such, that could
have a Material Adverse Effect.
Schedule 3(i) contains
a complete list and summary description of any pending or
threatened proceeding against or affecting the Company or any of
its Subsidiaries, without regard to whether it would have a
Material Adverse Effect. The Company and its Subsidiaries are
unaware of any facts or circumstances which might give rise to any
of the foregoing.
Patents, Copyrights, etc .
The Company and each of its Subsidiaries owns or possesses the
requisite licenses or rights to use all patents, patent
applications, patent rights, inventions, know-how, trade secrets,
trademarks, trademark applications, service marks, service names,
trade names and copyrights (“
Intellectual Property ”)
necessary to enable it to conduct its business as now operated
(and, except as set forth in
Schedule 3(j) hereof,
to the best of the Company’s knowledge, as presently
contemplated to be operated in the future); there is no claim or
action by any person pertaining to, or proceeding pending, or to
the Company’s knowledge threatened, which challenges the
right of the Company or of a Subsidiary with respect to any
Intellectual Property necessary to enable it to conduct its
business as now operated (and, except as set forth in
Schedule 3(j) hereof,
to the best of the Company’s knowledge, as presently
contemplated to be operated in the future); to the best of the
Company’s knowledge, the Company’s or its
Subsidiaries’ current and intended products, services and
processes do not infringe on any Intellectual Property or other
rights held by any person; and the Company is unaware of any facts
or circumstances which might give rise to any of the foregoing. The
Company and each of its Subsidiaries have taken reasonable security
measures to protect the secrecy, confidentiality and value of their
Intellectual Property.
No Materially Adverse Contracts, Etc
.
Neither the Company nor any of its Subsidiaries is subject to any
charter, corporate or other legal restriction, or any judgment,
decree, order, rule or regulation which in the judgment of the
Company’s officers has or is expected in the future to have a
Material Adverse Effect. Neither the Company nor any of its
Subsidiaries is a party to any contract or agreement which in the
judgment of the Company’s officers has or is expected to have
a Material Adverse Effect.
Tax Status .
Except as set forth on
Schedule 3(l) ,
the Company and each of its Subsidiaries has made or filed all
federal, state and foreign income and all other tax returns,
reports and declarations required by any jurisdiction to which it
is subject (unless and only to the extent that the Company and each
of its Subsidiaries has set aside on its books provisions
reasonably adequate for the payment of all unpaid and unreported
taxes) and has paid all taxes and other governmental assessments
and charges that are material in amount, shown or determined to be
due on such returns, reports and declarations, except those being
contested in good faith and has set aside on its books provisions
reasonably adequate for the payment of all taxes for periods
subsequent to the periods to which such returns, reports or
declarations apply. There are no unpaid taxes in any material
amount claimed to be due by the taxing authority o
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