Common use of Capitalization; Status of Capital Stock Clause in Contracts

Capitalization; Status of Capital Stock. (a) On the date of this Agreement and immediately prior to the issuance of Debentures contemplated by this Agreement, the Company has a total authorized capitalization consisting of: (i) 10,000,000 shares of Common Stock of which 3,117,647 are issued and outstanding and (ii) 3,000,000 shares of Preferred Stock, of which none are issued and outstanding. As of the date of this Agreement and immediately prior to the issuance of Debentures contemplated by this Agreement, 700,000 shares of Common Stock have been reserved for issuance in accordance with the Company’s 2005 Stock Option and Incentive Plan. Of those shares the Company granted: (i) nonqualified options to purchase 230,000 shares of the Company’s Common Stock that are currently not exercised and (ii) 15,000 shares of restricted common stock. (b) Schedule 2.05 sets forth the capitalization of the Company immediately following the issuance of the Debentures contemplated by this Agreement including the number of shares of the following: (i) issued and outstanding Common Stock; (ii) Common Stock reserved for issuance upon conversion of Debenture, including the names of the holders of the Debentures thereof; (iii) issued stock options, including vesting schedule and exercise price; (iv) stock options not yet issued but reserved for issuance; (v) issued and outstanding Preferred Stock; and (vi) warrants or stock purchase rights, if any. All of the outstanding shares of capital stock of the Company have been duly authorized, are validly issued and are fully paid and nonassessable and were issued in compliance with all applicable federal and state securities laws. The Debentures have been duly authorized, and when issued, sold and delivered in accordance with the terms and for the consideration set forth in this Agreement, will be validly issued. The Company has duly reserved the Conversion Shares for issuance upon conversion of the Debentures, and the Conversion Shares, when issued and delivered upon conversion of the Debentures, will be duly authorized, validly issued and fully paid and non assessable. Except as set forth on Schedule 2.05, there are no options, warrants or rights to purchase shares of capital stock or other securities of the Company authorized, issued or outstanding, nor is the Company obligated in any other manner to issue shares of its capital stock or other securities. There are no restrictions on the transfer of shares of capital stock of the Company other than those imposed by the Transaction Agreements and state and federal securities laws. No holder of any security of the Company is entitled to preemptive or similar statutory or contractual rights, either arising pursuant to any agreement or instrument to which the Company is a party, or which are otherwise binding upon the Company, which have not been waived. The offer and sale of all shares of capital stock and other securities of the Company issued before the date hereof complied with or were exempt from all federal and state securities laws.

Capitalization; Status of Capital Stock. (a) On the date of this Agreement The Company represents and warrants that immediately prior to the issuance of Debentures contemplated by this Agreement, Closing Date the Company has will have a total authorized capitalization consisting of: of (i) 10,000,000 100,000,000 shares of Common Stock Stock, without par value, of which 3,117,647 18,866,348 shares are issued and outstanding outstanding, and (ii) 3,000,000 25,000,000 shares of Preferred Stock, of which none 1,510,533 shares of Series A Convertible Preferred Stock are issued and outstanding, 6,316,705 shares of Series B Convertible Preferred Stock are issued and outstanding and 4,819,538 shares of Series C Convertible Preferred Stock are issued and outstanding. As of the date of this Agreement and immediately prior to the issuance of Debentures contemplated by this Agreement, 700,000 The Company has reserved 8,000,000 shares of Common Stock have been reserved for issuance in accordance with under the Company’s 2005 's 1996 Stock Option and Incentive Plan (the "Plan. Of those shares the Company granted: (i) nonqualified "), under which options to purchase 230,000 6,382,323 shares have been granted, stock grants for 5,000 shares have been made, 3,861,323 shares have been issued upon exercise of options, 30,200 shares have been returned to the Plan, options for 2,490,775 shares are currently outstanding, and 1,642,877 shares remain available for future grant under the Plan. The Company has issued warrants to purchase 53,000 shares of the Company’s Common Stock that are currently not exercised to certain individuals and (ii) 15,000 warrants to purchase 86,000 shares of restricted common stock. (b) Schedule 2.05 sets forth the capitalization of the Company immediately following the issuance of the Debentures contemplated by this Agreement including the number of Series B Convertible Preferred Stock and 36,553 shares of the following: (i) issued and outstanding Common Stock; (ii) Common Stock reserved for issuance upon conversion of Debenture, including the names of the holders of the Debentures thereof; (iii) issued stock options, including vesting schedule and exercise price; (iv) stock options not yet issued but reserved for issuance; (v) issued and outstanding Series C Convertible Preferred Stock; and (vi) warrants or stock purchase rights, if anyrespectively, to equipment lessors. All of the outstanding shares of capital stock of the Company have been duly authorized, are validly issued and are fully paid and nonassessable and were all shares issuable upon exercise of outstanding options and warrants have been duly authorized and, when issued in accordance with the terms of such options and warrants, will be validly issued, fully paid and nonassessable and issued in compliance with all applicable federal and state securities laws. The Debentures have been duly authorized, and when issued, sold and delivered in accordance with the terms and for the consideration set forth in this Agreement, will be validly issued. The Company has duly reserved the Conversion Shares sufficient shares of Common Stock for issuance upon conversion of the Debentures, and the Series D Preferred. The Conversion Shares, when issued and delivered upon conversion of the DebenturesSeries D Preferred, will be duly authorized, validly issued and fully paid and non assessablenonassessable. Except as set forth on Schedule 2.05in this Agreement and the Disclosure Schedule, there are no options, warrants or rights to purchase shares of capital stock or other securities of the Company authorized, issued or outstanding, nor is the Company obligated in any other manner to issue shares of its capital stock or other securities. There are Except as set forth in this Agreement and the Disclosure Schedule, no restrictions on the transfer of shares of capital stock of the Company other than those imposed by the Transaction Agreements and state and federal securities laws. No holder of any security of the Company is entitled to preemptive or similar statutory or contractual rights, either arising pursuant to any agreement or instrument to which the Company is a party, party or which that are otherwise binding upon the Company, which have not been waived. The offer and sale of all shares of capital stock and or other securities of the Company issued before the date hereof Closing complied with or were exempt from registration or qualification under all federal and state securities laws. As of and immediately following the Closing, each share of Series A Convertible Preferred Stock outstanding will be convertible into 1.1 shares of Common Stock and each share of Series B Convertible Preferred Stock, Series C Convertible Preferred Stock and Series D Preferred outstanding will be convertible into one share of Common Stock.

Capitalization; Status of Capital Stock. (a) On the date of this Agreement and immediately prior to the issuance of Debentures contemplated by this Agreement, the Company has a total authorized capitalization consisting of: (i) 10,000,000 shares of Common Stock of which 3,117,647 are issued and outstanding and (ii) 3,000,000 shares of Preferred Stock, of which none are issued and outstanding. As of the date of this Agreement and immediately prior to the issuance of Debentures contemplated by this Agreement, 700,000 shares of Common Stock have been reserved for issuance in accordance with the Company’s 's 2005 Stock Option and Incentive Plan. Of those shares the Company granted: (i) nonqualified options to purchase 230,000 shares of the Company’s 's Common Stock that are currently not exercised and (ii) 15,000 shares of restricted common stock. (b) Schedule 2.05 sets forth the capitalization of the Company immediately following the issuance of the Debentures contemplated by this Agreement including the number of shares of the following: (i) issued and outstanding Common Stock; (ii) Common Stock reserved for issuance upon conversion of Debenture, including the names of the holders of the Debentures thereof; (iii) issued stock options, including vesting schedule and exercise price; (iv) stock options not yet issued but reserved for issuance; (v) issued and outstanding Preferred Stock; and (vi) warrants or stock purchase rights, if any. All of the outstanding shares of capital stock of the Company have been duly authorized, are validly issued and are fully paid and nonassessable and were issued in compliance with all applicable federal and state securities laws. The Debentures have been duly authorized, and when issued, sold and delivered in accordance with the terms and for the consideration set forth in this Agreement, will be validly issued. The Company has duly reserved the Conversion Shares for issuance upon conversion of the Debentures, and the Conversion Shares, when issued and delivered upon conversion of the Debentures, will be duly authorized, validly issued and fully paid and non assessable. Except as set forth on Schedule 2.05, there are no options, warrants or rights to purchase shares of capital stock or other securities of the Company authorized, issued or outstanding, nor is the Company obligated in any other manner to issue shares of its capital stock or other securities. There are no restrictions on the transfer of shares of capital stock of the Company other than those imposed by the Transaction Agreements and state and federal securities laws. No holder of any security of the Company is entitled to preemptive or similar statutory or contractual rights, either arising pursuant to any agreement or instrument to which the Company is a party, or which are otherwise binding upon the Company, which have not been waived. The offer and sale of all shares of capital stock and other securities of the Company issued before the date hereof complied with or were exempt from all federal and state securities laws.

Capitalization; Status of Capital Stock. (a) On The Company has, or --------------------------------------- before the date of this Agreement and immediately prior to the issuance of Debentures contemplated by this AgreementClosing will have, the Company has a total authorized capitalization consisting of: of (i) 10,000,000 20,000,000 shares of Common Stock ("Common Stock"), of which 3,117,647 (A) 10,062,076 shares are issued and outstanding, (B) 1,215,216 shares are held by the Corporation as treasury shares, (C) 32,512 shares were issued in error and are awaiting cancellation but are shown as outstanding on the records of the Corporation's transfer agent, and (D) 68 shares are shown as outstanding on the records of the Corporation's transfer agent but cannot be allocated to a holder of record, and (ii) 3,000,000 20,000,000 shares of Preferred Stock ("Preferred Stock") of which (A)391,667 shares are authorized as Series A Junior Convertible Redeemable Preferred Stock, all of which none shares are issued and outstanding, (B) 390,000 shares are authorized as Series B Junior Convertible Redeemable Preferred Stock, all of which shares are issued and outstanding, (C) 40,000 shares are authorized as Series C Junior Convertible Redeemable Preferred Stock, all of which shares are issued and outstanding, (D) 1,500,000 shares are authorized as Series D Senior Cumulative Convertible Redeemable Preferred Stock, all of which shares are issued and outstanding, (E) 350,000 shares are authorized as Series E Junior Convertible Redeemable Preferred Stock, all of which shares are issued and outstanding, (F) 2,150,493 shares are authorized as Series G Junior Participating Convertible Voting Preferred Stock, all of which shares are issued and outstanding. As All of the date of this Agreement issued and immediately prior to the issuance of Debentures contemplated by this Agreement, 700,000 outstanding shares of Common Stock have been reserved for issuance in accordance with the Company’s 2005 Stock Option duly authorized and Incentive Plan. Of those shares the Company granted: (i) nonqualified options to purchase 230,000 shares of the Company’s Common Stock that are currently not exercised and (ii) 15,000 shares of restricted common stock. (b) Schedule 2.05 sets forth the capitalization of the Company immediately following the issuance of the Debentures contemplated by this Agreement including the number of shares of the following: (i) issued and outstanding Common Stock; (ii) Common Stock reserved for issuance upon conversion of Debenture, including the names of the holders of the Debentures thereof; (iii) issued stock options, including vesting schedule and exercise price; (iv) stock options not yet issued but reserved for issuance; (v) issued and outstanding Preferred Stock; and (vi) warrants or stock purchase rights, if any. All of the outstanding shares of capital stock of the Company have been duly authorizedvalidly issued, are validly issued fully paid, and are fully paid and nonassessable non-assessable, and were issued in compliance with all applicable state and federal and state securities laws. The Debentures have been duly authorized, and when issued, sold and delivered in accordance with the terms and for the consideration Other than as set forth in this Agreementthe Company's Public Filings, will be validly issued. The the Company has duly reserved the Conversion Shares for issuance upon conversion of the Debentures, and the Conversion Shares, when issued and delivered upon conversion of the Debentures, will be duly authorized, validly issued and fully paid and non assessable. Except as set forth on Schedule 2.05, there are no options, warrants options or rights to purchase shares of its capital stock stock, or other securities convertible into shares of the Company its capital stock, authorized, issued or outstanding, nor is the Company obligated in any other manner to issue shares of its capital stock or other securities. There securities convertible into or evidencing any right to acquire shares of its capital stock, or to distribute to holders of any of its capital stock any evidence of indebtedness or assets; (b) no Person has any preemptive right, right of first refusal or similar right to acquire additional shares of capital stock in connection with the sale and purchase of the Purchased Shares pursuant to this Agreement or otherwise; (c) there are no restrictions on the transfer of the shares of capital stock of the Company Company, other than those imposed by the Transaction Agreements and relevant state and federal securities laws. No holder laws or the Company's Certificate of Incorporation; (d) no Person has any right to cause the Company to effect the registration under the Securities Act of 1933, as amended (the "1933 Act"), of any security of the Company is entitled to preemptive or similar statutory or contractual rights, either arising pursuant to any agreement or instrument to which the Company is a party, or which are otherwise binding upon the Company, which have not been waived. The offer and sale of all shares of capital stock or any other securities (including debt securities) of the Company; (e) the Company has no obligation to purchase, redeem or otherwise acquire any of its equity securities or any interests therein, or to pay any dividend or make any other distribution in respect thereto; and other (f) there are no voting trusts, stockholders' agreements, or proxies relating to any securities of the Company. The Company issued before has heretofore delivered to the Investors true and correct copies of its Certificate of Incorporation and Bylaws, each as amended and in effect on the date hereof complied with or were exempt from all federal and state securities lawscertified by the Company's Secretary.

Capitalization; Status of Capital Stock. (a) On the date of this Agreement and immediately prior to the issuance of Debentures contemplated by this Agreement, the The Company has a total authorized capitalization consisting of: of (i) 10,000,000 300,000,000 shares of Common Stock Stock, par value $.01 per share, of which 3,117,647 19,222,655 shares are issued and outstanding and (ii) 3,000,000 10,000,000 shares of Preferred Stock, par value $.01 per share, of which none (A) 1,100,000 shares are designated as Series A Convertible Preferred Stock, all of which shares are issued and outstanding. As of outstanding on the date hereof, (B) 1,327,500 shares are designated as Series B Convertible Preferred Stock, all of this Agreement which shares are issued and immediately outstanding on the date hereof, (C) 145,195 shares are designated as Series C Convertible Preferred Stock, of which no shares are issued and outstanding on the date hereof, (D) 685,194 shares are designated as Series D Convertible Preferred Stock, all of which shares are issued and outstanding on the date hereof, and (D) 1,867,480 shares are designated as Series E Convertible Preferred Stock, of which no shares are issued and outstanding on the date hereof, prior to giving effect to the issuance transactions contemplated hereby. Set forth on Exhibit 3.15 is the number of Debentures contemplated by this Agreement, 700,000 shares of Common Stock have been reserved for issuance in accordance with the Company’s 2005 Stock Option issued and Incentive Plan. Of those shares the Company granted: (i) nonqualified options to purchase 230,000 outstanding shares of the Company’s Common Stock that are currently not exercised and (ii) 15,000 shares of restricted common stock. (b) Schedule 2.05 sets forth the capitalization capital stock of the Company immediately following the issuance of the Debentures contemplated by this Agreement including the number of shares of the following: (i) issued and outstanding Common Stock; (ii) Common Stock reserved for issuance upon conversion of Debenture, including the names of the holders of the Debentures thereof; (iii) issued stock options, including vesting schedule and exercise price; (iv) stock options not yet issued but reserved for issuance; (v) issued and outstanding Preferred Stock; and (vi) warrants or stock purchase rights, if anyCompany. All of the outstanding shares of capital stock of the Company have been duly authorized, and are validly issued and are issued, fully paid and nonassessable and were issued in compliance with all applicable federal and state securities lawsnon-assessable. The Debentures have been duly authorizedPreferred Shares, and when issued, sold issued and delivered in accordance with the terms hereof and for the consideration set forth in this Agreement, will be validly issued. The Company has duly reserved the Conversion Shares for issuance upon conversion after payment of the Debentures, purchase price therefor and the Conversion Converted Shares, when issued and delivered upon conversion of the DebenturesPreferred Shares, will be duly authorized, validly issued and fully issued, fully-paid and non non-assessable. Except as otherwise set forth on Schedule 2.05in Exhibit 3.15, there are no options, warrants warrants, subscriptions or purchase rights of any nature to purchase acquire from the Company shares of capital stock or other securities of the Company are authorized, issued or outstanding, nor is the Company obligated in any other manner to issue shares of its capital stock or other securitiessecurities except as contemplated by this Agreement. There Except as set forth in Exhibit 3.15, there are no restrictions on the transfer of shares of capital stock of the Company other than those imposed by the Transaction Agreements relevant federal and state securities laws and federal securities lawsas otherwise contemplated by this Agreement, the Amended and Restated Stockholders Agreement, the Amended and Restated Registration Rights Agreement, the Certificate of Incorporation and stock restriction and right of first refusal agreements between the Company and certain of its employees. No holder of any security Other than as provided in this Section and in the Amended and Restated Stockholders Agreement, there are no agreements, understandings, trusts or other collaborative arrangements or understandings concerning the voting of the Company is entitled to preemptive or similar statutory or contractual rights, either arising pursuant to any agreement or instrument to which the Company is a party, or which are otherwise binding upon capital stock of the Company, which have not been waived. The offer and sale of all shares of capital stock and other securities of the Company issued before the date hereof Closing complied with or were exempt from all applicable federal and state securities lawslaws and no stockholder has a right of rescission with respect thereto.

Capitalization; Status of Capital Stock. (a) On As of the date of this Agreement and immediately prior to the issuance of Debentures contemplated by this AgreementClosing, the Company has will have a total authorized capitalization consisting of: of (i) 10,000,000 12,000,000 shares of Common Stock of which 3,117,647 are issued and outstanding Stock, $.001 par value and (ii) 3,000,000 7,200,000 shares of Preferred Stock, $.01 par value, of which none are 6,200,000 shares will be designated as Series A Preferred Stock and 1,000,000 shares will be designated as Series B Preferred Stock. As of the Closing, 1,506,000 shares of Common Stock will be issued and outstanding. As A complete list of the date of this Agreement and immediately prior to the issuance of Debentures contemplated by this Agreement, 700,000 shares of Common Stock have been reserved for issuance in accordance with the Company’s 2005 Stock Option and Incentive Plan. Of those shares the Company granted: (i) nonqualified options to purchase 230,000 shares of the Company’s Common Stock that are currently not exercised and (ii) 15,000 shares of restricted common stock. (b) Schedule 2.05 sets forth the capitalization capital stock of the Company immediately following which has been previously issued and the issuance names in which such capital stock is registered on the stock transfer book of the Debentures contemplated by this Agreement including the number of shares of the following: (i) issued and outstanding Common Stock; (ii) Common Stock reserved for issuance upon conversion of Debenture, including the names of the holders of the Debentures thereof; (iii) issued stock options, including vesting schedule and exercise price; (iv) stock options not yet issued but reserved for issuance; (v) issued and outstanding Preferred Stock; and (vi) warrants or stock purchase rights, if anyCompany is set forth in Exhibit 3.13 hereto. All of the outstanding shares of capital stock of the Company have been duly authorized, and are validly issued and are issued, fully paid and nonassessable and were issued in compliance with all applicable federal and state securities lawsnon-assessable. The Debentures have been duly authorized, and Shares when issued, sold issued and delivered in accordance with the terms and for the consideration set forth in this Agreement, will be validly issued. The Company has duly reserved the Conversion Shares for issuance upon conversion of the Debentureshereof, and the Conversion Shares, when issued and delivered upon conversion of the DebenturesPreferred Shares, will be duly authorized, validly issued and fully issued, fully-paid and non non-assessable. Except for 2,112,000 shares of Common Stock that are reserved for issuance upon exercise of stock options, 177,083 shares of Series A Preferred Stock that have been reserved for issuance upon exercise of Warrants issued or to be issued to Comdisco (the "Comdisco Leasing Warrants") and the shares of Common Stock reserved for issuance upon the conversion of the currently outstanding Series A Preferred Stock and the Series A Preferred Stock which may be issued upon exercise of the Comdisco Leasing Warrants, all as further set forth on Schedule 2.05in Exhibit 3.13, there are no options, warrants warrants, subscriptions or purchase rights of any nature to purchase acquire from the Company, or commitments of the Company to issue, shares of capital stock or other securities of the Company are authorized, issued or outstanding, nor is the Company obligated in any other manner to issue shares of its capital stock or other securities. There are no restrictions on the transfer of shares of capital stock of the Company other than those imposed by the Transaction Agreements and state and federal securities laws. No holder of any security of the Company is entitled to preemptive or similar statutory or contractual rights, either arising pursuant to any agreement or instrument to which the Company is a party, or which are otherwise binding upon the Company, which have not been waived. The offer and sale of all shares of capital stock and other securities of the Company issued before the date hereof complied with or were exempt from all federal and state securities laws.is

Capitalization; Status of Capital Stock. (a) On the date of this Agreement and immediately prior to the issuance of Debentures contemplated by this Agreement, the The Company has a total authorized capitalization consisting of: (i) 10,000,000 of 32,625,000 shares of Common Stock Stock, $.00001 par value per share, 5,858,966 of which 3,117,647 are issued and outstanding; 6,500,000 shares of Series A Convertible Preferred Stock, $.00001 par value per share, 6,470,589 of which shares are issued and outstanding; 5,000,000 shares of Series B Convertible Preferred Stock, $.00001, par value per share, 5,000,000 of which shares are issued and outstanding; 1,350,000 shares of Series C Convertible Preferred Stock, 1,312,336 of which are issued and outstanding; 800,000 shares of Series D Convertible Preferred Stock, 787,402 of which are issued and outstanding, and 6,500,000 shares of Series E Convertible Preferred Stock, none of which are issued and outstanding and (ii) 3,000,000 shares of Preferred Stock, of which none are issued and outstanding. As of the date of this Agreement and immediately prior to the issuance Initial Closing. A complete list of Debentures contemplated by this Agreement, 700,000 the currently issued and outstanding shares of Common Stock have been reserved for issuance in accordance with the Company’s 2005 Stock Option and Incentive Plan. Of those shares the Company granted: (i) nonqualified options to purchase 230,000 shares of the Company’s Common Stock that are currently not exercised and (ii) 15,000 shares of restricted common stock. (b) Schedule 2.05 sets forth the capitalization capital stock of the Company immediately following the issuance of the Debentures contemplated by this Agreement including the number of shares of the following: (i) issued and outstanding Common Stock; (ii) Common Stock reserved for issuance upon conversion of Debenture, including the names of the holders of the Debentures thereof; (iii) issued stock options, including vesting schedule and exercise price; (iv) stock options not yet issued but reserved for issuance; (v) issued and outstanding Preferred Stock; and (vi) warrants or stock purchase rights, if anyin which such shares are registered is set forth in Exhibit 4.21 hereto. All of the outstanding shares of capital stock of the Company have been duly authorized, are validly issued and are fully paid and nonassessable nonassessable. All shares of capital stock issuable upon exercise of outstanding options and were issued in compliance with all applicable federal and state securities laws. The Debentures warrants have been duly authorizedauthorized and, when issued in accordance with the terms of such options and warrants, will be validly issued, and fully paid and nonassessable. The Purchased Shares, when issued, sold issued and delivered in accordance with the terms and for the consideration set forth in this Agreement, will be validly issued. The Company has duly reserved the Conversion Shares for issuance upon conversion of the Debentureshereof, and the Conversion Shares, when issued and delivered upon conversion of the DebenturesPurchased Shares, will be duly authorized, validly issued and fully paid and non assessablenonassessable. Except as set forth on Schedule 2.05in Exhibit 4.21 hereto, there are no options, warrants or rights to purchase shares of capital stock or other securities of the Company authorized, issued or outstanding, nor is the Company obligated in any other manner to issue shares of its capital stock or other securities. There Except as set forth in Exhibit 4.21 hereto, there are no restrictions on the transfer of shares of capital stock of the Company other than those imposed by the Transaction Agreements and relevant state and federal securities laws. No holder of any security of Except as set forth in this Agreement and the Company is entitled to preemptive or similar statutory or contractual rights, either arising pursuant to any agreement or instrument to which the Company is a party, or which are otherwise binding upon the Company, which have not been waived. The offer and sale of all shares of capital stock and other securities of the Company issued before the date hereof complied with or were exempt from all federal and state securities laws.Stockholders Agreement,

Capitalization; Status of Capital Stock. (a) On the date of this Agreement and immediately prior to the issuance of Debentures contemplated by this Agreement, the The Company has a total authorized capitalization consisting of: of (i) 10,000,000 33,000,000 shares of Class B Common Stock Stock, $.01 par value, of which 3,117,647 6,208,070 shares are issued and outstanding and on the date hereof, (ii) 3,000,000 3,040,000 shares of Preferred Class A Common Stock, $.01 par value, of which none 3,040,000 shares are issued and outstanding. As of outstanding on the date of this Agreement and immediately prior to the issuance of Debentures contemplated by this Agreementhereof, 700,000 (iii) 3,009,600 shares of Common Stock have been reserved for issuance in accordance with the Company’s 2005 Stock Option and Incentive Plan. Of those Series A Preferred, of which 3,009,600 shares the Company granted: (i) nonqualified options to purchase 230,000 shares of the Company’s Common Stock that are currently not exercised and (ii) 15,000 shares of restricted common stock. (b) Schedule 2.05 sets forth the capitalization of the Company immediately following the issuance of the Debentures contemplated by this Agreement including the number of shares of the following: (i) issued and outstanding Common Stock; (ii) Common Stock reserved for issuance upon conversion of Debentureon the date hereof, including the names of the holders of the Debentures thereof; (iii) issued stock options, including vesting schedule and exercise price; (iv) stock options not yet 7,246,036 shares of Series B Preferred, of which 7,042,254 shares are issued but reserved for issuance; and outstanding on the date hereof, (v) 4,727,786 shares of Series C Preferred, of which 4,727,786 shares are issued and outstanding Preferred Stock; on the date hereof, and (vi) warrants or 3,200,000 shares of Series D Preferred, none of which are issued and outstanding on the date hereof, in each case without giving effect to the transactions contemplated hereby. A complete list of the capital shares of the Company which has been previously issued and the names in which such capital shares are registered on the stock purchase rights, if anytransfer books of the Company is set forth in EXHIBIT 3.16 hereto. All of the outstanding capital shares of capital stock of the Company have been duly authorized, are validly issued and are fully paid and nonassessable and were issued in compliance with all applicable federal and state securities lawsnon-assessable. The Debentures have been duly authorizedPurchased Shares, and when issued, sold issued and delivered in accordance with the terms hereof and for the consideration set forth in this Agreement, will be validly issued. The Company has duly reserved the Conversion Shares for issuance upon conversion after payment of the Debenturespurchase price therefor, and the Conversion Converted Shares, when issued and delivered upon conversion of the DebenturesPurchased Shares, will be duly authorized, validly issued and issued, fully paid and non non-assessable. Except as otherwise set forth on Schedule 2.05in EXHIBIT 3.16, there are no options, warrants warrants, subscriptions or purchase rights of any nature to purchase acquire from the Company shares of capital stock or other securities of the Company are authorized, issued or outstanding, nor is the Company obligated in any other manner to issue shares of its capital stock shares or other securitiessecurities except as contemplated by this Agreement. There Except as set forth in EXHIBIT 3.16, to the Company's knowledge, there are no restrictions on the transfer of capital shares of capital stock of the Company other than those imposed by relevant Federal and State securities laws and as otherwise contemplated by this Agreement, the Transaction Agreements Stockholders' Agreement and state the Registration Rights Agreement. Except as set forth in EXHIBIT 3.16 and federal securities lawsother than as provided in the above-referenced Stockholders' Agreement, to the Company's knowledge, there are no agreements, understandings, trusts or other collaborative arrangements or understandings concerning the voting of the capital shares of the Company. No holder Except as set forth in EXHIBIT 3.16, to the Company's knowledge, there are no agreements, understandings or trusts concerning transfers of any security the capital shares of the Company is entitled to preemptive or similar statutory or contractual rightsexcept for the aforementioned Stockholders' Agreement, either arising pursuant to any agreement or instrument to which the Company is a party, or which are otherwise binding upon the Company, which have not been waivedaforementioned Registration Rights Agreement and except as contemplated by this Agreement. The offer and sale of all capital shares of capital stock and other securities of the Company issued before the date hereof Closing complied with or were exempt from all federal applicable Federal and state State securities lawslaws and no stockholder has a right of rescission with respect thereto.

Capitalization; Status of Capital Stock. (a) On the date of this Agreement and immediately prior to the issuance of Debentures contemplated by this Agreement, the The Company has a total authorized capitalization consisting of: of (i) 10,000,000 1,035,000,000 shares of Common Stock Stock, par value $.001 per share, of which 3,117,647 41,754,113 shares are issued and outstanding on the date hereof; and (ii) 3,000,000 865,000,000 shares of preferred stock, par value $.001 per share, (a) 2,100 of which shares are designated as Series B Preferred Stock, none of which are issued and outstanding on the date hereof, and (b) 816,949,489 of which shares are designated as Series D Preferred Stock, of which none 522,278,973 shares are issued and outstandingoutstanding on the date hereof, without giving effect to the transactions contemplated hereby. As of the date of this Agreement and immediately prior to Closing, the issuance of Debentures contemplated by this AgreementCompany shall have 816, 700,000 949,489 shares of Common Stock its preferred stock which shall have been reserved for issuance in accordance with the Company’s 2005 Stock Option and Incentive Plandesignated as Series D Preferred Stock. Of those shares the Company granted: (i) nonqualified options to purchase 230,000 shares A complete list of the Company’s Common Stock that are currently not exercised and (ii) 15,000 shares of restricted common stock. (b) Schedule 2.05 sets forth the capitalization capital stock of the Company immediately following and the issuance names in which such capital stock is currently registered on the stock transfer books of the Debentures contemplated by this Agreement including the number of shares of the following: (i) issued and outstanding Common Stock; (ii) Common Stock reserved for issuance upon conversion of Debenture, including the names of the holders of the Debentures thereof; (iii) issued stock options, including vesting schedule and exercise price; (iv) stock options not yet issued but reserved for issuance; (v) issued and outstanding Preferred Stock; and (vi) warrants or stock purchase rights, if anyCompany is set forth in Exhibit 3.15 hereto. All of the outstanding shares of capital stock of the Company have been duly authorized, and are validly issued and are issued, fully paid and nonassessable and were issued in compliance with all applicable federal and state securities lawsnon-assessable. The Debentures have been duly authorizedSeries D Preferred Stock, and when issued, sold issued and delivered in accordance with the terms hereof and for after payment of the purchase price or provision of such other applicable consideration set forth in this Agreementtherefor, will be duly authorized, validly issued, fully paid and non-assessable. The Company has duly reserved the Conversion Shares for issuance upon conversion of the Debentures, and the Conversion Converted Shares, when issued and delivered upon conversion of the DebenturesSeries D Preferred Stock, will be duly authorized, validly issued and fully issued, fully-paid and non non-assessable. Except as otherwise set forth on Schedule 2.05in Exhibit 3.15, there are no preemptive, conversion or other rights, options, warrants warrants, subscriptions or purchase rights of any nature to purchase acquire from the Company shares of capital stock or other securities of the Company are authorized, issued or outstanding, nor is the Company obligated in any other manner to issue shares of its capital stock or other securitiessecurities except as contemplated by this Agreement. There Except as set forth in Exhibit 3.15, there are no restrictions on the transfer of shares of capital stock of the Company other than those imposed by the Transaction Agreements relevant federal and state securities laws and federal securities lawsas otherwise contemplated by this Agreement, the Stockholders Agreement and the Investor Rights Agreement. No holder of any security Other than as provided in this Section, there are no agreements, understandings, trusts or other collaborative arrangements or understandings concerning the voting of the Company is entitled to preemptive or similar statutory or contractual rights, either arising pursuant to any agreement or instrument to which the Company is a party, or which are otherwise binding upon capital stock of the Company. Subject to applicable representations and warranties by purchasers of the Company’s capital stock, which have not been waived. The the offer and sale of all shares of capital stock and other securities of the Company issued before the date hereof Closing complied with or were exempt from all applicable federal and state securities lawslaws and no stockholder has a right of rescission with respect thereto.

Capitalization; Status of Capital Stock. (a) On the date The authorized capital stock of this Agreement and immediately prior to the issuance VCI consists solely of Debentures contemplated by this Agreement, the Company has a total authorized capitalization consisting of: (i) 10,000,000 30,000,000 shares of Common Stock voting common stock, $.01 par value per share, and 2,000,000 shares of preferred stock, $.01 par value per share, of which 3,117,647 are issued and outstanding and (ii) 3,000,000 an aggregate of 13,572,436 shares of common stock, 7,000 shares of Series AA Convertible Redeemable Preferred Stock, 76,000 shares of which none Series B Convertible Redeemable Preferred Stock and 112 shares of Series C Convertible Redeemable Preferred Stock are presently issued and outstanding. As of the date of this Agreement and immediately prior Immediately after giving effect to the issuance transactions described herein, an aggregate of Debentures contemplated by this Agreement, 700,000 13,916,436 shares of Common Stock have been reserved for issuance in accordance with the Company’s 2005 Stock Option and Incentive Plan. Of those shares the Company granted: (i) nonqualified options to purchase 230,000 VCI common stock, 7,000 shares of the Company’s Common Stock that are currently not exercised and (ii) 15,000 Series AA Convertible Redeemable Preferred Stock, 76,000 shares of restricted common stock. (b) Schedule 2.05 sets forth the capitalization of the Company immediately following the issuance of the Debentures contemplated by this Agreement including the number of Series B Convertible Redeemable Preferred Stock, 112 shares of the following: (i) Series C Convertible Redeemable Preferred Stock and 2,000 shares of Series D Convertible Redeemable Preferred Stock will be issued and outstanding Common Stock; (ii) Common Stock reserved for issuance upon conversion of Debenture, including the names of the holders of the Debentures thereof; (iii) issued stock options, including vesting schedule and exercise price; (iv) stock options not yet issued but reserved for issuance; (v) issued and outstanding Preferred Stock; and (vi) warrants or stock purchase rights, if anyoutstanding. All of the outstanding shares of capital stock of the Company VCI have been duly authorized, are validly issued issued, and are fully paid and nonassessable nonassessable. The VCI Preferred Shares (when issued and were delivered in accordance with the terms of this Agreement), the shares to be issued to Mortco upon exercise of the Warrant (when issued in compliance accordance with the terms of the Warrant), and the VCI Common Shares (when issued upon conversion of the VCI Preferred Shares) will be duly authorized, validly issued, fully paid and nonassessable, and free and clear of all claims, pledges, liens, encumbrances and restrictions of every kind. The offer and sale of all capital stock and other securities of VCI issued before the Closing complied with or was exempt from all applicable federal and state securities laws. The Debentures have been duly authorized, and when issued, sold and delivered no stockholder has a right of rescission with respect thereto. Upon closing VCI's acquisition of Galaxy in accordance compliance with the terms and for the consideration set forth in this Merger Agreement, will be validly issued. The Company has duly reserved the Conversion Shares for issuance upon conversion VCI shall own all of the Debentures, and the Conversion Shares, when issued and delivered upon conversion of the Debentures, will be duly authorized, validly issued and fully paid and non assessable. Except as set forth on Schedule 2.05, there are no options, warrants or rights to purchase shares of capital stock or other securities of the Company authorized, issued or outstanding, nor is the Company obligated in any other manner to issue shares of its capital stock or other securities. There are no restrictions on the transfer of shares of outstanding capital stock of the Company other than those imposed by the Transaction Agreements and state and federal securities laws. No holder of any security of the Company is entitled to preemptive or similar statutory or contractual rights, either arising pursuant to any agreement or instrument to which the Company is a party, or which are otherwise binding upon the Company, which have not been waived. The offer and sale of all shares of capital stock and other securities of the Company issued before the date hereof complied with or were exempt from all federal and state securities lawsGalaxy.

Capitalization; Status of Capital Stock. (a) On the date of this Agreement and immediately prior to the issuance of Debentures contemplated by this Agreement, the The Company has a total authorized capitalization consisting of: (i) 10,000,000 of 34,625,000 shares of Common Stock Stock, $.00001 par value per share, 5,858,966 of which 3,117,647 are issued and outstanding; 6,500,000 shares of Series A Convertible Preferred Stock, $.00001 par value per share, 6,470,589 of which shares are issued and outstanding; 5,000,000 shares of Series B Convertible Preferred Stock, $.00001, par value per share, 5,000,000 of which shares are issued and outstanding; 1,350,000 shares of Series C Convertible Preferred Stock, 1,312,336 of which are issued and outstanding; 800,000 shares of Series D Convertible Preferred Stock, 787,402 of which are issued and outstanding, and 6,500,000 shares of Series E Convertible Preferred Stock, 5,722,903 of which are issued and outstanding, and 2,000,000 shares of Series F Convertible Preferred Stock, none of which are issued and outstanding and (ii) 3,000,000 shares of Preferred Stock, of which none are issued and outstanding. As of the date of this Agreement and immediately prior to the issuance Initial Closing. A complete list of Debentures contemplated by this Agreement, 700,000 the currently issued and outstanding shares of Common Stock have been reserved for issuance in accordance with the Company’s 2005 Stock Option and Incentive Plan. Of those shares the Company granted: (i) nonqualified options to purchase 230,000 shares of the Company’s Common Stock that are currently not exercised and (ii) 15,000 shares of restricted common stock. (b) Schedule 2.05 sets forth the capitalization capital stock of the Company immediately following the issuance of the Debentures contemplated by this Agreement including the number of shares of the following: (i) issued and outstanding Common Stock; (ii) Common Stock reserved for issuance upon conversion of Debenture, including the names of the holders of the Debentures thereof; (iii) issued stock options, including vesting schedule and exercise price; (iv) stock options not yet issued but reserved for issuance; (v) issued and outstanding Preferred Stock; and (vi) warrants or stock purchase rights, if anyin which such shares are registered is set forth in Exhibit 4.21 hereto. All of the outstanding shares of capital stock of the Company have been duly authorized, are validly issued and are fully paid and nonassessable nonassessable. All shares of capital stock issuable upon exercise of outstanding options and were issued in compliance with all applicable federal and state securities laws. The Debentures warrants have been duly authorizedauthorized and, when issued in accordance with the terms of such options and warrants, will be validly issued, and fully paid and nonassessable. The Purchased Shares, when issued, sold issued and delivered in accordance with the terms and for the consideration set forth in this Agreement, will be validly issued. The Company has duly reserved the Conversion Shares for issuance upon conversion of the Debentureshereof, and the Conversion Shares, when issued and delivered upon conversion of the DebenturesPurchased Shares, will be duly authorized, validly issued and fully paid and non assessablenonassessable. Except as set forth on Schedule 2.05in Exhibit 4.21 hereto, there are no options, warrants or rights to purchase shares of capital stock or other securities of the Company authorized, issued or outstanding, nor is the Company obligated in any other manner to issue shares of its capital stock or other securities. There Except as set forth in Exhibit 4.21 hereto, there are no restrictions on the transfer of shares of capital stock of the Company other than those imposed by the Transaction Agreements and relevant state and federal securities laws. No Except as set forth in this Agreement and the Stockholders Agreement, no holder of any security of the Company is entitled to preemptive or similar statutory or contractual rights, either arising pursuant to any agreement or instrument to which the Company is a party, party or which that are otherwise binding upon the Company, which and all such rights have not been waivedduly waived with respect to the issuance of the Purchased Shares and the Conversion Shares. The offer and sale of all shares of capital stock and or other securities of the Company issued before the date hereof complied with or were exempt from all federal and state securities laws.the

Capitalization; Status of Capital Stock. (a) On the date of this Agreement and immediately prior to the issuance of Debentures contemplated by this Agreement, the The Company has a total authorized capitalization consisting of: of Fifty Million (i50,000,000) 10,000,000 shares of Common Stock Stock, of which 3,117,647 3,684,000 shares were issued and outstanding on November 2, 1999 and 3,695,666 shares were issued and outstanding on December 30, 1999, and Ten Million (10,000,000) shares of preferred stock, $.01 par value per share, of which (a) 10,000 shares are designated as Series A Convertible Voting Preferred Stock, of which 4,905 shares are issued and outstanding, (b) 1,300,000 shares are designated as Series B Convertible Preferred Stock, of which 1,100,000 shares are issued and outstanding and (iic) 3,000,000 6,000,000 shares of are designated as Series C Convertible Preferred Stock, of which none are 1,067,782 shares were issued and outstandingoutstanding as of December [30], 1999. As Set forth on SCHEDULE 2.15 is a list of all such shares owned by Ashton, the date Ashton Executives, the Xxxxx Founders as of this Agreement and immediately prior to the issuance of Debentures contemplated by this AgreementDecember 30, 700,000 shares of Common Stock have been reserved for issuance in accordance with the Company’s 2005 Stock Option and Incentive Plan. Of those shares the Company granted: (i) nonqualified options to purchase 230,000 shares of the Company’s Common Stock that are currently not exercised and (ii) 15,000 shares of restricted common stock. (b) Schedule 2.05 sets forth the capitalization of the Company immediately following the issuance of the Debentures contemplated by this Agreement including 1999, as well as the number of shares of the following: (i) issued stock options reserved and outstanding Common Stock; (ii) Common Stock reserved for issuance upon conversion of Debenture, including under the names of the holders of the Debentures thereof; (iii) issued stock options, including vesting schedule and exercise price; (iv) stock options not yet issued but reserved for issuance; (v) issued and outstanding Preferred Stock; and (vi) warrants or stock purchase rights, if anyplans referred to below. All of the outstanding shares of capital stock of the Company have been duly authorized, are validly issued and are fully paid and nonassessable non-assessable. As of immediately prior to the Closing, the designations, powers, preferences, rights, qualifications, limitations and were issued restrictions in compliance respect of the authorized capital stock of the Company will be as set forth in the Company's charter, and all such designations, powers, preferences, rights, qualifications, limitations and restrictions will be valid, binding and enforceable and in accordance with all applicable federal and state securities laws. The Debentures have been duly authorizedShares, and when issued, sold issued and delivered in accordance with the terms and for the consideration set forth in this Agreement, will be validly issued. The Company has duly reserved the Conversion Shares for issuance upon conversion of the Debentureshereof, and the Conversion Shares, shares of Common Stock when issued and delivered upon the conversion of the DebenturesShares (as adjusted from time to time in accordance the Certificate of Incorporation, as amended, the "Conversion Shares"), will be duly authorized, validly issued and issued, fully paid and non assessablenon-assessable and will be free and clear of all Liens or restrictions imposed by or through the Company except as set forth in this Agreement and the Investor Rights Agreement. The Conversion Shares have been duly reserved for issuance. Except for the Shares and as set forth on Schedule 2.05SCHEDULE 2.15, there are no subscriptions, options, warrants or other rights (contingent or otherwise) to purchase or otherwise acquire shares of capital stock or other securities of the Company authorized, issued or outstanding, nor is the Company obligated in any other manner to issue shares of its capital stock stock, subscriptions, warrants, options, convertible securities, or other securitiessuch rights or to distribute to holders of any of its equity securities any evidence of Indebtedness or asset. There As of the date hereof, 600, 000 shares of Common Stock remain reserved for issuance pursuant to the Company's 1998 Stock Plan (the "1998 Stock Plan"), 567,000 of which are subject to stock options outstanding as of December 30, 1999. As of the date hereof, 3,003,000 shares of Common Stock are reserved for issuance pursuant to the Company's 1999 Long Term Incentive Stock Plan (the "1999 LTI Plan"), all of which are subject to stock options outstanding as of December 30,1999. As of the date hereof, 3,000,000 shares of Common Stock are reserved for issuance pursuant to the Company's 1999 Stock Plan (the "1999 Stock Plan"), 855,000 of which are subject to stock options outstanding as of December 30, 1999. Except as set forth in SCHEDULE 2.15 or contemplated by this Agreement or the Ashton Stockholders Agreement, (i) there are no restrictions on the transfer of shares of capital stock of the Company other than those imposed by the Transaction Agreements and relevant state and federal Federal securities lawslaws and (ii) there are no agreements, understandings, proxies, trusts or other collaborative arrangements concerning the voting, pledge or purchase and sale of the capital stock of the Company. No Except as set forth in SCHEDULE 2.15 or the Investor Rights Agreement, no holder of any security of the Company is entitled to preemptive preemptive, first refusal or similar statutory or contractual rights, either arising pursuant to any agreement or instrument to which the Company is a party, or which are otherwise binding upon the Company, or to the best of the Company's knowledge, to which have not been waivedany other Person is a party. The Except as provided for in the Certificate of Incorporation, as amended, or as contemplated by the Ashton Stockholders Agreement, or as set forth in the attached SCHEDULE 2.15, the Company has no obligation (contingent or otherwise) to purchase, redeem or otherwise acquire any of its equity securities or any interest therein or to pay any dividend or make any other distribution in respect thereof. Assuming the representations and warranties of the purchasers thereof were true when made, the offer and sale of all shares of capital stock and other securities of the Company issued before the date hereof Closing complied with or were exempt from all federal applicable Federal and state securities lawslaws and no stockholder has a right of rescission or damages with respect thereto. Assuming the representations and warranties of the Purchasers contained in Article 3 of this Agreement are true when made, the offer and sale of the Shares will comply with or be exempt from all applicable Federal and state securities laws and no Purchaser will have a right of rescission or damages with respect thereto.

Capitalization; Status of Capital Stock. (a) On the date of this Agreement and immediately prior to the issuance of Debentures contemplated by this Agreement, the The Company has a total authorized capitalization consisting of: of (i) 10,000,000 300,000,000 shares of Common Stock Stock, par value $.01 per shares of which 3,117,647 44,832,810 shares are issued and outstanding and (ii) 3,000,000 10,000,000 shares of Preferred Stock, par value $.01 per share, of which none (A) 1,100,000 shares are designated as Series A Convertible Preferred Stock, all of which shares are issued and outstanding. As of outstanding on the date hereof, (B) 1,327,500 shares are designated as Series B Convertible Preferred Stock, all of this Agreement which shares are issued and immediately outstanding on the date hereof, (C) 145,195 shares are designated as Series C Convertible Preferred Stock, of which shares are issued and outstanding on the date hereof, (D) 685,194 shares are designated as Series D Convertible Preferred Stock, all of which shares are issued and outstanding on the date hereof, (D) 1,867,480 shares are designated as Series E Convertible Preferred Stock, all of which no shares are issued and outstanding on the date hereof, and (E) 985,545 shares are designated Series F Convertible Preferred Stock, of which no shares are issued and outstanding on the date hereof, prior to giving effect to the issuance transactions contemplated hereby. Set forth on EXHIBIT 3.15 is the number of Debentures contemplated by this Agreement, 700,000 shares of Common Stock have been reserved for issuance in accordance with the Company’s 2005 Stock Option issued and Incentive Plan. Of those shares the Company granted: (i) nonqualified options to purchase 230,000 outstanding shares of the Company’s Common Stock that are currently not exercised and (ii) 15,000 shares of restricted common stock. (b) Schedule 2.05 sets forth the capitalization capital stock of the Company immediately following the issuance of the Debentures contemplated by this Agreement including the number of shares of the following: (i) issued and outstanding Common Stock; (ii) Common Stock reserved for issuance upon conversion of Debenture, including the names of the holders of the Debentures thereof; (iii) issued stock options, including vesting schedule and exercise price; (iv) stock options not yet issued but reserved for issuance; (v) issued and outstanding Preferred Stock; and (vi) warrants or stock purchase rights, if anyCompany. All of the outstanding shares of capital stock of the Company have been duly authorized, and are validly issued and are issued, fully paid and nonassessable and were issued in compliance with all applicable federal and state securities lawsnon-assessable. The Debentures have been duly authorizedPreferred Shares, and when issued, sold issued and delivered in accordance with the terms hereof and for the consideration set forth in this Agreement, will be validly issued. The Company has duly reserved the Conversion Shares for issuance upon conversion after payment of the Debentures, purchase price therefor and the Conversion Converted Shares, when issued and delivered upon conversion of the DebenturesPreferred Shares, will be duly authorized, validly issued and fully issued, fully-paid and non non-assessable. Except as otherwise set forth on Schedule 2.05in EXHIBIT 3.15, there are no options, warrants or rights to purchase shares of capital stock or other securities of the Company authorized, issued or outstanding, nor is the Company obligated in any other manner to issue shares of its capital stock or other securities. There are no restrictions on the transfer of shares of capital stock of the Company other than those imposed by the Transaction Agreements and state and federal securities laws. No holder of any security of the Company is entitled to preemptive or similar statutory or contractual rights, either arising pursuant to any agreement or instrument to which the Company is a party, or which are otherwise binding upon the Company, which have not been waived. The offer and sale of all shares of capital stock and other securities of the Company issued before the date hereof complied with or were exempt from all federal and state securities laws.warrants,

Capitalization; Status of Capital Stock. (a) On At the date of this Agreement and immediately prior to the issuance of Debentures contemplated by this AgreementClosing, the Company has will have a total authorized capitalization consisting of: (i) 10,000,000 of 41,686,887 shares, including 24,000,000 shares of Common Stock Stock, $.001 par value per share, of which 3,117,647 1,773,884 shares are issued and outstanding outstanding; 200,000 shares of Series A-1 Convertible Preferred Stock, $0.001 par value per share, of which 200,000 shares are issued and (ii) outstanding; 101,430 shares of Series A-2 Convertible Preferred Stock, $0.001 par -12- 13 value per share, of which 101,430 shares are issued and outstanding; 624,000 shares of Series A-3 Convertible Preferred Stock, $0.001 par value per share, of which 624,000 shares are issued and outstanding; 776,718 shares of Series B Convertible Preferred Stock, $0.001 par value per share, of which 776,717 shares are issued and outstanding; and 3,000,000 shares of Series C Convertible Preferred Stock, $0.001 par value per share of which 2,928,316 shares are issued and outstanding; 5,900,000 shares of Series D Convertible Preferred Stock, $0.001 par value per share, of which 5,899,999 are issued and outstanding; 279,739 shares of Series E Convertible Preferred Stock, $.001 par value, of which none are outstanding; and 6,805,000 shares of Series F Convertible Preferred Stock, $.001 par value, of which none are issued and outstanding. As A complete list of the date of this Agreement currently issued and immediately prior to the issuance of Debentures contemplated by this Agreement, 700,000 outstanding shares of Common Stock have been reserved for issuance in accordance with the Company’s 2005 Stock Option and Incentive Plan. Of those shares the Company granted: (i) nonqualified options to purchase 230,000 shares of the Company’s Common Stock that are currently not exercised and (ii) 15,000 shares of restricted common stock. (b) Schedule 2.05 sets forth the capitalization capital stock of the Company immediately following the issuance of the Debentures contemplated by this Agreement including the number of shares of the following: (i) issued and outstanding Common Stock; (ii) Common Stock reserved for issuance upon conversion of Debenture, including the names of the holders of the Debentures thereof; (iii) issued stock options, including vesting schedule and exercise price; (iv) stock options not yet issued but reserved for issuance; (v) issued and outstanding Preferred Stock; and (vi) warrants or stock purchase rights, if anyin which such shares are registered is set forth in Exhibit 4.21 hereto. All of the outstanding shares of capital stock of the Company have been duly authorizedauthorized and reserved for issuance, are validly issued and are fully paid and nonassessable nonassessable. All shares of capital stock issuable upon exercise of outstanding options and were issued in compliance with all applicable federal and state securities laws. The Debentures warrants have been duly authorizedauthorized and, when issued in accordance with the terms of such options and warrants, will be validly issued, and fully paid and nonassessable. The Purchased Shares, when issued, sold issued and delivered in accordance with the terms and for the consideration set forth in this Agreement, will be validly issued. The Company has duly reserved the Conversion Shares for issuance upon conversion of the Debentureshereof, and the Conversion Shares, when issued and delivered upon conversion of the DebenturesPurchased Shares, will be duly authorized, validly issued and fully paid and non assessablenonassessable. Except as set forth on Schedule 2.05in this Agreement and Exhibit 4.21 hereto, there are no options, warrants or rights to purchase shares of capital stock or other securities of the Company authorized, issued or outstanding, nor is the Company obligated in any other manner to issue shares of its capital stock or other securities. There Except as set forth in Exhibit 4.21 hereto, there are no restrictions on the transfer of shares of capital stock of the Company other than those imposed by the Transaction Agreements and relevant state and federal securities laws. No Except as set forth in the Stockholder Agreement, no holder of any security of the Company is entitled to preemptive or similar statutory or contractual rights, either arising pursuant to any agreement or instrument to which the Company is a party, party or which that are otherwise binding upon the Company, which have not been waived. The offer and sale of all shares of capital stock and or other securities of the Company issued before the date hereof Closing complied with or were exempt from registration or qualification under all federal and state securities laws. No securities of the Company have been issued prior hereto at a price which would result in an increase in the number of shares of Common Stock issuable upon conversion of any outstanding shares of any series or subseries of Series A Preferred Stock, Series B Preferred Stock, Series C Preferred Stock or Series D Preferred Stock pursuant to the provisions of Article Fourth, A, 5(e) through (i) of the Charter.

Capitalization; Status of Capital Stock. (a) On As of the date of this Agreement and immediately prior to the issuance of Debentures contemplated by this Agreementinitial Closing, the Company has will have a total authorized capitalization consisting of: of (i) 10,000,000 500,000,000 shares of Common Stock of which 3,117,647 are issued and outstanding Stock, $0.00001 par value, and (ii) 3,000,000 50,000,000 shares of Preferred Stock, $0.00001 par value, of which none are issued 18,234 shares will be designated as Series B Preferred Stock and outstanding. As of the date of this Agreement and immediately prior to the issuance of Debentures contemplated by this Agreement, 700,000 which 4,000 shares of Common Stock have been reserved for issuance in accordance with the Company’s 2005 Stock Option and Incentive Plan. Of those shares the Company granted: (i) nonqualified options to purchase 230,000 shares of the Company’s Common Stock that are currently not exercised and (ii) 15,000 shares of restricted common stockwill be designated as Series B-2 Preferred Stock. (b) Schedule 2.05 sets forth As of the capitalization Initial Closing, 97,919,948 shares of Common Stock will be issued and outstanding, 2915.1 shares of the Company's Series B Preferred Stock will be issued and outstanding and, without giving effect to the transactions contemplated hereby, no shares of Series B-2 Preferred Stock will be issued or outstanding. A complete list of the outstanding shares of capital stock, convertible securities, exchangeable securities, rights, options, warrants, stock appreciation rights, subscription rights, rights to payment based on the financial performance of the Company immediately following (including rights to payment based on the issuance Company's revenues or earnings) and shares of phantom stock of the Debentures contemplated by this Agreement including Company is set forth in the number of shares of the following: (i) issued and outstanding Common Stock; (ii) Common Stock reserved for issuance upon conversion of Debenture, including the names of the holders of the Debentures thereof; (iii) issued stock options, including vesting schedule and exercise price; (iv) stock options not yet issued but reserved for issuance; (v) issued and outstanding Preferred Stock; and (vi) warrants or stock purchase rights, if anyDisclosure Letter hereto. All of the outstanding shares of capital stock of the Company have been duly authorized, and are validly issued and are issued, fully paid and nonassessable and were issued in compliance with all applicable federal and state securities lawsnon-assessable. The Debentures have been duly authorized, and Securities when issued, sold issued and delivered in accordance with the terms and for the consideration set forth in this Agreement, will be validly issued. The Company has duly reserved the Conversion Shares for issuance upon conversion of the Debentures, hereof and the Conversion Shares, when issued and delivered upon conversion of the Debenturesthereof, will be duly authorized, validly issued and fully issued, fully-paid and non non-assessable. . (c) Except as set forth in the Disclosure Letter and except for 10,689,882 shares of Common Stock that are reserved for issuance upon exercise of outstanding stock options, 66,971,236 shares of Common Stock reserved for issuance upon exercise of authorized stock options, 17,079,781shares of Common Stock that are reserved for issuance upon exercise of outstanding warrants (as further set forth in the Disclosure Letter), 58,302,000 shares of Common Stock that are reserved for issuance upon exercise of the Series B Preferred Stock (as further set forth in the Disclosure Letter), 3,466,800 shares of Common Stock reserved for issuance as payment of dividends accrued to date on Schedule 2.05the Series B Preferred Stock, there 426,554 shares of Common Stock issuable upon conversion of the outstanding preferred stock in the 6043577 Canada, Inc. Subsidiary, 2,000 shares of Series B-2 Preferred Stock that are reserved for issuance upon exercise of the Warrants (as further set forth in the Disclosure Letter), 40,000,000 shares of Common Stock reserved for issuance upon conversion of the Series B-2 Preferred Stock issuable pursuant to this Agreement and 40,000,000 shares of Common Stock reserved for issuance upon conversion of the Series B-2 Preferred Stock issuable upon exercise of the Warrants (as further described in the Disclosure Letter), no options, warrants warrants, subscriptions or purchase rights of any nature to purchase acquire from the Company, or commitments of the Company to issue, shares of capital stock or other securities of the Company are authorized, issued or outstanding, nor is the Company obligated in any other manner to issue shares or rights to acquire any of its capital stock or other securitiessecurities except as contemplated by this Agreement. (d) Except as set forth in the Disclosure Letter or the Certificate of Designations, none of the Company's outstanding securities or authorized capital stock are subject to any rights of redemption, repurchase, rights of first refusal, preemptive rights or other similar rights, whether contractual, statutory or otherwise, for the benefit of the Company, any stockholder, or any other Person, except pursuant to this Agreement or the Related Agreements. There Except as set forth in the Disclosure Letter, there are no restrictions on the transfer of shares of capital stock of the Company other than those imposed by relevant federal and state securities laws and as otherwise contemplated by this Agreement and the Transaction Related Agreements. Except for the Related Agreements and state and federal securities laws. No holder as set forth in the Disclosure Letter, the Company has no knowledge of any security agreements, understandings, trusts or other collaborative arrangements or understandings concerning the voting or transfer of the Company is entitled to preemptive or similar statutory or contractual rights, either arising pursuant to any agreement or instrument to which the Company is a party, or which are otherwise binding upon capital stock of the Company, which have not been waived. The offer and sale of all shares of capital stock and other securities of the Company issued before the date hereof Initial Closing complied with or were exempt from all applicable federal and state securities laws.

Capitalization; Status of Capital Stock. (a) On the date of this Agreement and immediately prior to the issuance of Debentures contemplated by this Agreement, the The Company has a total authorized capitalization consisting of: of (i) 180,000,000 shares of Common Stock, par value $.001 per share, of which 26,210,001 shares are issued and outstanding on the date hereof; and (ii) 10,000,000 shares of Common Stock preferred stock, par value $.001 per share, (a) 4,000 of which 3,117,647 shares are issued and outstanding and (ii) 3,000,000 shares of designated as Series A Preferred Stock, of which none no shares are issued and outstandingoutstanding on the date hereof, (b) 3,635 of which shares are designated as Series B Preferred Stock, of which approximately 2,087 shares are issued and outstanding on the date hereof, and (c) 2,000 of which shares are designated as Series C Preferred Stock, of which 1,795 shares are issued and outstanding on the date hereof, in each case without giving effect to the transactions contemplated hereby. As of the date of this Agreement and immediately prior to Closing, the issuance of Debentures contemplated by this Agreement, 700,000 Company shall have 600,000,000 shares of Common Stock its preferred stock which shall have been reserved for issuance in accordance with the Company’s 2005 Stock Option and Incentive Plandesignated as Series D Preferred Stock. Of those shares the Company granted: (i) nonqualified options to purchase 230,000 shares A complete list of the Company’s Common Stock that are currently not exercised and (ii) 15,000 shares of restricted common stock. (b) Schedule 2.05 sets forth the capitalization capital stock of the Company immediately following and the issuance names in which such capital stock is currently registered on the stock transfer books of the Debentures contemplated by this Agreement including the number of shares of the following: (i) issued and outstanding Common Stock; (ii) Common Stock reserved for issuance upon conversion of Debenture, including the names of the holders of the Debentures thereof; (iii) issued stock options, including vesting schedule and exercise price; (iv) stock options not yet issued but reserved for issuance; (v) issued and outstanding Preferred Stock; and (vi) warrants or stock purchase rights, if anyCompany is set forth in Exhibit 3.15 hereto. All of the outstanding shares of capital stock of the Company have been duly authorized, and are validly issued and are issued, fully paid and nonassessable and were issued in compliance with all applicable federal and state securities lawsnon-assessable. The Debentures have been duly authorizedSeries D Preferred Stock and the Warrants, and when issued, sold issued and delivered in accordance with the terms hereof and for after payment of the purchase price or provision of such other applicable consideration set forth in this Agreementtherefor, will be duly authorized, validly issued, fully paid and non-assessable. The Company has duly reserved the Conversion Shares for issuance upon conversion of the Debentures, and the Conversion Converted Shares, when issued and delivered upon conversion of the DebenturesSeries D Preferred Stock or any other preferred shares and the Warrant Shares, when issued and delivered upon the exercise of the Warrants, will be duly authorized, validly issued and fully issued, fully-paid and non non-assessable. Except as otherwise set forth on Schedule 2.05in Exhibit 3.15, there are no preemptive, conversion or other rights, options, warrants warrants, subscriptions or purchase rights of any nature to purchase acquire from the Company shares of capital stock or other securities of the Company are authorized, issued or outstanding, nor is the Company obligated in any other manner to issue shares of its capital stock or other securitiessecurities except as contemplated by this Agreement. There Except as set forth in Exhibit 3.15, there are no restrictions on the transfer of shares of capital stock of the Company other than those imposed by the Transaction Agreements relevant federal and state securities laws and federal securities lawsas otherwise contemplated by this Agreement, the Stockholders Agreement and the Investor Rights Agreement. No holder of any security Other than as provided in this Section, there are no agreements, understandings, trusts or other collaborative arrangements or understandings concerning the voting of the Company is entitled to preemptive or similar statutory or contractual rights, either arising pursuant to any agreement or instrument to which the Company is a party, or which are otherwise binding upon capital stock of the Company. Subject to applicable representations and warranties by purchasers of the Company's capital stock, which have not been waived. The the offer and sale of all shares of capital stock and other securities of the Company issued before the date hereof Closing complied with or were exempt from all applicable federal and state securities lawslaws and no stockholder has a right of rescission with respect thereto.

Capitalization; Status of Capital Stock. (a) On the date of this Agreement The Company represents and warrants that immediately prior to the issuance of Debentures contemplated by this Agreement, Closing Date the Company has will have a total authorized capitalization consisting of: of (i) 10,000,000 100,000,000 shares of Common Stock Stock, without par value, of which 3,117,647 18,808,748 shares are issued and outstanding outstanding, and (ii) 3,000,000 shares 20,000,000 of Preferred Stock, of which none 1,510,533 shares of Series A Convertible Preferred Stock are issued and outstanding and of which 6,316,706 shares of Series B Convertible Preferred Stock are issued and outstanding. As of the date of this Agreement and immediately prior to the issuance of Debentures contemplated by this Agreement, 700,000 The Company has reserved 5,000,000 shares of Common Stock have been reserved for issuance in accordance with under the Company’s 2005 's 1996 Stock Option and Incentive Plan. Of those shares Plan (the Company granted: (i) nonqualified "PLAN"), under which options to purchase 230,000 4,152,848 shares of have been granted, stock grants for 5,775 shares have been made, and 841,377 shares remain available for future grant. Optionees under the Company’s Common Stock that Plan are currently not exercised and (ii) 15,000 in the process of exercising their options for shares of restricted common stock. (b) Schedule 2.05 sets forth stock that will be subject to repurchase by the capitalization of the Company. The Company immediately following the issuance of the Debentures contemplated by this Agreement including the number of has issued warrants to purchase 53,000 shares of the following: (i) issued and outstanding Common Stock; (ii) Common Stock reserved for issuance upon conversion to certain individuals and has agreed to issue warrants to purchase 86,000 shares of Debenture, including the names of the holders of the Debentures thereof; (iii) issued stock options, including vesting schedule and exercise price; (iv) stock options not yet issued but reserved for issuance; (v) issued and outstanding Series B Preferred Stock; and (vi) warrants or stock purchase rights, if anyStock to an equipment lessor. All of the outstanding shares of capital stock of the Company have been duly authorized, are validly issued and are fully paid and nonassessable and were issued in compliance with all applicable federal shares issuable upon exercise of outstanding options and state securities laws. The Debentures warrants have been duly authorizedauthorized and, and when issued, sold and delivered issued in accordance with the terms of such options and for the consideration set forth in this Agreementwarrants, will be validly issued, fully paid and nonassessable. The Company has duly reserved the Conversion Shares sufficient shares of Common Stock for issuance upon conversion of the Debentures, and the Series C Convertible Preferred. The Conversion Shares, Shares when issued and delivered upon conversion of the DebenturesSeries C Preferred, will be duly authorized, validly issued and fully paid and non assessablenonassessable. Except as set forth on Schedule 2.05in this Agreement and the Exhibits and Schedules attached hereto, there are no options, warrants or rights to purchase shares of capital stock or other securities of the Company authorized, issued or outstanding, nor is the Company obligated in any other manner to issue shares of its capital stock or other securities. There are Except as set forth in this Agreement and the Exhibits and Schedules hereto, no restrictions on the transfer of shares of capital stock of the Company other than those imposed by the Transaction Agreements and state and federal securities laws. No holder of any security of the Company is entitled to preemptive or similar statutory or contractual rights, either arising pursuant to any agreement or instrument to which the Company is a party, party or which that are otherwise binding upon the Company, which have not been waived. The offer and sale of all shares of capital stock and or other securities of the Company issued before the date hereof Closing complied with or were exempt from registration or qualification under all federal and state securities laws.

Capitalization; Status of Capital Stock. (a) On As of the date of this Agreement and immediately prior to the issuance of Debentures contemplated by this AgreementClosing, the Company has will have a total authorized capitalization consisting of: of (i) 10,000,000 33,866,667 shares of Common Stock, $.001 par value and (ii) 13,441,667 shares of preferred stock, $.01 par value ("Preferred Stock"), of which 6,400,000 shares will be designated as Series A Convertible Preferred Stock, $.01 par value ("Series A Preferred Stock"), 1,100,000 shares will be designated as Series B Convertible Preferred Stock, $.01 par value ("Series B Preferred Stock"), 775,000 shares will be designated as Series C Convertible Preferred Stock, $.01 par value ("Series C Preferred Stock"), 3,000,000 shares will be designated as Series D Convertible Preferred Stock, $.01 par value ("Series D Preferred Stock") and 2,166,667 shares will be designated as Series E Convertible Preferred Stock. As of the Closing, 11,334,279 shares of Common Stock will be issued and outstanding, 6,150,732 shares of which 3,117,647 are Series A Preferred Stock will be issued and outstanding, 1,063,366 shares of Series B Preferred Stock will be issued and outstanding, 767,739 shares of Series C Preferred Stock will be issued and outstanding 3,000,000 shares of Series D Preferred Stock will be issued and outstanding and (ii) 3,000,000 833,334 shares of Series E Preferred Stock, of which none are Stock will be issued and outstanding. As A complete list of the date of this Agreement and immediately prior to the issuance of Debentures contemplated by this Agreement, 700,000 shares of Common Stock have been reserved for issuance in accordance with the Company’s 2005 Stock Option and Incentive Plan. Of those shares the Company granted: (i) nonqualified options to purchase 230,000 shares of the Company’s Common Stock that are currently not exercised and (ii) 15,000 shares of restricted common stock. (b) Schedule 2.05 sets forth the capitalization capital stock of the Company immediately following which has been previously issued and the issuance names in which such capital stock is registered on the stock transfer book of the Debentures contemplated by this Agreement including Company has been provided to the number of shares of the following: (i) issued and outstanding Common Stock; (ii) Common Stock reserved for issuance upon conversion of Debenture, including the names of the holders of the Debentures thereof; (iii) issued stock options, including vesting schedule and exercise price; (iv) stock options not yet issued but reserved for issuance; (v) issued and outstanding Preferred Stock; and (vi) warrants or stock purchase rights, if anyPurchaser. All of the outstanding shares of capital stock of the Company have been duly authorized, and are validly issued and are issued, fully paid and nonassessable and were issued in compliance with all applicable federal and state securities lawsnon-assessable. The Debentures have been duly authorized, and Series E Preferred Shares or shares of Common Stock when issued, sold issued and delivered in accordance with the terms and for the consideration set forth in this Agreement, will be validly issued. The Company has duly reserved the Conversion Shares for issuance upon conversion of the Debentureshereof, and the Conversion Shares, when issued and delivered upon conversion of the DebenturesSeries E Preferred Shares, will be duly authorized, validly issued and fully issued, fully-paid and non non-assessable. Except for 2,964,400 shares of Common Stock that are reserved for issuance upon exercise of stock options, 4,896,335 shares of Common Stock that are reserved for issuance upon the exercise of Warrants held by PerSeptive Biosystems, Inc. (the "PBIO Warrants"), 177,083 shares of Series A Preferred Stock that have been reserved for issuance upon exercise of Warrants issued or to be issued to Comdisco, Inc. (the "Comdisco Leasing Warrants"), the shares of Common Stock reserved for issuance upon the conversion of the currently outstanding shares of Series A Preferred Stock, Series B Preferred Stock, Series C Preferred Stock, Series D Preferred Stock and upon the conversion of the shares of Series A Preferred Stock which may be issued upon exercise of the Comdisco Leasing Warrants, all as further set forth on Schedule 2.05in Exhibit 3.13, there are no options, warrants warrants, subscriptions or purchase rights of any nature to purchase acquire from the Company, or commitments of the Company to issue, shares of capital stock or other securities of the Company are authorized, issued or outstanding, nor is the Company obligated in any other manner to issue shares or rights to acquire any of its capital stock or other securitiessecurities except as contemplated by this Agreement. There None of the Company's outstanding securities or authorized capital stock, including the Series E Preferred Stock, are subject to any rights of redemption, repurchase, rights of first refusal, preemptive rights or other similar rights, whether contractual, statutory or otherwise, for the benefit of the Company, any stockholder, or any other Person, except pursuant hereto, or as set forth on Exhibit 3.13. Except as set forth in Exhibit 3.13, there are no restrictions on - 12 - 13 the transfer of shares of capital stock of the Company other than those imposed by the Transaction Agreements relevant federal and state securities laws and federal securities laws. No holder of any security of the Company is entitled to preemptive or similar statutory or contractual rights, either arising pursuant to any agreement or instrument to which the Company is a party, or which are as otherwise binding upon the Company, which have not been waivedcontemplated by this Agreement. The offer and sale of all shares of capital stock and other securities of the Company issued before the date hereof Closing complied with or were exempt from all applicable federal and state securities lawslaws and no stockholder has a right of rescission or damages with respect thereto.

Capitalization; Status of Capital Stock. (a) On Effective as of the date of this Agreement and time --------------------------------------- immediately prior to the issuance of Debentures contemplated by this AgreementIPO, the Company has will have a total authorized capitalization consisting of: of (i) 10,000,000 shares of Common Stock common stock, $.01 par value par share, some of which 3,117,647 will be designated as Class A Common Stock, none of which will be issued and outstanding, which shares will be issued in connection with the IPO, some of which are designated as Class B Common Stock, none of which will be issued and outstanding or issued in connection with the IPO or the transactions contemplated hereby, and some of which will be designated as Class C Common Stock, none of which will be issued and outstanding or issued in connection with the IPO or the transactions contemplated hereby, and (ii) 3,000,000 shares of Preferred Stockpreferred stock, $.01 par value per share, some shares of which are designated as Series B Cumulative Redeemable Preferred Stock (the "Series B Preferred"), none are of which will be issued and outstanding. As outstanding but which will, upon consummation of the date of this Agreement IPO and immediately prior to the issuance of Debentures transactions contemplated by this Agreement, 700,000 shares of Common Stock have been reserved for issuance in accordance with the Company’s 2005 Stock Option hereby and Incentive Plan. Of those shares the Company granted: assuming (i) nonqualified options to purchase 230,000 no further issuances of capital stock by the Company after the date hereof and disregarding the shares of Class A Common Stock issued in the IPO, constitute 44% of the outstanding capital stock of the Company’s Common Stock that are currently not exercised , and (ii) 15,000 some shares of restricted common stock. which will be designated as Series C Cumulative Redeemable Preferred Stock (b) Schedule 2.05 sets forth the capitalization "Series C Preferred"), none of the Company immediately following the issuance of the Debentures contemplated by this Agreement including the number of shares of the following: (i) which will be issued and outstanding Common Stock; (ii) but which will, upon consummation of the IPO and the transactions contemplated hereby and assuming no further issuances of capital stock by the Company after the date hereof and disregarding the shares of Class A Common Stock reserved for issuance upon conversion of Debentureissued in the IPO, including the names constitute 44% of the holders outstanding capital stock of the Debentures thereof; (iii) issued stock optionsCompany. Effective as of the closing date of the IPO, including vesting schedule and exercise price; (iv) stock options not yet issued but reserved for issuance; (v) issued and outstanding Preferred Stock; and (vi) warrants or stock purchase rights, if any. All of all the outstanding shares of capital stock of the Company will have been duly authorized, are validly issued and are will be fully paid and nonassessable non-assessable and were issued no personal liability will attach to the ownership thereof. The designations, powers, preferences, rights, qualifications, limitations and restrictions in compliance respect of the authorized capital stock of the Company are and will be as of the closing date of the IPO as set forth in the Restated Certificate of Incorporation, and all such designations, powers, preferences, rights, qualifications, limitations and restrictions will be, upon filing of such Restated Certificate of Incorporation with the Delaware Secretary of State, valid, binding and in full force and effect in accordance with all applicable federal and state securities laws. The Debentures have been duly authorizedShares, will, immediately after the closing of the IPO and the transactions contemplated hereby and assuming no further issuances of capital stock by the Company after the date hereof and after giving effect to the issuance and sale of the Shares, constitute 12.0% of the issued and outstanding capital stock of the Company calculated on an as converted, fully diluted basis without taking into account (i) any then outstanding options or warrants to acquire (A) shares of Class A Common Stock or (B) any Common Stock Equivalents or other Equity Securities or (ii) any shares of Class A Common Stock, any Common Stock Equivalents or other Equity Securities issued by the Company after the date hereof other than (A) shares issued in the IPO and (B) shares of Class A Common Stock, Common Stock Equivalents and other Equity Securities issued by the Company in connection with the Reorganization. The Shares, when issued, sold issued and delivered in accordance with the terms and for the consideration set forth in this Agreement, will be validly issued. The Company has duly reserved the Conversion Shares for issuance upon conversion of the Debentures, and the Conversion Shares, when issued and delivered upon conversion of the Debentureshereof, will be duly authorized, validly issued and issued, fully paid and non non- assessable, free and clear of all Liens or restrictions imposed by or through the Company except as set forth in the Registration Rights Agreement. Except for the Shares, except as set forth on Schedule 2.052.14 of the ------------- Disclosure Letter, and except for shares of Common Stock and Common Stock Equivalents as may be issued by the Company after the date hereof, there are no subscriptions, options, warrants or other rights (contingent or otherwise) to purchase or otherwise acquire shares of capital stock or other equity securities of the Company authorized, issued or outstanding, nor is or will the Company be obligated in any other manner to issue shares of its capital stock stock, subscriptions, warrants, options, convertible securities, or other securitiessuch rights or to distribute to holders of any of its equity securities any evidence of indebtedness or asset. There As of the closing date of the IPO, shares of Class A Common Stock representing not more than five percent (5%) of the authorized capital stock of the Company will be authorized for issuance pursuant to the Company's 2000 Stock Option Plan. Except as set forth in Schedule 2.14 of the Disclosure Letter, or as contemplated by this ------------- Agreement or the Registration Rights Agreement (i) there are no restrictions on the transfer of shares of capital stock equity securities of the Company other than those imposed by the Transaction Agreements and relevant state and federal Federal securities lawslaws and (ii) there are no agreements, understandings, proxies, trusts or other collaborative arrangements concerning the voting, pledge or purchase and sale of the equity securities of the Company to which the Company is a party or of which it has Knowledge after due inquiry. No Except as set forth in Schedule 2.14 of the Disclosure Letter, no ------------- holder of any security of the Company is entitled to preemptive preemptive, first refusal or similar statutory or contractual rights, either arising pursuant to any agreement or instrument to which the Company is a party, or which are otherwise binding upon the Company, or to the best of the Company's Knowledge, to which any other Person is a party, and all such rights have not been waivedduly waived with respect to the issuance of the Shares. Except as provided for in the Company's Restated Certificate of Incorporation, or as set forth in the attached Schedule -------- 2.14 of the Disclosure ---- Letter, the Company has no obligation (contingent or otherwise) to purchase, redeem or otherwise acquire any of its equity securities or any interest therein or to pay any dividend or make any other distribution in respect thereof. The offer and sale of all shares of capital stock and other securities of the Company issued before the date hereof Closing complied with or were exempt from all federal applicable Federal and state securities lawslaws and no stockholder has a right of rescission or damages with respect thereto.

Capitalization; Status of Capital Stock. (a) On the date of this Agreement The Company represents and warrants that immediately prior to the issuance of Debentures contemplated by this Agreement, Second Closing Date the Company has will have a total authorized capitalization consisting of: of (i) 10,000,000 100,000,000 shares of Common Stock Stock, without par value, of which 3,117,647 15,000,000 shares are issued and outstanding and 5,000,000 shares are reserved for issuance under the Company's 1996 Stock Incentive Plan (the "PLAN"), and (ii) 3,000,000 shares 20,000,000 of Preferred Stock, of which none 1,510,533 shares of Series A Convertible Preferred Stock are issued and outstanding and of which 3,067,484 shares of Series B Convertible Preferred Stock are issued and outstanding. As of At the date of this Agreement and immediately prior First Closing, the Company had approved options to the issuance of Debentures contemplated by this Agreement, 700,000 purchase 2,660,848 shares of Common Stock have been reserved for issuance in accordance with under the Company’s 2005 Plan and warrants to purchase 53,000 shares of Common Stock Option and Incentive Plan. Of those shares to various individuals who had provided bridge financing to the Company granted: (i) nonqualified options prior to purchase 230,000 shares of the Company’s Common Stock that are currently not exercised and (ii) 15,000 shares of restricted common stock. (b) Schedule 2.05 sets forth the capitalization of the Company immediately following the issuance of the Debentures contemplated by this Agreement including the number of shares of the following: (i) issued and outstanding Common Stock; (ii) Common Stock reserved for issuance upon conversion of Debenture, including the names of the holders of the Debentures thereof; (iii) issued stock options, including vesting schedule and exercise price; (iv) stock options not yet issued but reserved for issuance; (v) issued and outstanding Preferred Stock; and (vi) warrants or stock purchase rights, if anyFirst Closing. All of the outstanding shares of capital stock of the Company have been duly authorized, are validly issued and are fully paid and nonassessable and were issued in compliance with all applicable federal and state securities laws. The Debentures shares issuable upon exercise of outstanding options have been duly authorizedauthorized and, and when issued, sold and delivered issued in accordance with the terms and for the consideration set forth in this Agreementof such options, will be validly issued, fully paid and nonassessable. The Company has duly reserved the Conversion Shares sufficient shares of Common Stock for issuance upon conversion of the DebenturesSeries A Convertible Preferred Stock and, prior to the Second Closing, the Company will have reserved an aggregate of up to 3,249,222 shares of Series B Preferred for issuance and the an aggregate of up to 6,316,706 shares of Common Stock for issuance upon conversion of such shares of Series B Preferred. The Conversion Shares, Shares when issued and delivered upon conversion of the DebenturesSeries B Preferred, will be duly authorized, validly issued and fully paid and non assessablenonassessable and the shares of Common Stock issuable upon exercise of the Series A Convertible Preferred Stock, when issued and delivered upon conversion of such Series A Convertible Preferred Stock, will be duly authorized, fully paid and nonassessable. Except as set forth on Schedule 2.05in this Agreement and the Exhibits and Schedules attached hereto, there are no options, warrants or rights to purchase shares of capital stock or other securities of the Company authorized, issued or outstanding, nor is the Company obligated in any other manner to issue shares of its capital stock or other securities. There are no restrictions on the transfer of shares of capital stock of the Company other than those imposed by the Transaction Agreements and state and federal securities laws. No holder of any security of the Company is entitled to preemptive or similar statutory or contractual rights, either arising pursuant to any agreement or instrument to which the Company is a party, party or which that are otherwise binding upon the Company, which have not been waived. The offer and sale of all shares of capital stock and or other securities of the Company issued before the date hereof First Closing complied with or were exempt from registration or qualification under all federal and state securities laws.