Common use of Exemption from Registration; Valid Issuances Clause in Contracts

Exemption from Registration; Valid Issuances. Subject to the accuracy of the Investors' representations in Article III, the sale of the Convertible Debentures, the Conversion Shares, the Warrants and the Warrant Shares will not require registration under the Securities Act and/or any applicable state securities law. When issued and paid for in accordance with the Warrants and validly converted in accordance with the terms of the Convertible Debentures, the Conversion Shares and the Warrant Shares will be duly and validly issued, fully paid, and non-assessable. Neither the sales of the Convertible Debentures, the Conversion Shares, the Warrants or the Warrant Shares pursuant to, nor the Company's performance of its obligations under, this Agreement, the Registration Rights Agreement, the Escrow Agreement, the Convertible Debentures or the Warrants will (i) result in the creation or imposition by the Company of any liens, charges, claims or other encumbrances upon the Convertible Debentures, the Conversion Shares, the Warrants or the Warrant Shares or, except as contemplated herein, any of the assets of the Company, or (ii) entitle the holders of Outstanding Capital Shares to preemptive or other rights to subscribe for or acquire the Capital Shares or other securities of the Company. The Convertible Debentures, the Conversion Shares, the Warrants and the Warrant Shares shall not subject the Investors to personal liability to the Company or its creditors by reason of the possession thereof.

Exemption from Registration; Valid Issuances. Subject to the accuracy of the InvestorsLenders' representations in Article III, the sale of the Convertible Debentures, the Conversion Shares, the Warrants and the Warrant Shares will not require registration under the Securities Act and/or any applicable state securities law. When issued and paid for in accordance with the Warrants and validly converted in accordance with the terms of the Convertible Debentures, the Conversion Shares and the Warrant Shares will be duly and validly issued, fully paid, and non-assessable. Neither the sales of the Convertible Debentures, the Conversion Shares, the Warrants or the Warrant Shares pursuant to, nor the Company's performance of its obligations under, this Agreement, the Registration Rights Agreement, the Escrow Agreement, the Convertible Debentures or the Warrants will (i) result in the creation or imposition by the Company of any liens, charges, claims or other encumbrances upon the Convertible Debentures, the Conversion Shares, the Warrants or the Warrant Shares or, except as contemplated herein, any of the assets of the Company, or (ii) entitle the holders of Outstanding Capital Shares to preemptive or other rights to subscribe for or acquire the Capital Shares or other securities of the Company. The Convertible Debentures, the Conversion Shares, the Warrants and the Warrant Shares shall not subject the Investors Lenders to personal liability to the Company or its creditors by reason of the possession thereof.

Exemption from Registration; Valid Issuances. Subject to the accuracy of the Investors' representations in Article III, the sale of the Convertible Debentures, Debentures and the Conversion Shares, the Warrants and the Warrant Shares will not require registration under the Securities Act and/or any applicable state securities law. When issued and paid for in accordance with the Warrants and validly converted in accordance with the terms of the Convertible Debentures, the Conversion Shares Shares, the Warrants and the Warrant Shares will be duly and validly issued, fully paid, and non-assessable. Neither the sales of the Convertible Debentures, the Conversion Shares, the Warrants or the and Warrant Shares pursuant to, nor the Company's performance of its obligations under, this Agreement, the Registration Rights Agreement, the Escrow Agreement, Agreement or the Convertible Debentures or and the Warrants will (i) result in the creation or imposition by the Company of any liens, charges, claims or other encumbrances upon the Convertible Debentures, the Conversion Shares, the Warrants or the Conversion Shares and Warrant Shares or, except as contemplated herein, any of the assets of the Company, or (ii) entitle the holders of Outstanding Capital Shares to preemptive or other rights to subscribe for or acquire the Capital Shares or other securities of the Company. The Convertible Debentures, the Conversion Shares, the Warrants and the Conversion Shares and Warrant Shares Shares, shall not subject the Investors to personal liability to the Company or its creditors by reason of the possession thereof.

Exemption from Registration; Valid Issuances. Subject to the accuracy of the Investors' Investor's representations in Article III, the sale of the Convertible Debentures, the Conversion SharesDebenture, the Warrants and the Warrant Investor Shares will not require registration under the Securities Act and/or any applicable state securities law. When issued and paid for in accordance with the Warrants and validly converted in accordance with Convertible Debenture or the terms of Warrants, as the Convertible Debenturescase may be, the Conversion Shares and the Warrant Investor Shares will be duly and validly issued, fully paid, and non-assessable. Neither the sales of the Convertible Debentures, the Conversion SharesDebenture, the Warrants or the Warrant Shares pursuant toInvestor Shares, nor the Company's performance of its obligations under, under this Agreement, the Registration Rights Agreement, the Escrow Agreement, the Convertible Debentures Debenture or the Warrants Warrants, will (i) result in the creation or imposition by the Company of any liens, charges, claims or other encumbrances upon the Convertible Debentures, the Conversion SharesDebenture, the Warrants or the Warrant Shares Investor or, except as contemplated herein, any of the assets of the Company, or (ii) entitle the holders of Outstanding Capital Shares to preemptive or other rights to subscribe for to or acquire the Capital Shares or other securities of the Company. The None of the Convertible Debentures, the Conversion SharesDebenture, the Warrants and or the Warrant Investor Shares shall not subject the Investors Investor to personal liability to the Company or its creditors by reason of the possession thereof.

Exemption from Registration; Valid Issuances. Subject to the accuracy of the Investors' Investor's representations in Article III, the Company's sale of the Convertible DebenturesDebentures and its issuance of the Warrants under this Agreement does not, and the Company's issuance of the Conversion Shares, Shares on the Warrants Investor's conversion of the Convertible Debentures and the Warrant Shares on the exercise of the Warrants will not not, require registration under the Securities Act and/or any applicable state securities law, except as provided for in the Registration Rights Agreement. When issued in accordance with the terms of the Convertible Debentures or issued and paid for in accordance with the Warrants and validly converted in accordance with the terms of the Convertible DebenturesWarrants, the Conversion Shares and the Warrant Shares Shares, as the case may be, will be duly and validly issued, fully fully-paid, and non-assessablenonassessable. Neither the sales of the Convertible Debentures, the Conversion Shares, the Warrants or the Warrant Shares Securities pursuant to, nor the Company's performance of its obligations under, this Agreement, the Registration Rights Agreement, the Escrow Agreement, the Convertible Debentures or the Warrants Transaction Documents will (i) result in the creation or imposition by the Company of any liens, charges, claims or other encumbrances upon any of the Convertible Debentures, the Conversion Shares, the Warrants or the Warrant Shares Securities or, except as contemplated herein, any of the assets of the Company, or (ii) entitle the holders of Outstanding Capital Shares to preemptive or other rights to subscribe for or acquire the Capital Shares or other securities of the Company. The Convertible Debentures, None of the Conversion Shares, the Warrants and the Warrant Shares shall not Securities will subject the Investors Investor to personal liability to the Company or its creditors by reason of the Investor's possession thereof.

Exemption from Registration; Valid Issuances. Subject to the -------------------------------------------- accuracy of the InvestorsLenders' representations in Article III, the sale of the Convertible Debentures, the Conversion Shares, the Warrants and the Warrant Shares will not require registration under the Securities Act and/or any applicable state securities law. When issued and paid for in accordance with the Warrants and validly converted in accordance with the terms of the Convertible Debentures, the Conversion Shares and the Warrant Shares will be duly and validly issued, fully paid, and non-assessable. Neither the sales of the Convertible Debentures, the Conversion Shares, the Warrants or the Warrant Shares pursuant to, nor the Company's performance of its obligations under, this Agreement, the Registration Rights Agreement, the Escrow Agreement, the Convertible Debentures or the Warrants will (i) result in the creation or imposition by the Company of any liens, charges, claims or other encumbrances upon the Convertible Debentures, the Conversion Shares, the Warrants or the Warrant Shares or, except as contemplated herein, any of the assets of the Company, or (ii) entitle the holders of Outstanding Capital Shares to preemptive or other rights to subscribe for or acquire the Capital Shares or other securities of the Company. The Convertible Debentures, the Conversion Shares, the Warrants and the Warrant Shares shall not subject the Investors Lenders to personal liability to the Company or its creditors by reason of the possession thereof.

Exemption from Registration; Valid Issuances. Subject to the continuing accuracy of the Investors' each Investor's representations in Article III, the sale of the Common Stock, the Convertible DebenturesPreferred, the Conversion Shares, the Warrants and the Warrant Shares will not require registration under the Securities Act and/or any applicable state securities law. The Common Stock to be issued at Closing shall be validly issued fully paid and non-assessable. When issued and paid for in accordance with the Warrants each Warrant and validly converted in accordance with the terms of the Convertible DebenturesPreferred, the Conversion Shares and the Warrant Shares will be duly and validly issued, fully paid, and non-assessable. Neither the sales of the Common Stock, the Convertible DebenturesPreferred, the Conversion Shares, the Warrants or the Warrant Shares pursuant to, nor the Company's performance of its obligations under, this Agreement, the Registration Rights Agreement, the Escrow Agreement, the Convertible Debentures Preferred, or the Warrants will (i) result in the creation or imposition by the Company of any liens, charges, claims or other encumbrances upon the Common Stock, the Convertible DebenturesPreferred, the Conversion Shares, the Warrants or the Warrant Shares or, except as contemplated herein, any of the assets of the Company, or (ii) entitle the holders of Outstanding Capital Shares to preemptive or other rights to subscribe for to or acquire the Capital Shares or other securities of the Company. The Common Stock, the Convertible DebenturesPreferred, the Conversion Shares, the Warrants and the Warrant Shares shall not subject the Investors Investor to personal liability to the Company or its creditors by reason of the possession thereof.

Exemption from Registration; Valid Issuances. Subject to the accuracy of the Investors' representations in Article III, the sale of the Convertible DebenturesDebenture, the Conversion Shares, the Warrants and the Warrant Shares will not require registration under the Securities Act and/or any applicable state securities law. When issued and paid for in accordance with the Warrants and validly converted in accordance with the terms of the Convertible DebenturesDebenture, the Conversion Shares and the Warrant Shares will be duly and validly issued, fully paid, and non-assessable. Neither the sales of the Convertible DebenturesDebenture, the Conversion Shares, the Warrants or the Warrant Shares pursuant to, nor the Company's performance of its obligations under, this Agreement, the Registration Rights Agreement, the Escrow Agreement, the Convertible Debentures Debenture or the Warrants will (i) result in the creation or imposition by the Company of any liens, charges, claims or other encumbrances upon the Convertible DebenturesDebenture, the Conversion Shares, the Warrants or the Warrant Shares or, except as contemplated herein, any of the assets of the Company, or (ii) entitle the holders of Outstanding Capital Shares to preemptive or other rights to subscribe for or acquire the Capital Shares or other securities of the Company. The Convertible DebenturesDebenture, the Conversion Shares, the Warrants and the Warrant Shares shall not subject the Investors to personal liability to the Company or its creditors by reason of the possession thereof.

Exemption from Registration; Valid Issuances. Subject to the accuracy of the Investors' Investor's representations in Article III, the sale of the Convertible DebenturesPreferred Stock, the Conversion Shares, the Warrants and the Warrant Shares will not require registration under the Securities Act and/or any applicable state securities law. When issued and paid for in accordance with the Warrants and validly converted in accordance with the terms of the Convertible DebenturesPreferred Stock, the Conversion Shares and the Warrant Shares will be duly and validly issued, fully paid, and non-assessable. Neither the sales of the Convertible DebenturesPreferred Stock, the Conversion Shares, the Warrants or the Warrant Shares pursuant to, nor the Company's performance of its obligations under, this Agreement, the Registration Rights Agreement, the Escrow Agreement, the Convertible Debentures Certificate of Designations or the Warrants will (i) result in the creation or imposition by the Company of any liens, charges, claims or other encumbrances upon the Convertible DebenturesPreferred Stock, the Conversion Shares, the Warrants or the Warrant Shares or, except as contemplated herein, any of the assets of the Company, or (ii) entitle the holders of Outstanding Capital Shares to preemptive or other rights to subscribe for or acquire the Capital Shares or other securities of the Company. The Convertible DebenturesPreferred Stock, the Conversion Shares, the Warrants and the Warrant Shares shall not subject the Investors Investor to personal liability to the Company or its creditors by reason of the possession thereof.

Exemption from Registration; Valid Issuances. Subject to the accuracy of the Investors' representations in Article III, the sale of the Convertible Debentures, Debentures and the Conversion Shares, the Warrants and the Warrant Shares will not require registration under the Securities Act and/or any applicable state securities lawCalifornia Law. When issued and paid for in accordance with the Warrants and validly converted in accordance with the terms of the Convertible Debentures, the Conversion Shares and the Warrant Shares will be duly and validly issued, fully paid, and non-assessable. Neither the sales of the Convertible Debentures, the Conversion Shares, the Warrants or the Warrant Shares pursuant to, nor the Company's performance of its obligations under, this Agreement, the Registration Rights Agreement, the Escrow Agreement, the Convertible Debentures or the Warrants will (i) result in the creation or imposition by the Company of any liens, charges, claims or other encumbrances upon the Convertible Debentures, Debentures or the Conversion Shares, the Warrants or the Warrant Shares or, except as contemplated herein, any of the assets of the Company, or (ii) entitle the holders of Outstanding Capital Shares to preemptive or other rights to subscribe for or acquire the Capital Shares or other securities of the Company. The ownership of Convertible Debentures, the Conversion Shares, the Warrants and the Warrant Shares Shares, shall not subject the Investors to personal liability to the Company or its creditors by reason of the possession thereof.

Exemption from Registration; Valid Issuances. Subject to the accuracy of the Investors' Investor's representations in Article III, the sale of the Convertible Debentures, the Conversion Shares, the Warrants and the Warrant Shares will not require registration under the Securities Act and/or any applicable state securities law. When issued and paid for in accordance with the Warrants each Warrant and validly converted in accordance with the terms of the each Convertible DebenturesDebenture, the Conversion Shares and the Warrant Shares will be duly and validly issued, fully paid, and non-assessable. Neither the sales of the Convertible Debentures, the Conversion Shares, the Warrants or the Warrant Shares pursuant to, nor the Company's performance of its obligations under, this Agreement, the Registration Rights Agreement, the Escrow Agreement, the Convertible Debentures Debentures, or the Warrants will (i) result in the creation or imposition by the Company of any liens, charges, claims or other encumbrances upon the Convertible Debentures, the Conversion Shares, the Warrants or the Warrant Shares or, except as contemplated herein, any of the assets of the Company, or (ii) entitle the holders of Outstanding Capital Shares to preemptive or other rights to subscribe for to or acquire the Capital Shares or other securities of the Company. The Convertible Debentures, the Conversion Shares, the Warrants and the Warrant Shares shall not subject the Investors Investor to personal liability to the Company or its creditors by reason of the possession thereof.

Exemption from Registration; Valid Issuances. Subject to the accuracy of the Investors' Investor's representations in Article III2, the sale of the Convertible Debentures, the Conversion Shares, Shares and the Warrants and the Warrant Shares will not require registration under the Securities Act and/or any applicable state securities lawlaw (other than any Commission, Principal Market or state securities filings that may be required to be made by the Company subsequent to closing and any registration statement that may be filed pursuant hereto). Shares and Warrants will be duly and validly issued, fully paid and non-assessable. When issued and paid for in accordance with the Warrants and validly converted in accordance with the terms of the Convertible DebenturesWarrants, the Conversion Shares and the Warrant Shares will be duly and validly issued, fully paid, and non-assessable. Shares, Warrants and Warrant Shares will be free from any liens, charges, claims or other encumbrances upon issuance. Neither the sales of the Convertible Debentures, the Conversion Shares, Shares and the Warrants or the Warrant Shares pursuant to, nor the Company's performance of its obligations under, under this Agreement, the Registration Rights Agreement, the Escrow Agreement, the Convertible Debentures or Agreement and the Warrants will (i) result in the creation or imposition by the Company of any liens, charges, claims or other encumbrances upon the Convertible Debentures, the Conversion Shares, the Warrants or the Warrant Shares or, except as contemplated herein, or any of the assets of the Company, or (ii) entitle the holders of Outstanding Capital Shares outstanding capital shares to preemptive or other rights to subscribe for or acquire the Capital Shares capital shares or other securities of the Company. The Convertible Debentures, None of the Conversion Shares, the Warrants and the Warrant Shares securities shall not subject the Investors Investor to personal liability to the Company or its creditors by reason of the possession thereof.

Exemption from Registration; Valid Issuances. Subject to the accuracy of the Investors' representations in Article III, the sale of the Convertible DebenturesExchangeable Preferred Stock, the Conversion Exchange Shares, the Warrants and the Warrant Shares will not require registration under the Securities Act and/or any applicable state securities law. When issued and paid for in accordance with the Warrants and validly converted exchanged in accordance with the terms of the Convertible DebenturesExchangeable Preferred Stock, the Conversion Exchange Shares and the Warrant Shares will be duly and validly issued, fully paid, and non-assessable. Neither the sales of the Convertible DebenturesExchangeable Preferred Stock, the Conversion Exchange Shares, the Warrants or the Warrant Shares pursuant to, nor the Company's performance of its obligations under, this Agreement, the Registration Rights Agreement, the Escrow Agreement, the Convertible Debentures Certificate of Designations or the Warrants will (i) result in the creation or imposition by the Company of any liens, charges, claims or other encumbrances upon the Convertible DebenturesExchangeable Preferred Stock, the Conversion Exchange Shares, the Warrants or the Warrant Shares or, except as contemplated herein, any of the assets of the Company, or (ii) entitle the holders of Outstanding Capital Shares to preemptive or other rights to subscribe for or acquire the Capital Shares or other securities of the Company. The Convertible DebenturesExchangeable Preferred Stock, the Conversion Exchange Shares, the Warrants and the Warrant Shares shall not subject the Investors to personal liability to the Company or its creditors by reason of the possession thereof.

Exemption from Registration; Valid Issuances. Subject to the accuracy of the Investors' Investor's representations in Article III, the sale of the Convertible DebenturesDebenture, the Conversion Shares, the Warrants and Warrants, the Warrant Shares and shares of Common Stock issuable by the Company, at the sole option of the Company, to make any payments of interest upon the Debentures will not require registration under the Securities Act and/or any applicable state securities lawlaw (other than any SEC, Principal Market or state securities filings that may be required to be made by the Company subsequent to Closing and any registration statement that may be filed pursuant hereto). When issued and paid for in accordance with the Warrants and validly converted in accordance with the terms of the Convertible DebenturesDebenture, the Conversion Shares and the Warrant Shares will be duly and validly issued, fully paid, and non-assessable. Neither the sales of the Convertible DebenturesDebenture, the Conversion Shares, the Warrants or the Warrant Shares pursuant to, nor the Company's performance of its obligations under, this Agreement, the Registration Rights Agreement, the Escrow Agreement, the Convertible Debentures or the Warrants Transaction Documents will (i) result in the creation or imposition by the Company of any liens, charges, claims or other encumbrances upon the Convertible DebenturesDebenture, the Conversion Shares, the Warrants or the Warrant Shares or, except as contemplated herein, any of the assets of the Company, or (ii) entitle the holders of Outstanding Capital Shares to preemptive or other rights to subscribe for or acquire the Capital Shares or other securities of the Company. The Convertible Debentures, None of the Conversion Shares, the Warrants and the Warrant Shares Securities shall not subject the Investors Investor to personal liability to the Company or its creditors by reason of the possession thereof.

Exemption from Registration; Valid Issuances. Subject to the accuracy of the Investors' representations in Article III, the sale of the Convertible DebenturesPreferred Stock, the Conversion Shares, the Warrants and the Warrant Shares will not require registration under the Securities Act and/or any applicable state securities law. When issued and paid for in accordance with the Warrants and validly converted in accordance with the terms of the Convertible DebenturesPreferred Stock, the Conversion Shares and the Warrant Shares will be duly and validly issued, fully paid, and non-assessable. Neither the sales of the Convertible DebenturesPreferred Stock, the Conversion Shares, the Warrants or the Warrant Shares pursuant to, nor the Company's performance of its obligations under, this Agreement, the Registration Rights Agreement, the Escrow Agreement, the Convertible Debentures Certificate of Designations or the Warrants will (i) result in the creation or imposition by the Company of any liens, charges, claims or other encumbrances upon the Convertible DebenturesPreferred Stock, the Conversion Shares, the Warrants or the Warrant Shares or, except as contemplated herein, any of the assets of the Company, or (ii) entitle the holders of Outstanding Capital Shares to preemptive or other rights to subscribe for or acquire the Capital Shares or other securities of the Company. The Convertible DebenturesPreferred Stock, the Conversion Shares, the Warrants and the Warrant Shares shall not subject the Investors to personal liability to the Company or its creditors by reason of the possession thereof.

Exemption from Registration; Valid Issuances. Subject to the accuracy of the Investors' representations in Article III, the sale of the Convertible Debentures, Debentures and the Conversion Shares, the Warrants and the Warrant Shares will not require registration under the Securities Act and/or any applicable state securities law. When issued and paid for in accordance with the Warrants and validly converted in accordance with the terms of the Convertible Debentures, the Conversion Shares Shares, the Warrants and the Warrant Shares will be duly and validly issued, fully paid, and non-assessable. Neither the sales of the Convertible Debentures, the Conversion Shares, the Warrants or the and Warrant Shares pursuant to, nor the Company's performance of its obligations under, this Agreement, the Registration Rights Agreement, the Escrow Agreement, Agreement or the Convertible Debentures or and the Warrants will (ia) result in the creation or imposition by the Company of any liens, charges, claims or other encumbrances upon the Convertible Debentures, the Conversion Shares, the Warrants or the Conversion Shares and Warrant Shares or, except as contemplated herein, any of the assets of the Company, or (iib) entitle the holders of Outstanding Capital Shares to preemptive or other rights to subscribe for or acquire the Capital Shares or other securities of the Company. The Convertible Debentures, the Conversion Shares, the Warrants and the Conversion Shares and Warrant Shares Shares, shall not subject the Investors to personal liability to the Company or its creditors by reason of the possession thereof.

Exemption from Registration; Valid Issuances. Subject to the accuracy of the Investors' representations in Article IIIII, the sale of the Convertible Debentures, Subordinated Debentures and the Conversion Shares, the Warrants and the Warrant Shares will not require registration under the Securities Act and/or any applicable state securities law. When issued and paid for in accordance with the Warrants and validly converted in accordance with the terms of the Convertible DebenturesSubordinated Debentures and purchased in accordance with the terms of the Warrants, the Conversion Shares and the Warrant Shares will be duly and validly issued, fully paid, and non-assessable. Neither the sales of the Convertible Subordinated Debentures, the Conversion Shares, the Warrants or the and Warrant Shares pursuant to, nor the Company's performance of its obligations under, this Agreement, the Registration Rights Agreement, the Escrow Agreement, Agreement or the Convertible Subordinated Debentures or and the Warrants will (ia) result in the creation or imposition by the Company of any liens, charges, claims or other encumbrances upon the Convertible Subordinated Debentures, the Conversion Shares, the Warrants or the Conversion Shares and Warrant Shares or, except as contemplated hereinherein or therein, any of the assets of the Company, or (iib) entitle the holders of Outstanding Capital Shares to preemptive or other rights to subscribe for or acquire the Capital Shares or other securities of the Company. The Convertible Subordinated Debentures, the Conversion Shares, the Warrants and the Conversion Shares and Warrant Shares Shares, shall not subject the Investors to personal liability to the Company or its creditors by reason of the possession thereof.

Exemption from Registration; Valid Issuances. Subject to the accuracy of the Investors' Investor's representations in Article III, the sale of the Convertible DebenturesDebenture, the Conversion Shares, the Warrants and the Warrant Shares will not require registration under the Securities Act and/or any applicable state securities lawlaw (other than any SEC, Principal Market or state securities filings that may be required to be made by the Company subsequent to Closing and any registration statement that may be filed pursuant hereto). When issued and paid for in accordance with the Warrants and validly converted in accordance with the terms of the Convertible DebenturesDebenture, the Conversion Shares and the Warrant Shares will be duly and validly issued, fully paid, and non-assessable. Neither the sales of the Convertible DebenturesDebenture, the Conversion Shares, the Warrants or the Warrant Shares pursuant to, nor the Company's performance of its obligations under, this Agreement, the Registration Rights Agreement, the Escrow Agreement, the Convertible Debentures or the Warrants Transaction Documents will (i) result in the creation or imposition by the Company of any liens, charges, claims or other encumbrances upon the Convertible DebenturesDebenture, the Conversion Shares, the Warrants or the Warrant Shares or, except as contemplated herein, any of the assets of the Company, or (ii) entitle the holders of Outstanding Capital Shares to preemptive or other rights to subscribe for or acquire the Capital Shares or other securities of the Company. The Convertible Debentures, None of the Conversion Shares, the Warrants and the Warrant Shares Securities shall not subject the Investors Investor to personal liability to the Company or its creditors by reason of the possession thereof.

Exemption from Registration; Valid Issuances. Subject to the accuracy of the Investors' representations in Article III, the sale of the Convertible DebenturesPreferred Stock, the Conversion Shares, the Warrants and the Warrant Shares will not require registration under the Securities Act and/or any applicable state securities law. When issued and paid for in accordance with the Warrants and validly converted in accordance with the terms of the Convertible DebenturesPreferred Stock, the Conversion Shares and the Warrant Shares will be duly and validly issued, fully paid, and non-assessable. Neither the sales of the Convertible DebenturesPreferred Stock, the Conversion Shares, the Warrants or the Warrant Shares pursuant to, nor the Company's performance of its obligations under, this Agreement, the Registration Rights Agreement, the Escrow Agreement, the Convertible Debentures Certificate of Designations or the Warrants will (i) result in the creation or imposition by the Company of any liens, charges, claims or other encumbrances upon the Convertible DebenturesPreferred Stock, the Conversion Shares, the Warrants or the Warrant Shares or, except as contemplated herein, any of the assets of the Company, or (ii) entitle the holders of Outstanding Capital Shares to preemptive or other rights to subscribe for or acquire the Capital Shares or other securities of the Company. The Convertible Debentures, the Conversion Shares, the Warrants and the Warrant Shares shall not subject the Investors to personal liability to the Company or its creditors by reason of the possession thereof.Preferred Stock,

Exemption from Registration; Valid Issuances. Subject to the --------------------------------------------- accuracy of the Investors' representations in Article III, the sale of the Convertible Debentures, Debentures and the Conversion Shares, the Warrants and the Warrant Shares will not require registration under the Securities Act and/or any applicable state securities law. When issued and paid for in accordance with the Warrants and validly converted in accordance with the terms of the Convertible Debentures, the Conversion Shares Shares, the Warrants and the Warrant Shares will be duly and validly issued, fully paid, and non-assessable. Neither the sales of the Convertible Debentures, the Conversion Shares, the Warrants or the and Warrant Shares pursuant to, nor the Company's performance of its obligations under, this Agreement, the Registration Rights Agreement, the Escrow Agreement, Agreement or the Convertible Debentures or and the Warrants will (i) result in the creation or imposition by the Company of any liens, charges, claims or other encumbrances upon the Convertible Debentures, the Conversion Shares, the Warrants or the Conversion Shares and Warrant Shares or, except as contemplated herein, any of the assets of the Company, or (ii) entitle the holders of Outstanding Capital Shares to preemptive or other rights to subscribe for or acquire the Capital Shares or other securities of the Company. The Convertible Debentures, the Conversion Shares, the Warrants and the Conversion Shares and Warrant Shares Shares, shall not subject the Investors to personal liability to the Company or its creditors by reason of the possession thereof.

Exemption from Registration; Valid Issuances. Subject to the accuracy of the Investors' representations in Article III, the sale of the Convertible DebenturesCommon Stock, the Conversion Exchangeable Preferred Stock, the Exchange Shares, the Warrants and the Warrant Shares will not require registration under the Securities Act and/or any applicable state securities law. When issued and paid for in accordance with the Warrants and validly converted exchanged in accordance with the terms of the Convertible DebenturesExchangeable Preferred Stock, the Conversion Exchange Shares and the Warrant Shares will be duly and validly issued, fully paid, and non-assessable. Neither the sales of the Convertible DebenturesCommon Stock, the Conversion Exchangeable Preferred Stock, the Exchange Shares, the Warrants or the Warrant Shares pursuant to, nor the Company's performance of its obligations under, this Agreement, the Registration Rights Agreement, the Escrow Agreement, the Convertible Debentures Certificate of Designations or the Warrants will (i) result in the creation or imposition by the Company of any liens, charges, claims or other encumbrances upon the Convertible DebenturesCommon Stock, the Conversion Exchangeable Preferred Stock, the Exchange Shares, the Warrants or the Warrant Shares or, except as contemplated herein, any of the assets of the Company, or (ii) entitle the holders of Outstanding Capital Shares to preemptive or other rights to subscribe for or acquire the Capital Shares or other securities of the Company. The Convertible DebenturesCommon Stock, the Conversion Exchangeable Preferred Stock, the Exchange Shares, the Warrants and the Warrant Shares shall not subject the Investors to personal liability to the Company or its creditors by reason of the possession thereof.

Exemption from Registration; Valid Issuances. Subject to the accuracy of the Investors' representations in Article III, the sale of the Convertible Debentures, Preferred Stock and the Conversion Shares, the Warrants and the Warrant Shares will not require registration under the Securities Act and/or any applicable state securities law. When issued and paid for in accordance with the Warrants and validly converted in accordance with the terms of the Convertible DebenturesCertificate of Designations, the Conversion Shares Shares, the Warrants and the Warrant Shares will be duly and validly issued, fully paid, and non-assessable. Neither the sales of the Convertible DebenturesPreferred Stock, the Conversion Shares, the Warrants or the and Warrant Shares pursuant to, nor the Company's performance of its obligations under, this Agreement, the Registration Rights Agreement, the Escrow Agreement, Agreement or the Convertible Debentures or Certificate of Designations and the Warrants will (ia) result in the creation or imposition by the Company of any liens, charges, claims or other encumbrances upon the Convertible Debentures, the Conversion SharesPreferred Stock, the Warrants or the Conversion Shares and Warrant Shares or, except as contemplated herein, any of the assets of the Company, or (iib) entitle the holders of Outstanding Capital Shares to preemptive or other rights to subscribe for or acquire the Capital Shares or other securities of the Company. The Convertible Debentures, the Conversion SharesPreferred Stock, the Warrants and the Conversion Shares and Warrant Shares Shares, shall not subject the Investors to personal liability to the Company or its creditors by reason of the possession thereof.

Exemption from Registration; Valid Issuances. Subject to the accuracy of the Investors' representations in Article III, the sale of the Convertible Debentures, Debentures and the Conversion Shares, the Warrants and the Warrant Shares will not require registration under the Securities Act and/or any applicable state securities lawCalifornia Law. When issued and paid for in accordance with the Warrants and validly converted in accordance with the terms of the Convertible Debentures, the Conversion Shares and the Warrant Shares will be duly and validly issued, fully paid, and non-assessablenonassessable. Neither the sales of the Convertible Debentures, the Conversion Shares, the Warrants or the Warrant Shares pursuant to, nor the Company's performance of its obligations under, this Agreement, the Registration Rights Agreement, the Escrow Agreement, the Convertible Debentures or the Warrants will (i) result in the creation or imposition by the Company of any liens, charges, claims or other encumbrances upon the Convertible Debentures, Debentures or the Conversion Shares, the Warrants or the Warrant Shares or, except as contemplated herein, any of the assets of the Company, or (ii) entitle the holders of Outstanding Capital Shares to preemptive or other rights to subscribe for or acquire the Capital Shares or other securities of the Company. The ownership of Convertible Debentures, the Conversion Shares, the Warrants and the Warrant Shares Shares, shall not subject the Investors to personal liability to the Company or its creditors by reason of the possession thereof.

Exemption from Registration; Valid Issuances. Subject to the -------------------------------------------- accuracy of the Investors' representations in Article III, the Company's sale of the Convertible DebenturesDebentures and its issuance of the Warrants under this Agreement does not, and the Company's issuance of the Conversion Shares, Shares on the Warrants Investor's conversion of the Convertible Debentures and the Warrant Shares on the exercise of the Warrants will not not, require registration under the Securities Act and/or any applicable state securities law. When issued and paid for in accordance with the Warrants and validly converted in accordance with the terms of the Convertible DebenturesDebentures or issued and paid for in accordance with the Warrants, the Conversion Shares and the Warrant Shares Shares, as the case may be, will be duly and validly issued, fully fully-paid, and non-assessablenonassessable. Neither the sales of the Convertible Debentures, the Conversion Shares, the Warrants or the Warrant Shares Securities pursuant to, nor the Company's performance of its obligations under, this Agreement, the Registration Rights Agreement, the Escrow Agreement, the Convertible Debentures or the Warrants Transaction Documents will (i) result in the creation or imposition by the Company of any liens, charges, claims or other encumbrances upon any of the Convertible Debentures, the Conversion Shares, the Warrants or the Warrant Shares Securities or, except as contemplated herein, any of the assets of the Company, or (ii) entitle the holders of Outstanding Capital Shares to preemptive or other rights to subscribe for or acquire the Capital Shares or other securities of the Company. The Convertible Debentures, None of the Conversion Shares, the Warrants and the Warrant Shares shall not Securities will subject the Investors to personal liability to the Company or its creditors by reason of the an Investor's possession thereof.

Exemption from Registration; Valid Issuances. Subject to the accuracy of the Investors' Investor's representations in Article III, the sale of the Convertible DebenturesPreferred Shares, the Conversion Shares, the Warrants Warrant and the Warrant Shares will not require registration under the Securities Act and/or any applicable state securities law. When issued and paid for in accordance with the Warrants Warrant and validly converted in accordance with the terms of the Convertible DebenturesPreferred Shares, the Conversion Shares and the Warrant Shares will be duly and validly issued, fully paid, and non-assessable. Neither the sales of the Convertible DebenturesPreferred Shares, the Conversion Shares, the Warrants Warrant or the Warrant Shares pursuant to, nor the Company's performance of its obligations under, this Agreement, the Registration Rights Agreement, the Escrow Agreement, the Convertible Debentures Preferred Shares, or the Warrants Warrant will (i) result in the creation or imposition by the Company of any liens, charges, claims or other encumbrances upon the Convertible DebenturesPreferred Shares, the Conversion Shares, the Warrants Warrant or the Warrant Shares or, except as contemplated herein, any of the assets of the Company, or (ii) entitle the holders of Outstanding Capital Shares to preemptive or other rights to subscribe for to or acquire the Capital Shares or other securities of the Company. The Convertible DebenturesPreferred Shares, the Conversion Shares, the Warrants Warrant and the Warrant Shares shall not subject the Investors Investor to personal liability to the Company or its creditors by reason of the possession thereof.

Exemption from Registration; Valid Issuances. Subject to the accuracy of the Investors' representations in Article III, the sale of the Convertible Debentures, the Conversion Shares, the Warrants and the Warrant Shares will not require registration under the Securities Act and/or any applicable state securities law. When issued and paid for in accordance with the Warrants and validly converted in accordance with the terms of the Convertible Debentures, the Conversion Shares and the Warrant Shares will be duly and validly issued, fully paid, and non-assessable. Neither the sales of the Convertible Debentures, the Conversion Shares, the Warrants or the Warrant Shares pursuant to, nor the Company's performance of its obligations under, this Agreement, the Security Documents, the Registration Rights Agreement, the Escrow Agreement, the Convertible Debentures Agreement or the Warrants will (i) result in the creation or imposition by the Company of any liens, charges, claims or other encumbrances upon the Convertible Debentures, the Conversion Shares, the Warrants or the Warrant Shares or, except as contemplated herein, any of the assets of the CompanyCompany (or Subsidiary, as applicable), or (ii) entitle the holders of Outstanding Capital Shares to preemptive or other rights to subscribe for or acquire the Capital Shares or other securities of the Company. The Convertible Debentures, the Conversion Shares, the Warrants and the Warrant Shares shall not subject the Investors to personal liability to the Company or its creditors by reason of the possession thereof.

Exemption from Registration; Valid Issuances. Subject to the accuracy of the Investors' representations in Article III, the sale of the Convertible DebenturesPreferred Stock, the Conversion Shares, the Warrants and the Warrant Shares will not require registration under the Securities Act and/or any applicable state securities law. When issued and paid for in accordance with the Warrants and validly converted in accordance with the terms of the Convertible DebenturesPreferred Stock, the Conversion Shares and the Warrant Shares will be duly and validly issued, fully paid, and non-assessable. Neither the sales of the Convertible DebenturesPreferred Stock, the Conversion Shares, the Warrants or the Warrant Shares pursuant to, nor the Company's performance of its obligations under, this Agreement, the Registration Rights Agreement, the Escrow Agreement, the certificate of designation for the Convertible Debentures Preferred Stock, or the Warrants will (i) result in the creation or imposition by the Company of any liens, charges, claims or other encumbrances upon the Convertible DebenturesPreferred Stock, the Conversion Shares, the Warrants or the Warrant Shares or, except as contemplated herein, any of the assets of the Company, or (ii) entitle the holders of Outstanding Capital Shares to preemptive or other rights to subscribe for to or acquire the Capital Shares or other securities of the Company. The Convertible DebenturesPreferred Stock, the Conversion Shares, the Warrants and the Warrant Shares shall not subject the Investors to personal liability to the Company or its creditors by reason of the possession thereof.

Exemption from Registration; Valid Issuances. Subject to the -------------------------------------------- accuracy of the Investors' representations in Article IIIII, the sale of the Convertible Debentures, Debentures and the Conversion Shares, the Warrants and the Warrant Shares will not require registration under the Securities Act and/or any applicable state securities law. When issued and paid for in accordance with the Warrants and validly converted in accordance with the terms of the Convertible Debentures, the Conversion Shares Shares, the Warrants and the Warrant Shares will be duly and validly issued, fully paid, and non-assessable. Neither the sales of the Convertible Debentures, the Conversion Shares, the Warrants or the and Warrant Shares pursuant to, nor the Company's performance of its obligations under, this Agreement, the Registration Rights Agreement, the Escrow Agreement, Agreement or the Convertible Debentures or and the Warrants will (ia) result in the creation or imposition by the Company of any liens, charges, claims or other encumbrances upon the Convertible Debentures, the Conversion Shares, the Warrants or the Conversion Shares and Warrant Shares or, except as contemplated herein, any of the assets of the Company, or (iib) entitle the holders of Outstanding Capital Shares to preemptive or other rights to subscribe for or acquire the Capital Shares or other securities of the Company. The Convertible Debentures, the Conversion Shares, the Warrants and the Conversion Shares and Warrant Shares Shares, shall not subject the Investors to personal liability to the Company or its creditors by reason of the possession thereof.

Exemption from Registration; Valid Issuances. Subject to the accuracy of the InvestorsLenders' representations in Article III, the sale of the Convertible Debentures, the Conversion Shares, the Warrants and the Warrant Shares will not require registration under the Securities Act and/or any applicable state securities law. When issued and paid for in accordance with the Warrants and validly converted in accordance with the terms of the Convertible Debentures, the Conversion Shares and the Warrant Shares will be duly and validly issued, fully paid, and non-assessable. Neither Except as set forth on the Disclosure Schedule, neither the sales of the Convertible Debentures, the Conversion Shares, the Warrants or the Warrant Shares pursuant to, nor the Company's performance of its obligations under, this Agreement, the Registration Rights Agreement, the Escrow Agreement, the Convertible Debentures or the Warrants will (i) result in the creation or imposition by the Company of any liens, charges, claims or other encumbrances upon the Convertible Debentures, the Conversion Shares, the Warrants or the Warrant Shares or, except as contemplated herein, any of the assets of the Company, or (ii) entitle the holders of Outstanding Capital Shares to preemptive or other rights to subscribe for or acquire the Capital Shares or other securities of the Company. The Convertible Debentures, the Conversion Shares, the Warrants and the Warrant Shares shall not subject the Investors Lenders to personal liability to the Company or its creditors by reason of the possession thereof.

Exemption from Registration; Valid Issuances. Subject to the accuracy of the Investors' Investor's representations in Article III, the sale of the Convertible DebenturesDebenture, the Conversion Shares, any Additional Debentures, the Warrants Warrant and the Warrant Shares will not require registration under the Securities Act and/or any applicable state securities law. When issued and paid for in accordance with the Warrants Warrant and validly converted in accordance with the terms of the Convertible DebenturesDebenture or any Additional Debenture, the Conversion Shares and the Warrant Shares will be duly and validly issued, fully paid, and non-assessable. Neither the sales of the Convertible DebenturesDebenture, the Conversion Shares, any Additional Debentures, the Warrants Warrant or the Warrant Shares pursuant to, nor the Company's performance of its obligations under, this Agreement, the Registration Rights Agreement, the Escrow Agreement, the Convertible Debentures Debenture, any Additional Debenture, or the Warrants Warrant will (i) result in the creation or imposition by the Company of any liens, charges, claims or other encumbrances upon the Convertible DebenturesDebenture, any Additional Debenture, the Conversion Shares, the Warrants or the Warrant Shares or, except as contemplated herein, any of the assets of the Company, or (ii) entitle the holders of Outstanding Capital Shares to preemptive or other rights to subscribe for to or acquire the Capital Shares or other securities of the Company. The Convertible DebenturesDebenture, any Additional Debenture, the Conversion Shares, the Warrants and the Warrant Shares shall not subject the Investors Investor to personal liability to the Company or its creditors by reason of the possession thereof.

Exemption from Registration; Valid Issuances. Subject to the accuracy of the InvestorsLenders' representations in Article III, the sale of the Convertible Debentures, the Conversion Shares, the Warrants and the Warrant Shares will not require registration under the Securities Act and/or any applicable state securities law. When issued and paid for in accordance with the Warrants and validly converted in accordance with the terms of the Convertible Debentures, the Conversion Shares and the Warrant Shares will be duly and validly issued, fully paid, and non-assessable. Neither the sales of the Convertible Debentures, the Conversion Shares, the Warrants or the Warrant Shares pursuant to, nor the Company's performance of its obligations under, this Agreement, the Registration Rights Agreement, the Escrow Agreement, the Convertible Debentures or the Warrants will (i) result in the creation or imposition by the Company of any liens, charges, claims or other encumbrances upon the Convertible Debentures, the Conversion Shares, the Warrants or the Warrant Shares or, except as contemplated herein, any of the assets of the Company, or (ii) entitle the holders of Outstanding Capital Shares to preemptive or other rights to subscribe for or acquire the Capital Shares or other securities of the Company. Company The Convertible Debentures, the Conversion Shares, the Warrants and the Warrant Shares shall not subject the Investors Lenders to personal liability to the Company or its creditors by reason of the possession thereof.

Exemption from Registration; Valid Issuances. Subject to the accuracy of the Investors' representations in Article IIIII, the sale to the Investors of the Convertible Debentures, Subordinated Debentures and the Conversion Shares, and the Warrants and the Warrant Shares will not require registration under the Securities Act and/or any applicable state securities law. When issued and paid for in accordance with the Warrants and validly converted or exercised in accordance with the terms of the Convertible DebenturesSubordinated Debentures and the Warrants, the Conversion Shares and the Warrant Shares will be duly and validly issued, fully paid, and non-assessable. Neither the sales of the Convertible Subordinated Debentures, the Conversion Shares, the Warrants or the and Warrant Shares pursuant to, nor the Company's performance of its obligations under, this Agreement, the Registration Rights Agreement, the Escrow Agreement, Agreement or the Convertible Debentures or and the Warrants will (ia) result in the creation or imposition by the Company of any liens, charges, claims or other encumbrances upon the Convertible Subordinated Debentures, the Conversion Shares, the Warrants or the Conversion Shares and Warrant Shares or, except as contemplated herein, any of the assets of the Company, or (iib) entitle the holders of Outstanding Capital Shares to preemptive or other rights to subscribe for or acquire the Capital Shares or other securities of the Company. The Convertible Subordinated Debentures, the Conversion Shares, the Warrants and the Conversion Shares and Warrant Shares Shares, shall not subject the Investors to personal liability to the Company or its creditors by reason of the possession thereof.

Exemption from Registration; Valid Issuances. Subject to the accuracy of the Investors' representations in Article III, the sale of the Convertible DebenturesPreferred Stock, the Conversion Shares, the Warrants and the Warrant Shares will not require registration under the Securities Act and/or any applicable state securities law. When issued and paid for in accordance with the Warrants and validly converted in accordance with the terms of the Convertible DebenturesPreferred Stock, the Conversion Shares and the Warrant Shares will be duly and validly issued, fully paid, and non-assessable. Neither the sales of the Convertible DebenturesPreferred Stock, the Conversion Shares, the Warrants or the Warrant Shares pursuant to, nor the Company's performance of its obligations under, this Agreement, the Registration Rights Agreement, the Escrow Agreement, the Convertible Debentures Certificate of Designation or the Warrants will (i) result in the creation or imposition by the Company of any liens, charges, claims or other encumbrances upon the Convertible DebenturesPreferred Stock, the Conversion Shares, the Warrants or the Warrant Shares or, except as contemplated herein, any of the assets of the Company, or (ii) entitle the holders of Outstanding Capital Shares to preemptive or other rights to subscribe for or acquire the Capital Shares or other securities of the Company. The Convertible DebenturesPreferred Stock, the Conversion Shares, the Warrants and the Warrant Shares shall not subject the Investors to personal liability to the Company or its creditors by reason of the possession thereof.

Exemption from Registration; Valid Issuances. Subject to the accuracy of the Investors' representations in Article IIIII, the sale of the Convertible Debentures, Subordinated Debentures and the Conversion Shares, the Warrants and the Warrant Shares will not require registration under the Securities Act and/or any applicable state securities law. When issued and paid for in accordance with the Warrants and validly converted in accordance with the terms of the Convertible DebenturesSubordinated Debentures and the Warrants, the Conversion Shares and the Warrant Shares will be duly and validly issued, fully paid, and non-assessable. Neither the sales of the Convertible Subordinated Debentures, the Conversion Shares, the Warrants or the and Warrant Shares pursuant to, nor the Company's performance of its obligations under, this Agreement, the Registration Rights Agreement, the Escrow Agreement, Agreement or the Convertible Subordinated Debentures or and the Warrants will (ia) result in the creation or imposition by the Company of any liens, charges, claims or other encumbrances upon the Convertible Subordinated Debentures, the Conversion Shares, the Warrants or the Conversion Shares and Warrant Shares or, except as contemplated herein, any of the assets of the Company, or (iib) entitle the holders of Outstanding Capital Shares to preemptive or other rights to subscribe for or acquire the Capital Shares or other securities of the Company. The Convertible Subordinated Debentures, the Conversion Shares, the Warrants and the Conversion Shares and Warrant Shares Shares, shall not subject the Investors to personal liability to the Company or its creditors by reason of the possession thereof.