Common use of Valid Issuance of Stock Clause in Contracts

Valid Issuance of Stock. (a) The Purchased Shares, when issued, sold and delivered in accordance with the terms of this Agreement for the consideration provided for herein, will be duly and validly issued, fully paid and nonassessable. The Conversion Shares have been duly and validly reserved for issuance and, upon issuance in accordance with the terms of the Series A Certificate, will be duly and validly issued, fully paid and nonassessable. (b) Based in part on the representations made by the Investor in Section 4 hereof, the Purchased Shares and (assuming no change in applicable law and no unlawful distribution of Purchased Shares by the Investor or other parties) the Conversion Shares will be issued in full compliance with the registration and prospectus delivery requirements of the U.S. Securities Act of 1933, as amended (the "1933 Act") and the registration and qualification requirements of all applicable state securities laws; provided that, with respect to the Conversion Shares, no commission or other remuneration is paid or given, directly or indirectly, for soliciting the issuance of Conversion Shares upon the conversion of the Purchased Shares and no additional consideration is paid for the Conversion Shares other than surrender of the applicable Purchased Shares upon conversion thereof in accordance with the Series A Certificate. (c) The outstanding shares of the capital stock of the Company are duly and validly issued, fully paid and nonassessable, and such shares of capital stock, and all outstanding options, warrants, convertible notes and other securities of the Company, have been issued in full compliance with the registration and prospectus delivery requirements of the 1933 Act or in compliance with applicable exemptions therefrom, the registration and qualification requirements of all applicable securities laws of states of the United States and all other provisions of applicable securities laws of States of the United States, including, without limitation, anti-fraud provisions.

Valid Issuance of Stock. (a) The Purchased Preferred Shares, when issued, sold issued and delivered paid for as provided in accordance with the terms of this Agreement for the consideration provided for herein, will be duly authorized and validly issued, fully paid and nonassessable. The Conversion Shares and the Warrant Shares have been duly and validly reserved for issuance and, when issued upon issuance conversion in accordance with the Amended and Restated Certificate (assuming no change in the Amended and Restated Certificate or in applicable law) and terms of the Series A CertificateWarrant, respectively, will be duly authorized and validly issued, fully paid and nonassessable. (b) Based in part on the representations made by the Investor Seller in Section 4 Article IV hereof, the Purchased offer and sale of the Preferred Shares and Warrant solely to the Seller in accordance with this Agreement and (assuming no change in currently applicable law or the Amended and Restated Certificate, no unlawful distribution transfer of Purchased Preferred Shares by the Investor or other parties) the Conversion Shares will be issued in full compliance with the registration an holder thereof and prospectus delivery requirements of the U.S. Securities Act of 1933, as amended (the "1933 Act") and the registration and qualification requirements of all applicable state securities laws; provided that, with respect to the Conversion Shares, no commission or other remuneration is paid or given, directly or indirectly, for soliciting the issuance of Conversion Shares upon the conversion of the Purchased Shares and no additional consideration is paid for Preferred Shares) the Conversion Shares other than surrender and Warrant Shares are exempt from the registration and prospectus delivery requirements of the applicable Purchased Shares upon conversion thereof in accordance with Act and the Series A Certificatesecurities registration and qualification requirements of the currently effective provisions of the securities laws of the State of California. (c) The outstanding shares of the capital stock of the Company Purchaser are duly authorized and validly issued, fully paid and nonassessable, and such have been approved by all requisite stockholder action. Such shares of such capital stock, and all outstanding options, warrants, convertible notes and other securities of the CompanyPurchaser, have been issued in full compliance with the registration and prospectus delivery requirements of the 1933 Act or in compliance with applicable exemptions therefrom, the registration and qualification requirements of all applicable securities laws of states of the United States and all other provisions of applicable securities laws of States of the United States, including, without limitation, anti-fraud antifraud provisions.

Valid Issuance of Stock. (a) The Purchased SharesSecurities, when issued, sold issued and delivered paid for as provided in accordance with the terms of this Agreement for the consideration provided for hereinAgreement, will be duly authorized and validly issued, fully paid and nonassessablenonassessable and will be free of restrictions on transfer other than restrictions under this Agreement and the Restated Rights Agreement and under applicable state and federal securities laws. The Conversion Shares and the shares of Common Stock issuable upon conversion of the Series B Stock and the Series B-1 Stock and the shares of Series B Stock issuable upon exercise of the Warrant, have been duly and validly reserved for issuance upon conversion and/or exercise, respectively, thereof and, when issued upon issuance such conversion in accordance with the terms Restated Certificate (assuming no change in the Restated Certificate or in applicable law), or when issued upon exercise of the Series A Certificate, Warrant pursuant to the term set forth therein will be duly authorized and validly issued, fully paid and nonassessablenonassessable and, to the Company's knowledge, will be free of restrictions on transfer other than restrictions under this Agreement and the Related Agreements and under applicable state and federal securities laws. (b) Based in part on the representations made by the Investor Investors in Section 4 hereof, the offer and sale of the Purchased Shares Securities solely to the Investors in accordance with this Agreement and (assuming no change in currently applicable law or the Restated Certificate, no transfer of Purchased Securities by a holder thereof and no unlawful distribution of Purchased Shares by the Investor commission or other partiesremuneration is paid or given, directly or indirectly, for soliciting the issuance of Conversion Shares upon conversion of the Purchased Securities ) the issuance of the Conversion Shares will be issued in full compliance with and the issuance of Series B Stock upon exercise of the Warrant are exempt from the registration and prospectus delivery requirements of the U.S. Securities Act of 1933, as amended (the "1933 Act") and the securities registration and qualification requirements of all applicable state securities laws; provided that, with respect to the Conversion Shares, no commission or other remuneration is paid or given, directly or indirectly, for soliciting the issuance of Conversion Shares upon the conversion currently effective provisions of the Purchased Shares and no additional consideration is paid for the Conversion Shares other than surrender of the applicable Purchased Shares upon conversion thereof in accordance with the Series A Certificate. (c) The outstanding shares of the capital stock of the Company are duly and validly issued, fully paid and nonassessable, and such shares of capital stock, and all outstanding options, warrants, convertible notes and other securities of the Company, have been issued in full compliance with the registration and prospectus delivery requirements of the 1933 Act or in compliance with applicable exemptions therefrom, the registration and qualification requirements of all applicable securities laws of states the States in which the Investors are resident based upon their addresses set forth on the Schedule of the United States and all other provisions of applicable securities laws of States of the United States, including, without limitation, anti-fraud provisions.Investors attached hereto as Exhibit A. ---------

Valid Issuance of Stock. (a) The Purchased Shares, when paid for and then issued, sold and delivered as provided in accordance with the terms of this Agreement for the consideration provided for hereinAgreement, will be (i) duly authorized and validly issued, fully paid and nonassessablenonassessable and (ii) free of restrictions on transfer other than restrictions on transfer under the Certificate of Designation, this Agreement, the Investors' Rights Agreement and applicable state and federal securities laws and other than those imposed through the action or inaction of the holders thereof. The Conversion Shares and Warrant Shares have been duly and validly reserved for issuance upon conversion of the Purchased Shares and exercise or conversion of the Warrants, respectively, and, when issued upon issuance such conversion in accordance with the terms Certificate of Designation (assuming no change in the Certificate of Designation or in applicable law) or when issued upon exercise or conversion of the Series A CertificateWarrants pursuant to the terms set forth therein, will be (x) duly authorized and validly issued, fully paid and nonassessablenonassessable and (y) free of restrictions on transfer other than restrictions on transfer under the this Agreement, the Investors' Rights Agreement and applicable State and federal securities laws and other than those imposed through the action or inaction of the holders thereof. (b) Based in part on the representations made by the Investor Investors in Section 4 hereof, the offer and sale of the Purchased Shares and Warrants solely to the Investors in accordance with this Agreement and (assuming no change in currently applicable law and or regulations or the Certificate of Designation, no unlawful distribution change in the status of an Investor as an accredited investor as that term is defined in Rule 502 promulgated under the Securities Act, no transfer of Purchased Shares or Warrants by the Investor or other parties) the Conversion Shares will be issued in full compliance with the registration any holder thereof and prospectus delivery requirements of the U.S. Securities Act of 1933, as amended (the "1933 Act") and the registration and qualification requirements of all applicable state securities laws; provided that, with respect to the Conversion Shares, no commission or other remuneration is paid or given, directly or indirectly, for soliciting the issuance of Conversion Shares upon the conversion of the Purchased Shares and no additional consideration is paid for or the Warrant Shares upon conversion of the Warrants) the issuance of the Conversion Shares other than surrender of and the applicable Purchased Warrant Shares upon conversion thereof in accordance with the Series A Certificate. (c) The outstanding shares of the capital stock of the Company are duly and validly issued, fully paid and nonassessable, and such shares of capital stock, and all outstanding options, warrants, convertible notes and other securities of the Company, have been issued in full compliance with exempt from the registration and prospectus delivery requirements of the 1933 Securities Act or in compliance with applicable exemptions therefrom, and the securities registration and qualification requirements of all applicable the currently effective provisions of the securities laws of the states in which the Investors are resident based upon their addresses set forth on the Schedule of the United States and all other provisions of applicable securities laws of States of the United States, including, without limitation, anti-fraud provisions.Investors attached hereto as Exhibit A.

Valid Issuance of Stock. (a) The Purchased Shares, when issued, sold and delivered in accordance with the terms of this Agreement for the consideration provided for herein, will be duly and validly issued, fully paid and nonassessable. The Conversion Shares have been duly and validly reserved for issuance and, upon issuance in accordance with the terms of the Series A Certificate, will be duly and validly issued, fully paid and nonassessable. (ba) Based in part on the representations made by the Investor Investors in Section 4 hereof and the Founders in Section 5 hereof, the Purchased Shares and (assuming no change in applicable law and no unlawful distribution of Purchased Shares by the Investor Investors or other parties) the Conversion Shares will be issued in full compliance with pursuant to an exemption from the registration and prospectus delivery requirements of the U.S. Securities Act of 1933, as amended (the "1933 Act") and in compliance with the registration and qualification requirements requirements, or applicable exemptions therefrom, of all applicable state securities laws; provided that, with respect to the Conversion Shares, no commission or other remuneration is paid or given, directly or indirectly, for soliciting the issuance of Conversion Shares upon the conversion of the Purchased Preferred Shares and no additional consideration is paid for the Conversion Shares other than surrender of the applicable Purchased Preferred Shares upon conversion thereof in accordance with the Series A Certificate. (cb) The outstanding shares of the capital stock of the Company are duly and validly issued, fully paid and nonassessable, and such shares of capital stock, and all outstanding options, warrants, convertible notes and other securities of the Company, have been issued in full compliance with the registration and prospectus delivery requirements of the 1933 Act or in compliance with applicable exemptions therefrom, the registration and qualification requirements of all applicable securities laws of states of the United States and all other provisions of applicable securities laws of States of the United States, including, without limitation, anti-fraud provisions.

Valid Issuance of Stock. (a) The Purchased SharesShares and the Warrants, when issued, sold and delivered in accordance with the terms of this Agreement for the consideration provided for herein, will be duly and validly issued, fully paid and nonassessable. The Conversion Shares and the Warrant Shares have been duly and validly reserved for issuance and, upon issuance in accordance with the terms of the Series A CertificateCertificate or the Warrants, as applicable, will be duly and validly issued, fully paid and nonassessable. (b) Based in part on the representations made by the Investor in Section 4 hereof, the Purchased Shares and the Warrants and (assuming no change in applicable law and no unlawful distribution of Purchased Shares by the Investor or other parties) the Conversion Shares and the Warrant Shares will be issued in full compliance with the registration and prospectus delivery requirements of the U.S. Securities Act of 1933, as amended (the "1933 Act") or in compliance with applicable exemptions therefrom and the registration and qualification requirements of all applicable state securities laws; provided that, with respect to the Conversion Shares and the Warrant Shares, no commission or other remuneration is paid or given, directly or indirectly, for soliciting the issuance of Conversion Shares or the Warrant Shares upon the conversion of the Purchased Shares or exercise of the Warrants, if applicable, and no additional consideration is paid for the Conversion Shares or the Warrant Shares other than surrender of the applicable Purchased Shares or the Warrants upon conversion or exercise thereof in accordance with the Series A CertificateCertificate or the Warrants, as applicable. (c) The outstanding shares of the capital stock of the Company are duly and validly issued, fully paid and nonassessable, and such shares of capital stock, and all outstanding options, warrants, convertible notes and other securities of the Company, have been issued in full compliance with the registration and prospectus delivery requirements of the 1933 Act or in compliance with applicable exemptions therefrom, therefrom and the registration and qualification requirements of all applicable state securities laws of states of the United States and all other provisions of applicable securities laws of States of the United States, including, without limitation, anti-fraud provisionslaws.

Valid Issuance of Stock. (a) The Purchased Shares, when issued, sold and delivered in accordance with the terms of this Agreement for the consideration provided for herein, will be duly and validly issued, fully paid and nonassessablenon-assessable. The Conversion Shares have been duly and validly reserved for issuance and, upon issuance in accordance with the terms of the Series A Restated Certificate, will be duly and validly issued, fully paid and nonassessablenon-assessable. (b) Based in part on the representations made by the Investor Purchaser in Section 4 hereof, the Purchased Shares and (assuming no change in applicable law and no unlawful distribution of Purchased Shares by the Investor Purchaser or other parties) the Conversion Shares will be issued in full compliance with the registration and prospectus delivery requirements of the U.S. Securities Act of 1933, as amended (the "1933 Act") or in compliance with applicable exemptions therefrom, and the registration and qualification requirements of all applicable state securities lawsthe California Corporate Securities Law of 1968, as amended, and the rules thereunder (the "Law"); provided that, that with respect to the Conversion Shares, no commission or other remuneration is paid or given, directly or indirectly, for soliciting the issuance of Conversion Shares upon the conversion of the Purchased Shares and no additional consideration is paid for the Conversion Shares other than surrender of the applicable Purchased Shares upon conversion thereof in accordance with the Series A Restated Certificate. (c) The outstanding shares of the capital stock of the Company are duly and validly issued, fully paid and nonassessablenon-assessable, and such shares of such capital stock, and all outstanding options, warrants, convertible notes and other securities of the Company, have been issued in full compliance with the registration and prospectus delivery requirements of the 1933 Act or in compliance with applicable exemptions therefrom, the registration and qualification requirements of all applicable securities laws of states of the United States and all other provisions of applicable securities laws of States states of the United States, including, without limitation, anti-fraud provisions.

Valid Issuance of Stock. (a) The Purchased Any shares issued upon the conversion of the Note and exercise of the Warrant (the "Conversion Shares"), when issued, sold and delivered in accordance with the terms of this Agreement for the consideration provided for herein, will be duly and validly issued, fully paid and nonassessable. The Conversion Shares have been duly and validly reserved ----------------- for issuance and, upon issuance in accordance with the terms of the Series A CertificateNote, will be duly and validly issued, fully paid and nonassessable. (b) Based in part on the representations made by the Investor Template in Section 4 --------- 3 hereof, the Purchased Conversion Shares and (assuming no change in applicable law and no unlawful distribution of Purchased the Conversion Shares by the Investor Template or other parties) the Conversion Shares will be issued in full compliance with the registration and prospectus delivery requirements of the U.S. Securities Act of 1933, as amended (the "1933 Act") and the registration and qualification requirements of all applicable state securities laws); -------- provided that, with respect to the Conversion Shares, no ------------- commission or other remuneration is paid or given, directly or indirectly, for soliciting the issuance of Conversion Shares upon the conversion of the Purchased Shares and no additional consideration is paid for the Conversion Shares other than surrender of the applicable Purchased Shares upon conversion thereof Note in accordance with the Series A CertificateNote or exercise of the Warrant in accordance with the terms of the Warrant, as the case may be. (c) The outstanding shares of the capital stock of and the Company are duly and validly issued, fully paid and nonassessable, and such shares of capital stock, and all outstanding options, warrants, convertible notes and other securities of the Company, have been issued in full compliance with the registration and prospectus delivery requirements of the 1933 Act or in compliance with applicable exemptions therefrom, the registration and qualification requirements of all applicable securities laws of states of the United States and all other provisions of applicable securities laws of States states of the United States, including, without limitation, anti-fraud provisions. The Conversion Shares will be free of any liens or encumbrances other than any liens or encumbrances created by or imposed upon the holders; provided, however, that --------- ------- the Conversion Shares may be subject to restrictions on transfer under state and/or federal securities laws as set forth herein. The Conversion Shares will not be subject to any preemptive rights or rights of first refusal which have not been waived.

Valid Issuance of Stock. (a) The Purchased Series B Shares, when issued, sold and delivered in accordance with the terms of this Agreement for the consideration provided for herein, will be duly and validly issued, fully paid and nonassessable. The Conversion Shares have been duly and validly reserved for issuance and, upon issuance in accordance with the terms of the Series A CertificateRestated Articles, will be duly and validly issued, fully paid and nonassessable. (b) Based in part on the representations made by the Investor in Section 4 hereof, the Purchased Series B Shares and (assuming no change in applicable law and no unlawful distribution of Purchased Series B Shares by the Investor or other parties) the Conversion Shares will be issued in full compliance with the registration and prospectus delivery requirements of the U.S. Securities Act of 1933, as amended (the "1933 Act") and the registration and qualification requirements of all -------- the State of Washington or in compliance with applicable state securities laws; exemptions therefrom (provided that, with respect to the Conversion Shares, no commission or other remuneration is paid or given, directly or indirectly, for soliciting the issuance of Conversion Shares upon the conversion of the Purchased Series B Shares and no additional consideration is paid for the Conversion Shares other than surrender of the applicable Purchased Series B Shares upon conversion thereof in accordance with the Series A CertificateRestated Articles). (c) The outstanding shares of the capital stock of the Company are duly and validly issued, fully paid and nonassessable, and such shares of such capital stock, and all outstanding options, warrants, convertible notes and other securities of the Company, have been issued in full compliance with the registration and prospectus delivery requirements of the 1933 Act or in compliance with applicable exemptions therefrom, the registration and qualification requirements of all applicable securities laws of states of the United States and all other provisions of applicable securities laws of States of the United States, including, without limitation, anti-fraud provisions.

Valid Issuance of Stock. (a) The 5.1 As of the Closing, the Purchased SharesStock, when issued, sold and delivered in accordance with the terms of this Agreement and for the consideration provided for hereinset forth in this Agreement, will be duly and validly issued, fully paid and nonassessablenonassessable and free of Liens and other restrictions on transfer other than restrictions on transfer under this Agreement, the Shareholders’ Agreement, applicable securities laws and liens or encumbrances created by or imposed by the relevant Purchaser. The Subject in part to the accuracy of the representations of the Purchaser in Schedule 7 of this Agreement, the Purchased Stock will be issued in compliance with all applicable securities laws. As of the Closing, the Conversion Shares Stock will have been duly and validly reserved for issuance andissuance, and upon issuance in accordance with the terms of the Series A CertificateCertificate of Incorporation, will be validly issued, fully paid and nonassessable and free of Liens and other restrictions on transfer other than restrictions on transfer under the Transaction Documents, applicable securities laws and liens or encumbrances created by or imposed by the relevant Purchaser. The Conversion Stock will be issued in compliance with all applicable securities laws. 5.2 As of the Closing, all presently outstanding Common Stock and Preferred Stock of the Company were duly and validly issued, fully paid and nonassessable. non-assessable, and are free and clear of any Liens and free of restrictions on transfer (b) Based in part except for any restrictions on the representations made by the Investor in Section 4 hereof, the Purchased Shares and (assuming no change in transfer under Transaction Documents or applicable law and no unlawful distribution of Purchased Shares by the Investor or other parties) the Conversion Shares will be issued in full compliance with the registration and prospectus delivery requirements of the U.S. Securities Act of 1933, as amended (the "1933 Act"securities laws) and the registration and qualification requirements of all applicable state securities laws; provided that, with respect to the Conversion Shares, no commission or other remuneration is paid or given, directly or indirectly, for soliciting the issuance of Conversion Shares upon the conversion of the Purchased Shares and no additional consideration is paid for the Conversion Shares other than surrender of the applicable Purchased Shares upon conversion thereof in accordance with the Series A Certificate. (c) The outstanding shares of the capital stock of the Company are duly and validly issued, fully paid and nonassessable, and such shares of capital stock, and all outstanding options, warrants, convertible notes and other securities of the Company, have been issued in full compliance in all material respects with the registration and prospectus delivery requirements of the 1933 Act or in compliance with applicable exemptions therefrom, the registration and qualification requirements of all applicable securities laws of states of the United States and all other provisions of applicable securities laws of States of the United Statesregulations, including, without limitationto the extent applicable, anti-fraud provisionsthe Securities Act.

Valid Issuance of Stock. (a) The Purchased Shares, when issued, sold and delivered in accordance with the terms of this Agreement for the consideration provided for herein, will be duly and validly issued, fully paid and nonassessable. The Conversion Shares have been duly and validly reserved for issuance and, upon issuance in accordance with the terms of the Series A CertificateArticles and Certificate of Designation, will be duly and validly issued, fully paid and nonassessable. (b) Based in part on the representations made by the Investor in Section 4 3 hereof, the Purchased Shares and (assuming no change in applicable law and no unlawful distribution of Purchased Shares by the Investor or other parties) the Conversion Shares will be issued pursuant to an exemption from or in full compliance with the registration and prospectus delivery requirements of the U.S. Securities Act of 1933, as amended (the "1933 Act") and the registration and qualification requirements of all applicable state securities lawslaws of the states of the United States, including, without limitation, Nevada and California; provided that, with respect to the Conversion Shares, no commission or other remuneration is paid or given, directly or indirectly, for soliciting the issuance of of: the Conversion Shares upon the conversion of the Purchased Shares and no additional consideration is paid for the Conversion Shares other than (in the case of the Conversion Shares) surrender of the applicable Purchased Shares upon conversion thereof in accordance with the Series A CertificateArticles and the Certificate of Designation. (c) The outstanding shares of the capital stock of the Company are duly and validly issued, fully paid and nonassessable, and such shares of such capital stock, and all outstanding options, warrants, convertible notes and other securities of the Company, have been issued in full compliance with the registration and prospectus delivery requirements of the 1933 Act or in compliance with applicable exemptions therefrom, the registration and qualification requirements of all applicable securities laws of the states of the United States and all other provisions of applicable securities laws of States the states of the United States, including, without limitation, anti-fraud provisions.

Valid Issuance of Stock. (a) The Purchased SharesShares and Warrant Shares have been reserved for issuance and, when issued, sold and delivered in accordance with the terms of this Agreement for the consideration provided for hereinherein or upon exercise of the Warrant in accordance with the terms thereof, will be duly and validly issued, fully paid and nonassessablenonassessable and will be free of any liens. The Conversion Shares have been duly and validly reserved for issuance and, upon issuance in accordance with the terms of the Series A CertificateRestated Articles, will be duly and validly issued, fully paid and nonassessablenonassessable and will be free of any liens. (b) Based in part on the representations made by the Investor in Section 4 hereof, the Purchased Shares Shares, the Warrant Shares, when issued in accordance with the terms of the Warrant, and (assuming no change in applicable law and no unlawful distribution of Purchased Shares by the Investor or other parties) the Conversion Shares Shares, when issued in accordance with the terms of the Restated Articles, will be issued in full compliance with the registration and prospectus delivery requirements of the U.S. Securities Act of 1933, as amended (the "1933 ActACT") ), and the registration and qualification requirements of all applicable state the securities laws; provided thatlaws of the State of California (PROVIDED THAT, with respect to the Conversion Shares and the Warrant Shares, no commission or other remuneration is paid or given, directly or indirectly, for soliciting the issuance of Conversion Shares upon the conversion of the Purchased Shares or exercise of the Warrant Shares, as the case may be, and no additional consideration is paid for the Conversion Shares other than surrender of the applicable Purchased Shares or Warrant Shares upon conversion thereof in accordance with the Series A CertificateRestated Articles). (c) The outstanding shares of the capital stock of the Company are duly and validly issued, fully paid and nonassessable, and such shares of capital stock, and all outstanding options, warrants, convertible notes and other securities of the Company, have been issued in full compliance with the registration and prospectus delivery requirements of the 1933 Act or in compliance with applicable exemptions therefrom, the registration and qualification requirements of all applicable securities laws of states of the United States and all other provisions of applicable securities laws of States of the United States, including, without limitation, anti-fraud provisions.

Valid Issuance of Stock. (a) The Purchased SharesShares and the Warrants, when issued, sold and delivered in accordance with the terms of this Agreement for the consideration provided for herein, will be duly and validly issued, fully paid and nonassessable, free and clear of any liens, claims, encumbrances, or preemptive rights. The Conversion Shares and the Warrant Shares have been duly and validly reserved for issuance and, upon issuance in accordance with the terms of the Series A CertificateArticles of Amendment, will be duly and validly issued, fully paid and nonassessable, free and clear of any liens, claims, encumbrances or preemptive rights. The Purchased Shares shall have the rights, privileges and preferences set forth in the Articles of Amendment. (b) Based in part on the representations and warranties made by the Investor Investors in Section 4 6 hereof, and assuming compliance by Cruttenden Roth (the "Placement Agent") with all ▇▇ ▇he requirements of Regulation D governing the offering of the Purchased Shares and the Warrants, the Purchased Shares and (assuming no change in applicable law and no unlawful distribution of the Purchased Shares or the Warrants by the Investor or other parties) Investors), the Conversion Shares and the Warrant Shares will be issued in full compliance with the registration and prospectus delivery requirements of the U.S. Securities Act of 19331933 (as in effect on the date hereof), as amended (or in compliance with applicable exemptions therefrom, and with the "1933 Act") and the registration and qualification requirements securities laws of all applicable state securities laws; provided that, with respect to the Conversion Shares, no commission or other remuneration is paid or given, directly or indirectly, for soliciting the issuance of Conversion Shares upon the conversion those states of the Purchased Shares and no additional consideration is paid for United States (as in effect on the Conversion Shares other than surrender of date hereof) in which the applicable Purchased Shares upon conversion thereof in accordance with the Series addresses shown on Exhibit A Certificateare located. (c) The outstanding shares of the capital stock of the Company Corporation are duly and validly issued, fully paid and nonassessable, and such shares of such capital stock, and all outstanding options, warrants, convertible notes and other securities of the CompanyCorporation, have been issued in full compliance with the registration and prospectus delivery requirements of the Securities Act of 1933, as amended (the "1933 Act Act"), or in compliance with applicable exemptions therefrom, the registration and qualification requirements of all applicable securities laws of states of the United States States, or in compliance with applicable exemptions therefrom, and all other provisions of applicable securities laws of States states of the United States, including, without limitation, anti-fraud provisions.

Valid Issuance of Stock. (a) The Purchased Preferred Shares, when issued, sold issued and delivered paid for as provided in accordance with the terms of this Agreement for the consideration provided for herein, will be duly authorized and validly issued, fully paid and nonassessable. The Conversion Shares have been duly and validly reserved for issuance and, when issued upon issuance conversion in accordance with the terms of Restated Certificate (assuming no change in the Series A Certificate, Restated Certificate or in applicable law) will be duly authorized and validly issued, fully paid and nonassessable. (b) Based in part on the representations made by the Investor Adaptec in Section 4 hereof, the Purchased offer and sale of the Preferred Shares solely to Adaptec in accordance with this Agreement and (assuming no change in currently applicable law and or the Restated Certificate, no unlawful distribution transfer of Purchased Preferred Shares by the Investor or other parties) the Conversion Shares will be issued in full compliance with the registration an holder thereof and prospectus delivery requirements of the U.S. Securities Act of 1933, as amended (the "1933 Act") and the registration and qualification requirements of all applicable state securities laws; provided that, with respect to the Conversion Shares, no commission or other remuneration is paid or given, directly or indirectly, for soliciting the issuance of Conversion Shares upon the conversion of the Purchased Shares and no additional consideration is paid for Preferred Shares) the Conversion Shares other than surrender are exempt from the registration and prospectus delivery requirements of the applicable Purchased Shares upon conversion thereof in accordance with 1933 Act and the Series A Certificatesecurities registration and qualification requirements of the currently effective provisions of the securities laws of the States of Colorado and California. (c) The outstanding shares of the capital stock of the Company Chaparral are duly authorized and validly issued, fully paid and nonassessable, and such have been approved by all requisite stockholder action. Such shares of such capital stock, and all outstanding options, warrants, convertible notes and other securities of the CompanyChaparral, have been issued in full compliance with the registration and prospectus delivery requirements of the 1933 Act or in compliance with applicable exemptions therefrom, the registration and qualification requirements of all applicable securities laws of states of the United States and all other provisions of applicable securities laws of States of the United States, including, without limitation, anti-fraud antifraud provisions.

Valid Issuance of Stock. (a) The Purchased Shares, when issued, sold and delivered in accordance with the terms of this Agreement for the consideration provided for herein, will be duly and validly issued, fully paid and nonassessable. The Conversion Shares have been duly and validly reserved for issuance and, upon issuance in accordance with the terms of the Series A Certificate, will be duly and validly issued, fully paid and nonassessable. (b) Based in part on the representations made by the Investor in Section 4 hereof, the Purchased Shares and (assuming no change in applicable law and no unlawful distribution of Purchased Shares by the Investor or other parties) the Conversion Shares will be issued in full compliance with the registration and prospectus delivery requirements of the U.S. Securities Act of 1933, as amended (the "1933 Act") and the registration and qualification requirements of all applicable state securities laws; provided that, with respect to the Conversion Shares, no commission or other remuneration is paid or given, directly or indirectly, for soliciting the issuance of Conversion Shares upon the conversion of the Purchased Shares and no additional consideration is paid for the Conversion Shares other than surrender of the applicable Purchased Shares upon conversion thereof in accordance with the Series A Certificate. (c) The outstanding shares of the capital stock of the Company are duly and validly issued, fully paid and nonassessable, and such shares of capital stock, and all outstanding options, warrants, convertible notes and other securities of the Company, have been issued in full compliance with the registration and prospectus delivery requirements of the 1933 Act or in compliance with applicable exemptions therefrom, the registration and qualification requirements of all applicable securities laws of states of the United States and all other provisions of applicable securities laws of States of the United States, including, without limitation, anti-fraud provisions.

Valid Issuance of Stock. (a) The Purchased Shares, when issued, sold and delivered in accordance with the terms of this Agreement for the consideration provided for herein, will be duly and validly issued, fully paid and nonassessable. The Conversion Shares have been duly and validly reserved for issuance and, upon issuance in accordance with the terms of the Series A CertificateRestated Articles, will be duly and validly issued, fully paid and nonassessable. Except as otherwise set forth in this Agreement, the Investors' Rights Agreement, and/or applicable state or federal securities laws, the Purchased Shares when issued, sold and delivered, and the Conversion Shares upon issuance, will have no other restrictions on transfer imposed by the Company. (b) Based in part on the representations made by the Investor Investors in Section 4 hereof, the Purchased Shares and (assuming no change in applicable law and no unlawful distribution of Purchased Shares by the Investor Investors or other parties) the Conversion Shares will be issued in full compliance with the registration and prospectus delivery requirements of the U.S. Securities Act of 1933, as amended (the "1933 Act") and the registration and qualification requirements of -------- all applicable state securities laws; laws (provided that, with respect to the Conversion -------- ---- Shares, no commission or other remuneration is paid or given, directly or indirectly, for soliciting the issuance of Conversion Shares upon the conversion of the Purchased Shares and no additional consideration is paid for the Conversion Shares other than surrender of the applicable Purchased Shares upon conversion thereof in accordance with the Series A CertificateRestated Articles). (c) The outstanding shares of the capital stock of the Company Common Stock, Series A Stock, Series B Stock, Series C Stock, Series D Stock and Series E Stock are all duly and validly authorized and issued, fully paid and nonassessable, and such shares of capital stock, and all outstanding options, warrants, convertible notes and other securities of the Company, have been were issued in full compliance with the registration and prospectus delivery requirements of the 1933 Act or in compliance with applicable exemptions therefrom, the registration and qualification requirements of all applicable federal and state securities laws of states of the United States and all other provisions of applicable securities laws of States of the United States, including, without limitation, anti-fraud provisionslaws.