1)

The consolidated financial statements referred to above are fairly presented in conformity with U.S. generally accepted accounting principles, and include all disclosures necessary for such fair presentation and disclosures required to be included therein by the laws and regulations to which the Company is subject.

2)

We have made available to you all—

a)

Financial records and related data, including the names of all related parties and all relationships and transactions with related parties.

b)

Minutes of the meetings of stockholders, directors, and committees of directors, or summaries of actions of recent meetings for which minutes have not yet been prepared.

3)

There have been no communications from the SEC or other regulatory agencies concerning noncompliance with, or deficiencies in, financial reporting practices.

4)

There are no material transactions that have not been properly recorded in the accounting records underlying the financial statements.

5)

We believe that the effects of the uncorrected financial statement misstatements summarized in the attached schedule are immaterial, both individually and in the aggregate, to the financial statements taken as a whole.

6)

We acknowledge our responsibility for the design and implementation of programs and controls to prevent and detect fraud.

7)

We have no knowledge of any fraud or suspected fraud affecting the Company involving:

a)

Management,

b)

Employees who have significant roles in internal control over financial reporting, or

c)

Others where the fraud could have a material effect on the financial statements.

8)

We have no knowledge of any allegations of fraud or suspected fraud affecting the Company’s consolidated financial statements received in communications from employees, former employees, analysts, regulators, or others.

9)

The Company has no plans or intentions that may materially affect the carrying value or classification of assets and liabilities.

10)

The following have been properly accounted for and adequately disclosed in the consolidated financial statements:

a)

Related-party relationships or transactions, including sales, purchases, loans, transfers, leasing arrangements, guarantees, and amounts receivable from or payable to related parties.

b)

Guarantees, whether written or oral, under which the Company is contingently liable.

c)

Significant estimates and material concentrations known to management that are required to be disclosed in accordance with FASB ASC 275, Risks and Uncertainties.

11)

We have identified all accounting estimates that could be material to the consolidated financial statements, including the key factors and significant assumptions underlying those estimates, and we believe the estimates and assumptions are reasonable in the circumstances, including those measured at fair value using the Black-Scholes and Monte Carlo pricing models.

12)

There are no:

a)

Violations or possible violations of laws or regulations whose effect should be considered for disclosure in the financial statements or as a basis for recording a loss contingency.

b)

Unasserted claims or assessments that our lawyer has advised us are probable of assertion and must be disclosed in accordance with FASB ASC 450, Contingencies .

c)

Other liabilities or gain or loss contingencies that are required to be accrued or disclosed by FASB ASC 450, Contingencies .

d)

Side agreements, implicit provisions, unstated customary business practices, or other arrangements (either written or oral) that affect the amount or timing of revenue reported in the financial statements and have not been disclosed to you.

13)

The Company has satisfactory title to all owned assets, and there are no liens or encumbrances on such assets nor has any asset been pledged as collateral.

14)

The Company has complied with all aspects of contractual agreements that would have a material effect on the consolidated financial statements in the event of noncompliance.

15)

The Company has appropriately reconciled its general ledger accounts to their related supporting information. All related reconciling items considered to be material were identified and included on the reconciliations and were appropriately adjusted in the financial statements. All intracompany (and

intercompany) accounts have been eliminated or appropriately measured and considered for disclosure in the financial statements.

16)

The Company does not owe the PCAOB outstanding past-due accounting support fees. Note 4 to the consolidated financial statements discloses all of the matters of which we are aware that are relevant to the Company’s ability to continue as a going concern, including significant conditions and events, and management’s plans.

17)

The Company utilized a third party specialist to assist in specific valuation procedures related to derivative debt instruments. All inputs, estimates, and assumptions provided to, and by, the third party valuation specialist were materially correct, to the best of management’s knowledge.

/s/ VICTOR LEE
Victor Lee

President and Chief Executive Officer

/s/ MICHAEL J. GILBRETH
Michael J. Gilbreth

Chief Financial Officer

/s/ KIM J. HUNTLEY
Kim J. Huntley

Audit Committee Chair