Common use of Absence of Certain Changes or Events Clause in Contracts

Absence of Certain Changes or Events. Since the date of the Company Balance Sheet, the Company has conducted its business only in the ordinary course of business consistent with past practice and there has not been: (i) any Material Adverse Change to the Company, (ii) any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, stock or property) in respect of, any of the Company’s or any of its Subsidiaries’ capital stock, or any purchase, redemption or other acquisition by the Company or any of its Subsidiaries of any of the Company’s capital stock or any other securities of the Company or its Subsidiaries or any options, warrants, calls or rights to acquire any such shares or other securities except for repurchases from employees following their termination pursuant to the terms of their pre-existing stock option or purchase agreements, (iii) any split, combination or reclassification of any of the Company’s or any of its Subsidiaries’ capital stock, (iv) entry by the Company or any of its Subsidiaries into any licensing or other agreement with regard to the disposition of any material intellectual property other than licenses, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into in the ordinary course of business consistent with past practice, (v) any material change by the Company in its accounting methods, principles or practices, except as required by concurrent changes in GAAP or by the Commission, (vi) any material revaluation by the Company of any of its assets, including, without limitation, writing down the value of capitalized inventory or writing off notes or accounts receivable other than in the ordinary course of business consistent with past practice, (vii) any communication from the Nasdaq Stock Market with respect to the delisting of the Common Stock, (viii) any cancellation by the Company or any of its Subsidiaries of any debts or waiver of any claims or rights of material value, (ix) any sale, transfer or other disposition outside of the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangible) by the Company or any of its Subsidiaries, or (x) any agreement, whether in writing or otherwise, to take any action described in this section by the Company or any of its Subsidiaries.

Absence of Certain Changes or Events. Since Except as disclosed in Schedule 3.6, since January 1, 2002, there has not been any: (a) Material Adverse Change; (b) sale, assignment or transfer of any of the date material assets of the Company Balance Sheet, the Company has conducted its business only in the ordinary course of business consistent with past practice and there has not been: (i) any Material Adverse Change to the Company, (ii) any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, stock or property) in respect of, any of the Company’s or any of its Subsidiaries’ capital stock, singly or in the aggregate, other than sales, assignments or transfers of assets in the Ordinary Course of Business consistent with past practice; (c) waiver of any material rights of value to the Company or any purchaseof its Subsidiaries, redemption except in the Ordinary Course of Business and consistent with past practice; (d) amendment, cancellation or other acquisition termination of any material Contract or Permit material to the Company or any of its Subsidiaries taken as a whole; (e) capital expenditure, execution of any Lease or the incurrence of any obligations by the Company or any of its Subsidiaries to make any capital expenditure or execute any Lease, involving payments in excess of $50,000 individually or $250,000 in the aggregate; (f) failure to pay any material obligation except those contested in good faith and for which proper reserves have been made; (g) failure to operate the Business in the Ordinary Course or to use reasonable efforts to preserve the Business intact and to preserve the goodwill of parties having business relations with the Company, its Subsidiaries or their Representatives; (h) change in any method of accounting or accounting practice by the Company or its Subsidiaries except for such change required by reason of a concurrent change in GAAP; (i) revaluation of any of the Company’s capital stock assets, including without limitation, writing off notes or accounts receivable other than those for which reserves were established in the Interim Balance Sheet; (j) damage, destruction or loss (whether or not covered by insurance) materially and adversely affecting the Company or its Subsidiaries as a whole or the operation of the Business; (k) creation of a new material Encumbrance, singly or in the aggregate, other than a Permitted Encumbrance against any other securities of the assets of the Company or its Subsidiaries or any options, warrants, calls or rights to acquire any such shares or other securities except for repurchases from employees following their termination pursuant to the terms of their pre-existing stock option or purchase agreements, Subsidiaries; (iiil) any split, combination or reclassification of any of the Company’s or any of its Subsidiaries’ capital stock, (iv) entry indebtedness incurred by the Company or any of its Subsidiaries into for borrowed or purchase money or any licensing or other agreement with regard commitment to the disposition of any material intellectual property other than licenses, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements borrow money entered into in the ordinary course of business consistent with past practice, (v) any material change by the Company in its accounting methods, principles or practices, except as required by concurrent changes in GAAP or by the Commission, (vi) any material revaluation by the Company of any of its assets, including, without limitation, writing down the value of capitalized inventory or writing off notes or accounts receivable other than in the ordinary course of business consistent with past practice, (vii) any communication from the Nasdaq Stock Market with respect to the delisting of the Common Stock, (viii) any cancellation by the Company or its Subsidiaries, or any of loans made or agreed to be made by the Company or its Subsidiaries other than indebtedness in the Ordinary Course of any debts or waiver of any claims or rights of Business to meet working capital requirements and capital expenditure requirements; (m) material value, (ix) any sale, transfer or other disposition outside of the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangible) Liability incurred by the Company or any of its Subsidiaries, or ; (xn) any agreementchange in any assumptions underlying or methods of calculating any bad debt, whether contingency or other reserves; (o) payment, discharge or satisfaction of any material Liabilities of the Company or its Subsidiaries, singly or in writing the aggregate, other than the payment, discharge or otherwise, satisfaction of Liabilities in the Ordinary Course of Business; (p) distribution or incurrence of any obligation to take make any action described in this section distribution by the Company to Seller; (q) increase in compensation or benefits payable to or to become payable to any employees, officers or directors of the Company or its Subsidiaries other than immaterial increases in the Ordinary Course of Business or any establishment of any new Employee Plans; (r) other event or condition of any character which in any one case or in the aggregate has had or might be reasonably expected to have a Material Adverse Effect; or (s) agreement by the Company, its Subsidiaries, Seller or IHC to do any of the foregoing.

Absence of Certain Changes or Events. Since June 30, 1997, except as contemplated by this Agreement, as set forth in Section 3.1(i) of the Disclosure Schedule or disclosed in the SEC Reports filed since that date and up to the date of the Company Balance Sheetthis Agreement, the Company has and its subsidiaries have conducted its business their businesses only in the ordinary course of business and in a manner consistent with past practice and and, since such date, there has not been: been (i) any condition, event or occurrence which, individually or in the aggregate, has had, or would reasonably be expected to have, a Material Adverse Change to the CompanyEffect, (ii) any declaration, setting aside termination or payment of any dividend on, or other distribution (whether in cash, stock or property) in respect cancellation of, any of the Company’s or any of its Subsidiaries’ capital stock, or any purchasemodification to, redemption any agreement, arrangement or other acquisition by the Company understanding which has had or any of its Subsidiaries of any of the Company’s capital stock or any other securities of the Company or its Subsidiaries or any options, warrants, calls or rights would reasonably be expected to acquire any such shares or other securities except for repurchases from employees following their termination pursuant to the terms of their pre-existing stock option or purchase agreementshave a Material Adverse Effect, (iii) any split, combination or reclassification of any of the Company’s or any of its Subsidiaries’ capital stock, (iv) entry by the Company or any of its Subsidiaries into any licensing or other agreement with regard to the disposition of any material intellectual property other than licenses, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into in the ordinary course of business consistent with past practice, (v) any material change by the Company in its accounting methods, principles or practices, except as required by concurrent changes in GAAP or by the Commission, (viiv) any material revaluation by the Company of any of its assetsmaterial assets other than in the ordinary course of business, consistent with past practice, (v) any entry by the Company or any of its subsidiaries into any commitment or transactions material to the Company, (vi) any declaration, setting aside or payment of any dividends or distributions in respect of the shares of Company Common Stock or any redemption, purchase or other acquisition of any of its securities, (vii) any increase in or establishment of any bonus, insurance, severance, deferred compensation, pension, retirement, profit sharing, stock option (including, without limitation, writing down the value granting of capitalized inventory stock options, stock appreciation rights, performance awards, or writing off notes restricted stock awards), stock purchase or accounts receivable other employee benefit plan or agreement or arrangement, or any other increase in the compensation payable or to become payable to any officers or key employees of the Company or any of its subsidiaries other than in the ordinary course of business consistent with past practicepractice or as was required under employment, (vii) any communication from the Nasdaq Stock Market with respect to the delisting severance or termination agreements in effect as of the Common StockJune 30, 1997, (viii) any cancellation bonus paid to the employees of the Company or its subsidiaries other than in the ordinary course of business and consistent with past practice, (ix) any sale or transfer of any material assets of the Company or its subsidiaries other than in the ordinary course of business and consistent with past practice or (x) any loan, advance or capital contribution to or investment in any person in an aggregate amount in excess of $100,000 by the Company or any of its Subsidiaries of subsidiary (excluding any debts loan, advance or waiver of any claims capital contribution to, or rights of material valueinvestment in, (ix) any sale, transfer or other disposition outside of the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangible) by the Company or any of its Subsidiaries, or (x) any agreement, whether in writing or otherwise, to take any action described in this section wholly owned subsidiary and except for drawdowns by the Company or any of under its Subsidiariescredit facility).

Absence of Certain Changes or Events. Since the date of the Company Balance Sheet, the Company has conducted its business only in the ordinary course of business consistent with past practice and Sheet there has not been: (i) any Material Adverse Change to Effect on the Company, (ii) any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, stock or property) in respect of, any of the Company’s 's or any of its Subsidiaries’ subsidiaries' capital stock, or any purchase, redemption or other acquisition by the Company or any of its Subsidiaries of any of the Company’s 's capital stock or any other securities of the Company or its Subsidiaries subsidiaries or any options, warrants, calls or rights to acquire any such shares or other securities except for repurchases from employees following their termination pursuant to the terms of their pre-existing stock option or purchase agreements, (iii) any split, combination or reclassification of any of the Company’s 's or any of its Subsidiaries’ subsidiaries' capital stock, (iv) except as set forth in Part 2.6 of the Company Schedules, any granting by the Company or any of its subsidiaries of any increase in compensation or fringe benefits, except for normal increases of cash compensation in the ordinary course of business consistent with past practice, or any payment by the Company or any of its subsidiaries of any bonus, except for bonuses made in the ordinary course of business consistent with past practice, or (v) any granting by the Company or any of its subsidiaries of any increase in severance or termination pay or (vi) any entry by the Company or any of its subsidiaries into any currently effective employment, severance, termination or indemnification agreement or any other agreement the benefits of which are contingent or the terms of which are materially altered upon the occurrence of a transaction involving the Company of the nature contemplated hereby, (vii) entry by the Company or any of its Subsidiaries subsidiaries into any licensing or other agreement with regard to the acquisition or disposition of any material intellectual property Intellectual Property (as defined in Section 2.9) other than licenses, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into licenses in the ordinary course of business consistent with past practice, (vviii) any amendment or consent with respect to any licensing agreement filed or required to be filed by the Company with the SEC, (ix) any material change by the Company in its accounting methods, principles or practices, except as required by concurrent changes in GAAP or by the CommissionGAAP, (vix) any material revaluation by the Company of any of its assets, including, without limitation, writing down the value of capitalized inventory or writing off notes or accounts receivable other than in the ordinary course of business and consistent with past practice, ; or (viixi) any communication from changes in the Nasdaq Stock Market with respect to the delisting vesting schedules of the Common Stock, (viii) any cancellation by the outstanding Company or any of its Subsidiaries of any debts or waiver of any claims or rights of material value, (ix) any sale, transfer or other disposition outside of the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangible) by the Company or any of its Subsidiaries, or (x) any agreement, whether in writing or otherwise, to take any action described in this section by the Company or any of its SubsidiariesOptions.

Absence of Certain Changes or Events. Since Except for liabilities incurred in connection with this Agreement or as expressly permitted pursuant to Section 4.01(a)(i) through (xiv), since the date of the most recent financial statements included in the Filed Company Balance SheetSEC Documents, the Company has and its Subsidiaries have conducted its business their respective businesses only in the ordinary course of business consistent with past practice practice, and there has not been: (i) been any Material Adverse Change to Change, and from such date until the Company, date hereof there has not been (iii) any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, stock or property) in with respect of, to any capital stock of the Company’s Company or any of its Subsidiaries’ capital stock, other than (x) cash dividends payable by the Company in respect of shares of Company Common Stock consistent with past practice and not exceeding $0.10 per share of Company Common Stock per fiscal quarter or (y) dividends or distributions by a direct or indirect wholly owned Subsidiary of the Company to its shareholders, (ii) any purchase, redemption or other acquisition by the Company or any of its Subsidiaries of any shares of the Company’s capital stock or any other securities of the Company or any of its Subsidiaries or any options, warrants, calls or rights to acquire any such shares or other securities except for repurchases from employees following their termination pursuant to securities, other than in connection with net share withholding in connection with the terms vesting of their pre-existing stock option or purchase agreementsCompany Restricted Stock, (iii) any split, combination or reclassification of any capital stock of the Company’s Company or any of its Subsidiaries’ Subsidiaries or any issuance or the authorization of any issuance of any other securities in respect of, in lieu of or in substitution for shares of their respective capital stock, (iv) (A) any granting by the Company or any of its Subsidiaries to any current or former (1) director of the Company or any of its Subsidiaries or (2) employee of the Company or any of its Subsidiaries who is treated as a Tier I Employee (a “Tier I Employee”) or Tier II Employee (a “Tier II Employee”) for purposes of the Company’s Change in Control Severance Pay Plan for Select Employees (all individuals described in the foregoing clauses (1) and (2) of this clause (A), collectively, the “Key Personnel”) of any increase in compensation, bonus or fringe or other benefits, except for normal increases in cash compensation (including cash bonuses) in the ordinary course of business consistent with past practice or as was required under any Company Benefit Agreement or Company Benefit Plan, (B) any granting by the Company or any of its Subsidiaries to any Key Personnel of (1) any increase in severance or termination pay or (2) any right to receive any severance or termination pay except for severance or termination pay received in the ordinary course of business consistent with past practice or as was required under any Company Benefit Agreement or Company Benefit Plan, (C) any entry by the Company or any of its Subsidiaries into into, or any licensing amendments of, (1) any employment, deferred compensation, consulting, severance, change of control, termination or other agreement indemnification Contract with regard to any Key Personnel or (2) any Contract with any Key Personnel the disposition benefits of which are contingent, or the terms of which are materially altered, upon the occurrence of a transaction involving the Company of a nature contemplated by this Agreement (all such Contracts under this clause (C), collectively, “Company Benefit Agreements”), (D) the removal or modification of any material intellectual property other than licenses, distribution agreements, advertising agreements, sponsorship agreements restrictions in any Company Benefit Agreement or merchant program agreements entered into in the ordinary course of business consistent with past practice, (v) any material change by the Company in its accounting methods, principles Benefit Plan or practicesawards made thereunder, except as required by concurrent changes to comply with applicable Law or any Company Benefit Agreement or Company Benefit Plan in GAAP effect as of the date hereof or by (E) the Commissionadoption, (vi) any material revaluation by the Company amendment or termination of any of its assetsCompany Benefit Plan, includingother than, without limitation, writing down the value of capitalized inventory or writing off notes or accounts receivable other than in the ordinary course cases of business consistent with past practice, clauses (vii) any communication from the Nasdaq Stock Market with respect to the delisting of the Common Stock, (viii) any cancellation by the Company or any of its Subsidiaries of any debts or waiver of any claims or rights of material value, (ix) any sale, transfer or other disposition outside of the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangible) by the Company or any of its Subsidiaries, or (x) any agreement, whether in writing or otherwise, to take any action described in this section by the Company or any of its Subsidiaries.A),

Absence of Certain Changes or Events. Since the date of the Company Balance Sheet, the Company has conducted its business only in the ordinary course of business consistent with past practice and there has not been: (i) any Material Adverse Change to the Company, (ii) any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, stock or property) in respect of, any of the Company’s or any of its Subsidiaries’ capital stock, or any purchase, redemption or other acquisition by the Company or any of its Subsidiaries of any of the Company’s capital stock or any other securities of the Company or its Subsidiaries or any options, warrants, calls or rights to acquire any such shares or other securities except for repurchases from employees following their termination pursuant to the terms of their pre-existing stock option or purchase agreements, (iii) any split, combination or reclassification of any of the Company’s or any of its Subsidiaries’ capital stock, (iv) entry by the Company or any of its Subsidiaries into any licensing or other agreement with regard to the disposition of any material intellectual property other than licenses, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into in the ordinary course of business consistent with past practice, (v) any material change by the Company in its accounting methods, principles or practices, except as required by concurrent changes in GAAP or by the Commission, (vi) any material revaluation by the Company of any of its assets, including, without limitation, writing down the value of capitalized inventory or writing off notes or accounts receivable other than in the ordinary course of business consistent with past practice, (vii) any communication from the Nasdaq Stock Global Market with respect to the delisting of the Common Stock, (viii) any cancellation by the Company or any of its Subsidiaries of any debts or waiver of any claims or rights of material value, (ix) any sale, transfer or other disposition outside of the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangible) by the Company or any of its Subsidiaries, or (x) any agreement, whether in writing or otherwise, to take any action described in this section by the Company or any of its Subsidiaries.

Absence of Certain Changes or Events. Since the date of Except as disclosed in the Company Balance SheetDisclosure Schedule or in the SEC Documents filed and publicly available prior to the Agreement Date (the "FILED SEC DOCUMENTS"), since June 30, 1998 the Company has and its Subsidiaries have conducted its their respective business only in the ordinary course of business consistent with past practice practices, and up to the Agreement Date, there has not been: been with respect to the Company or any of its Subsidiaries any: (i) any Material Adverse Change to the Company, Change; (ii) amendment or change in the Certificate of Incorporation or Bylaws of the Company; (iii) purchase, license, sale, assignment or other disposition or transfer (or any agreement or other arrangement for the purchase, license, sale, assignment or other disposition or transfer), of any of the assets or properties of the Company or any of its Subsidiaries (including any Intellectual Property Rights), other than (a) non-exclusive licenses of any product or products of the Company or any of its Subsidiaries made in the ordinary course of the Company's business consistent with its past practices, (b) purchases and sales of assets (other than Intellectual Property Rights (as defined in Section 4.1(i)) in the ordinary course of business consistent with its past practices, and (c) purchases and sales of assets (other than Intellectual Property Rights) having a purchase price of less than $100,000 on an individual basis and less than $250,000 in aggregate; (iv) damage, destruction or loss of any property or asset, whether or not covered by insurance, having (or reasonably likely with the passage of time to have) a Material Adverse Effect on the Company; (v) declaration, setting aside or payment of any dividend on, or the making of any other distribution (whether in cash, stock or property) in respect of, any shares of the capital stock of the Company’s , any split, combination or recapitalization of the capital stock of the Company or any direct or indirect redemption, purchase or other acquisition of any shares of the capital stock of the Company or any change in any rights, preferences, privileges or restrictions of any outstanding stock or other security of the Company; (vi) obligation or liability incurred by the Company or any of its Subsidiaries’ capital stock, Subsidiaries to any of its officers or any purchase, redemption or other acquisition directors except for normal and customary compensation and expense allowances payable to officers in the ordinary course of the Company's business consistent with past practices; (vii) making by the Company or any of its Subsidiaries of any loan, advance or capital contribution to, or any investment in, any officer or director of the Company or, to the knowledge of the Company’s , any firm or business enterprise in which any such person had a direct or indirect material interest at the time of such loan, advance, capital stock contribution or investment; (viii) material adverse development in any other securities litigation described in any Filed SEC Document or in any litigation or proceeding required to be disclosed in Section 4.1(j) of the Company Disclosure Schedule; (ix) material increase in the volume or its Subsidiaries dollar amount of returns (or any options, warrants, calls or rights to acquire any such shares or other securities except for repurchases from employees following their termination pursuant to the terms of their pre-existing stock option or purchase agreements, (iiiclaims therefor) any split, combination or reclassification of any of the Company’s 's products by distributors, customers, value added resellers, original equipment manufacturers or other resellers of such product, or any claims for price adjustments by any such parties with respect to any products of its Subsidiaries’ capital stockthe Company that have been delivered to such party, or any reason to believe that any such increases or claims are likely; (ivx) entry by material change in the manner in which, or terms on which, the Company or any of its Subsidiaries into extends discounts or credits or rights to return products or receive price adjustments to customers or distributors or otherwise deals with its customers or distributors; (xi) change in accounting methods, principles or practices by the Company (other than as required by GAAP) or any licensing or other agreement with regard to the disposition material revaluation of any of the assets of the Company or any of its Subsidiaries, or any material intellectual property other than licenses, distribution agreements, advertising agreements, sponsorship agreements write-offs of accounts receivable or merchant program agreements entered into write-downs of the value of capitalized inventory not in the ordinary course of business consistent with past practicepractices; or (xii) license, transfer or grant of a right under any Company IP Rights (v) any material change by the Company as defined in its accounting methodsSection 4.1(i), principles or practices, except as required by concurrent changes in GAAP or by the Commission, (vi) any material revaluation by the Company of any of its assets, including, without limitation, writing down the value of capitalized inventory or writing off notes or accounts receivable other than non-exclusive licenses granted in the ordinary course of the Company's business consistent with its past practice, (vii) any communication from the Nasdaq Stock Market with respect to the delisting of the Common Stock, (viii) any cancellation by the Company or any of its Subsidiaries of any debts or waiver of any claims or rights of material value, (ix) any sale, transfer or other disposition outside of the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangible) by the Company or any of its Subsidiaries, or (x) any agreement, whether in writing or otherwise, to take any action described in this section by the Company or any of its Subsidiariespractices.

Absence of Certain Changes or Events. Since Except as disclosed in the SEC Documents filed and publicly available prior to the date of this Agreement (as amended to the date of this Agreement, the "Filed SEC Documents") or in Section 4.01(h) of the Company Disclosure Schedule or as otherwise expressly contemplated by the Transaction Agreements, since the date of the Company Balance Sheetmost recent audited financial statements included in the Filed SEC Documents, the Company has and its subsidiaries have conducted its business the Retained Business only in the ordinary course of business consistent with past practice practice, and there has not been: been (i) any Material Adverse Change event, change or development which individually or in the aggregate has had or would reasonably be expected to have a material adverse effect on the CompanyRetained Companies or on the GBC Companies or would impair the ability of the Retained Companies or the GBC Companies, as the case may be, to consummate the transactions contemplated by, or to satisfy their obligations under, the Transaction Agreements, (ii) any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, stock or property) in with respect of, to any of the Company’s or any of its Subsidiaries’ 's capital stock, or any purchase, redemption or other acquisition by the Company or any of its Subsidiaries of any of the Company’s capital stock or any other securities of the Company or its Subsidiaries or any options, warrants, calls or rights to acquire any such shares or other securities except for repurchases from employees following their termination pursuant to the terms of their pre-existing stock option or purchase agreementsthan regular quarterly cash dividends, (iii) any split, combination or reclassification of any of the Company’s 's capital stock or any issuance or the authorization of any issuance of any other securities in respect of, in lieu of or in substitution for shares of its Subsidiaries’ capital stock, (iv) entry (x) any granting by the Company or any of its Subsidiaries into subsidiaries to any licensing or other agreement with regard to employee who will be a Retained Employee (as defined in the disposition Distribution Agreement) of any material intellectual property other than licensesincrease in compensation, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into except for increases in the ordinary course of business consistent with past practice, (vy) any material change granting by the Company in its accounting methods, principles or practices, except as required by concurrent changes in GAAP or by the Commission, (vi) any material revaluation by the Company of any of its assetssubsidiaries to any such employee of any increase in severance or termination pay, including, without limitation, writing down the value of capitalized inventory or writing off notes or accounts receivable other than except in the ordinary course of business consistent with past practicepractice or as was required under any employment, severance or termination agreements in effect as of the date of the most recent audited financial statements included in the Filed SEC Documents, or (viiz) any communication from the Nasdaq Stock Market with respect to the delisting of the Common Stock, (viii) any cancellation entry by the Company or any of its Subsidiaries of subsidiaries into any debts employment, consulting, severance, termination or waiver of indemnification agreement with any claims or rights of material valuesuch employee, (ixv) any saledamage, transfer destruction or other disposition outside of loss, whether or not covered by insurance, that has had or would reasonably be expected to have a material adverse effect on the ordinary course of business of Retained Companies or on the GBC Companies or (vi) except insofar as may have been disclosed in the Filed SEC Documents or required by a change in GAAP, any properties change in accounting methods, principles or assets (real, personal or mixed, tangible or intangible) practices by the Company materially affecting the assets, liabilities or any businesses of its Subsidiaries, or (x) any agreement, whether in writing or otherwise, to take any action described in this section by the Company or any of its SubsidiariesRetained Companies.

Absence of Certain Changes or Events. Since the date of December 31, 1998, Company and the Company Balance Sheet, the Company has Subsidiaries have conducted its business their businesses in all material respects only in the ordinary course of business consistent with past practice and and, since such date, there has not been: been (i) any Company Material Adverse Change Effect, (ii) any event that could reasonably be expected to prevent or materially delay the performance of Company's obligations pursuant to this Agreement and the consummation of the Merger by Company, (iiiii) any material change by Company in its accounting methods, principles or practices, (iv) any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, stock or property) in respect of, any of the Company’s shares of Company Common Stock or any of its Subsidiaries’ capital stockredemption, or any purchase, redemption purchase or other acquisition by the Company or any of its Subsidiaries of any of the Company’s capital stock or any other securities of the Company or its Subsidiaries or any options's securities, warrants, calls or rights to acquire any such shares or other securities (v) except for repurchases from employees following their termination pursuant to the terms of their pre-existing stock option or purchase agreements, (iii) any split, combination or reclassification of any of the Company’s or any of its Subsidiaries’ capital stock, (iv) entry by the Company or any of its Subsidiaries into any licensing or other agreement with regard to the disposition of any material intellectual property other than licenses, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into changes in the ordinary course of business consistent with past practicepractice that only affect non-officer employees of the Company, any increase in the compensation or benefits or establishment of any bonus, insurance, severance, deferred compensation, pension, retirement, profit sharing, stock option (v) including, without limitation, the granting of stock options, stock appreciation rights, performance awards or restricted stock awards), stock purchase or other employee benefit plan, or any material change by other increase in the compensation payable or to become payable to any employees, officers, consultants or directors of Company in its accounting methods, principles or practices, except as required by concurrent changes in GAAP or by the Commissionany Company Subsidiary, (vi) any material revaluation by the Company issuance or sale of any stock, notes, bonds or other securities other than pursuant to offerings registered under the Securities Act or pursuant to the exercise of its assetsoutstanding securities, includingor entering into any agreement with respect thereto, without limitation(vii) any amendment to the Company's certificate of incorporation or bylaws, writing down the value of capitalized inventory or writing off notes or accounts receivable (viii) other than in the ordinary course of business consistent with past practice, any (viix) purchase, sale, assignment or transfer of any communication from the Nasdaq Stock Market with respect to the delisting of the Common Stockmaterial assets, (viiiy) any cancellation by the Company mortgage, pledge or any of its Subsidiaries existence of any debts lien, encumbrance or charge on any material assets or properties, tangible or intangible, except for liens for Taxes not yet delinquent and such other liens, encumbrances or charges which do not, individually or in the aggregate, have a Company Material Adverse Effect, or (z) waiver of any claims or rights of material valuevalue or cancellation or any material debts or claims, (ix) any saleincurrence of any material liability (absolute or contingent), transfer or other disposition outside of except for current liabilities and obligations incurred in the ordinary course of business of any properties or assets (realconsistent with past practice, personal or mixed, tangible or intangible) by the Company or any of its Subsidiaries, or (x) any agreementincurrence of any damage, destruction or similar loss, whether in writing or otherwisenot covered by insurance, to take any action described in this section by materially affecting the business or properties of Company or any Company Subsidiary, or (xi) any entering into any transaction of its Subsidiariesa material nature other than in the ordinary course of business, consistent with past practice.

Absence of Certain Changes or Events. Since Between the date of the Company Balance SheetSheet and the date hereof, the Company has conducted its business only in the ordinary course of business consistent with past practice and there has not been: (i) any event or occurrence which has had a Material Adverse Change to Effect on the Company, (ii) any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, stock or property) in respect of, any of the Company’s 's or any of its Subsidiaries’ subsidiaries' capital stock, or any purchase, redemption or other acquisition by the Company or any of its Subsidiaries of any of the Company’s 's capital stock or any other securities of the Company or its Subsidiaries subsidiaries or any options, warrants, calls or rights to acquire any such shares or other securities except for repurchases from employees employees, directors or consultants following the termination of their termination services pursuant to the terms of their pre-existing stock option or purchase agreements, (iii) any split, combination or reclassification of any of the Company’s 's or any of its Subsidiaries’ subsidiaries' capital stock, (iv) any granting by the Company or any of its subsidiaries of any increase in compensation or fringe benefits, except for normal increases of cash compensation in the ordinary course of business consistent with past practice, or any payment by the Company or any of its subsidiaries of any bonus, except for bonuses made in the ordinary course of business consistent with past practice, or any granting by the Company or any of its subsidiaries of any increase in severance or termination pay or any entry by the Company or any of its subsidiaries into any currently effective employment, severance, termination or indemnification agreement or any agreement the benefits of which are contingent or the terms of which are materially altered upon the occurrence of a transaction involving the Company of the nature contemplated hereby, (v) entry by the Company or any of its Subsidiaries subsidiaries into any licensing or other agreement with regard to the acquisition or disposition of any material intellectual property Intellectual Property (as defined in Section Section 3.9((a))) other than licenses, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into non-exclusive licenses granted in the ordinary course of business consistent with past practice, (vvi) any material change by the Company in its accounting methods, principles or practices, except as required by concurrent changes in GAAP or by the CommissionSEC requirements, or (vivii) any material revaluation by the Company of any of its assets, including, without limitation, writing down the value of capitalized inventory or writing off notes or accounts receivable other than in the ordinary course of business consistent with past practice, (vii) any communication from the Nasdaq Stock Market with respect to the delisting of the Common Stock, (viii) any cancellation by the Company or any of its Subsidiaries of any debts or waiver of any claims or rights of material value, (ix) any sale, transfer or other disposition outside of the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangible) by the Company or any of its Subsidiaries, or (x) any agreement, whether in writing or otherwise, to take any action described in this section by the Company or any of its Subsidiaries.

Absence of Certain Changes or Events. Since Except for liabilities incurred in connection with this Agreement, between December 31, 2006 and the date of the Company Balance Sheetthis Agreement, the Company has and its Subsidiaries have conducted its their business only in the ordinary course of business consistent with past practice and practice. Since December 31, 2006 through the date hereof, except as disclosed in Section 2.9 of the Company Disclosure Letter, there has not beenbeen any damage, destruction or other casualty loss in excess of $1.0 million individually or in the aggregate with respect to any asset or property owned, leased or otherwise used by the Company or any of its Subsidiaries, whether or not covered by insurance. Subsequent to December 31, 2006, through the date hereof: (ia) there has not been any Material Adverse Change to Effect on the Company; (b) other than the Cash Distribution to be made pursuant to Section 5.12(a) and the repurchase by the Company of 274,776 of its Ordinary Shares, (ii) there has not been any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, stock or property) in respect of, any of the Company’s or any of its Subsidiaries’ capital stockshare capital, or any purchase, redemption or other acquisition by the Company or any of its Subsidiaries of any of the Company’s share capital stock or any other securities of the Company or its Subsidiaries or any optionsoptions (other than Company Share Options in the ordinary course of business consistent with past practice), warrants, calls or rights to acquire any such shares or other securities except for repurchases from employees following their termination pursuant to the terms of their pre-existing stock option or purchase agreements, securities; (iiic) there has not been any split, combination or reclassification of any of the Company’s or any of its Subsidiaries’ capital stock, share capital; (ivd) entry by the Company or there has not been any of its Subsidiaries into any licensing or other agreement with regard to the disposition of any material intellectual property other than licenses, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into in the ordinary course of business consistent with past practice, (v) any material change by the Company in its accounting methods, principles or practices, except as required by concurrent changes in GAAP GAAP; (e) except as set forth in Section 2.9 of the Company Disclosure Letter, there has not been any sale, license or by the Commission, (vi) other transfer of any material revaluation by assets of the Company or its Subsidiaries other than in the ordinary course of business consistent with past practice; (f) to the Company’s Knowledge, no key employee of the Company or its Subsidiaries as of the date hereof has communicated to the Company or any of its assetsSubsidiaries (orally, includingin writing or otherwise) an intent to terminate or otherwise significantly decrease his or her contribution to the Company or its Subsidiaries; and (g) except as set forth in Section 2.9 of the Company Disclosure Letter, without limitationthere has not been any material Tax election made or any material Tax claim, writing down the value of capitalized inventory audit or writing off notes or accounts receivable assessment settled, in each case, other than in the ordinary course of business consistent with past practice, (vii) or any communication from the Nasdaq Stock Market with respect to the delisting of the Common Stock, (viii) any cancellation Tax ruling or arrangement applied for or received by the Company on its own behalf, whether or not in connection with the Merger, or to the Knowledge of the Company, on behalf of any of its Subsidiaries of any debts or waiver of any claims or rights of material valueshareholders in connection with the Merger, (ix) any sale, transfer or other disposition outside of the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangible) by the Company or any of its Subsidiaries, or (x) any agreement, whether in writing or otherwise, to take any action described except as explicitly contemplated in this section by the Company or any of its SubsidiariesAgreement.

Absence of Certain Changes or Events. Since the date Except (i) as disclosed in Section 4.7 of the Company Balance SheetDisclosure Schedule, (ii) for the Transactions or (iii) as permitted by this Agreement, since the Company Balance Sheet Date, Company and its Subsidiaries have carried on and operated their respective businesses in all material respects in the ordinary course of business consistent with past practice, and there has conducted not occurred any: (a) effect, event or change that has had or would reasonably be expected to have a Material Adverse Effect on Company; (b) sale, transfer, distribution, abandonment or other disposal of, or mortgage, pledge or imposition of any encumbrance on any property (including real estate) or other assets of Company and its business only Subsidiaries that are material to Company and its Subsidiaries taken as a whole, except for (i) sales of inventory in the ordinary course of business consistent with past practice and there has not been: (i) any Material Adverse Change to the Company, or (ii) any dispositions of obsolete or worthless assets in the ordinary course of business consistent with past practice; (c) declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, stock or property) in with respect of, to any class of the Company’s capital stock of Company or any of its Subsidiaries (other than dividends or other distributions paid to Company by its Subsidiaries’ capital stock), or any purchaserepurchase, redemption or other acquisition by the Company or any of its Subsidiaries of any of the Company’s capital stock or any other securities of the of, or other ownership interest in, Company or any of its Subsidiaries or any optionsSubsidiaries, warrants, calls or rights to acquire any such shares or other securities except for repurchases from employees following their termination pursuant to the terms Company Stock Options and Company Warrants outstanding as of their pre-existing stock option or purchase agreements, the date of this Agreement; (iiid) any split, combination or reclassification of any capital stock of Company; (e) change in financial or tax accounting methods, principles or practices by Company or its Subsidiaries, except insofar as may have been required by a change in GAAP, SEC rule or applicable Law; (f) tax election or revocation or change to any material Tax election or the Company’s settlement or compromise of any material Tax liability by Company or any of its Subsidiaries’ capital stock; (g) granting by Company or any of its Subsidiaries to any director or employee of any award or bonus or other compensation, except to the extent accrued on the Company Balance Sheet or pursuant to a Company Benefit Plan set forth on Section 4.11(a) of the Company Disclosure Schedule; (ivh) granting by Company or any of its Subsidiaries to any employee of any increase in (or acceleration of vesting or payment of) severance or termination pay, except as required under any employment, severance or termination agreements set forth on Section 4.7 of the Company Disclosure Schedule; (i) entry by the Company or any of its Subsidiaries into any licensing (or other amendment in any material respect of any existing) employment, severance or termination agreement with regard to any employee, director or officer of Company or any of its Subsidiaries; (j) entry by Company or any of its Subsidiaries into any consulting agreement with any Person; (k) acceleration of the disposition vesting of any material intellectual property other than licenses, distribution agreements, advertising agreements, sponsorship agreements option issued by Company or merchant program agreements entered into in the ordinary course any of business consistent with past practice, (v) its Subsidiaries to acquire capital stock of Company or any material change by the Company in of its accounting methods, principles or practicesSubsidiaries, except as required contemplated in this Agreement; (l) capital expenditures by concurrent changes in GAAP Company or by the Commission, (vi) any material revaluation by the Company of any of its assetsSubsidiaries, includingtaken as a whole, without limitationin excess of $50,000 individually or $500,000 in the aggregate; (m) establishment, writing down the value amendment or termination of capitalized inventory any collective bargaining agreement to which Company or writing off notes or any of its Subsidiaries is a party; (n) acceleration of accounts receivable other than in the ordinary course of business consistent with past practice; (o) general delay of payments by Company or any of its Subsidiaries to vendors or others to whom Company owes payments (except for disputed payments); (p) making of loans to any Persons other than in the ordinary course of business consistent with past practice or loans to any of its Subsidiaries; (q) settlement of any action, complaint, claim, petition, investigation, suit or other proceeding, whether civil or criminal, in law or in equity, before any arbitrator or Governmental Entity, to which Company or any of its Subsidiaries are a party or any of their respective properties is subject; (viir) any communication from the Nasdaq Stock Market with respect to the delisting acceleration of the Common Stockpayment, right to payment or vesting under any benefit, retirement, profit sharing or deferred compensation plan or other compensation arrangement of Company or any of its Subsidiaries, except as contemplated by such plan or arrangement listed on Section 4.11(a) of the Company Disclosure Schedule or this Agreement; (viiis) incurrence of any cancellation Company Indebtedness in an amount in excess of $1,000,000 in the aggregate; (t) granting by the Company or any of its Subsidiaries of any debts license or waiver sublicense of any claims rights under or rights of with respect to any Intellectual Property that is material valueto Company and its Subsidiaries; (u) establishment, (ix) amendment or contribution to any saleinsurance, transfer pension, retirement, profit sharing, stock bonus, multi-employer or other disposition outside benefit plan covering any of the ordinary course current or former employees, officers, directors or consultants of business of any properties or assets (real, personal or mixed, tangible or intangible) by the Company or any of its Subsidiaries, except as required by Law or pursuant to such benefit plan; (xv) establishment of, or entering into, or financial commitment or contribution to, or amendment to the terms of, or termination of, any joint venture, partnership agreement or similar arrangement or any contract involving a sharing of profits, losses, business or opportunities with any other Person; or (w) any agreement, whether in writing agreement or otherwise, to take any action described in this section commitment by the Company or any of its SubsidiariesSubsidiaries to do any of the foregoing.

Absence of Certain Changes or Events. Since the date Except as set forth in Section 5.8 of the Company Balance SheetInuvo Disclosure Schedule, the Company has since September 30, 2018, Inuvo and its Subsidiaries have conducted its business only their businesses in the ordinary course of business consistent with past practice and there has not been: : (ia) any circumstance or event, or series of circumstances or events, which, individually or in the aggregate, has had or would reasonably be expected to have an Inuvo Material Adverse Change Effect; (b) any material change in any method of accounting or accounting practice by Inuvo or any Subsidiary, except for any such change required by reason of a concurrent change in GAAP or required by applicable Law; (c) any material revaluation by Inuvo or any Subsidiary of a material asset (including, without limitation, any material writing down of the value of inventory or material writing-off of notes or accounts receivable); (d) any transaction or commitment made, or any Contract or agreement entered into, by Inuvo or any Subsidiary, relating to its assets or business (including, without limitation, the Companyacquisition, disposition, leasing or licensing of any tangible or intangible assets) or any relinquishment by Inuvo or any Subsidiary of any Contract or other right, in either case, material to Inuvo and Subsidiary taken as a whole, other than transactions and commitments in the ordinary course of business consistent with past practice and those contemplated by this Agreement; (iie) any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, stock or property) or other distribution in respect of, any of the Company’s or any of its Subsidiaries’ capital stock, or any purchase, redemption or other acquisition by the Company or any of its Subsidiaries of any of the CompanyInuvo’s capital stock or any other securities of the Company or its Subsidiaries or any optionsredemption, warrants, calls or rights to acquire any such shares purchase or other securities except for repurchases from employees following their termination pursuant to the terms acquisition of their pre-existing stock option or purchase agreements, any of Inuvo’s securities; (iiif) any split, combination or reclassification of any of the CompanyInuvo’s capital stock or any issuance or the authorization of any issuance of any other securities in respect of, in lieu of or in substitution for shares of its Subsidiaries’ capital stock, ; (ivg) entry by the Company or any of its Subsidiaries into any licensing or other agreement with regard to the disposition amendment of any material intellectual property term of any outstanding security of Inuvo or any Subsidiary; (h) any issuance by Inuvo or any Subsidiary of any notes, bonds or other debt securities or any capital stock or other equity securities or any securities convertible, exchangeable or exercisable into any capital stock or other equity securities, except for the issuance of any Inuvo Common Stock pursuant to the exercise of any Inuvo Stock Options and Inuvo RSUs, or otherwise pursuant to Inuvo Stock Plans, in existence prior to the date hereof; (i) any material incurrence, assumption or guarantee by Inuvo or any Subsidiary of any Indebtedness for borrowed money other than licenses, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into in the ordinary course of business and in amounts and on terms consistent with past practice, practices; (vj) any material change creation or assumption by the Company in its accounting methods, principles Inuvo or practices, except as required by concurrent changes in GAAP or by the Commission, (vi) any Subsidiary of any material revaluation by Lien on any material asset(s) (alone or in the Company of any of its assets, including, without limitation, writing down the value of capitalized inventory or writing off notes or accounts receivable aggregate) other than in the ordinary course of business consistent with past practice, ; (viik) any communication from making of any material loan, advance or capital contributions to or investment in any entity or person other than loans, advances or capital contributions to or investments in any Subsidiary and except for cash advances to employees for reimbursable travel and other reasonable business expenses, in each case made in the Nasdaq Stock Market ordinary course of business consistent with respect to the delisting of the Common Stock, past practice; (viiil) any cancellation damage, destruction or other casualty loss (whether or not covered by insurance) affecting the Company business or assets of Inuvo or any Subsidiary which, individually or in the aggregate, has had or would reasonably be expected to have a Inuvo Material Adverse Effect; (m) any material grant of equity or other compensation, or increase in the benefits under, or the establishment, material amendment or termination of, any Inuvo Benefit Plan covering current or former employees, officers, consultants, or directors of Inuvo or any Subsidiary, or any material increase in the compensation payable or to become payable to or any other material change in the employment terms for any current or former directors or officers of Inuvo or any of its Subsidiaries or any other employee earning noncontingent cash compensation in excess of any debts or waiver of any claims or rights of material value, $100,000 per year; (ixn) any saleentry by Inuvo or any Subsidiary into any employment, transfer consulting, severance, change in control, retention, termination or other disposition indemnification agreement with any current or former director, consultant or officer of Inuvo or any Subsidiary, entry into any such agreement with any person for a noncontingent cash amount in excess of $250,000 per year or outside of the ordinary course of business business, or entry into any employment agreement other than on an at-will basis; (o) any labor dispute, other than routine individual grievances, or any activity or Proceeding by a labor union or representative thereof to organize any employees of any properties or assets (real, personal or mixed, tangible or intangible) by the Company Inuvo or any of its Subsidiariessubsidiaries for the purposes of forming a labor union or labor organization, or for selecting a labor union or labor organization as a collective bargaining representative; (xp) any agreementauthorization or commitment with respect to, whether any single capital expenditure that was in writing excess of $1,000,000 individually or otherwise$5,000,000 in the aggregate; or (q) any authorization of, or agreement by Inuvo or any Subsidiary to take take, any action of the actions described in this section Section 5.8, except as expressly contemplated by the Company or any of its Subsidiariesthis Agreement.

Absence of Certain Changes or Events. Since Except as disclosed in the date of the Company Balance SheetSEC Documents, since January 1, 2000, the Company has and the Subsidiaries have conducted its business their businesses only in the ordinary course of business and in a manner consistent with past practice practice, and there has not been: (i) occurred any Material Adverse Change to the Companyevent, (ii) any declarationcondition, setting aside circumstance, change or payment of any dividend on, or other distribution development (whether in cash, stock or property) in respect of, any of the Company’s or any of its Subsidiaries’ capital stock, or any purchase, redemption or other acquisition by the Company or any of its Subsidiaries of any of the Company’s capital stock or any other securities of the Company or its Subsidiaries or any options, warrants, calls or rights to acquire any such shares or other securities except for repurchases from employees following their termination pursuant to the terms of their pre-existing stock option or purchase agreements, (iii) any split, combination or reclassification of any of the Company’s or any of its Subsidiaries’ capital stock, (iv) entry by the Company or any of its Subsidiaries into any licensing or other agreement with regard to the disposition of any material intellectual property other than licenses, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into not in the ordinary course of business consistent business) that, individually or in the aggregate, has had or could reasonably be expected to have a Material Adverse Effect. Without limiting the generality of the foregoing, except as set forth on Schedule 3.10 hereto or as disclosed in any SEC Documents filed with past practicethe SEC and publicly available prior to January 1, 2000, since January 1, 2000, there has not been (vi) any material change by the Company in its accounting methods, principles or practices, except as required by concurrent changes in GAAP or by the Commission, (viii) any material revaluation by the Company of any of its or any Subsidiary's material assets, including, without limitationincluding but not limited to, writing down the value of capitalized inventory or writing off notes or accounts receivable any Rights to Receive other than in the ordinary course of business consistent with past practice, (viiiii) any communication from entry outside the Nasdaq Stock Market with respect to the delisting ordinary course of the Common Stock, (viii) any cancellation business by the Company or any Subsidiary into any commitments or transactions material, individually or in the aggregate, to the Company and the Subsidiaries taken as a whole, (iv) any declaration, setting aside or payment of any dividends or distributions in respect of the shares of Common Stock or, any redemption, purchase or other acquisition of any of its Subsidiaries securities, other than semi-annual cash dividends of $.02 per share on outstanding Common Stock consistent with past practices, (v) any grant or issuance of any debts Equity Securities of the Company or waiver any Subsidiary; or (vi) any increase in, establishment of or amendment of any claims Employment, Consulting or rights Severance Agreement, bonus, insurance, deferred compensation, pension, retirement, profit sharing, stock option (including without limitation the granting of material valuestock options, (ix) any salestock appreciation rights, transfer performance awards, or restricted stock awards), stock purchase or other disposition outside employee benefit plan or agreement or arrangement, or any other increase in the compensation payable or to become payable to any present or former directors, officers or employees of the Company or any Subsidiary, except for increases in compensation in the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangible) by the Company or any of its Subsidiaries, or (x) any agreement, whether in writing or otherwise, to take any action described in this section by the Company or any of its Subsidiariesconsistent with past practice.

Absence of Certain Changes or Events. Since January 1, 2006, until the date of the Company Balance Sheetthis Agreement, (i) except as contemplated by this Agreement, the Company has and its Subsidiaries have conducted its their business only in the ordinary course of business consistent with past practice practice, and (ii) there has not been: been (ia) any change, event or occurrence which has had or would reasonably be expected to have a Material Adverse Change to the Company, Effect or (iib) (A) any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, stock stock, property or property) otherwise in respect of, any of the Company’s or any of its Subsidiaries’ capital stock; (B) any redemption, or any purchase, redemption repurchase or other acquisition by the Company or any of its Subsidiaries of any shares of the Company’s capital stock or any other securities of the Company or its Subsidiaries (other than in connection with the forfeiture or any optionsexercise of equity based awards, warrants, calls Options and Restricted Company Common Stock in accordance with existing agreements or rights to acquire any such shares or other securities terms); (C) except for repurchases from employees following their termination pursuant to the terms of their pre-existing stock option or purchase agreements, as contemplated by this Agreement (iii1) any split, combination or reclassification of any of the Company’s or any of its Subsidiaries’ capital stock, (iv) entry granting by the Company or its Subsidiaries to any of its Subsidiaries into any licensing their directors, officers or other agreement with regard to the disposition employees of any material intellectual property other than licensesincrease in compensation or benefits, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into except for increases in the ordinary course of business consistent with past practicepractice or that are required under any Company Plan; (2) any granting to any director, officer or employee of the right to receive any severance or termination pay, except as provided for under any plan or agreement in effect prior to January 1, 2006 or (v3) any entry by the Company or its Subsidiaries into any employment, consulting, indemnification, termination, change of control or severance agreement or arrangement with any present or former director, officer or employee of the Company or its Subsidiaries, or any amendment to or adoption of any Company Plan or collective bargaining agreement; (D) any material change by the Company in its accounting methods, principles or practicesprinciples, except as may be required by concurrent to conform to changes in statutory or regulatory accounting rules or GAAP or by the Commission, regulatory requirements with respect thereto; (viE) any material revaluation by the Company of any of its assets, including, without limitation, writing down the value of capitalized inventory or writing off notes or accounts receivable other than in the ordinary course of business consistent with past practice, (vii) any communication from the Nasdaq Stock Market with respect to the delisting of the Common Stock, (viii) any cancellation Tax election made by the Company or any of its Subsidiaries or any settlement or compromise of any debts or waiver of any claims or rights of material value, (ix) any sale, transfer or other disposition outside of the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangible) Tax liability by the Company or any of its Subsidiaries, ; or (xF) any agreement, whether material change in writing or otherwise, to take any action described in this section Tax accounting principles by the Company or any of its Subsidiaries, except insofar as may have been required by applicable Law.

Absence of Certain Changes or Events. Except as contemplated by this Agreement, since the date of the Company Balance Sheet, Company and Company Subsidiaries have conducted their respective businesses in all material respects in the ordinary course of business. Since the date of the Company Balance Sheet, the Company has conducted its business only in the ordinary course of business consistent with past practice and there has not been: : (a) a Material Adverse Effect on Company; (i) any Material Adverse Change to the Companysplit, combination or reclassification of any capital stock, (ii) any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, stock or property) in respect of, any of the Company’s or any shares of its Subsidiaries’ capital stock, or any purchase, redemption or other acquisition by the Company or any of its Subsidiaries of any of the Company’s shares of capital stock or any other securities of the Company or its Subsidiaries other partnership interests or any options, warrants, calls or rights to acquire any such shares or other securities except for repurchases from employees or consultants following their termination pursuant to the terms of their pre-existing stock option or purchase agreements, or (iii) any split, combination or reclassification amendment of any material term of any outstanding security; (c) any (i) any disposing or impairment of or permitting to lapse of any Company IP Rights that would be material and adverse to Company or outside the ordinary course of business, (ii) disposing of or disclosing (except as necessary in the conduct of its business) to any Person other than representatives of Parent any trade secret or other Intellectual Property Rights not theretofore a matter of public knowledge to any party that is not subject to a nondisclosure or similar agreement, or (iii) any material change to Company’s or any Company Subsidiary’s rights to use Intellectual Property Rights licensed from a third party, except, in the case of its (i) through (iii) in the aggregate, as would not be material to Company and Company Subsidiaries’ capital stock, taken as a whole; (ivd) entry by the Company or any of its Subsidiaries into any licensing sale, transfer, or other agreement with regard to the disposition of any material intellectual property other than licensesproperties or assets (whether real, distribution agreementspersonal or mixed, advertising agreements, sponsorship agreements tangible or merchant program agreements entered into intangible) except in the ordinary course of business consistent with past practicepractices; (e) (i) any assumption, guarantee, endorsement or liability otherwise incurred (whether directly, contingently or otherwise) for the obligations of any other Person other than those of Company or Company Subsidiaries, or (ii) any making of any loan, advance or capital contribution to or investment in any Person, including any director, officer or other affiliate of Company, other than advances to employees for travel and other reimbursable expenses in the ordinary course of business; (i) any material Tax election or material change in any Tax election, any material change in annual Tax accounting period or method of Tax accounting other than as required by applicable laws or regulations, any filing of any material amended Tax Returns, any entering into of a closing agreement, settlement of or consent to any Tax claim, any surrendering of any right to claim a material refund of Taxes, or any consent to any extension or waiver of the statutory period of limitation applicable to any material Tax claim, (vii) any material change by the Company in its any method of accounting, method of accounting methods, principles or practicespractice, except as for any such change required by reason of a concurrent changes change in GAAP or compliance with the applicable requirements of the rules and regulations promulgated by the CommissionSEC, or (viiii) any material revaluation by the Company of any of its material assets, including, without limitation, writing down the value of capitalized inventory or writing writing-off notes or accounts receivable other than in the ordinary course of business consistent with past practice, business; (viig) any communication from the Nasdaq Stock Market with respect to the delisting loss of, or receipt of the Common Stock, (viii) any cancellation by the Company or any of its Subsidiaries written notice of any debts intention to cancel or waiver of otherwise terminate, any claims identified Contract that would be reasonably likely, individually or rights of in the aggregate, to be material value, (ix) any sale, transfer or to Company other disposition outside of than in the ordinary course of business consistent with past practices and other than threatened terminations of any properties identified Contract where Company has cured the underlying cause of the threat and such Contract still remains in full force and effect; (h) as of the date hereof, (i) any increase or assets change in any compensation, benefits or bonus paid or made payable to any of their executive officers or directors, or employees earning more than $100,000 in base salary annually, or any increase in severance or termination pay, or any material modification or amendment of any currently effective employment, severance, termination or indemnification agreement or any agreement or policy the benefits of which are contingent, or the terms of which are materially altered, upon the occurrence of a transaction involving Company of the nature contemplated hereby or (realii) any action taken to accelerate, personal amend or mixedchange the period of vesting or exercisability of options or restricted stock, tangible or intangible) by reprice Company Options granted under the Company Stock Plans or authorization of cash payments in exchange for any of its Subsidiaries, or Company Options granted under the Company Stock Plans; or (xi) any agreement, whether in writing or otherwise, to take any action described in this section by the Company or any of its SubsidiariesSection 2.7.

Absence of Certain Changes or Events. Since the date of the Company Balance Sheet, the Company has conducted and its business only Subsidiary have operated their businesses in the ordinary course of business consistent with past practice practices, and since such date there has not been: : (ia) any amendment or change in the Company Charter Documents or Subsidiary Charter Documents; (b) any Material Adverse Change Effect on the Company; (c) any acquisition by the Company or its Subsidiary, or agreement by the Company or its Subsidiary to acquire (by merging or consolidating with, or by purchasing any assets or equity securities of, or by any other manner), any business or corporation, partnership, association or other business organization or division thereof, or other acquisition or agreement to acquire any assets or any equity securities that are material, individually or in the aggregate, to the business of the Company; (d) any Contract, agreement in principle, letter of intent, memorandum of understanding or similar agreement with respect to any material joint venture, strategic partnership or alliance; (iie) any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, stock or property) in respect of, any of the Company’s or any of its Subsidiaries’ capital stockSubsidiary’s share capital, or any purchase, redemption or other acquisition by the Company or any of its Subsidiaries Subsidiary of any of the Company’s share capital stock or any other securities of the Company or its Subsidiaries Subsidiary, or any options, warrantsCompany Options, calls or rights to acquire any such shares or other securities securities, except for repurchases from employees Employees following their termination pursuant to the terms of their pre-existing stock option or purchase agreements, ; (iiif) any split, combination or reclassification of any of the Company’s or its Subsidiary’s share capital; (g) any forgiveness by the Company or its Subsidiary, whether orally or in writing, of any loan to any Employee; (i) any increase or decrease in compensation or fringe benefits (except for normal increases or decreases of cash compensation to current non-executive officer employees and/or independent consultants in the ordinary course of business consistent with past practice and/or resulting from any Legal Requirement) by the Company or its Subsidiaries’ capital stockSubsidiary, whether orally or in writing, (ii) any promise, commitment or payment by the Company or its Subsidiary, whether orally or in writing, of any bonus (except for bonuses made to current non-executive officer employees in the ordinary course of business consistent with past practice), (iii) any adoption, change, or termination by the Company or its Subsidiary, whether orally or in writing, of any severance, change of control, termination or bonus plan, policy or practice, (iv) any entry by the Company or any of its Subsidiaries Subsidiary, whether orally or in writing, into any licensing employment, severance, termination, change of control or other indemnification agreement with regard to or any agreement the disposition benefits of which are contingent or the terms of which are materially altered upon the occurrence of a transaction involving the Company of the nature contemplated hereby (either alone or upon the occurrence of additional or subsequent events), or (v) the adoption, termination or amendment of any Company Employee Plan or collective bargaining agreement; (i) any amendment, termination, modification, violation or consent with respect to any Company Material Contract; (j) (i) entry into any material intellectual property customer Contract that contains any material non-standard terms, including but not limited to, non-standard discounts, provisions for unpaid future deliverables, non-standard service requirements or future royalty payments other than licenses, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into in the ordinary course of business consistent with past practice, or (vii) any material change in the manner in which the Company or its Subsidiary extends discounts, credits or warranties to customers or otherwise deals with its customers; (k) any change by the Company in its accounting methods, principles or practices, except as required by concurrent changes in GAAP or applicable law; (l) any debt, capital lease or other debt or equity financing transaction by the CommissionCompany or its Subsidiary or entry into any agreement by the Company or its Subsidiary in connection with any such transaction; (m) entry into any material new customer, reseller or distributor agreement, or amendment or modification of any such material agreement or any grants of any material refunds, credits, rebates or other allowances by the Company to any end user, customer, reseller or distributor, in each case, other than in the ordinary course of business consistent with past practice; (vin) any material change in the level of product returns or factors influencing accounts receivable or warranty reserves experienced by the Company or its Subsidiary; (o) any material restructuring activities by the Company or its Subsidiary, including any reductions in force, lease terminations, restructuring of contracts or similar actions; (p) any sale, lease, license, encumbrance or other disposition of any business lines or any properties or assets, except the sale, lease, license or disposition of property or assets which are not material, individually or in the aggregate, to the business of the Company or the licenses of current Company Products, in each case, in the ordinary course of business and in a manner consistent with past practice; (q) any loan or extension of credit by the Company or its Subsidiary to any Person other than in the ordinary course of business consistent with past practice; (r) any material purchases of fixed assets, spares or other long-term assets other than in the ordinary course of business and in a manner consistent with past practice; (s) adoption of or change in any Tax accounting method or Tax election, entering into any closing agreement in respect of Taxes, settlement or compromise of any Tax claim or assessment, or extension or waiver of the limitation period applicable to any Tax claim or assessment; (t) any expenditure, transaction or commitment by the Company or its Subsidiary exceeding $250,000 individually or $500,000 in the aggregate, other than in the ordinary course of business consistent with past practice; (u) any acceleration or release by the Company or its Subsidiary of any vesting condition to the right to exercise any Company Option or other right to purchase or otherwise acquire any of the Company’s shares, or any acceleration or release of any right to repurchase shares upon termination of employment or services with it or pursuant to any right of first refusal; (v) any payment or discharge by the Company or its Subsidiary of any Lien or other encumbrance on any of its assets or properties, or payment or discharge of any of its obligations or liabilities, in each case that was not either shown on the Company Balance Sheet or incurred in the ordinary course of its business consistent with its past practices after the date of the Company Balance Sheet in an amount not in excess of $150,000 individually, or $300,000 in the aggregate; (w) any material damage, destruction or loss of any material property or material asset of the Company or its Subsidiary, whether or not covered by insurance; (x) except as set forth in Section 3.5(x) of the Company Disclosure Letter, any change with respect to the management, supervisory or other key personnel of the Company or its Subsidiary, or any termination of employment of a material number of employees; (y) any claims or matters raised by any individual, Governmental Entity, or workers’ representative organization, bargaining unit or union, regarding, claiming or alleging a labor dispute, labor trouble, wrongful discharge or any other unlawful employment or labor practice or action with respect to the Company or its Subsidiary; (z) any liability or obligation incurred by it to any of its executive officers, directors or shareholders, except for normal and customary compensation and expense allowances payable to officers and directors in the ordinary course of its business consistent with past practice; (aa) any loan, advance or capital contribution to, or any investment in, any of the Company’s or its Subsidiary’s officers, directors or shareholders or any firm or business enterprise in which any such Person had a direct or indirect material interest at the time of such loan, advance, capital contribution or investment; (bb) any commencement or settlement of any material litigation by the Company or its Subsidiary; (cc) any material revaluation, or any indication that such a revaluation was merited under GAAP, by the Company of any of its assets, including, without limitation, writing down the value of capitalized inventory inventory, spares, long term or short-term investments, fixed assets, goodwill, intangible assets, deferred tax assets, or writing off notes or accounts receivable other than in the ordinary course of business consistent with past practice, ; (viidd) any communication from agreement for the Nasdaq Stock Market with respect purchase or sale of any interest in real property, the grant of any Lien in any real property, or any agreement to the delisting lease, sublease, license or otherwise use or occupy any real property; or (ee) announcement of, any negotiation by or any entry into any Contract to do any of the Common Stock, things described in the preceding clauses (viiia) any cancellation by the Company or any of its Subsidiaries of any debts or waiver of any claims or rights of material value, through (ix) any sale, transfer or other disposition outside of the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangibledd) by the Company or any of its Subsidiaries, or Subsidiary (x) any agreement, whether in writing or otherwise, to take any action described in other than negotiations and agreements with Parent and its representatives regarding the transactions contemplated by this section by the Company or any of its SubsidiariesAgreement).

Absence of Certain Changes or Events. Since Except for liabilities incurred as a result of this Agreement or, with respect to liabilities incurred after the date of the Company Balance Sheethereof, as expressly permitted pursuant to Section 4.01(a), since December 31, 2006, the Company has and its Subsidiaries have conducted its business their respective businesses only in the ordinary course of business consistent with past practice and practice, (i) there has not been: (i) been any Material Adverse Change to the CompanyChange, and (ii) from such date until the date hereof there has not been (A) any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, stock or property) in with respect of, to any capital stock of the Company’s Company or any of its Subsidiaries’ capital stock, other than dividends or distributions by a direct or indirect wholly owned Subsidiary of the Company to its stockholders, (B) any purchase, redemption or other acquisition by the Company or any of its Subsidiaries of any shares of the Company’s capital stock or any other securities of the Company or any of its Subsidiaries or any options, warrants, calls or rights to acquire any such shares or other securities except for repurchases from employees following their termination securities, including pursuant to the terms of their pre-existing stock option or purchase agreementsCompany’s share repurchase program, (iiiC) any split, combination or reclassification of any capital stock of the Company’s Company or any of its Subsidiaries’ Subsidiaries or any issuance or the authorization of any issuance of any other securities in respect of, in lieu of or in substitution for shares of their respective capital stock, (ivD) (1) any granting by the Company or any of its Subsidiaries to any current or former director, officer, employee or independent contractor, of the Company or any of its Subsidiaries (all such individuals, collectively, the “Company Personnel”) of any increase in compensation, bonus or fringe or other benefits, except in the ordinary course of business consistent with past practice or as was required under any Company Benefit Agreement or Company Benefit Plan, (2) any granting by the Company or any of its Subsidiaries to any Company Personnel of (x) any increase in severance or termination pay or (y) any right to receive any severance or termination pay, (3) any entry by the Company or any of its Subsidiaries into, or any amendments of, (x) any employment, deferred compensation, consulting, severance, change of control, termination, retention, deal bonus or indemnification Contract with any Company Personnel or (y) any Contract with any Company Personnel the benefits of which are contingent, or the terms of which are materially altered, upon the occurrence of a transaction involving the Company of a nature contemplated by this Agreement (all Contracts of the type described by this clause (3), collectively, “Company Benefit Agreements”), (4) the removal or modification of any restrictions in any Company Benefit Agreement or Company Benefit Plan or awards made thereunder, except as required to comply with applicable Law or any Company Benefit Agreement or Company Benefit Plan in effect as of the date hereof, or (5) the adoption, amendment or termination of any Company Benefit Plan or entry into any licensing agreement, plan or other agreement with regard arrangement to do any of the disposition of any material intellectual property other than licenses, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into in the ordinary course of business consistent with past practiceforegoing, (vE) any material damage, destruction or loss, whether or not covered by insurance, (F) any change by the Company in its accounting methods, principles or practicespractices by the Company materially affecting its assets, liabilities or businesses, except insofar as may have been required by concurrent changes a change in GAAP or by the CommissionGAAP, (viG) any material revaluation by the Company Tax election or any settlement or compromise of any of its assets, including, without limitation, writing down the value of capitalized inventory material income Tax liability or writing off notes or accounts receivable other than in the ordinary course of business consistent with past practice, (viiH) any communication from the Nasdaq Stock Market with respect other action taken or committed to the delisting of the Common Stock, (viii) any cancellation be taken by the Company or any of its Subsidiaries of any debts or waiver of any claims or rights of material value, (ix) any sale, transfer or other disposition outside Subsidiary of the ordinary course of business of any properties or assets (realCompany which, personal or mixed, tangible or intangible) if taken following entry by the Company or any into this Agreement, would have required the consent of its Subsidiaries, or (x) any agreement, whether in writing or otherwise, Parent pursuant to take any action described in this section by the Company or any of its SubsidiariesSection 4.01(a).

Absence of Certain Changes or Events. Since Except as set ------------------------------------ forth in the date of the Company Balance SheetRecent SEC Documents, since June 30, 2000, the Company has and its subsidiaries have conducted its business their businesses only in the ordinary course of business and in a manner consistent with past practice and and, since such date, there has not been: (i) any event that, individually or in the aggregate, has had or could reasonably be expected to have in the future a Company Material Adverse Change to the CompanyEffect, (ii) any declaration, payment or setting aside or for payment of any dividend on, or other distribution (whether in cash, stock or property) in respect of, any of the Company’s or any of its Subsidiaries’ capital stock, or any purchase, redemption or other acquisition by the Company or any of its Subsidiaries of any shares of the Company’s capital stock or any other securities of the Company or its Subsidiaries or any options, warrants, calls or rights to acquire any such shares or other securities except for repurchases from employees following their termination pursuant to by the terms of their pre-existing stock option or purchase agreementsCompany, (iii) any splitmaterial damage or loss to any material asset or property, combination whether or reclassification of any of the Company’s or any of its Subsidiaries’ capital stocknot covered by insurance, (iv) entry any change by the Company in accounting principles or any of its Subsidiaries into any licensing or other agreement with regard to the disposition of any material intellectual property other than licenses, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into in the ordinary course of business consistent with past practicepractices, (v) any material change by the Company in its accounting methods, principles or practices, except as required by concurrent changes in GAAP or by the Commission, (vi) any material revaluation by the Company of any of its assetsmaterial assets or liabilities, including, without limitation, writing down the value of capitalized inventory or writing off notes or accounts receivable other than in the ordinary course of business consistent with past practicebusiness, (viivi) any communication from the Nasdaq Stock Market with respect to the delisting of the Common Stock, (viii) any cancellation entry by the Company or any of its Subsidiaries of subsidiaries into any debts commitment or waiver of any claims transactions material to the Company and its subsidiaries taken as a whole (other than commitments or rights of material value, (ix) any sale, transfer or other disposition outside of transactions entered into in the ordinary course of business business), (vii) any increase in or establishment of any properties Company Benefit Plan (as defined in Section 3.12), or assets (realany other increase in the compensation payable or to become payable to any present or former directors or officers, personal or mixedany employment, tangible consulting or intangible) by severance agreement or arrangement entered into with any such present or former directors, officers or employees of the Company or any of its Subsidiariessubsidiaries, or (xviii) any agreementamendment (including any amendment of the exercise or other price to be paid in connection therewith) or cancellation of any rights, whether in writing warrants, option, calls, commitments or otherwiseany other agreements of any character to purchase or acquire any shares of its capital stock or any securities or rights convertible into, exchangeable for, or evidencing the right to take subscribe for, any action described in this section by shares of capital stock of the Company or any of its Subsidiariessubsidiaries. Since June 30, 2000, neither the Company nor any of its subsidiaries has taken, or failed to take, any action that would have constituted a breach of Section 5.1 hereof had the covenants therein applied since that date.

Absence of Certain Changes or Events. Since the date March 31, 2013, (i) there has not been any change, effect, event, occurrence or state of facts that has had or would reasonably be expected to have a Material Adverse Effect, (ii) the Company Balance Sheet, the Company has and its Subsidiaries have conducted its business their businesses in all material respects only in the ordinary course of business consistent with past practice and (iii) through the date of this Agreement, there has not been: : (i) any Material Adverse Change to the Company, (ii) any declaration, setting aside or payment of any dividend on, or making of any other distribution (whether in cash, stock or property) in with respect ofto, any capital stock or other equity interest of the Company’s Company or any of its Subsidiaries’ , except for (A) regular quarterly cash dividends on Company Common Stock of $0.10 per share and (B) any dividend or distribution by a wholly owned Subsidiary of the Company to the Company or another wholly owned Subsidiary thereof; (ii) any split, combination or reclassification of any capital stock, stock of the Company or any issuance or the authorization of any issuance of any other securities in respect of, in lieu of or in substitution for shares of capital stock of the Company; (iii) any purchase, repurchase, redemption or other acquisition by the Company or any of its Subsidiaries of any shares of the Company’s capital stock or any other securities equity interests of the Company or any of its Subsidiaries or any optionsrights, warrants, calls warrants or rights options to acquire any such shares or other securities except for repurchases from employees following their termination equity interests, other than (A) the acquisition by the Company of shares of Company Common Stock in connection with the surrender of shares of Company Common Stock by holders of Company Stock Options in order to pay the exercise price of the Company Stock Options, (B) the withholding of shares of Company Common Stock to satisfy tax obligations with respect to awards granted pursuant to the terms of their pre-existing stock option or purchase agreementsCompany Stock Plans, (iiiC) any splitthe acquisition by the trustee of the Company 401(k) Plan of shares of Company Common Stock in order to satisfy participant investment elections under the Company 401(k) Plan, combination or reclassification (D) the acquisition by the Company of any Company Stock Options and shares of Company Restricted Stock in connection with the forfeiture of such awards, (E) the acquisition by the Company of Company Common Stock in connection with the exercise of rights under the ESPP and (F) the acquisition by the Company of Company Common Stock pursuant to Company Common Stock repurchase plans approved by the Board of Directors of the Company’s ; (1) any grant to any present or former director, executive officer or employee of the Company of any material increase in compensation or benefits, other than in the ordinary course of its Subsidiaries’ capital stockbusiness consistent with past practice with respect to non-executive officer employees, (iv2) any grant to any present or former director, executive officer or employee of the Company of any material increase in severance or termination pay, other than in the ordinary course of business consistent with past practice with respect to non-executive officer employees, (3) any entry by the Company or any of its Subsidiaries into any licensing employment, consulting, severance or other termination agreement with regard to any director, executive officer or employee of the disposition of any material intellectual property Company, other than licenses, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into in the ordinary course of business consistent with past practicepractice with an individual with annual target cash compensation not in excess of $250,000, (4) any loan or advance of money or other property by the Company or any of its Subsidiaries to any present or former director, executive officer or employee (other than advances of business and travel expenses) or (5) any grant of any equity or equity-based awards; (v) any material change by the Company in its accounting methods, principles or practicespractices by the Company or any of its Subsidiaries affecting the consolidated assets, liabilities or results of operations of the Company, except as required (A) by concurrent changes in GAAP (or any interpretation thereof), including pursuant to standards, guidelines and interpretations of the Financial Accounting Standards Board or any similar organization, or (B) by Law, including Regulation S‑X under the Commission, Securities Act; (vi) any material revaluation tax election made by the Company of or any of its assetsSubsidiaries, includingany closing agreement, without limitationsettlement or compromise of any proceeding with respect to any material tax claim or assessment relating to the Company or any of its Subsidiaries or the surrender of any right to claim a material refund of taxes, writing down the value of capitalized inventory or writing off notes or accounts receivable other than in the ordinary course of business consistent with past practice, ; (vii) any communication from the Nasdaq Stock Market with respect amendment to the delisting Company Certificate of Incorporation or the Common Stock, Company Bylaws; (viii) any cancellation by the Company settlement of any material claim, investigation, proceeding or litigation (or any of its Subsidiaries of any debts material portion thereof), in each case made or waiver of any claims or rights of material value, (ix) any sale, transfer or other disposition outside of the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangible) by pending against the Company or any of its Subsidiaries; (ix) entry into or material modification of any existing Company Regulatory Agreement, or except as required by applicable Law; (x) any agreementadoption or entry into a plan of complete or partial liquidation, whether in writing dissolution, restructuring, recapitalization or otherwise, other reorganization or any merger or consolidation by the Company; or (xi) any commitment or agreement to take any action described in this section by of the Company or any of its Subsidiariesforegoing actions.

Absence of Certain Changes or Events. Since (a) Except as and to the extent disclosed in the Company SEC Reports filed on or before the date hereof, since June 30, 2004 (the “Company Balance Sheet Date”), (i) the Company and its Subsidiaries have not incurred any liability or obligation (indirect, direct or contingent), or entered into any oral or written agreement or other transaction, that is not in the ordinary course of business, (ii) the Company and its Subsidiaries have not sustained any material loss or material interference with their business or properties from fire, flood, windstorm, accident or other calamity (whether or not covered by insurance), (iii) there has been no change in the capital stock of the Company Balance Sheet, except for the issuance of shares of the Company has conducted its business only Common Stock pursuant to Company Stock Options, in the ordinary course of business consistent with past practice and practices; (iv) there has been no dividend or distribution of any kind declared, paid or made by the Company on any class of its stock, (v) there has not been: been (iA) any Material Adverse Change to the Companyadoption of a new Company Plan (as hereinafter defined), (iiB) any declarationamendment to a Company Plan increasing benefits thereunder, setting aside or payment of (C) any dividend on, or other distribution (whether in cash, stock or property) in respect of, any of granting by the Company’s Company or any of its Subsidiaries’ capital stock, or Subsidiaries to any purchase, redemption or other acquisition by executive officer of the Company or any of its Subsidiaries of any increase in compensation, except in the ordinary course of business consistent with prior practice or as was required under employment agreements in effect as of the Company’s capital stock or any other securities date of the Company or its Subsidiaries or any options, warrants, calls or rights to acquire any such shares or other securities except for repurchases from employees following their termination pursuant to the terms of their pre-existing stock option or purchase agreementsBalance Sheet Date, (iiiD) any split, combination or reclassification of any of granting by the Company’s Company or any of its Subsidiaries’ capital stockSubsidiaries to any such executive officer of any increase in severance or termination agreements in effect as of the Company Balance Sheet Date, or (ivE) any entry by the Company or any of its Subsidiaries into any licensing employment, severance or other termination agreement with regard to the disposition of any material intellectual property other than licenses, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into in the ordinary course of business consistent with past practice, (v) any material change by the Company in its accounting methods, principles or practices, except as required by concurrent changes in GAAP or by the Commissionsuch executive officer, (vi) there has not been any material revaluation by the Company of any of its assets, including, without limitation, writing down the value of capitalized inventory or writing off notes or accounts receivable other than change in the ordinary course of business consistent with past practice, (vii) any communication from the Nasdaq Stock Market with respect to the delisting amount or terms of the Common Stock, (viii) any cancellation by indebtedness of the Company or any of its Subsidiaries from the Balance Sheet Date, and (vii) other than amendment of the Company Rights Plan pursuant to Sections 3.30 and 5.9 hereof, amendment of any debts or waiver term of any claims or rights outstanding security of material value, (ix) any sale, transfer or other disposition outside of the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangible) by the Company or any Subsidiary. (b) Except as and to the extent disclosed in the Company SEC Reports filed on or before the date hereof, since the Company Balance Sheet Date there has been no event causing a Material Adverse Effect on the Company, nor any development that would, individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect on the Company. For purposes of its Subsidiariesthis Agreement, “Material Adverse Change” or “Material Adverse Effect” mean, when used with respect to the Company, any change or effect that is or could reasonably be expected (as far as can be foreseen at the time) to be materially adverse to the business, operations, properties, assets, liabilities, employee relationships, customer or supplier relationships, earnings or results of operations, financial projections or forecasts, or the business prospects and condition (xfinancial or otherwise) of the Company, taken as a whole, other than such changes, effects or circumstances reasonably attributable to: (i) economic conditions generally in the United States or foreign economies in any locations where the Company and its Subsidiaries have material operations or sales; (ii) conditions generally affecting the industries in which the Company participates, provided, with respect to clauses (i) and (ii), the changes, effects or circumstances do not have a materially disproportionate effect (relative to other industry participants) on the Company, (iii) the payment of any amounts due to, or the provision of any other benefits to, any officers or employees under employment contracts, non-competition agreements, employee benefit plans, severance arrangements or other arrangements in existence on the date of this Agreement and disclosed in the Company Letter; (iv) any agreement, whether in writing or otherwise, to take any action described in this section taken by the Company with Buyer’s express written consent (except that consent to action taken to respond to a Material Adverse Effect or a Material Adverse Change shall not be deemed any waiver by Buyer as to the event or circumstance giving rise to such Material Adverse Effect or Material Adverse Change); (v) the announcement or pendency of the Merger to the extent the same causes cancellation or delay in placing customer or potential customer orders, (vi) any change in the trading price of the Company’s common stock in and of itself; or (vii) any failure, in and of itself, by the Company to meet internal or other estimates, predictions, projections or forecasts of revenue, net income or any other measure of its Subsidiariesfinancial performance (it being understood that, with respect to clauses (vi) and (vii), the facts or circumstances giving rise or contributing to such change in trading price or failure to meet estimates or projections may be deemed to constitute, or be taken into account in determining whether there has been, a Material Adverse Effect).

Absence of Certain Changes or Events. Since From the Interim Balance Sheet Date through the date of the Company Balance Sheethereof, the Company has conducted its business only in the ordinary course of business consistent with past practice and there has not been, occurred or arisen: (ia) any event or condition of any character that has had or would be reasonably expected to have a Material Adverse Change to Effect on the Company, ; (iib) any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, stock or property) in respect of, any of the Company’s or any of its Subsidiariessubsidiaries’ capital stock, or any purchase, redemption or other acquisition by the Company or any of its Subsidiaries of any of the Company’s capital stock or any other securities of the Company or its Subsidiaries subsidiaries or any options, warrants, calls or rights to acquire any such shares or other securities securities, except for repurchases from employees Employees following their termination pursuant to the terms of their pre-existing stock option or purchase agreements, agreements existing as of the Interim Balance Sheet Date; (iiic) any split, combination or reclassification of any of the Company’s or any of its Subsidiariessubsidiaries’ capital stock; (d) any granting by the Company or any of its subsidiaries of any increase in compensation or fringe benefits to any Employee (other than Consultants who are not Significant Consultants) or any payment by the Company or any of its subsidiaries of any bonus or any entry by the Company or one of its subsidiaries into any Contract (or amendment of an existing Contract) to grant or provide severance, acceleration of vesting, termination pay or other similar benefits; (ive) the execution of any employment Contract or service Contract, the extension of the term of any existing employment Contract or service Contract with any Employee, or any entry or other modification by the Company or any of its subsidiaries of any employment, severance, termination or indemnification Contract or any Contract the benefits of which are contingent, or the terms of which are materially altered, upon the occurrence of a transaction involving the Company of the nature contemplated hereby; (f) entry by the Company or any of its Subsidiaries subsidiaries into (i) any licensing or other agreement with regard to Contract providing for the use, acquisition or disposition of any material intellectual property Intellectual Property (as defined in Section 2.19 hereof) other than licenses, distribution agreements, advertising agreements, sponsorship (A) licenses of commercially available third party software applications for internal use by the Company or otherwise in the Company’s ordinary course of business consistent with past practice and (B) confidentiality agreements or merchant program agreements entered into in the ordinary course of business consistent with past practice, or (vii) any amendment or consent with respect to any material licensing or other Contract providing for the use, acquisition or disposition of any Intellectual Property, other than confidentiality agreements in the ordinary course of business consistent with past practice; (g) any change by the Company in its accounting methods, principles or practicespractices (including any change in depreciation or amortization policies or rates or revenue recognition policies), except as required by concurrent changes in GAAP or by the Commission, GAAP; (vih) any material revaluation by the Company of any of its assets, including, without limitation, writing down the value of capitalized inventory or including writing off promissory notes or accounts receivable other than in the ordinary course receivable, or any sale of business consistent with past practice, (vii) any communication from the Nasdaq Stock Market with respect to the delisting assets of the Common Stock, Company; (viiii) any cancellation entry by the Company or any of its Subsidiaries subsidiaries into any Contract (other than the Voting Agreements) filed or required to be filed by the Company with the SEC; (j) the incurrence, creation or assumption of any debts material Encumbrance (other than a Permitted Encumbrance) or waiver any discharge of any claims material Encumbrance, any material Liability for borrowed money or rights any material Liability or obligation as guaranty or surety with respect to the obligations of material valueothers who are not wholly-owned subsidiaries of the Company, (ixk) any purchase, offer to purchase, sale, offer to sell, option to purchase or sell, agreement to transfer any interest in, or any lease, right to use, sublease or other disposition outside of the ordinary course of business occupancy, of any properties or assets Company Real Estate (real, personal or mixed, tangible or intangibleas defined in Section 2.15(a)) by the Company or its subsidiaries; and (l) any announcement of or any agreement by the Company, any of its Subsidiariessubsidiaries, or (x) any agreement, whether in writing or otherwiseEmployee on behalf of the Company, to take do any action of the things described in this section by the Company preceding clauses (a) through (k) (other than negotiations or any of its Subsidiariesagreements with Parent and Merger Sub regarding the Transactions).

Absence of Certain Changes or Events. Since the date Except as set forth in Section 5.11 of the Company Balance SheetDisclosure Schedule or except for liabilities incurred in accordance with this Agreement or arising as a result of the transactions contemplated by or provided for in this Agreement, the since September 30, 2005, Company has and its Subsidiaries have conducted its their business only in the ordinary course of business and in a manner consistent with past practice and and, since such date, there has not been: : (ia) any Company Material Adverse Change to the Company, Effect; (iib) any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, with respect to any shares of capital stock or property) in respect of, any of the Company’s or any of its Subsidiaries’ capital stock, or any purchaserepurchase, redemption or other acquisition by the Company or any of its Subsidiaries of any outstanding shares of the Company’s capital stock or any other securities of the Company or its Subsidiaries or any optionsof, warrants, calls or rights to acquire any such shares or other securities except for repurchases from employees following their termination pursuant to the terms of their pre-existing stock option or purchase agreementsownership interests in, (iii) any split, combination or reclassification of any of the Company’s Company or any of its Subsidiaries’ capital stock; (c) any amendment of any material term of any outstanding security of Company or any of its Subsidiaries; (d) any incurrence, (iv) entry assumption or guarantee by the Company or any of its Subsidiaries into any licensing or other agreement with regard to the disposition of any material intellectual property indebtedness with third parties for borrowed money, other than licenses, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into in the ordinary course of business and consistent with past practice, practice (vi) any material change in connection with the purchases by the Company in its accounting methods, principles or practices, except as required by concurrent changes in GAAP or by the Commission, (vi) any material revaluation by the Company of any of its assetsSubsidiaries of wireless handset products for sale and resale and (ii) in connection with any other third party indebtedness which in no event shall exceed U.S. $5,000,000 in the aggregate; (e) any creation or other incurrence by Company or any of its Subsidiaries of any Lien on any material asset, including, without limitation, writing down the value of capitalized inventory or writing off notes or accounts receivable other than in the ordinary course of business consistent with past practice, practices; (viif) any communication from making of any loan, advance or capital contribution to or investment in any third party, other than in the Nasdaq Stock Market ordinary course of business and consistent with respect to the delisting of the Common Stock, past practice; (viiig) any cancellation transaction or commitment made, or any contract or agreement entered into, by Company or any of its Subsidiaries relating to its assets or business (including the acquisition or disposition of any assets) or any relinquishment by Company or any of its Subsidiaries of any debts or waiver of any claims or rights of material value, (ix) any sale, transfer contract or other disposition outside of right, in either case, material to Company and its Subsidiaries, other than transactions and commitments in the ordinary course of business consistent with past practices or those expressly contemplated by this Agreement; (h) any change in any method of any properties accounting, method of tax accounting or assets (real, personal accounting principles or mixed, tangible or intangible) practice by the Company or any of its Subsidiaries, except for any such change required by reason of a change in GAAP or Regulation S-X under the Exchange Act; (i) any (i) grant of any severance or termination pay to (or amendment to any existing arrangement with) any director, officer or employee of Company or any of its Subsidiaries other than in the ordinary course of business consistent with past practices, (ii) increase in compensation, bonus or other benefits payable to any director, officer or employee of Company or any of its Subsidiaries other than in the ordinary course of business consistent with past practices, (iii) increase in benefits payable under any existing severance or termination pay policies or employment agreements other than in the ordinary course of business consistent with past practices, (iv) entering into any employment, deferred compensation or other similar agreement (or any amendment to any such existing agreement) with any director, officer or employee of Company or any of its Subsidiaries other than in the ordinary course of business consistent with past practices, or (xv) establishment, adoption or amendment (except as required by applicable law) of any agreementcollective bargaining, whether in writing bonus, profit-sharing, thrift, pension, retirement, deferred compensation, compensation, stock option, restricted stock or otherwiseother benefit plan or arrangement covering any director, to take any action described in this section by the officer or employee of Company or any of its Subsidiaries, except in connection with the extension of the exercise period of existing Company Options held by Company directors and officers or any actions taken in connection with Section 1.2(b); or (j) any material Tax election made or changed, any annual tax accounting period changed, any method of tax accounting adopted or changed, any material amended Tax Returns or claims for material Tax refunds filed, any material closing agreement entered into, any material Tax claim, audit or assessment settled, or any right to claim a material Tax refund, offset or other reduction in Tax liability surrendered.

Absence of Certain Changes or Events. Since the date Except as set forth in Section 2.9 of the Company Schedule, since the Interim Balance Sheet, the Company has conducted its business only in the ordinary course of business consistent with past practice and Sheet Date there has not been, occurred or arisen: (i) any event or condition of any character that has had or is reasonably expected to have Material Adverse Change to Effect on the Company, ; (ii) any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, stock or property) in respect of, any of the Company’s 's or any of its Subsidiaries’ subsidiaries' capital stock, or any purchase, redemption or other acquisition by the Company or any of its Subsidiaries of any of the Company’s 's capital stock or any other securities of the Company or its Subsidiaries subsidiaries or any options, warrants, calls or rights to acquire any such shares or other securities except for repurchases from employees following their termination pursuant to the terms of their pre-existing stock option or purchase agreements, ; (iii) any split, combination or reclassification of any of the Company’s 's or any of its Subsidiaries’ subsidiaries' capital stock, ; (iv) any granting by the Company or any of its subsidiaries of any increase in compensation or fringe benefits or any payment by the Company or any of its subsidiaries of any bonus, or any granting by the Company or any of its subsidiaries of any increase in severance or termination pay or any entry by the Company or any of its subsidiaries into any currently effective employment, severance, termination or indemnification agreement or any agreement the benefits of which are contingent or the terms of which are materially altered upon the occurrence of a transaction involving the Company of the nature contemplated hereby; (v) entry by the Company or any of its Subsidiaries subsidiaries into (x) any licensing or other agreement with regard Contract relating to the use, acquisition or disposition of any material intellectual property Intellectual Property (as defined in Section 2.18 hereof) other than licenses, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into (1) end-user licenses of commercially available software applications for internal use by the Company in the ordinary course of business consistent with past practice, and (v2) commercial licenses of the Company's software in the ordinary course of business consistent with past practice, or (y) any amendment or consent with respect to any material licensing or other Contract relating to the use, acquisition or disposition of any Intellectual Property; (vi) any change by the Company in its accounting methods, principles or practices, except as required by concurrent changes in GAAP or by the Commission, GAAP; (vivii) any material revaluation by the Company of any of its assets, including, without limitation, writing down the value of capitalized inventory or writing off notes or accounts receivable or any sale of assets of the Company other than in the ordinary course of business consistent with past practice, (vii) any communication from the Nasdaq Stock Market with respect to the delisting of the Common Stock, ; (viii) any cancellation entry by the Company or any of its Subsidiaries of subsidiaries into any debts Contract filed or waiver of any claims or rights of material value, required to be filed by the Company with the SEC; (ix) any sale, transfer negotiation or other disposition outside of the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangible) agreement by the Company or any of its Subsidiaries, or (x) subsidiaries to do any agreement, whether in writing or otherwise, to take any action of the things described in this section by the Company preceding clauses (i) through (viii) (other than negotiations or any of its Subsidiariesagreements with Parent regarding the Transactions).

Absence of Certain Changes or Events. Since the date Except as set forth in Section 4.08 of the Company Balance SheetDisclosure Schedule or in the Company SEC Reports, since December 31, 2002, the Company has conducted its business only in the ordinary course of business consistent with past practice and there has not beenoccurred: (i) any Company Material Adverse Change to the Company, Effect; (ii) any declaration, setting aside amendments or payment changes in the certificate of any dividend on, incorporation or other distribution (whether in cash, stock or property) in respect of, any bylaws of the Company’s or any of its Subsidiaries’ capital stock, or any purchase, redemption or other acquisition by the Company or any of its Subsidiaries of any of the Company’s capital stock or any other securities of the Company or its Subsidiaries or any options, warrants, calls or rights to acquire any such shares or other securities except for repurchases from employees following their termination pursuant to the terms of their pre-existing stock option or purchase agreements, subsidiaries; (iii) any splitdamage to, combination destruction or reclassification loss of any asset of the Company’s or any of its Subsidiaries’ capital stock, (iv) entry by the Company or any of its Subsidiaries into any licensing or other agreement with regard to the disposition of any material intellectual property other than licenses, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into in the ordinary course of business consistent with past practicesubsidiaries, (vwhether or not covered by insurance) that has had or is reasonably likely to have a Company Material Adverse Effect; (iv) any material change by the Company in its accounting methods, principles or practices; (v) any material change to any Company Stock Option Plans or Company Employee Plans, except as required by concurrent changes in GAAP including the establishment of any new plans or by any amendment that extends the Commission, extension of coverage under any plan to new groups of employees or other Persons not previously covered; (vi) any material revaluation by restructuring or reorganization of the Company or any of its subsidiaries; (vii) any split, combination or reclassification of any of its capital stock or any issuance or the authorization of any issuance of any other securities in respect of, in lieu of or in substitution for shares of its capital stock; (viii) any revaluation of any of the Company's or any subsidiary's assets, including, without limitation, writing down the value of capitalized inventory or writing off notes or accounts receivable other than in the ordinary course of business; (ix) any sale, pledge, disposition of or encumbrance upon a material amount of property of the Company or of any of its subsidiaries, except in the ordinary course of business and consistent with past practice, ; (viix) any communication from material Tax election inconsistent with past practices or the Nasdaq Stock Market with respect settlement or compromise of any material Tax liability; (xi) any declaration, issuance or payment of any dividend or other distribution (whether in cash, stock or property or any combination thereof) other than a dividend or distribution by a wholly-owned subsidiary to the delisting Company; or (xii) the creation of any indebtedness for borrowed money or the Common Stockissuance of any debt securities or the assumption, guarantee (viiiother than guarantees of bank debt of a subsidiary entered into in the ordinary course of business) any cancellation by or endorsement or other accommodation whereby the Company or any of its Subsidiaries subsidiaries became responsible for, the obligations of any debts person, or waiver the making of any claims loans or rights of material valueadvances, (ix) any sale, transfer or other disposition outside of except in the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangible) by the Company or any of its Subsidiaries, or (x) any agreement, whether in writing or otherwise, to take any action described in this section by the Company or any of its Subsidiariesconsistent with past practice.

Absence of Certain Changes or Events. Since the date of the Company Balance SheetExcept as set forth on Schedule 2.26, the Company has conducted its business only in the ordinary course of business consistent with past practice and since January 1, 2017, there has not been: : (ia) any change in the assets, liabilities, operating results or condition (financial or otherwise) of the Company that would reasonably be expected to result in a Material Adverse Change to the Company, Effect; (iib) any declarationredemption, setting aside or payment of any dividend on, or other distribution (whether in cash, stock or property) in respect of, any of the Company’s or any of its Subsidiaries’ capital stock, or any purchase, redemption purchase or other acquisition by the Company or any of its Subsidiaries of any of the Company’s capital stock or any other securities of the Company or its Subsidiaries or any options, warrants, calls or rights to acquire any such shares or other securities except for repurchases from employees following their termination as may occur after the date hereof solely pursuant to the terms of their pre-existing stock option or purchase agreements, this Agreement; (iiic) any splitgrant of any option to purchase or other right to acquire any of the Shares or any capital stock of the Company, combination any grant of any stock appreciation rights, or reclassification any issuance of shares of capital stock (whether treasury shares or otherwise) by the Company; (d) any indebtedness incurred for borrowed money or commitment to borrow money by the Company; (e) any sale, assignment or transfer of any Licenses; (f) any mortgage, pledge, transfer of a security interest in, or Lien, created by the Seller or the Company, with respect to any of the Company’s material properties or assets, including but not limited to its Licenses, excluding Liens for taxes not yet due or payable; (g) any dividend, distribution or payment on shares of its Subsidiaries’ capital stock, (iv) entry by stock of the Company declared, made, set aside or any of its Subsidiaries into any licensing or other agreement with regard to the disposition of any material intellectual property other than licenses, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into in the ordinary course of business consistent with past practice, (v) any material change by the Company in its accounting methods, principles or practicespaid, except as required by concurrent changes in GAAP or by the Commission, (vi) any material revaluation by the Company of any of its assets, including, without limitation, writing down the value of capitalized inventory or writing off notes or accounts receivable other than in the ordinary course of business contemplated pursuant to and consistent with past practice, the terms of this Agreement; (viih) any communication from the Nasdaq Stock Market with respect to the delisting Company, any making, revocation of the Common Stockor change in any election in respect of Taxes, (viii) any cancellation by the Company or any of its Subsidiaries filing of any debts amended Tax Return, entering into any closing agreement, settling any claim or assessment in respect of Taxes, surrendering by any affirmative action any right to claim a refund of Taxes, or consenting to any extension or waiver of any claims statute of limitation applicable to any claim or rights assessment in respect of material value, Taxes; or (ixi) any sale, transfer or other disposition outside of amount which is presently due and payable from the ordinary course of business Company in respect of any properties guaranties or assets (realsimilar instruments, personal or mixed, tangible or intangible) issued by the Company guaranteeing loans advanced to its agents by any financial institution under any agent loan program or similar type program. The Company has not entered into any oral or written agreement as to any of its Subsidiaries, the acts or (x) any agreement, whether in writing or otherwise, to take any action things described in this section by the Company or any of its SubsidiariesSection 2.26.

Absence of Certain Changes or Events. Since Except (a) as disclosed (i) in the date Company SEC Documents, or (ii) in Schedule 4.7 of the Company Balance SheetDisclosure Schedule, and (b) if this representation is being made at Closing, as expressly provided in this Agreement or as contemplated by the parties in connection with obtaining financing for the Merger, since December 31, 2003, the Company has and the Subsidiaries have conducted its business their businesses only in the ordinary course of business and, to the Company’s Knowledge, in a manner consistent with past practice practice, and there has not been: : (ia) any Material Adverse Change to material adverse change in the Companybusiness, operations, properties, condition (ii) any declaration, setting aside financial or payment of any dividend onotherwise), or other distribution assets or liabilities (whether in cashincluding, stock or propertywithout limitation, contingent liabilities) in respect of, any of the Company’s or any of its Subsidiaries’ capital stock, or any purchase, redemption or other acquisition by the Company or any of its Subsidiaries of Subsidiary; (b) any of the Company’s capital stock material damage, destruction or loss (if not covered by insurance) with respect to any other securities material property or asset of the Company or its Subsidiaries or any options, warrants, calls or rights to acquire any such shares or other securities except for repurchases from employees following their termination pursuant to the terms of their pre-existing stock option or purchase agreements, Subsidiary; (iii) any split, combination or reclassification of any of the Company’s or any of its Subsidiaries’ capital stock, (iv) entry by the Company or any of its Subsidiaries into any licensing or other agreement with regard to the disposition of any material intellectual property other than licenses, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into in the ordinary course of business consistent with past practice, (vc) any material change by the Company or any Subsidiary in its accounting methods, principles or practices, except as required by concurrent changes applicable laws, regulations or accounting pronouncements, provided that each such change has been disclosed in GAAP or by the Commission, Company SEC Documents; (vid) any material revaluation by the Company or any Subsidiary of any of its assets, material asset (including, without limitation, any writing down of the value of capitalized inventory or writing off of notes or accounts receivable receivable), other than in the ordinary course of business consistent with past practice, ; (viie) any communication from other than the Nasdaq Stock Market distribution of quarterly dividends consistent with past practice with respect to the delisting outstanding shares of Company Preferred Stock, any declaration, setting aside or payment of any dividend or distribution in respect of any capital stock (or ownership interests) of the Common StockCompany or any Subsidiary, or any redemption, purchase or other acquisition of any of their respective securities; (viiif) any cancellation issuance to any director, officer or employee of the Company or any Subsidiary of any options, warrants, rights, or convertible securities relating to the issued or unissued capital stock (or ownership interests) of the Company or any Subsidiary other than pursuant to the Company ESP Plan; (g) any acquisition by the Company or any Subsidiary (including, without limitation, by merger, consolidation, or acquisition of its Subsidiaries stock or assets or any other business combination) of any debts corporation, partnership, other business organization or waiver any division thereof or any material amount of any claims or rights of material value, assets; (ixh) any sale, transfer or incurrence of Indebtedness other disposition outside of than in the ordinary course of business and consistent with past practice or any issuance of any properties or assets (real, personal or mixed, tangible or intangible) debt securities by the Company or any of its Subsidiaries, or Subsidiary; (xi) any agreement, whether in writing assumption or otherwise, to take any action described in this section guarantee by the Company or any Subsidiary of its Subsidiariesthe obligations of any Person; (j) other than trade payables, extensions of credit to customers and advances to employees and independent contractors for travel expenses or wage or salary advances for non-executive employees of the Company that do not exceed two weeks wages or salary, in each case in the ordinary course of business and consistent with past practice, any loan or advance by the Company or any Subsidiary to any Person; (k) any authorization of, or commitment to make, any capital expenditure that exceeds the Company’s 2004 capital expenditure budget, a copy of which has been previously provided to Parent (the “2004 Capital Expenditure Budget”); or (l) any increase in the compensation payable or to become payable or the benefits provided or to be provided to any director, officer or employee of the Company or any Subsidiary, except for increases in the ordinary course of business and consistent with past practice.

Absence of Certain Changes or Events. Since Except as disclosed on the date of Company Disclosure Schedule, since the Company Balance SheetSheet Date, the Company has conducted its business only in the ordinary course of business consistent with past practice and there has not been: (i) any Material Adverse Change to the Effect on Company, (ii) any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, stock or property) in respect of, any of the Company’s 's or any of its Subsidiaries’ subsidiaries' capital stock, or any purchase, redemption or other acquisition by the Company or any of its Subsidiaries of any of the Company’s 's capital stock or any other securities of the Company or its Subsidiaries subsidiaries or issuances of any options, warrants, calls or rights to acquire any such shares or other securities except for repurchases from employees following their termination pursuant to the terms of their pre-existing stock option or purchase agreements, (iii) any split, combination or reclassification of any of the Company’s 's or any of its Subsidiaries’ subsidiaries' capital stock, (iv) entry any granting by the Company or any of its Subsidiaries into any licensing or other agreement with regard to the disposition subsidiaries of any material intellectual property other than licensesincrease in compensation or fringe benefits, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into except for normal increases of cash compensation in the ordinary course of business consistent with past practice, or any payment by Company or any of its subsidiaries of any material bonus, except for bonuses made in the ordinary course of business consistent with past practice, or any granting by Company or any of its subsidiaries of any increase in severance or termination pay or any entry by Company or any of its subsidiaries into any currently effective employment, severance, termination or indemnification agreement or any agreement the benefits of which are contingent or the terms of which are materially altered upon the occurrence of a transaction involving Company of the nature contemplated hereby, (v) entry by Company or any of its subsidiaries into any licensing or other agreement with regard to the acquisition or disposition of any material Intellectual Property (as defined in Section 2.18) other than licenses in the ordinary course of business consistent with past practice or any amendment or consent with respect to any licensing agreement filed or required to be filed by Company with the SEC, (vi) any material change by the Company in its accounting methods, principles or practices, except as required by concurrent changes in GAAP GAAP, or by the Commission, (vivii) any material revaluation by the Company of any of its assets, including, without limitation, writing down the value of capitalized inventory or writing off notes or accounts receivable other than in the ordinary course of business consistent with past practice, (vii) any communication from the Nasdaq Stock Market with respect to the delisting of the Common Stock, (viii) any cancellation by the Company or any of its Subsidiaries of any debts or waiver of any claims or rights of material value, (ix) any sale, transfer or other disposition outside of the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangible) by the Company or any of its Subsidiaries, or (x) any agreement, whether in writing or otherwise, to take any action described in this section by the Company or any of its Subsidiariesbusiness.

Absence of Certain Changes or Events. Since the date of the Company Balance SheetSeptember 30, 2009, the Company and each of its Subsidiaries has conducted its business only in the ordinary course Ordinary Course of business consistent with past practice and Business, and, except as disclosed in the Company SEC Documents since such date: (a) there has not been: (i) been any change, event, condition, development or occurrence that constitutes a Company Material Adverse Change to the Company, Change; (iib) there has not been any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, stock or property) in respect of, any of the Company’s or any of its Subsidiaries’ capital stock, property or any purchase, redemption or other acquisition by the Company or any of its Subsidiaries of any of otherwise) with respect to the Company’s capital stock; (c) there has not been any redemption, repurchase or other acquisition for value by the Company of any shares of capital stock or any other securities of the Company, or Company Options or its Subsidiaries or any options, warrants, calls or rights to acquire any such shares or other securities Restricted Shares except for repurchases from employees following their termination pursuant to the acceptance of shares of Company Common Stock as payment for the exercise price of Company Options or for withholding taxes incurred in connection with the exercise of Company Options or the vesting of Restricted Shares, in each case in accordance with the terms of their pre-existing stock option or purchase agreements, the applicable award agreements and the Company Stock Plan; (iiid) there has not been any split, combination or reclassification of any shares of capital stock of the Company’s , or any issuance or the authorization of its Subsidiaries’ any issuance of any other securities in respect of, in lieu of or in substitution for shares of capital stock, stock of the Company; (ive) entry by neither the Company or nor any of its Subsidiaries has (i) except for normal increases and normal severance and termination payments made in the Ordinary Course of Business or as required by applicable Law or as contemplated by this Agreement, increased the wages, salaries, compensation, pension, or other fringe benefits or perquisites payable to any executive officer, employee or director from the amount thereof in effect as of September 30, 2009, granted any severance or termination pay, entered into any licensing contract to make or other agreement with regard to the disposition of grant any material intellectual property severance or termination pay, or paid any bonus (other than licenses, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into the customary year-end bonuses for fiscal year 2009 in the ordinary course of business amounts consistent with past practice), (vii) granted any stock appreciation or similar rights or granted any rights to acquire any shares of its capital stock, or issued any shares of its capital stock, to any executive officer, director or employee other than grants made prior to the date hereof in the Ordinary Course of Business, or (iii) suffered any strike, work stoppage, slow-down, or other labor disturbance. (f) there has not been any material change by the Company in its accounting methods, principles or practicesprinciples, except as required by concurrent may be appropriate to conform to changes in statutory or regulatory accounting rules or GAAP or by the Commission, regulatory requirements with respect thereto; (vig) there has not been any material revaluation by the Company of any of its assets, including, without limitation, writing down the value of capitalized inventory Tax election made or writing off notes or accounts receivable other than in the ordinary course of business consistent with past practice, (vii) any communication from the Nasdaq Stock Market with respect to the delisting of the Common Stock, (viii) any cancellation revoked by the Company or any of its Subsidiaries or any settlement or compromise of any debts or waiver of any claims or rights of material value, (ix) any sale, transfer or other disposition outside of the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangible) Tax liability by the Company or any of its Subsidiaries, or ; and (xh) there has not been any agreement, whether material change in writing or otherwise, to take any action described in this section a tax accounting method by the Company or any of its Subsidiaries.

Absence of Certain Changes or Events. (a) Since December 31, 2020 (the date “Company Balance Sheet Date”), there has not been (i) any change or development in the business, operations, assets, liabilities, condition (financial or otherwise), results of operations, cash flows, or properties of Company or any of its Subsidiaries which has had, or would reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect with respect to Company, and to the Knowledge of the Company Balance SheetCompany, no fact or condition exists which is reasonably likely to cause a Material Adverse Effect with respect to the Company has conducted in the future, (ii) any change by Company or any of its business only Subsidiaries in its accounting methods, principles or practices, other than changes required by applicable Law or GAAP or regulatory accounting as concurred in by Company’s independent accountants, (iii) any declaration, setting aside or payment of any dividend or distribution in respect of any capital stock of Company or any of its Subsidiaries or any redemption, purchase or other acquisition of any of its securities, other than in the ordinary course of business consistent with past practice, (iv) any material election made by Company or any of its Subsidiaries for federal or state income tax purposes, (v) any material change in the credit policies or procedures of Company or any of its Subsidiaries, the effect of which was or is to make any such policy or procedure less restrictive, (vi) other than loans and loan commitments, investment securities, and other real estate owned in the ordinary course of business and consistent with past practice, any material acquisition or disposition of any assets or properties, or any contract for any acquisition or disposition entered into, or (vii) any material lease of real or personal property entered into, other than in connection with foreclosed property or in the ordinary course of business consistent with past practice. (b) Except as otherwise expressly permitted or expressly contemplated by this Agreement, and except as set forth in Company Disclosure Schedule 3.10(b),since the Company Balance Sheet Date, the Company and its Subsidiaries have carried on its business in the ordinary course consistent with past practice and there has not been: (i) any Material Adverse Change to the Company, (ii) any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, stock or property) in respect of, any of the Company’s or any of its Subsidiaries’ capital stock, or any purchase, redemption or other acquisition by the Company or any of its Subsidiaries of any of the Company’s capital stock or any other securities of the Company or its Subsidiaries or any options, warrants, calls or rights to acquire any such shares or other securities except for repurchases from employees following their termination pursuant to the terms of their pre-existing stock option or purchase agreements, (iii) any split, combination or reclassification of any of the Company’s or any of its Subsidiaries’ capital stock, (iv) entry by the Company or any of its Subsidiaries into any licensing contract or other agreement commitment of more than (A) $150,000 in the aggregate or (B) $150,000 per annum with regard to the disposition a term of any material intellectual property more than one year, other than licensesborrowings, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into loans and loan commitments in the ordinary course of business consistent with past practicebusiness, or (vii) any material change by the Company increase in its accounting methods, principles or practices, except as required by concurrent changes in GAAP or by the Commission, (vi) any material revaluation by the Company establishment of any of its assetsbonus, insurance, severance, deferred compensation, pension, retirement, profit sharing, stock option (including, without limitation, writing down the value granting of capitalized inventory stock options, stock appreciation rights, performance awards, or writing off notes restricted stock awards), stock purchase or accounts receivable other than employee benefit plan, or any other increase in the ordinary course compensation payable or to become payable to any directors, officers or employees of business consistent with past practice, (vii) any communication from the Nasdaq Stock Market with respect to the delisting of the Common Stock, (viii) any cancellation by the Company or any of its Subsidiaries of any debts or waiver of any claims or rights of material value, (ix) any sale, transfer or other disposition outside of the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangible) by the Company or any of its Subsidiaries, or (x) any agreementgrant of severance or termination pay, whether in writing or otherwiseany contract or arrangement entered into to make or grant any severance or termination pay, to take any payment of any bonus, or the taking of any action described not in this section by the ordinary course of business with respect to the compensation or employment of directors, officers, or employees of Company or any of its Subsidiaries.

Absence of Certain Changes or Events. Since December 31, 2012 to the date of hereof, there has not been any Company Material Adverse Effect. Since December 31, 2013 to the date hereof, except as expressly contemplated by this Agreement, (a) the Company Balance Sheet, the Company has and its Subsidiaries have conducted its business only their businesses in all material respects in the ordinary course of business and in a manner consistent with past practice and there practice, (b) the Company has not beentaken or permitted any of its Subsidiaries to take any of the following actions: (i) declare, set aside or pay any Material Adverse Change dividend or other distribution, payable in cash, stock, property or otherwise, with respect to any of the Shares (other than dividends or other distributions from any Subsidiary to the CompanyCompany or to another wholly-owned Subsidiary), or redeem, purchase or otherwise acquire, directly or indirectly, any of its shares or other securities (other than in connection with the settlement of any Company Share Awards in accordance with the appropriate Share Incentive Plans and this Agreement) or (ii) adopt, pass any declarationresolution to approve or make any petition or similar proceeding or order in relation to, setting aside a plan of complete or payment partial liquidation, dissolution, scheme of arrangement, merger, consolidation, restructuring, recapitalization or other reorganization of any dividend on, Group Company (other than the Merger or other distribution (whether in cash, stock any merger or property) in respect of, any consolidation among wholly-owned Subsidiaries of the Company’s ), (c) there has not been any material change in any method of accounting or any of its Subsidiaries’ capital stock, or any purchase, redemption or other acquisition accounting practice by the Company or any of its Subsidiaries Subsidiaries, (d) other than in the ordinary course of business and consistent with past practice (including with respect to amount and timing), there has not been any material increase in the compensation or benefits payable or to become payable to its officers or key employees, (e) the Group Companies have not incurred Indebtedness in excess of US$70,000,000 in the aggregate, (f) none of the Company’s Group Companies has (i) acquired or made any capital stock contributions to or investments in any other securities business or entity or (ii) acquired any assets outside of the Company or its Subsidiaries or any options, warrants, calls or rights to acquire any such shares or other securities except for repurchases from employees following their termination pursuant to the terms of their pre-existing stock option or purchase agreements, (iii) any split, combination or reclassification of any of the Company’s or any of its Subsidiaries’ capital stock, (iv) entry by the Company or any of its Subsidiaries into any licensing or other agreement with regard to the disposition of any material intellectual property other than licenses, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into in the ordinary course of business consistent with past practice, and (vg) no receiver, trustee, administrator or other similar person has been appointed in relation to the affairs of any Group Company or its property or any part thereof material change by to the Company in its accounting methods, principles or practices, except as required by concurrent changes in GAAP or by the Commission, (vi) any material revaluation by the Company of any of its assets, including, without limitation, writing down the value of capitalized inventory or writing off notes or accounts receivable other than in the ordinary course of business consistent with past practice, (vii) any communication from the Nasdaq Stock Market with respect to the delisting of the Common Stock, (viii) any cancellation by the Company or any of and its Subsidiaries of any debts or waiver of any claims or rights of material value, (ix) any sale, transfer or other disposition outside of the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangible) by the Company or any of its Subsidiaries, or (x) any agreement, whether in writing or otherwise, to take any action described in this section by the Company or any of its Subsidiariestaken as a whole.

Absence of Certain Changes or Events. Since Except as disclosed in the Company Reports filed prior to the date of this Agreement or as set forth in the Company Disclosure Schedule and except for the transactions contemplated hereby, from May 28, 2000 (the "Company Balance SheetSheet Date") through the date hereof, the Company has and its subsidiaries, taken as a whole, have conducted its business their businesses only in the ordinary course of business and in a manner consistent with past practice and there has not been: (ia) any damage, destruction or loss (whether or not covered by insurance) with respect to any assets of the Company or any of its subsidiaries that would have a Company Material Adverse Change to Effect; (b) any material change by the CompanyCompany or any of its subsidiaries in their accounting methods, principles or practices (iiexcept as may be required by applicable Law or GAAP); (c) any declaration, setting aside or payment of any dividend on, dividends or other distribution (whether in cash, stock or property) distributions in respect of, any of shares of the Company’s capital stock of the Company or any of its Subsidiaries’ capital stocksubsidiaries (other than dividends permitted in Article V), or any purchaseredemption, redemption purchase or other acquisition by the Company or any of its Subsidiaries subsidiaries of any of the Company’s capital stock or any their securities (other securities of than repurchases after the Company or its Subsidiaries or any options, warrants, calls or rights to acquire any such shares or other securities except for repurchases from employees following their termination Balance Sheet Date pursuant to stock repurchase programs disclosed in the terms of their pre-existing stock option or purchase agreements, Company Reports); (iiid) any split, combination or reclassification of any capital stock of the Company’s Company or any of its Subsidiaries’ subsidiaries or any issuance or the authorization of any issuance of any other securities in respect of, in lieu of or in substitution for shares of capital stockstock of the Company or any of its subsidiaries; (e) any acquisition, divestiture, or investment in the equity or debt securities of any person (ivincluding in any joint venture or similar arrangement) material to the Company and its subsidiaries, taken as a whole; (f) any entry by the Company or any of its Subsidiaries subsidiaries into any licensing commitment or other agreement with regard transaction material to the disposition of any material intellectual property other than licensesCompany and its subsidiaries, distribution agreementstaken as a whole, advertising agreements, sponsorship agreements or merchant program agreements entered into in the ordinary course of business consistent with past practice, (v) any material change by the Company in its accounting methods, principles or practices, except as required by concurrent changes in GAAP or by the Commission, (vi) any material revaluation by the Company of any of its assets, including, without limitation, writing down the value of capitalized inventory or writing off notes or accounts receivable other than in the ordinary course of business and consistent with past practice, ; or (viig) any communication from the Nasdaq Stock Market with respect to the delisting of the Common Stock, (viii) any cancellation by the Company or any of its Subsidiaries of any debts or waiver of any claims or rights of material value, (ix) any sale, transfer or other disposition outside of the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangible) by the Company or any of its Subsidiaries, or (x) any agreement, whether in writing or otherwise, to take any action described in this section by the Company or any of its SubsidiariesMaterial Adverse Effect.

Absence of Certain Changes or Events. Since From the date of the Company Balance Sheet to and including the date of this Agreement, the Company and its Subsidiaries have conducted their respective businesses and operations in the ordinary course consistent with past practice and neither the Company nor any of its Subsidiaries has: (a) split, combined, or reclassified any shares of its capital stock or made any other changes in its equity capital structure; (b) purchased, redeemed, or otherwise acquired, directly or indirectly, any shares of its capital stock or any options, rights, or warrants to purchase any such capital stock or any securities convertible into or exchangeable for any such capital stock; (c) declared, set aside, or paid any dividend or made any other distribution in respect of shares of its capital stock, except for dividends or distributions by any of the Company's Subsidiaries to the Company or another of the Company's Subsidiaries; (d) issued any shares of its capital stock or granted any options, rights, or warrants to purchase any such capital stock or any securities convertible into or exchangeable for any such capital stock, except for issuances of shares of Company Common Stock upon the exercise of options granted on or before the date of the Company Balance Sheet; (e) purchased any business, the Company has conducted its business only in the ordinary course purchased any stock of business consistent with past practice and there has not been: (i) any Material Adverse Change to corporation other than the Company, or merged or consolidated with any person; (iif) any declarationsold, setting aside leased, licensed or payment encumbered or otherwise disposed of any dividend onassets or properties, or other distribution (whether in cash, stock or property) in respect of, any of the Company’s or any of its Subsidiaries’ capital stock, or any purchase, redemption or other acquisition by the Company or any of its Subsidiaries of any of the Company’s capital stock or any other securities of the Company or its Subsidiaries or any options, warrants, calls or rights to acquire any such shares or other securities except for repurchases from employees following their termination pursuant to the terms of their pre-existing stock option or purchase agreements, (iii) any split, combination or reclassification of any of the Company’s or any of its Subsidiaries’ capital stock, (iv) entry by the Company or any of its Subsidiaries into any licensing or other agreement with regard to the disposition of any material intellectual property other than licenses, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into in the ordinary course of business consistent with past practice, (v) any material change by the Company in its accounting methods, principles or practices, except as required by concurrent changes in GAAP or by the Commission, (vi) any material revaluation by the Company of any of its assets, including, without limitation, writing down the value of capitalized inventory or writing off notes or accounts receivable other than in the ordinary course of business consistent with past practice, (vii) which sales, leases, licenses, encumbrances or other dispositions of assets other than inventory, in any communication from the Nasdaq Stock Market with respect event, were not material to the delisting Company and its Subsidiaries, taken as a whole; (g) incurred, assumed, or guaranteed any indebtedness for money borrowed other than (i) borrowing incurred for working capital purposes under the Company's existing revolving credit facility and (ii) intercompany indebtedness; (h) changed or modified in any material respect any existing accounting method, principle or practice, other than as required by GAAP; (i) except for this Agreement, entered into any commitment to do any of the Common Stockforegoing; (j) suffered any business interruption, (viii) any cancellation by the Company damage to or any destruction of its Subsidiaries of any debts or waiver of any claims or rights of material valueproperties, (ix) any sale, transfer or other disposition outside of incident, occurrence, or event that has had or would be reasonably likely to have (after giving effect to insurance coverage), individually or in the aggregate, a Company Material Adverse Effect; (k) except for normal increases in the ordinary course of business consistent with past practice that, in the aggregate, do not result in a material increase in benefits or compensation expense to the Company, increased in any manner the compensation or benefits of any properties employee who is not a director or assets officer, former employee, or independent contractor providing personal services of the Company or its Subsidiaries (real, personal "COMPANY EMPLOYEE"); (l) increased the compensation or mixed, tangible benefits of any officer or intangible) by director of the Company or any of its Subsidiaries, other than consistent with past practice; or (m) entered into or (x) amended any contract, agreement, whether employment, severance or special pay arrangement with any Company Employee, except in writing or otherwise, to take any action described in this section by the Company or any ordinary course of its Subsidiariesbusiness consistent with past practice.

Absence of Certain Changes or Events. Since December 31, 2005 there has not been, except where it would not have a Material Adverse Effect on the date of the Company Balance SheetParent Guarantor, the Company has conducted its or any of their Subsidiaries and except as permitted and/or required by the Merger Agreement (a) any material liability incurred by the Parent Guarantor, the Company or any of their Subsidiaries, other than current liabilities incurred in the ordinary course of business only consistent in type and amount with past practices, (b) any material asset or property of the Parent Guarantor, the Company or any of their Subsidiaries made subject to any Encumbrance of any kind (except pursuant to the Security Documents), (c) any cancellation of any debt owed to or claim held by the Parent Guarantor, the Company or any of their Subsidiaries, (d) any payment of dividends on, or other distribution with respect to, or any direct or indirect redemption, purchase or acquisition of, any shares of the capital stock or other securities of the Parent Guarantor, the Company or any of their Subsidiaries., (f) any disposition of any tangible or intangible material asset of the Parent Guarantor, the Company or any of their Subsidiaries, (g) any loan by the Parent Guarantor, the Company or any of their Subsidiaries to any officer, director, employee, consultant, agent, Affiliate or stockholder of the Parent Guarantor, the Company or any of their Subsidiaries (other than advances to such persons in the ordinary course of business consistent with past practice and there has practices in connection with bona fide business expenses), (h) any damage, destruction or loss (whether or not been: covered by insurance) of any asset of the Parent Guarantor, the Company or any of their Subsidiaries, (i) any Material Adverse Change extraordinary increase, direct or indirect, in the compensation paid or payable to any officer, director, employee, consultant or agent of the CompanyParent Guarantor, the Company or any of their Subsidiaries, (iij) any declaration, setting aside or payment write-down of the value of any dividend oninventory, or other distribution (whether in cashany write-off as uncollectible of any account or note receivable of the Parent Guarantor, stock the Company or property) in respect of, any of their Subsidiaries that is not consistent in type and amount with the Parent Guarantor’s, the Company’s or any of its their Subsidiaries’ capital stockpast practices or for which adequate amounts had not been reserved, (k) any change in the accounting methods, practices or any purchasepolicies followed by the Parent Guarantor, redemption or other acquisition by the Company or any of its Subsidiaries of any of the Company’s capital stock or any other securities of the Company or its their Subsidiaries or any optionschange in depreciation or amortization policies or rates theretofore adopted, warrants, calls which has not been adequately provided for or rights to acquire any such shares or other securities except for repurchases from employees following their termination pursuant to the terms of their pre-existing stock option or purchase agreements, (iii) any split, combination or reclassification of any of the Company’s or any of its Subsidiaries’ capital stock, (iv) entry by the Company or any of its Subsidiaries into any licensing or other agreement with regard to the disposition of any material intellectual property other than licenses, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into disclosed in the ordinary course of business consistent with past practice, (v) any material change by the Company in its accounting methods, principles or practices, except as required by concurrent changes in GAAP or by the Commission, (vi) any material revaluation by the Company of any of its assets, including, without limitation, writing down the value of capitalized inventory or writing off notes or accounts receivable other than in the ordinary course of business consistent with past practice, (vii) any communication from the Nasdaq Stock Market with respect to the delisting of the Common Stock, (viii) any cancellation by the Company or any of its Subsidiaries of any debts or waiver of any claims or rights of material value, (ix) any sale, transfer or other disposition outside of the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangible) by the Company or any of its Subsidiaries, or (x) any agreement, whether in writing or otherwise, to take any action described in this section by the Company or any of its SubsidiariesFinancial Statements.

Absence of Certain Changes or Events. Since the date of the Company Balance SheetSheet and through the date hereof there has not occurred or arisen: (a) any Effect that, individually or when taken together with all other Effects that have occurred since the date of the Company Balance Sheet through the date hereof, that has conducted or would reasonably be expected to have a Material Adverse Effect on the Company; (b) any acquisition by the Company or any Subsidiary of, or agreement by the Company or any Subsidiary to acquire by merging or consolidating with, or by purchasing any assets or equity securities of, or by any other manner, any business or corporation, partnership, association or other business organization or division thereof, or other acquisition or agreement to acquire any assets or any equity securities that are material, individually or in the aggregate, to the business of the Company and its business only Subsidiaries, taken as a whole; (c) any entry into, amendment or termination by the Company or any of its Subsidiaries of any Contract, agreement in principle, letter of intent, memorandum of understanding or similar agreement with respect to any joint venture, strategic partnership or alliance, (in each case, other than reseller, original equipment manufacturer (“OEM”) and licensing agreements entered into in the ordinary course of business consistent with past practice and there has not been: (ibusiness) any Material Adverse Change material to the CompanyCompany and its Subsidiaries, taken as a whole; (iid) any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, stock or property) in respect of, any of the Company’s or any of its Subsidiaries’ capital stock, or any purchase, redemption or other acquisition by the Company or any of its Subsidiaries of any of the Company’s capital stock or any other securities of the Company or its Subsidiaries or any options, warrants, calls or rights to acquire any such shares or other securities except for repurchases from employees Employees following their termination pursuant to the terms of their pre-existing stock option or purchase agreements, ; (iiie) any split, combination or reclassification of any of the Company’s or any of its Subsidiaries’ capital stock; (f) except to the extent such grant, payment, change or entry would not exceed $10,000 per individual or pursuant to agreements outstanding as of the date of the Company Balance Sheet, (i) any granting by the Company or any of its Subsidiaries, whether orally or in writing, of any increase in compensation or fringe benefits (except for normal increases of cash compensation to current non-officer employees in the ordinary course of business), (ii) any payment by the Company or any of its Subsidiaries of any bonus (except for bonuses made to current non-officer employees in the ordinary course of business), (iii) any change by the Company or any of its Subsidiaries that materially increases the value of, or accelerates the timing of payment of any severance, termination or bonus payments or benefits to any current officer or employee of the Company or (iv) any entry by the Company or any of its Subsidiaries into any licensing currently effective agreement that is (A) an employment, severance, termination or other indemnification agreement with regard to any officer of the disposition of any material intellectual property other than licenses, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into in Company outside the ordinary course of business consistent or (B) any agreement with past practiceany officer of the Company the benefits of which are contingent or the terms of which are materially altered upon the occurrence of a transaction involving the Company of the nature contemplated hereby (either alone or upon the occurrence of additional or subsequent events), in any case as disclosed in Section 3.5(f) of the Company Disclosure Letter; (vg) any material amendment, termination or consent with respect to any Company Material Contract, Material Lease Document or Company Benefit Plan entered into outside the ordinary course of business, except as required by applicable law; (h) entry into any customer Contract that contains any material non-customary provisions for future deliverables or future royalty payments; (i) any material change by the Company in its accounting methods, principles or practices, except as required by concurrent changes in GAAP GAAP; (j) any debt, capital lease or other debt or equity financing transaction, other than trade and other ordinary course payables, by the CommissionCompany or any of its Subsidiaries or entry into any agreement by the Company or any of its Subsidiaries in connection with any such transaction, except for capital leases entered into in the ordinary course of business which are not, individually or in the aggregate, material to the Company and its Subsidiaries, taken as a whole; (vik) other than pursuant to Contracts in effect on the date hereof, any grants of any material refunds, credits, rebates or other allowances by the Company or any of its Subsidiaries to any end user, customer, reseller or distributor, in each case, other than in the ordinary course of business or otherwise previously accrued in the Company Balance Sheet; (l) any material change in the level of product returns, bad debts or rights to accounts receivable which, individually or in the aggregate, have had or are reasonably likely to have a material effect on accounts receivable reserves or other reserves maintained by the Company and its Subsidiaries (other than historical seasonal changes or similar factors); (m) any material reductions in work force, real property lease terminations with respect to Material Leased Real Property, or other exit or disposal plan which would be required to be disclosed by Item 2.01 of Form 8-K; (n) any sale, lease, license, encumbrance or other disposition of any Material Leased Real Property or assets except the sale, lease, license or disposition of property or assets which are not material, individually or in the aggregate, to the business of the Company and any of its Subsidiaries, taken as a whole, or the licenses of current Company products, in each case, in the ordinary course of business; (o) any loan, extension of credit or financing or grant of extended payment terms by the Company or any of its Subsidiaries to any Person other than in the ordinary course of business; (p) any material purchases of fixed assets or other long-term assets other than in the ordinary course of business; (q) any adoption of or change in any material election in respect of Taxes, adoption or change in any accounting method in respect of Taxes, agreement or settlement of any claim or assessment in respect of Taxes, or extension or waiver of the limitation period applicable to any claim or assessment in respect of Taxes; (r) any revaluation by the Company of any of its or its Subsidiaries’ assets, including, without limitation, writing down the value of capitalized inventory long term or short-term investments, fixed assets, goodwill, intangible assets, deferred tax assets, or writing off notes or accounts receivable other than in the ordinary course of business consistent and which would be material to the Company and its Subsidiaries, taken as a whole, or to the Company’s knowledge, any factor or circumstance, that, in accordance with past practiceGAAP, would require any such material revaluation; (viis) any communication from significant deficiency or material weakness identified in the Nasdaq Stock Market with respect to the delisting system of the Common Stock, (viii) any cancellation internal controls utilized by the Company and its Subsidiaries; or (t) brought, or had brought against it, any of its Subsidiaries of litigation or proceeding related to Intellectual Property, or settled any debts or waiver of any claims or rights of material value, litigation; (ixu) any sale, transfer written agreement (other than this Agreement or other disposition outside of the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangibleagreements contemplated hereby) by the Company or any of its Subsidiaries, or (x) any agreement, whether in writing or otherwise, to take any action described in this section by the Company or any of its SubsidiariesSection 3.5.

Absence of Certain Changes or Events. (a) Since the date Balance Sheet Date, and except as discussed in the Company SEC Reports, the business of the Company Balance Sheet, the Company and its Subsidiaries has been conducted its business only in all material respects in the ordinary course of business consistent with past practice practice, neither the Company nor any of its Subsidiaries has engaged in any transaction or series of related transactions material to the Company and its Subsidiaries taken as a whole other than in the ordinary course consistent with past practice, and there has not been any event, occurrence or development, alone or taken together with all other existing facts, that, individually or in the aggregate, has had, or would reasonably be expected to have, a Material Adverse Effect on the Company. (b) Without limiting the generality of the foregoing SECTION 5.9(a), since the Balance Sheet Date and except as disclosed in SECTION 5.9 of the Disclosure Letter, there has not been: : (i) any damage, destruction or loss to any of the assets or properties of the Company or any of its Subsidiaries that, individually or in the aggregate, has a Material Adverse Change to Effect on the Company, ; (ii) any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, stock or property) capital return in respect of, of any shares of the Company’s 's capital stock or any of its Subsidiaries’ capital stockredemption, or any purchase, redemption purchase or other acquisition by the Company or any of its Subsidiaries of any shares of the Company’s 's capital stock or any other securities of the Company or its Subsidiaries or any optionsrepurchase, warrants, calls or rights to acquire any such shares redemption or other securities except for repurchases from employees following their termination pursuant to the terms of their pre-existing stock option or purchase agreements, (iii) any split, combination or reclassification of any of the Company’s or any of its Subsidiaries’ capital stock, (iv) entry by the Company or any of its Subsidiaries into of any licensing outstanding shares of capital stock or other agreement with regard to securities of, or other ownership interests in, the disposition Company or any of its Subsidiaries, or any amendment of any material intellectual property term of any outstanding security of the Company or any of its Subsidiaries; (iii) any sale, assignment, transfer, lease or other disposition or agreement to sell, assign, transfer, lease or otherwise dispose of any of the assets of the Company or any of its Subsidiaries for consideration in the aggregate in excess of One Hundred Thousand Dollars ($100,000) or other than licensesin the ordinary course of business consistent with past practices; (iv) any acquisition (by merger, distribution agreementsconsolidation, advertising agreementsor acquisition of stock or assets) by the Company or any of its Subsidiaries of any corporation, sponsorship agreements partnership or merchant program other business organization or division thereof or any equity interest therein for consideration, or any loans or advances to any Person in excess of One Hundred Thousand Dollars ($100,000) in the aggregate; (v) any incurrence of or guarantee with respect to any indebtedness for borrowed money by the Company or any of its Subsidiaries other than pursuant to the Company's existing credit facilities in the ordinary course of business or any creation or assumption by the Company or any of its Subsidiaries of any material Lien on any material asset; (vi) any material change in any method of accounting or accounting practice used by the Company or any of its Subsidiaries, other than such changes required by a change in law or generally accepted accounting principles; (vii) (B) any employment, deferred compensation, severance or similar agreement entered into or amended by the Company or any of its Subsidiaries and any employee, in each case other than sales commission agreements entered into in the ordinary course of business consistent with past practice, (vB) any material change increase in the compensation payable or to become payable by it to any of its directors or officers or generally applicable to all or any category of the Company's employees, (C) any increase in the coverage or benefits available under any vacation pay, company awards, salary continuation or disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan, payment or arrangement made to, for or with any of the directors or officers of the Company or generally applicable to all or any category of the Company's employees or (D) severance pay arrangements made to, for or with such directors, officers or employees other than, in the case of (B) and (C) above, increases in the ordinary course of business consistent with past practice and that in the aggregate have not resulted in a material increase in the benefits or compensation expense of the Company or any of its accounting methods, principles or practices, except as required by concurrent changes in GAAP or by the Commission, Subsidiaries; (viviii) any revaluing in any material revaluation by the Company respect of any of the assets of the Company or any of its assetsSubsidiaries, including, including without limitation, limitation writing down the value of capitalized inventory or writing off notes or accounts receivable other than in the ordinary course of business consistent with past practice, business; (viiix) any communication from the Nasdaq Stock Market with respect to the delisting of the Common Stockloan, (viii) any cancellation advance or capital contribution made by the Company or any of its Subsidiaries to, or investment in, any person other than loans, advances or capital contributions, or investments of any debts or waiver of any claims or rights of material value, (ix) any sale, transfer or other disposition outside of the Company made in the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangible) by the Company or any of its Subsidiaries, or consistent with past practices; or (x) any agreement, whether in writing or otherwise, agreement to take any action described actions specified in this section by the Company or any of its SubsidiariesSECTION 5.9(b), except for this Agreement.

Absence of Certain Changes or Events. Since From the Interim Balance Sheet Date to the date hereof (i) there has not been or arisen any Material Adverse Effect on the Company, and (ii) neither the Company nor any of its subsidiaries has taken any of the following actions: (a) Caused, permitted or submitted to a vote of the Company’s stockholders any amendments to the Company Charter Documents (or similar governing instruments of any of its subsidiaries); (b) Acquired or agreed to acquire by merging or consolidating with, or by purchasing any equity interest in or a portion of the assets of, or by any other manner, any business or any corporation, partnership, association or other business organization or division thereof; (i) Granted any equity-based compensation, whether payable in cash, securities or property, or granted or paid any severance or termination pay or any bonus or other special remuneration (whether in cash, securities or property) or any increase thereof to any director, officer, consultant or employee, (ii) adopted any new severance plan, or amended or modified or altered in any manner any severance plan, agreement or arrangement existing on the date thereof (including without limitation any retention, change of control or similar agreement), or (iii) entered into any agreement the benefits of which were contingent or the terms of which were materially altered upon the occurrence of a transaction involving the Company of the nature contemplated hereby; (d) Declared, set aside or paid any dividends on or made any other distributions (whether in cash, securities or property) in respect of any capital stock of the Company Balance Sheetor its subsidiaries or split, combined or reclassified any capital stock of the Company has conducted or its business only subsidiaries or issued or authorized the issuance of any other securities in respect of, in lieu of or in substitution for any capital stock of the Company or its subsidiaries; (e) Granted any loans or advances (other than customary travel or expense advances in compliance with the Company’s policies) to employees, officers, directors or other third parties, made any investments in or capital contributions to any person, incurred any indebtedness for borrowed money or guaranteed any such indebtedness of another person, issued or sold any debt securities or options, warrants, calls or other rights to acquire any debt securities of the Company, entered into any “keep well” or other agreement to maintain any financial statement condition or entered into any arrangement having the economic effect of any of the foregoing other than in connection with the financing of ordinary course trade payables consistent with past practice; (i) Increased the compensation or benefits payable or to become payable to officers, directors, consultants, or employees, (ii) entered into any new or amended any existing Company Employee Plan, Employment Agreement, indemnification, collective bargaining, or similar agreement, except as required by applicable law, (iii) hired any employee, (iv) terminated any employee, or (v) taken any action that would allow any employee to claim a constructive termination or termination for good cause; (g) Waived the material benefits of, agreed to modify in any manner, terminated, released any person from or knowingly failed to enforce the confidentiality or nondisclosure provisions of any material Contract to which the Company or any of its subsidiaries is a party or of which the Company or any of its subsidiaries is a beneficiary; (h) Other than non-exclusive licenses granted to end-users in the ordinary course of business and consistent with past practice and there has not been: practice, (iA) entered into, renewed, or modified or amended in any Material Adverse Change material respect any Contract relating to the Companydistribution, (ii) any declarationsale, setting aside license or payment of any dividend on, or other distribution (whether in cash, stock or property) in respect of, any marketing by third parties of the Company’s products or any of its Subsidiaries’ capital stock, or any purchase, redemption or other acquisition by the Company or any of its Subsidiaries of any of the Company’s capital stock or any other securities services of the Company or its Subsidiaries or any options, warrants, calls or rights to acquire any such shares subsidiaries (including Company Products or other securities except for repurchases from employees following their termination pursuant to the terms of their pre-existing stock option Company Intellectual Property) or purchase agreements, (iii) any split, combination products or reclassification of any of the Company’s or any of its Subsidiaries’ capital stock, (iv) entry services licensed by the Company or its subsidiaries (including any of its Subsidiaries into IP Licenses), (B) sold, leased, licensed, transferred or otherwise disposed of, or otherwise extended, amended or modified in any licensing material respect, any rights to, Company Products or other agreement with regard Company Intellectual Property, (C) entered into, renewed, or modified or amended in any material respect any Contract relating to the disposition design, manufacture, marketing or sale of products relating to the Company’s Embedded Mobility Business, or (D) transferred or licensed to any material intellectual property other person future rights to the Company Intellectual Property; (i) Other than licenses, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into non-exclusive licenses granted to end-users in the ordinary course of business and consistent with past practice, (v) sold, leased, licensed, encumbered or otherwise disposed of any material change by properties or assets, except for the sale, lease, licensing, encumbering or disposition of property or assets not in excess of $50,000 individually or $150,000 in the aggregate, provided such property or assets were not material, individually or in the aggregate, to the business of the Company and its subsidiaries; (j) Made or committed to make any capital expenditures in its accounting methodsexcess of $50,000 individually or $100,000 in the aggregate, principles or practices, except other than any commitments for capital expenditures reflected on the Interim Balance Sheet; (k) Except as required by concurrent changes in GAAP or by the Commissionrules and regulations of the SEC, (vi) any material revaluation by the Company of revalued any of its assets, including, material assets (including without limitation, limitation writing down the value of capitalized inventory or writing off notes or accounts receivable other than in the ordinary course of business consistent with past practice) or made any material change in accounting methods, principles or practices; (viil) Canceled or failed to renew, without reasonable substitutes, any communication from insurance policy naming the Nasdaq Stock Market with respect Company or any subsidiary as a beneficiary or loss payee; or (m) Made any Tax election or accounting method change (except as required by GAAP) that, individually or in the aggregate, was reasonably likely to materially adversely affect the delisting Tax liability or Tax attributes of the Common Stock, (viii) any cancellation by the Company or any of its Subsidiaries of subsidiaries, settled or compromised any debts material Tax liability or refund, filed any amendment to a Return, entered into any closing agreement or consented to any extension or waiver of any claims or rights of material value, (ix) any sale, transfer or other disposition outside of the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangible) by the Company or any of its Subsidiaries, or (x) any agreement, whether in writing or otherwise, limitation period with respect to take any action described in this section by the Company or any of its SubsidiariesTaxes.

Absence of Certain Changes or Events. Since the date Except as disclosed on Section 4.08 of the Company Balance SheetDisclosure Schedule or as permitted by Section 6.01 after the date hereof, since December 31, 2004, (i) the Company has conducted its business only in the ordinary and usual course of business consistent with past practice and there has not been: (i) any Material Adverse Change to the Companybusiness, (ii) neither the Company nor any declarationCompany Subsidiary has experienced a Company Material Adverse Effect and (iii) neither the Company nor any Company Subsidiary has taken any of the following actions: (a) (i) declared, setting set aside or payment of paid any dividend dividends on, or made any other distribution (whether in cash, stock or property) distributions in respect of, any of its capital stock, other than (A) regular quarterly cash dividends on the Company’s Company Common Stock at a rate not in excess of the regular quarterly cash dividend most recently declared by the Company prior to the date of this Agreement and (B) dividends and distributions by a Company Subsidiary to its parent, (ii) split, combined or reclassified any of its Subsidiaries’ capital stock or issued or authorized the issuance of any other securities in respect of, in lieu of or in substitution for shares of its capital stock, (iii) purchased, redeemed or otherwise acquired any purchase, redemption or other acquisition by shares of capital stock of the Company or any of its Subsidiaries of any of the Company’s capital stock Company Subsidiary or any other securities of the Company or its Subsidiaries thereof or any optionsrights, warrants, calls warrants or rights options to acquire any such shares or other securities except or (iv) adopted a plan of complete or partial liquidation or resolutions providing for repurchases from employees following their termination or authorizing such liquidation or a dissolution, merger, consolidation, restructuring, recapitalization or reorganization of the Company or any of the Company Subsidiaries; (b) other than grants of Company Stock Options and Company Restricted Shares and issuances pursuant to the terms exercise of their pre-existing stock option Company Stock Options, authorized for issuance, issued, delivered, sold or purchase agreementsgranted (i) any shares of its capital stock, (ii) any Voting Company Debt or other voting securities, (iii) any splitsecurities convertible into or exchangeable for, combination or reclassification any options (including Company Stock Options), warrants or rights to acquire, any such shares, voting securities or convertible or exchangeable securities or (iv) any “phantom” stock, “phantom” stock rights, stock appreciation rights or stock-based performance units; (c) amended its certificate of any incorporation, by-laws or other comparable charter or organizational documents; (d) acquired or agreed to acquire (i) by merging or consolidating with, or by purchasing a substantial portion of the Company’s assets of, or by any other manner, any business or any Person or division thereof or (ii) any assets outside the ordinary and usual course of its Subsidiaries’ capital stockbusiness; (e) except as disclosed in Section 4.08(e) of the Company Disclosure Schedule, (i) granted to any officer or director of the Company or any Company Subsidiary any material increase in compensation or fringe benefits, (ii) granted to any present or former employee, officer or director of the Company or any Company Subsidiary any increase in severance or termination pay, (iii) entered into or amended any employment, consulting, indemnification, severance or termination agreement with any such present or former employee, officer or director, (iv) entry by established, adopted, entered into or amended in any material respect any Company Plan, (v) taken any action to accelerate any rights or benefits, or made any material determinations not in the ordinary and usual course of business, under any Company Plan or (vi) loaned or advanced money or other property in excess of $25,000 to any present or former employee, officer or director of the Company or any of its Subsidiaries into Company Subsidiary; (f) made any licensing or other agreement with regard to the disposition of any material intellectual property other than licenses, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into change in the ordinary course of business consistent with past practice, (v) any material change by the Company in its accounting methods, principles or practicespractices affecting the reported consolidated assets, liabilities or results of operations of the Company, except insofar as may have been required by concurrent changes a change in GAAP GAAP; (g) made or by agreed to make any new capital expenditure or expenditures that, individually, is in excess of $100,000 or, in the Commissionaggregate, are in excess of $2,000,000; (vih) any material revaluation by the Company of any of its assets, including, without limitation, writing down the value of capitalized inventory or writing off notes or accounts receivable other than in the ordinary and usual course of business consistent with past practicebusiness, made any material Tax election or settled or compromised any material Tax liability or refund; (viii) settled any communication from the Nasdaq Stock Market with respect material Proceeding to the delisting of the Common Stock, (viii) any cancellation by which the Company or any of its Subsidiaries of Company Subsidiary was or is a party; (j) entered into, renewed, terminated or amended in any debts or waiver of material respect any claims or rights of material value, Real Property Lease; or (ixk) authorized any sale, transfer or other disposition outside of the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangible) by the Company or any of its Subsidiariesof, or (x) any agreement, whether in writing committed or otherwise, agreed to take any action described in this section by of, the Company or any of its Subsidiariesforegoing actions.

Absence of Certain Changes or Events. (a) Since the date of the Company Balance SheetFebruary 28, 2002, the Company has conducted its business only in the ordinary and usual course of business and in a manner consistent with past practice and and, since such date, there has not been: been any (i) any Material Adverse Change to the Company, (ii) any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, stock or property) in respect of, any of the Company’s or any of its Subsidiaries’ capital stock, or any purchase, redemption redemption, retirement, or other acquisition by the Company or any of its Subsidiaries from the Company Shareholders of any shares of the Company’s capital stock or any other securities of the Company or its Subsidiaries or any options, warrants, calls or rights to acquire any such shares capital stock; or declaration or payment of any dividend or other securities except for repurchases from employees following their termination pursuant to the terms distribution or payment in respect of their pre-existing stock option or purchase agreements, (iii) any split, combination or reclassification shares of any of the Company’s or any of its Subsidiaries’ capital stock, ; (ivii) entry payment or increase by the Company or of any of its Subsidiaries into any licensing bonuses, salaries, or other agreement with regard compensation to the disposition of any material intellectual property other than licensesstockholder, distribution agreementsdirector, advertising agreementsofficer, sponsorship agreements or merchant program agreements entered into (except in the ordinary course of business consistent business) employee or entry into any employment, severance, or similar contract with past practiceany director, officer, or employee; (iii) adoption of, or increase in the payments to or benefits under, any Company Benefit Plan (as defined in Section 2.16(a)); (iv) damage to or destruction or loss of any asset or property of the Company, whether or not covered by insurance, that is reasonably likely to have a Material Adverse Effect; (v) entry into, termination of, or receipt of notice of termination of (A) any license, distributorship, dealer, sales representative, joint venture, credit, or similar agreement, or (B) any Material Agreement or transaction involving a total remaining commitment by or to the Company of at least $5,000; (vii) sale (other than sales of inventory in the ordinary course of business), lease, or other disposition of any asset or property of the Company or mortgage, pledge, or imposition of any Lien on any material asset or property of the Company, including the sale, lease, or other disposition of any of the Intellectual Property Rights; (vii) cancellation or waiver of any claims or rights with a value to the Company in excess of $5,000; (viii) material change in the accounting methods used by the Company; (ix) incurrence of any indebtedness for borrowed money or capital lease obligations outside the ordinary course of business; (x) guaranty of any indebtedness of another Person; (xi) acquisition by merger or consolidation with, or by purchasing a substantial equity interest in, or by any other manner, any business or any Person; (xii) acceleration, termination (other than end-of-term expirations), modification, cancellation, declaration of a default under or indication of an intent to terminate any Material Agreement (or series of related Material Agreements) involving more than $5,000 to which the Company is a party or by which it is bound; (xiii) any capital expenditure (or series of related capital expenditures) either involving more than $5,000 or outside the ordinary course of business; (xiv) delay or postponement of the collection of accounts receivable or the payment of accounts payable and other liabilities outside the ordinary course of business; (xvi) loan to, or, except in the ordinary course of business, entry into any other transaction with, any of its directors, officers and employees; (xvi) entry into any transaction other than in the ordinary course of business; (xvii) agreement, whether oral or written, by the Company to do any of the foregoing; and (xviii) any other change, event, development or circumstance affecting the Company which, individually or in the aggregate, has, or is reasonably likely to have, a Material Adverse Effect. (b) Since December 31, 2001, there has not been any change by the Company in its accounting methods, principles or practices, except as required by concurrent changes in GAAP or by the Commission, (vi) any material revaluation by the Company of any of its assets, including, without limitation, writing down the value of capitalized inventory or writing off notes or accounts receivable other than in the ordinary course of business consistent with past practicebusiness, (vii) or any communication from condition, event or occurrence which could reasonably be expected to prevent, hinder or materially delay the Nasdaq Stock Market with respect to the delisting ability of the Common Stock, (viii) any cancellation Company to consummate the transactions contemplated by the Company or any of its Subsidiaries of any debts or waiver of any claims or rights of material value, (ix) any sale, transfer or other disposition outside of the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangible) by the Company or any of its Subsidiaries, or (x) any agreement, whether in writing or otherwise, to take any action described in this section by the Company or any of its SubsidiariesAgreement.

Absence of Certain Changes or Events. Since From the date of the Company Buyer Balance SheetSheet to and including the date of this Agreement, the Company has Buyer and its Subsidiaries have conducted its business only their respective businesses and operations in the ordinary course of business consistent with past practice and there has not been: (i) any Material Adverse Change to the Company, (ii) any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, stock or property) in respect of, any of the Company’s or any of its Subsidiaries’ capital stock, or any purchase, redemption or other acquisition by the Company or neither Buyer nor any of its Subsidiaries has: (a) split, combined, or reclassified any shares of its capital stock or made any other changes in its equity capital structure; (b) purchased, redeemed, or otherwise acquired, directly or indirectly, any shares of the Company’s its capital stock or any options, rights, or warrants to purchase any such capital stock or any securities convertible into or exchangeable for any such capital stock; (c) declared, set aside, or paid any dividend or made any other securities distribution in respect of the Company shares of its capital stock, except for dividends or distributions by any of Buyer's Subsidiaries to Buyer or another of Buyer's Subsidiaries; (d) issued any shares of its Subsidiaries capital stock or granted any options, warrantsrights, calls or rights warrants to acquire purchase any such shares or other securities except for repurchases from employees following their termination pursuant to the terms of their pre-existing capital stock option or purchase agreements, (iii) any split, combination or reclassification of any of the Company’s or any of its Subsidiaries’ securities convertible into or exchangeable for any such capital stock, except for issuances of shares of Buyer Common Stock upon the exercise of options, granted on or before the date of the Buyer Balance Sheet; (ive) entry by the Company or purchased any of its Subsidiaries into business, purchased any licensing or other agreement with regard to the disposition stock of any material intellectual property corporation other than licensesBuyer, distribution agreementsor merged or consolidated with any person; (f) sold, advertising agreementsleased, sponsorship agreements licensed or merchant program agreements entered into in the ordinary course of business consistent with past practice, (v) any material change by the Company in its accounting methods, principles encumbered or practices, except as required by concurrent changes in GAAP or by the Commission, (vi) any material revaluation by the Company otherwise disposed of any of its assetsassets or properties, including, without limitation, writing down the value of capitalized inventory or writing off notes or accounts receivable other than in the ordinary course of business consistent with past practice, which sales, leases, licenses, encumbrances or other dispositions of assets other than inventory, in any event, were not material to Buyer and its Subsidiaries, taken as a whole; (viig) incurred, assumed, or guaranteed any communication from the Nasdaq Stock Market with indebtedness for money borrowed other than (A) borrowing incurred for working capital purposes under Buyer's existing revolving credit facility and (B) intercompany indebtedness; (h) changed or modified in any material respect any existing accounting method, principle or practice, other than as required by GAAP; (i) except for this Agreement, entered into any commitment to the delisting do any of the Common Stockforegoing; (j) suffered any business interruption, (viii) any cancellation by the Company damage to or any destruction of its Subsidiaries of any debts or waiver of any claims or rights of material valueproperties, (ix) any sale, transfer or other disposition outside of incident, occurrence, or event that has had or would be reasonably likely to have (after giving effect to insurance coverage), individually or in the aggregate, a Buyer Material Adverse Effect; (k) except for normal increases in the ordinary course of business consistent with past practice that, in the aggregate, do not result in a material increase in benefits or compensation expense to Buyer, increased in any manner the compensation or benefits of any properties employee who is not a director or assets officer, former employee, or independent contractor providing personal services of Buyer or its Subsidiaries (real, personal "BUYER EMPLOYEE"); (l) increased the compensation or mixed, tangible benefits of any officer or intangible) by the Company director of Buyer or any of its Subsidiaries, other than consistent with past practice; or (m) entered into or (x) amended any contract, agreement, whether employment, severance or special pay arrangement with any Buyer Employee, except in writing or otherwise, to take any action described in this section by the Company or any ordinary course of its Subsidiariesbusiness consistent with past practice.

Absence of Certain Changes or Events. Since June 1, 2006, the date Company and each of its Subsidiaries has, in all material respects, conducted its business in the ordinary course consistent with past practice and there has not occurred: (i) any change, event or condition that constitutes a Company Material Adverse Effect; (ii) any acquisition, sale or transfer of any material asset of the Company Balance Sheet, the Company has conducted or any of its business only Subsidiaries other than in the ordinary course of business consistent with past practice and there has not been: practice; (iiii) any Material Adverse Change to change in the Company’s accounting methods or practices (including any change in depreciation or amortization policies or rates) materially affecting the Assets, except as set forth in any Company SEC Document or as required by a change in GAAP or, other than in the ordinary course of business, any negative revaluation by the Company of any of its Assets, including writing down the value of inventory or writing off notes or accounts receivable; (iiiv) any declaration, setting aside or payment of any a dividend on, or other distribution (whether in cash, stock or property) in with respect of, any to the shares of the Company’s or any Company (except for quarterly dividends in the amount of its Subsidiaries’ capital stock$.10 per share of Company Common Stock), or any purchasedirect or indirect redemption, redemption purchase or other acquisition by the Company or of any of its Subsidiaries shares of capital stock, except in connection with (A) the acceptance of shares of Company Common Stock in payment of the exercise price or withholding Taxes incurred by any holder in connection with the exercise of Company Options or the settlement of Company Restricted Shares or Deferred Shares and (B) shares of Company Common Stock purchased prior to the date of this Agreement pursuant to the Company’s capital publicly announced stock or any other securities of the Company or its Subsidiaries or any options, warrants, calls or rights to acquire any such shares or other securities except for repurchases from employees following their termination pursuant to the terms of their pre-existing stock option or purchase agreements, repurchase program; (iiiv) any split, combination or reclassification of any of the Company’s or any of its Subsidiaries’ capital stock, (iv) entry by the Company or any of its Subsidiaries into any licensing or other agreement with regard to the disposition of any material intellectual property other than licensesa Material Contract, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into in the ordinary course of business consistent with past practice, (v) any material change by the Company in its accounting methods, principles or practices, except as required by concurrent changes in GAAP or by the Commission, (vi) any material revaluation by the Company of any of its assets, including, without limitation, writing down the value of capitalized inventory or writing off notes or accounts receivable other than in the ordinary course of business consistent with past practice, or any material amendment or termination of, or default under, any Material Contract to which the Company or any of its Subsidiaries is a party or by which it is bound; (vi) any amendment or change to the Company Charter or Company Bylaws; or (vii) any communication from the Nasdaq Stock Market with respect to the delisting of the Common Stock, (viii) any cancellation entry by the Company or any of its Subsidiaries of into any debts or waiver of agreement to do any claims or rights of material value, (ix) any sale, transfer or other disposition outside of the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangible) by the Company or any of its Subsidiaries, or (x) any agreement, whether in writing or otherwise, to take any action things described in the preceding clauses (i) through (vi) (other than with respect to the transactions contemplated by this section by the Company or any of its SubsidiariesAgreement).

Absence of Certain Changes or Events. (a) Since the Balance Sheet Date and through the date of hereof, there has not been any event, fact or circumstance which has resulted or which would reasonably be expected to result in a Material Adverse Effect on the Company Company. (b) Since the Balance SheetSheet Date through the date hereof, the Company has conducted its business only in the ordinary course of business consistent with past practice and there has not been: (i) any Material Adverse Change to the Company, (ii) any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, stock or property) in respect of, any of the Company’s or any of its Subsidiaries’ capital stockCompany Capital Stock, or (ii) any purchase, redemption or other acquisition by the Company or any of its Subsidiaries of any of the Company’s capital stock Company Capital Stock or any other securities of the Company or its Subsidiaries or any options, warrants, calls or rights to acquire any such shares or other securities except for repurchases from employees Employees following their termination pursuant to the terms of their pre-existing stock option or purchase agreements, (iii) any split, combination or reclassification of any of the Company’s or any of its Subsidiaries’ capital stockCompany Xxxxxxx Xxxxx, (iv) entry by the Company or any of its Subsidiaries into any licensing or other agreement with regard to the disposition of any material intellectual property other than licenses, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into in the ordinary course of business consistent with past practice, (vxx) any material change by the Company in its accounting methods, principles or practices, except as required by concurrent changes in GAAP GAAP, (v) any tax election made or changed by the Commission, Company; (vi) any increase in salary, wages or fees for Employees or any change in other compensation provided to the employees of the Company outside of the ordinary course of business; (vii) any material revaluation by the Company of any of its assets, including, without limitation, including writing down the value of capitalized inventory or writing off notes or accounts receivable other than in the ordinary course of business consistent with past practicebusiness, (vi) any material loss, damage or destruction to, or any material interruption in the use of, any of the assets of the Company, (vii) other than the issuance of Company Common Stock upon the exercise of Company Options or the issuance of Company Options, the Company has not sold, issued or authorized the issuance of (a) any communication from the Nasdaq Company Capital Stock Market with respect to the delisting or other securities of the Common StockCompany, (b) any option or right to acquire any Company Capital Stock or other securities of the Company, or (c) any instrument convertible into or exchangeable for any Company Capital Stock or other security of the Company, (viii) any cancellation by capital expenditure (as determined in accordance with GAAP) which, when added to all other capital expenditures made on behalf of the Company or any of its Subsidiaries of any debts or waiver of any claims or rights of material valuesince the Balance Sheet Date, exceeds $25,000, (ix) any sale, transfer or other disposition outside pledge of any of the ordinary course of business of any properties or assets (realCompany’s assets, personal or mixed, tangible or intangible) by and the Company or has not otherwise permitted any of its Subsidiariesassets to become subject to any Lien (other than Permitted Liens), or (x) any agreement, whether in writing or otherwise, to take any action described in this section loan by the Company to any Person , and the Company has not incurred or guaranteed any of its SubsidiariesIndebtedness for borrowed money.

Absence of Certain Changes or Events. Since the date of the Company ------------------------------------ Balance Sheet, the Company has conducted its business only in the ordinary course of business consistent with past practice and Sheet there has not been: (i) any Material Adverse Change to Effect on the Company, (ii) any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, stock or property) in respect of, any of the Company’s 's or any of its Subsidiaries’ subsidiaries' capital stock, or any purchase, redemption or other acquisition by the Company or any of its Subsidiaries subsidiaries of any of the Company’s 's capital stock or any other securities of the Company or its Subsidiaries subsidiaries or any options, warrants, calls or rights to acquire any such shares or other securities except for repurchases from employees or independent contractors following their termination pursuant to the terms of their pre-pre- existing stock option or purchase agreements, (iii) any split, combination or reclassification of any of the Company’s 's or any of its Subsidiaries’ subsidiaries' capital stock, (iv) any granting by the Company or any of its subsidiaries of any increase in compensation or fringe benefits, except for normal increases of cash compensation in the ordinary course of business consistent with past practice, or any payment by the Company or any of its subsidiaries of any bonus, except for bonuses made in the ordinary course of business consistent with past practice, or any granting by the Company or any of its subsidiaries of any increase in severance or termination pay or any entry by the Company or any of its subsidiaries into any currently effective employment, severance, termination or indemnification agreement or any agreement the benefits of which are contingent or the terms of which are materially altered upon the occurrence of a transaction involving the Company of the nature contemplated hereby, (v) entry by the Company or any of its Subsidiaries subsidiaries into any licensing or other agreement with regard to the acquisition or disposition of any material intellectual property Intellectual Property (as defined in Section 2.9) other than licenses, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into licenses in the ordinary course of business consistent with past practice, (vvi) any amendment or consent with respect to any licensing agreement filed or required to be filed by the Company with the SEC, (vii) any material change by the Company in its accounting methods, principles or practices, except as required by concurrent changes in GAAP GAAP, or by the Commission, (viviii) any material revaluation by the Company of any of its assets, including, without limitation, writing down the value of capitalized inventory or writing off notes or accounts receivable other than in the ordinary course of business consistent with past practice, (vii) any communication from the Nasdaq Stock Market with respect to the delisting of the Common Stock, (viii) any cancellation by the Company or any of its Subsidiaries of any debts or waiver of any claims or rights of material value, (ix) any sale, transfer or other disposition outside of the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangible) by the Company or any of its Subsidiaries, or (x) any agreement, whether in writing or otherwise, to take any action described in this section by the Company or any of its Subsidiariesbusiness.

Absence of Certain Changes or Events. Since the date December 31, 2002, each of the Company Balance Sheet, and the Company Subsidiaries has conducted its business only in the ordinary course of business and in a manner consistent with past practice and and, since such date, there has not been: been any: (ia) any Company Material Adverse Change Effect; (b) amendment or any other change to the Company, (ii) any declaration, setting aside Certificate of Incorporation or payment Bylaws or equivalent organizational documents of any dividend on, or other distribution (whether in cash, stock or property) in respect of, any of the Company’s or any of its Subsidiaries’ capital stock, or any purchase, redemption or other acquisition by the Company or any of its Subsidiaries Company Subsidiary; (c) sale, pledge, lease, license, disposition, grant, encumbrance, or authorization for any sale, pledge, lease, license, disposition, grant or encumbrance, of any of the Company’s capital stock or any other securities material assets of the Company or its Subsidiaries or any optionsCompany Subsidiary, warrantsincluding, calls or rights to acquire without limitation, any such shares or other securities except for repurchases from employees following their termination pursuant to the terms Intellectual Property (as defined below) of their pre-existing stock option or purchase agreements, (iii) any split, combination or reclassification of any of the Company’s or any of its Subsidiaries’ capital stock, (iv) entry by the Company or any of its Subsidiaries into any licensing or other agreement with regard to the disposition of any material intellectual property other than licensesCompany Subsidiary, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into except in the ordinary course of business and in a manner consistent with past practice; (d) authorization, declaration, set aside, dividend payment or other distribution, payable in cash, stock, property or otherwise, with respect to any of the capital stock of the Company or any Company Subsidiary; (ve) reclassification, combination, split, subdivision or redemption, purchase or other acquisition, directly or indirectly, of any of the capital stock of the Company or any Company Subsidiary; (f) acquisition (including, without limitation, by merger, consolidation, or acquisition of stock or assets) of any interest in any corporation, partnership, other business organization or any division thereof or any assets, other than acquisitions of assets for consideration which is not, in the aggregate, in excess of $2,000,000; (g) incurrence of any indebtedness for borrowed money or issuance of any debt securities or assumption, guarantee or endorsement of the obligations of any person, or any loans or advances made, except for (i) indebtedness incurred in the ordinary course of business and consistent with past practice and (ii) other indebtedness with a maturity of not more than one year in a principal amount not, in the case of both (i) and (ii) in the aggregate, in excess of $1,000,000; (h) waiver of any stock repurchase rights, acceleration, amendment or change in the period of exercisability of options or restricted stock, or the repricing of options granted under the Company Stock Option Plans or authorization of cash payments in exchange for any options granted under any such plans; (i) increase in, or agreement to increase, the compensation (including base salary, target bonus and other compensation) payable or to become payable to its officers or employees, except for increases in accordance with past practices, or the grant of any rights to severance or termination pay to, or the entering into of any employment, consulting, termination, indemnification or severance agreement with, any director, officer or other employee of the Company or any Company Subsidiary, or the establishment, adoption, entering into or amendment of any collective bargaining, bonus, profit sharing, thrift, compensation, stock option, restricted stock, pension, retirement, deferred compensation, employment, termination, severance or other plan, agreement, trust, fund, policy or arrangement for the benefit of any director, officer or employee; provided, however, that the foregoing provisions of this subsection shall not apply to any amendments to employee benefits plans described in section 3(3) of the Employee Retirement Security Act of 1974, as amended (“ERISA”) that may be required by law; (j) action to make or change any material Tax (as defined in Section 3.16 below) or material accounting election, change by the Company in its any annual accounting methodsperiod, principles adopt or practices, except change any accounting method (other than as required by concurrent changes GAAP), file any amended Tax Return (as defined in Section 3.16 below) which amends the Tax Return in any material respect, enter into any closing agreement, settle any material Tax claim or assessment relating to the Company or any Company Subsidiary, surrender any right to claim a material refund of Taxes, consent to any extension or waiver of the limitation period applicable to any material Tax claim or assessment relating to the Company or any Company Subsidiary, or take any other action or omit to take any action that would have the effect of increasing the Tax liability, in any material respect, of the Company or any Company Subsidiary or Parent; (k) action taken, other than as required by GAAP or by the CommissionSEC, (vi) any material revaluation by the Company of any of its assetswith respect to accounting principles or procedures, including, without limitation, writing down any revaluation of assets; (l) acceleration (or grant of any right to acceleration, whether or not contingent), amendment or change in the value period of capitalized inventory exercisability or writing off notes the vesting schedule of restricted stock or accounts receivable options granted under any option plan, employee stock plan or agreements or authorization of cash payments in exchange for any Company Stock Options granted under any of such plans, except as specifically required by the terms of such plans or any such agreements or any related agreements in effect as of the date of this Agreement and disclosed in the Company Disclosure Letter; (m) (i) sale, assignment, lease, termination, abandonment, transfer, authorization to encumber or to otherwise dispose of or grant of any security interest in and to any item of the Company Intellectual Property, in whole or in part, (ii) grant of any license with respect to any Company Intellectual Property, other than license of Company software to customers of the Company or any Company Subsidiary to whom the Company or any Company Subsidiary licenses such Company software in the ordinary course of business consistent with past practicebusiness, (viiiii) development, creation or invention of any Intellectual Property jointly with any third party, or (iv) disclosure, or authorization for disclosure, of any confidential Company Intellectual Property, unless such Company Intellectual Property is subject to a confidentiality or non-disclosure covenant protecting against disclosure thereof; or (n) any communication from the Nasdaq Stock Market with respect to the delisting of the Common Stockauthorization, (viii) any cancellation agreement or commitment by the Company or any of its Subsidiaries of Company Subsidiary to do any debts or waiver of any claims or rights of material value, (ix) any sale, transfer or other disposition outside of the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangible) by the Company or any of its Subsidiaries, or (x) any agreement, whether in writing or otherwise, to take any action things described in this section by the Company or any of its SubsidiariesSection 3.09.

Absence of Certain Changes or Events. Since From June 30, 2007 through the date hereof, there has not been any state of facts, change, development, effect, condition or occurrence that, individually or in the Company Balance Sheetaggregate, has had or would reasonably be expected to have a Material Adverse Effect. From June 30, 2007 through the date hereof, the Company has and its Subsidiaries have conducted its business their respective businesses only in the ordinary course of business consistent with past practice and there has not been: : (i) any Material Adverse Change to the Company, (ii) any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, stock or property) in respect of, any of the Company’s or any of its Subsidiaries’ capital stockstock or other equity or voting interests, or except for dividends by a wholly owned Subsidiary of the Company to its parent and regular quarterly dividends on Company Common Shares; (ii) any purchase, redemption or other acquisition by of any shares of capital stock of, or other equity or voting interests in, the Company or any of its Subsidiaries of any of the Company’s capital stock or any other securities of the Company or its Subsidiaries or any options, warrants, calls or rights to acquire any such shares or other securities except for repurchases from employees following their termination pursuant to the terms of their pre-existing stock option or purchase agreements, interests; (iii) any split, combination or reclassification of any of the Company’s or any of its Subsidiaries’ capital stockstock or other equity or voting interests or any issuance or the authorization of any issuance of any other securities in respect of, (iv) entry by in lieu of or in substitution for shares of capital stock of, or other equity or voting interests in, the Company or any of its Subsidiaries into Subsidiaries; (iv) except as required to comply with applicable law, any licensing or other agreement with regard to the disposition provision of any material intellectual property other than licensesEmployee Plan, distribution agreements, advertising agreements, sponsorship agreements the Company’s compensation policies as in effect on the date hereof or merchant program agreements entered into in the ordinary course of business consistent with past practice, (vA) any material change granting by the Company or any of its Subsidiaries to any current or former director or executive officer of any increase in its accounting methodscompensation, principles bonus or practicesother benefits or (B) any granting to any current or former director or executive officer of the right to receive any severance or termination pay, or increases therein; (v) except (A) as expressly required under any Employee Plan existing on June 30, 2007 or disclosed in the Filed SEC Documents or in any Form 4 filed with the SEC at least two Business Days prior to the date hereof, (B) as required to comply with applicable law or (C) payments or grants in the ordinary course of business consistent with past practice to any non-executive officer, any payment of any benefit or the grant or amendment of any award in respect of stock options, share appreciation rights, performance awards, restricted shares or other share-based or share-related awards or the removal or modification of any restrictions in any Employee Plan or awards made thereunder; (vi) except as required by concurrent changes to comply with applicable law (including but not limited to amendments to the extent necessary to bring Employee Plans into compliance with Section 409A of the Code without material increase in GAAP or by the Commission, (vi) any material revaluation by costs to the Company of any such plans, as amended, to comply with such Section 409A) and for termination, adoptions and amendments of its assets, including, without limitation, writing down the value of capitalized inventory broad-based Employee Plans or writing off notes or accounts receivable other than non-executive officer Employee Plans in the ordinary course of business consistent with past practice, (A) any termination, adoption, or amendment or any agreement to terminate, adopt or amend in any material respect any Employee Plan (including any such plan that would constitute an Employee Plan if it were to be adopted and including any related trust agreement or other operative agreement relating to an Employee Plan), (B) change or agreement to change any actuarial or other assumption used to calculate funding obligations with respect to any Employee Plan or (C) any change in the timing or manner in which contributions to any Employee Plan are made or the basis on which such contributions are determined; (vii) any communication from material change in financial or tax accounting methods, principles or practices by the Nasdaq Stock Market with respect to the delisting Company or any of the Common Stockits Subsidiaries, except insofar as may have been required by a change in GAAP or applicable law or regulations; (viii) any cancellation revaluation by the Company or any of its Subsidiaries of any debts or waiver of any claims or rights of assets that are material valueto the Company and its Subsidiaries, taken as a whole; (ix) any consummation of, or entrance into any agreement for, any acquisition, by means of merger or otherwise, of any business, rights, assets or securities or any sale, transfer lease, license, encumbrance or other disposition outside of assets or securities, in each case involving the payment or receipt of consideration of $5,000,000 or more (inclusive of assumed debt), except for purchases or sales made in the ordinary course of business and consistent with past practice; (x) prior to the date hereof, any resignation or termination, or notice of any properties pending resignation or assets termination, of any executive officer of the Company; or (real, personal xi) any material increase or mixed, tangible or intangible) decrease in the aggregate number of Persons employed by the Company or any of and its Subsidiaries, taken as a whole, except increases or (x) any agreement, whether decreases in writing or otherwise, to take any action described in this section by the Company or any ordinary course of its Subsidiariesbusiness consistent with past practice.

Absence of Certain Changes or Events. (a) Since January 1, 2005 to the date of the Company Balance Sheetthis Agreement, the Company Seller and the Seller Subsidiaries have conducted their businesses only in the ordinary course and in a manner consistent with past practice and, since January 1, 2005, there has conducted not been (i) any change in the financial condition, results of operations or business of the Seller and any of the Seller Subsidiaries which has had a Seller Material Adverse Effect, (ii) any damage, destruction or loss (whether or not covered by insurance) with respect to any assets of the Seller or any of the Seller Subsidiaries which has had a Seller Material Adverse Effect, (iii) any change by the Seller in its business only accounting methods, principles or practices, (iv) any revaluation by the Seller of any of its assets in any material respect, (v) except for regular quarterly cash dividends on the Seller Common Stock with usual record and payment dates, to the date of this Agreement, and the publicly-announced stock repurchase program, any declaration setting aside or payment of any dividends or distributions in respect of shares of Seller Common Stock or any redemption, purchase or other acquisition of any of its securities or any of the securities of any Seller Subsidiary, (vi) any increase in the wages, salaries, bonuses, compensation, pension, or other fringe benefits or perquisites payable to any executive officer, employee, or director or any grant of any severance or termination pay, except in the ordinary course of business consistent with past practice and there has not been: (i) any Material Adverse Change to the Company, (ii) any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, stock or property) in respect of, any of the Company’s or any of its Subsidiaries’ capital stock, or any purchase, redemption or other acquisition by the Company or any of its Subsidiaries of any of the Company’s capital stock or any other securities of the Company or its Subsidiaries or any options, warrants, calls or rights to acquire any such shares or other securities except for repurchases from employees following their termination pursuant to the terms of their pre-existing stock option or purchase agreements, (iii) any split, combination or reclassification of any of the Company’s or any of its Subsidiaries’ capital stock, (iv) entry by the Company or any of its Subsidiaries into any licensing or other agreement with regard to the disposition of any material intellectual property other than licenses, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into in the ordinary course of business consistent with past practice, (v) any material change by the Company in its accounting methods, principles or practices, except as required by concurrent changes in GAAP or by the Commission, (vi) any material revaluation by the Company of any of its assets, including, without limitation, writing down the value of capitalized inventory or writing off notes or accounts receivable other than in the ordinary course of business consistent with past practice, (vii) any communication from the Nasdaq Stock Market with respect to the delisting of the Common Stockstrike, work stoppage, slow-down or other labor disturbance, (viii) any cancellation by the Company or any of its Subsidiaries execution of any debts collective bargaining agreement, contract or waiver of any claims other agreement or rights of material valueunderstanding with a labor union or organization, or (ix) any saleunion organizing activities. (b) To Seller’s Knowledge, transfer no third party has used, with or without permission, the corporate name, the trademarks, trade names, service marks, logos, symbols or similar intellectual property of Seller or any Seller Subsidiary in connection with the marketing, advertising, promotion or sale of such third party’s products or services. Neither Seller nor any Seller Subsidiary is a party to any joint marketing or other disposition outside of the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangible) by the Company or any of its Subsidiaries, or (x) any agreement, whether in writing or otherwise, to take any action described in this section by the Company or any of its Subsidiariesaffinity marketing program with a third party.

Absence of Certain Changes or Events. Since the date Except as set forth in SECTION 4.09 of the Company Balance SheetDisclosure Schedule or as contemplated by this Agreement, since January 29, 2005, the Company has and its Subsidiaries have conducted its business their businesses only in the ordinary course of business and in a manner consistent with past practice and there has not been: : (ia) any Material Adverse Change material change in any method of accounting or accounting practice by the Company or any of its Subsidiaries or made any material write-down in the value of its inventory or accounts receivable or reversed any material accruals; (b) any declaration of any dividend scheduled to be paid after the date hereof or, other than regular quarterly dividends and distributions from any Subsidiary of the Company to the Company or another wholly owned Subsidiary of the Company, (ii) any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, stock or other property) or other distribution in respect of the Company's securities or any redemption, purchase or other acquisition of any of the Company's securities; (c) any issuance or the authorization of any issuance of any securities in respect of, any in lieu of or in substitution for shares of its capital stock, except for (i) the granting of Options set forth in SECTION 4.03(A) of the Company’s Company Disclosure Schedule and (ii) the issuance of any Common Shares pursuant to the exercise of any Options; (d) any amendment of any material term of any outstanding security of the Company or any of its Subsidiaries’ capital stock, or ; (e) any purchase, redemption or other acquisition issuance by the Company or any of its Subsidiaries of any of the Company’s notes, bonds or other debt securities or any capital stock or other equity securities or any securities convertible, exchangeable or exercisable into any capital stock or other securities equity securities, except for (i) the granting of Options set forth in SECTION 4.03(A) of the Company Disclosure Schedule and (ii) the issuance of any Common Shares pursuant to the exercise of any Options; (f) any incurrence, assumption or guarantee by the Company or any of its Subsidiaries of any indebtedness for borrowed money other than the issuance of letters of credit in the ordinary course of business consistent with past practices of the Company and its Subsidiaries; (g) any creation or assumption by the Company or any of its Subsidiaries of any Lien on any material assets other than Permitted Liens; (h) any making of any loans, advances or capital contributions to or investment in any entity or person, other than loans, advances or capital contributions to or investments in the Company or its wholly owned Subsidiaries other than in connection with the construction of stores pursuant to a lease agreement relating to Leased Real Property in the ordinary course of business (which as of August 27, 2005 is set forth in SECTION 4.17(A) of the Company Disclosure Schedule); (i) any entry into any Contract related to the acquisition or disposition of any business or any options, warrants, calls or rights to acquire any such shares or material assets other securities except for repurchases from employees following their termination pursuant to than inventory in the terms ordinary course of their pre-existing stock option or purchase agreements, business; (iiij) any spliteffect, combination event or reclassification of change that has had or is reasonably likely to have a Company Material Adverse Effect; (k) any material increase in the benefits under, or the establishment, material amendment or termination of, any Benefit Plan (as defined in SECTION 4.13(B)) covering current or former employees, officers or directors of the Company’s Company or any of its Subsidiaries’ capital stock, or any material increase in the compensation payable or to become payable to or any other material change in the employment terms for any directors or officers with a title of vice president or higher of the Company or any of its Subsidiaries; (ivl) any entry by the Company or any of its Subsidiaries into any licensing employment, consulting, severance, termination, change-of-control or other indemnification agreement with regard any director or officer of the Company or any of its Subsidiaries or entry into any such agreement with director or officer with a title of vice president or higher for a noncontingent cash amount in excess of $50,000 per year or outside the ordinary course of business; (m) any capital expenditures that amount in the aggregate to more than $1,000,000 or any commitments with respect to capital expenditures and other planned capital expenditures through the disposition of any material intellectual property other than licenses, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into Offer Payment Date in the ordinary course of business consistent with past practice, that amount in the aggregate to more than $2,000,000 (vin each case by category); or (n) any material change by the Company in its accounting methodsauthorization of, principles or practices, except as required by concurrent changes in GAAP or by the Commission, (vi) any material revaluation by the Company of any of its assets, including, without limitation, writing down the value of capitalized inventory or writing off notes or accounts receivable other than in the ordinary course of business consistent with past practice, (vii) any communication from the Nasdaq Stock Market with respect to the delisting of the Common Stock, (viii) any cancellation agreement by the Company or any of its Subsidiaries of to take, any debts or waiver of any claims or rights of material value, (ix) any sale, transfer or other disposition outside of the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangible) by the Company or any of its Subsidiaries, or (x) any agreement, whether in writing or otherwise, to take any action actions described in this section SECTION 4.09, except as expressly contemplated by the Company or any of its Subsidiariesthis Agreement.

Absence of Certain Changes or Events. Since the date of the Company Balance Sheet, the Company has conducted its business only in the ordinary course of business consistent with past practice and Sheet Date ------------------------------------ there has not been: occurred: (ia) any Material Adverse Change to change in the condition (financial or otherwise), properties, assets, liabilities, businesses, operations or results of operations of the Company, taken separately or as a whole, that could reasonably constitute a Material Adverse Effect; (iib) any amendments or changes in the certificate of incorporation or bylaws of the Company; (c) any damage, destruction or loss, whether covered by insurance or not, that could reasonably constitute a Material Adverse Effect; (d) any redemption, repurchase or other acquisition of shares of the Common Stock by the Company, or any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, stock or property) with respect to the Common Stock; (e) any material increase in respect of, any or modification of the Company’s compensation or benefits payable or to become payable by the Company to any of its Subsidiaries’ capital stockdirectors or employees, or any purchase, redemption or other acquisition by the Company or any of its Subsidiaries of any of the Company’s capital stock or any other securities of the Company or its Subsidiaries or any options, warrants, calls or rights to acquire any such shares or other securities except for repurchases from employees following their termination pursuant to the terms of their pre-existing stock option or purchase agreements, (iii) any split, combination or reclassification of any of the Company’s or any of its Subsidiaries’ capital stock, (iv) entry by the Company or any of its Subsidiaries into any licensing or other agreement with regard to the disposition of any material intellectual property other than licenses, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into in the ordinary course of business consistent with past practice, ; (vf) any material change by increase in or modification of any bonus, pension, insurance or other benefit (including, but not limited to, the Company in its accounting methodsgranting of stock options, principles restricted stock awards or practicesstock appreciation rights) made to, except as required by concurrent changes in GAAP for or by the Commission, (vi) any material revaluation by the Company of with any of its assetsemployees or consultants, including, without limitation, writing down the value of capitalized inventory or writing off notes or accounts receivable other than in the ordinary course of business consistent with past practice, ; (viig) any communication acquisition or sale of a material amount of property or assets of the Company, other than in the ordinary course of business consistent with past practices; (h) any alteration in any term of any outstanding security of the Company; (i) any (A) incurrence, assumption or guarantee by the Company of any debt for borrowed money; (B) issuance or sale of any securities convertible into or exchangeable for debt securities of the Company; or (C) issuance or sale of options or other rights to acquire from the Nasdaq Stock Market with respect to the delisting Company, directly or indirectly, debt securities of the Common Stock, (viii) any cancellation by the Company or any of its Subsidiaries securities convertible into or exchangeable for any such debt securities; (j) any creation or assumption by the Company of any debts mortgage, pledge, security interest or waiver lien or other encumbrance on any asset; (k) any making of any claims loan, advance or rights of material value, capital contribution to or investment in any person other than (ixi) any sale, transfer travel loans or other disposition outside of advances made in the ordinary course of business of the Company, (ii) other loans and advances in an aggregate amount which does not exceed $25,000 outstanding at any properties time and (iii) purchases on the open market of liquid, publicly traded securities; (l) any entering into, amendment of, relinquishment, termination or assets non-renewal by the Company of any contract, lease transaction, commitment or other right or obligation other than in the ordinary course of business, except as expressly contemplated in this Agreement or any other agreement to be executed in connection herewith; (realm) any transfer or grant of a right under the IP Rights (as defined in Section 2.14), personal other than those transferred or mixedgranted in the ordinary ------------ course of business; (n) any labor dispute or charge of unfair labor practice (other than routine individual grievances), tangible any activity or intangible) proceeding by a labor union or representative thereof to organize any employees of the Company or any of its Subsidiaries, or campaign being conducted to solicit authorization from employees to be represented by the labor union; or (xo) any agreement, whether in writing agreement or otherwise, arrangement made by the Company to take any action described which, if taken prior to the date hereof, would have made any representation or warranty set forth in this section by the Company Agreement untrue or any of its Subsidiariesincorrect unless otherwise disclosed.

Absence of Certain Changes or Events. Since From March 31, 2006 to the date hereof, except as set forth in Section 3.7 of the Company Balance SheetDisclosure Schedule, the Company has and its Subsidiaries have conducted its business only their respective businesses in all material respects in the ordinary course of business and consistent with past practice and there has not been: : (a) any material loss, damage or destruction to, or any material interruption in the use of, any of the assets of the Company or any of its Subsidiaries (whether or not covered by insurance) that constitutes a Company Material Adverse Effect; (i) any Material Adverse Change to the Company, (ii) any declaration, setting accrual, set aside or payment of any dividend on, or any other distribution (whether in cash, stock or property) in respect of, of any shares of capital stock of the Company’s Company or any of its Subsidiaries’ capital stock, other than payment of dividends owing to the holders of the Company Preferred Stock in accordance with its terms, or (ii) any purchaserepurchase, redemption or other acquisition by the Company or any of its Subsidiaries of any shares of the Company’s capital stock or other securities; (c) any other securities sale, issuance or grant, or authorization of the Company or its Subsidiaries or issuance of, (i) any options, warrants, calls or rights to acquire any such shares capital stock or other securities except for repurchases from employees following their termination pursuant to the terms security of their pre-existing stock option or purchase agreements, (iii) any split, combination or reclassification of any of the Company’s or any of its Subsidiaries’ capital stock, (iv) entry by the Company or any of its Subsidiaries (except for Company Common Stock issued upon the valid exercise of options granted under any of the Stock Plans), (ii) any option, warrant or right to acquire any capital stock or any other security of the Company or any of its Subsidiaries (except for Options or restricted stock units described in Section 3.2), or (iii) any instrument convertible into or exchangeable for any licensing capital stock or other agreement with regard to security of the disposition Company or any of any material intellectual property other than licenses, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into in the ordinary course of business consistent with past practice, its Subsidiaries; (vd) any material change by the Company in its accounting methods, principles amendment or practices, except as required by concurrent changes in GAAP or by the Commission, (vi) any material revaluation by the Company waiver of any of the rights of the Company or any of its assetsSubsidiaries under, including, without limitation, writing down the value or acceleration of capitalized inventory or writing off notes or accounts receivable other than in the ordinary course of business consistent with past practicevesting under, (viii) any communication from the Nasdaq Stock Market with respect to the delisting provision of any of the Common StockStock Plans, (viiiii) any cancellation provision of any contract evidencing any outstanding Option, or (iii) any restricted stock purchase agreement; (e) any amendment to any organizational document of any of the Company or any of its Subsidiaries, any merger, consolidation, share exchange, business combination, recapitalization, reclassification of shares, stock split, reverse stock split or similar transaction involving the Company or any of its Subsidiaries; (f) any creation of any Subsidiary of the Company or any of its Subsidiaries or acquisition by the Company or any of its Subsidiaries of any debts equity interest or waiver other interest in any other Person; (g) any capital expenditure by the Company or any of its Subsidiaries which, when added to all other capital expenditures made on behalf of the Company or any of its Subsidiaries since the date of the Interim Financial Statements, exceeds $100,000 in the aggregate; (h) any action by the Company or any of its Subsidiaries to (i) enter into, or suffer any of the assets owned or used by it to become bound by, any Company Material Contract (as defined in Section 3.17), or (ii) amend or terminate, or waive any material right or remedy under, any Company Material Contract; (i) any (i) acquisition, lease or license by the Company or any of its Subsidiaries of any claims material right or rights of other material valueasset from any other Person, (ixii) any sale, transfer sale or other disposition outside disposal or lease or license by the Company or any of its Subsidiaries of any material right or other material asset to any other Person, or (iii) waiver or relinquishment by the Company or any of its Subsidiaries of any right, except for rights or other assets acquired, leased, licensed or disposed of in the ordinary course of business and consistent with past practices; (j) any write-off as uncollectible, or establishment of any properties extraordinary reserve with respect to, any material account receivable or other material debt owing to the Company or any of its Subsidiaries; (k) any pledge of any assets of or sufferance of any of the assets of the Company or any of its Subsidiaries to become subject to any Lien, except for Permitted Liens and pledges of immaterial assets made in the ordinary course of business and consistent with past practices; (reall) any (i) loan by the Company or any of its Subsidiaries to any Person (other than loans among the Company and its Subsidiaries), personal or mixed(ii) new incurrence or new guarantee by the Company or any of its Subsidiaries of any indebtedness for borrowed money, tangible other than draws under the revolver under the Credit Facility in the ordinary course of business; (m) any (i) adoption, establishment, entry into or intangibleamendment by the Company or any of its Subsidiaries of any Employee Plan or (ii) payment of any bonus or any profit sharing or similar payment to, or material increase in the amount of the wages, salary, commissions, fringe benefits or other compensation or remuneration payable to, any of the directors, officers or employees of the Company or any of its Subsidiaries; (n) any change of the methods of accounting or accounting practices of the Company or any of its Subsidiaries in any material respect; (o) any material Tax election by the Company or any of its Subsidiaries, or ; (xp) any agreement, whether in writing commencement or otherwise, to take settlement of any action described in this section material legal proceeding by the Company or any of its Subsidiaries; or (q) any agreement or commitment to take any of the actions referred to in clauses (a) through (q) above.

Absence of Certain Changes or Events. Since the date Except as set forth in Section 3.09 of the Company Balance SheetDisclosure Schedule or as contemplated by this Agreement, since December 31, 2004, the Company has and its subsidiaries have conducted its business their businesses only in the ordinary course of business and in a manner consistent with past practice and there has not been: : (ia) any Material Adverse Change to material change in any method of accounting or accounting practice by the CompanyCompany or any of its subsidiaries, except for any such change required by reason of a concurrent change in United States generally accepted accounting principles; (iib) any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, stock or other property) or other distribution in respect ofof the Company’s securities or any redemption, purchase or other acquisition of any of the Company’s securities; (c) any issuance or the authorization of any issuance of any securities in respect of, in lieu of or in substitution for shares of the Company’s capital stock; (d) any amendment of any material term of any outstanding security of the Company or any of its Subsidiaries’ capital stock, or subsidiaries except as required under Section 3.19 hereof; (e) any purchase, redemption or other acquisition issuance by the Company or any of its Subsidiaries subsidiaries of any of the Company’s notes, bonds or other debt securities or any capital stock or any other equity securities of the Company or its Subsidiaries or any optionssecurities convertible, warrants, calls exchangeable or rights to acquire exercisable into any such shares capital stock or other securities equity securities, except for repurchases from employees following their termination (i) the granting of Options and (ii) the issuance of any Common Shares pursuant to the terms exercise of their pre-existing stock option or purchase agreements, any Options; (iiif) any splitincurrence, combination assumption or reclassification of any of the Company’s or any of its Subsidiaries’ capital stock, (iv) entry guarantee by the Company or any of its Subsidiaries into any licensing or other agreement with regard to the disposition subsidiaries of any indebtedness for borrowed money; (g) except for Permitted Liens (as defined in Section 3.25), any creation or assumption by the Company or any of its subsidiaries of any Lien on any material intellectual property other than licenses, distribution agreements, advertising agreements, sponsorship agreements assets; (h) except for loans or merchant program agreements entered into advances to employees for reimbursable business expenses and travel advances incurred in the ordinary course of business consistent with past practice, any making of any loan, advance or capital contributions to or investment in any entity or person, other than loans, advances or capital contributions to or investments in wholly owned subsidiaries; (vi) any entry into any definitive agreement related to the acquisition or disposition of any business or any material assets; (j) any effect, event or change that has had or is reasonably likely to have a Company Material Adverse Effect; (k) any material change by increase in the benefits under, or the establishment, material amendment or termination of, any Benefit Plan (as defined in Section 3.13(b)) covering current or former employees, officers or directors of the Company in its accounting methods, principles or practices, except as required by concurrent changes in GAAP or by the Commission, (vi) any material revaluation by the Company of any of its assetssubsidiaries, including, without limitation, writing down the value of capitalized inventory or writing off notes or accounts receivable other than any material increase in the ordinary course compensation payable or to become payable to or any other material change in the employment terms for any directors or officers of business consistent with past practice, the Company or any of its subsidiaries or any other employee earning noncontingent cash compensation in excess of $100,000 per year; (viil) any communication from the Nasdaq Stock Market with respect to the delisting of the Common Stock, (viii) any cancellation entry by the Company or any of its Subsidiaries subsidiaries into any employment, consulting, severance, termination, change-of-control or indemnification agreement with any director or officer of the Company or any debts of its subsidiaries or waiver entry into any such agreement with any person for a noncontingent cash amount in excess of any claims $100,000 per year or rights of material value, (ix) any sale, transfer or other disposition outside of the ordinary course of business of business; or (m) any properties authorization of, or assets (real, personal or mixed, tangible or intangible) agreement by the Company or any of its Subsidiariessubsidiaries to take, or (x) any agreement, whether in writing or otherwise, to take any action of the actions described in this section Section 3.09, except as expressly contemplated by the Company or any of its Subsidiariesthis Agreement.

Absence of Certain Changes or Events. Since the date of the Company Balance Sheet, the Company has conducted its business only in the ordinary course of business consistent with past practice and Sheet there has not been: (i) any Material Adverse Change to Effect on the Company, (ii) any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, stock or property) in respect of, any of the Company’s 's or any of its Subsidiaries’ subsidiaries' capital stock, or any purchase, redemption or other acquisition by the Company or any of its Subsidiaries subsidiaries of any of the Company’s 's capital stock or any other securities of the Company or its Subsidiaries subsidiaries or any options, warrants, calls or rights to acquire any such shares or other securities except for repurchases from employees following their termination pursuant to the terms of their pre-existing stock option or purchase agreements, (iii) any split, combination or reclassification of any of the Company’s 's or any of its Subsidiaries’ subsidiaries' capital stock, (iv) any granting by the Company or any of its subsidiaries of any increase in compensation or fringe benefits, except for normal increases of cash compensation in the ordinary course of business consistent with past practice, or any payment by the Company or any of its subsidiaries of any bonus, except for bonuses made in the ordinary course of business consistent with past practice, or any granting by the Company or any of its subsidiaries of any increase in severance or termination pay or any entry by the Company or any of its subsidiaries into any currently effective employment, severance, termination or indemnification agreement or any agreement the benefits of which are contingent or the terms of which are materially altered upon the occurrence of a transaction involving the Company of the nature contemplated hereby, (v) entry by the Company or any of its Subsidiaries subsidiaries into any licensing or other agreement with regard to the acquisition or disposition of any material intellectual property Intellectual Property (as defined in Section 2.9) other than licenses, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into in the ordinary course of business consistent with past practicepractice (collectively, "ORDINARY COURSE AGREEMENTS"), (vvi) any amendment or consent with respect to any licensing agreement filed or required to be filed by the Company with the SEC, (vii) any material change by the Company in its accounting methods, principles or practices, except as required by concurrent changes in GAAP GAAP, or by the Commission, (viviii) any material revaluation by the Company of any of its assets, including, without limitation, writing down the value of capitalized inventory or writing off notes or accounts receivable other than in the ordinary course of business consistent with past practice, (vii) any communication from the Nasdaq Stock Market with respect to the delisting of the Common Stock, (viii) any cancellation by the Company or any of its Subsidiaries of any debts or waiver of any claims or rights of material value, (ix) any sale, transfer or other disposition outside of the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangible) by the Company or any of its Subsidiaries, or (x) any agreement, whether in writing or otherwise, to take any action described in this section by the Company or any of its Subsidiariesbusiness.

Absence of Certain Changes or Events. Since From the date of the Company Balance SheetCompany’s most recent audited balance sheet included in its SEC Documents through the date of this Agreement, except as contemplated by this Agreement or as set forth in Section 4.9 of the Company Disclosure Letter: (a) each of the Company, Company Operating Partnership and each Company Subsidiary has conducted its business only in the ordinary course of business consistent with past practice practice, and prior to the date hereof there has not been: : (i) any Material Adverse Change to the Company, (ii) any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, with respect to any shares of capital stock or property) in respect of, any other equity interests of the Company’s Company or any of its Subsidiaries’ capital stockCompany Subsidiary, or other than regular quarterly dividends consistent with past practice; (ii) any purchaserepurchase, redemption or other acquisition by the Company or any of its Subsidiaries Company Subsidiary of any shares of the Company’s capital stock or any other securities equity interests of the Company or its Subsidiaries any Company Subsidiary or any options, warrants, calls or rights to acquire any such shares securities or other securities except equity interests convertible into or exercisable for repurchases from employees following their termination any shares of capital stock or other equity interests, of the Company or any Company Subsidiary, other than (A) the withholding of shares of Company Common Stock to satisfy withholding Tax obligations with respect to shares of Company Restricted Stock, and (B) the acquisition by the Company in the ordinary course of business consistent with past practice in connection with the forfeiture of shares of Company Restricted Stock pursuant to the terms of their pre-existing stock option the Company Equity Plans upon termination of employment or purchase agreements, service of an award holder; (iii) any split, combination combination, subdivision or reclassification of any of the Company’s capital stock or other equity interests, or any issuance of its Subsidiaries’ any other securities or equity interests in respect of, in lieu of or in substitution for shares of capital stockstock or other equity interests, (iv) entry by of the Company or any Company Subsidiary; (iv) any (A) amendment to the Company Charter, Company Bylaws or other organizational documents of its Subsidiaries the Company; or (B) amendment to the articles or certificates of incorporation, bylaws or other organizational documents of any Company Subsidiary; (v) except as required to comply with Law, any Company employment agreement or any Company Benefit Plan, (A) any grant of any severance, termination pay, retention, or change in control benefits to any current or former director, employee or other individual service provider of the Company or any Company Subsidiary, (B) any entry into any licensing employment, change in control, deferred compensation or other agreement with regard to the disposition of similar agreement, plan, arrangement or policy (or any material intellectual property amendment to any such agreement, plan arrangement or policy) with any current or former director or employee of the Company or any Company Subsidiary, (C) any increase in the compensation or benefits payable under any Company Benefit Plan other than licenses, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into increases in the ordinary course of business consistent with past practice, (vD) recognition by the Company, Company Operating Partnership or any other Company Subsidiary of any labor union, (E) any establishment, adoption, entry into, amendment, modification or termination of any collective bargaining agreement, (F) any establishment, adoption, entry into, termination or amendment or modification in any material change by respect, of any material Company Benefit Plan or (G) the taking of any action to accelerate any material compensation or benefits, including vesting, funding and payment or the making of any material determinations, under any collective bargaining agreement, Company in its accounting methods, principles Equity Plan or practices, except as required by concurrent changes in GAAP or by the Commission, Company Benefit Plan; (vi) any material revaluation change in the Company’s method of accounting or accounting principles or policies, except for any such change required by reason of a change in GAAP or by Regulation S-X under the Exchange Act, as approved by the Company of any of its assets, including, without limitation, writing down the value of capitalized inventory or writing off notes or accounts receivable other than in the ordinary course of business consistent with past practice, Company’s independent accountants; or (vii) any communication from the Nasdaq Stock Market with respect to the delisting settlement or remediation of the Common Stock, (viii) any cancellation by material Claim against or affecting the Company or a Company Subsidiary; and (b) there has not been any of its Subsidiaries of any debts or waiver of any claims or rights of material value, (ix) any sale, transfer or other disposition outside of the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangible) by the Company Material Adverse Effect or any of its Subsidiarieseffect, event, development or (x) any agreementcircumstance that, whether individually or in writing or otherwisethe aggregate with all other effects, events, developments and changes, would reasonably be expected to take any action described result in this section by the a Company or any of its SubsidiariesMaterial Adverse Effect.

Absence of Certain Changes or Events. Since the date Except as set forth in Section 3.07 of the Company Balance SheetDisclosure Schedule, since December 31, 2007, the Company has and its Subsidiaries have conducted its business their respective businesses only in the ordinary course of business consistent with their past practice and practice, (a) there has not been: (i) been any Material Adverse Change to Change, and (b) from such date until the Company, date hereof there has not been (iii) any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, stock or property) in with respect of, to any capital stock of the Company’s Company or any of its Subsidiaries’ capital stock, other than dividends or distributions by a direct or indirect wholly owned Subsidiary of the Company to its stockholders, (ii) any purchase, redemption or other acquisition by the Company or any of its Subsidiaries of any shares of the Company’s capital stock or any other securities of the Company or any of its Subsidiaries or any options, warrants, calls or rights to acquire any such shares or other securities except for repurchases from employees following their termination securities, including pursuant to the terms of their pre-existing stock option or purchase agreementsCompany’s share repurchase program, (iii) any split, combination or reclassification of any capital stock of the Company’s Company or any of its Subsidiaries’ Subsidiaries or any issuance or the authorization of any issuance of any other securities in respect of, in lieu of or in substitution for shares of their respective capital stock, (iv) (A) any granting by the Company or any of its Subsidiaries to any current or former director, officer, employee or independent contractor, of the Company or any of its Subsidiaries (all such individuals, collectively, the “Company Personnel”) of any increase in compensation, bonus or fringe or other benefits, except in the ordinary course of business consistent with past practice or as was required under any Company Benefit Agreement or Company Benefit Plan, (B) any granting by the Company or any of its Subsidiaries to any Company Personnel of (1) any increase in severance or termination pay or (2) any right to receive any severance or termination pay, (C) any entry by the Company or any of its Subsidiaries into, or any amendments of, (1) any Company Benefit Agreement or (2) any Contract with any Company Personnel the benefits of which are contingent, or the terms of which are materially altered, upon the occurrence of a transaction involving the Company of a nature contemplated by this Agreement, (D) the removal or modification of any restrictions in any Company Benefit Agreement or Company Benefit Plan or awards made thereunder, except as required to comply with applicable Law or any Company Benefit Agreement or Company Benefit Plan in effect as of the date hereof, or (E) the adoption, amendment or termination of any Company Benefit Plan or entry into any licensing agreement, plan or other agreement with regard arrangement to do any of the disposition of any material intellectual property other than licenses, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into in the ordinary course of business consistent with past practiceforegoing, (v) any material change damage, destruction or loss, whether or not covered by the Company in its accounting methodsinsurance, principles or practices, except as required by concurrent changes in GAAP or by the Commission, (vi) of any material revaluation by the Company asset of any of its assets, including, without limitation, writing down the value of capitalized inventory or writing off notes or accounts receivable other than in the ordinary course of business consistent with past practice, (vii) any communication from the Nasdaq Stock Market with respect to the delisting of the Common Stock, (viii) any cancellation by the Company or any of its Subsidiaries of any debts or waiver of any claims or rights of material value, (ix) any sale, transfer or other disposition outside of the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangible) by the Company or any of its Subsidiaries, or (xvi) any agreementchange in accounting methods, whether in writing principles or otherwise, to take any action described in this section practices by the Company materially affecting its assets, liabilities or businesses, except insofar as may have been required by a change in GAAP, (vii) any material Tax election or any settlement or compromise of its Subsidiariesany material income Tax liability or (viii) any sales of real estate or restaurants, or any Contract with respect to any such sale.

Absence of Certain Changes or Events. (a) Since the date of the Company Balance Sheet, the business of the Company and its subsidiaries has been conducted its business only in the ordinary course of business consistent with past practice practices (other than the transactions contemplated by this Agreement and the Transaction Option Agreement) and there is not and has not been: been (i) any event, occurrence, development or state of circumstances or facts that has had or could reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect on the Company or give rise to a Material Adverse Change to (as defined in Section 9.3(c)) on the Company, (ii) any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, stock or property) in respect of, any of the Company’s 's or any of its Subsidiaries’ subsidiaries' capital stock, or any purchase, redemption or other acquisition by the Company or any of its Subsidiaries of any of the Company’s 's capital stock or any other securities of the Company or its Subsidiaries subsidiaries or any options, warrants, calls or rights to acquire any such shares or other securities except for repurchases which are not, individually or in the aggregate, material in amount from employees following their termination pursuant to the terms of their pre-existing stock option or purchase agreements, (iii) any split, combination or reclassification of any of the Company’s or any of its Subsidiaries’ capital stock, (iv) entry by the Company or any of its Subsidiaries into any licensing or other agreement with regard to the disposition of any material intellectual property other than licenses, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into in the ordinary course of business consistent with past practice, (v) any material change by the Company in its accounting methods, principles or practices, except as required by concurrent changes in GAAP or by the CommissionGAAP, (viiv) any material revaluation by the Company of any of its material assets, includingother than in the ordinary course of business, without limitationor (v) any condition, writing down event or occurrence which, individually or in the value aggregate, could reasonably be expected to prevent or materially delay the ability of capitalized inventory the Company to consummate the transactions contemplated by this Agreement and the Transaction Option Agreement or writing off notes perform its obligations hereunder or accounts receivable thereunder. (b) Except as set forth in Section 3.6(b) of the Company Disclosure Schedule, since the date of the Company Balance Sheet and through the date of this Agreement, there has not been (i) any amendment of any material term of any outstanding security of the Company or any of its subsidiaries, (ii) any incurrence, assumption or guarantee by the Company or any of its subsidiaries of any indebtedness for borrowed money other than in the ordinary course of business and in amounts and on terms consistent with past practices, (iii) any split, combination or reclassification of any of the Company's or any of its subsidiaries' capital stock, (iv) any granting by the Company or any of its subsidiaries of any increase in compensation or fringe benefits to any Employee, or any payment by the Company or any of its subsidiaries of any severance, termination pay or benefits or bonus to any Employee, or any granting by the Company or any of its subsidiaries of any increase in severance or termination pay, other than in the ordinary course, consistent with past practice, or any entry by the Company or any of its subsidiaries into, or material modification or amendment of, any Employee Agreement, or any agreement the benefits of which are contingent or the terms of which are materially altered upon the occurrence of a transaction involving the Company of the nature contemplated hereby, (v) any labor dispute or any activity or proceeding by a labor union or representative thereof to organize any Employees, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to any Employees, (vi) except as set forth in Section 3.6(b) of the Company Disclosure Schedule any layoffs of Employees or any Employee terminations other than for poor performance or cause, and the Company and its subsidiaries have preserved intact and kept available the services of present Employees in accordance with past practice, (vii) any creation or other incurrence by the Company or any of its subsidiaries of any lien on any material asset other than in the ordinary course of business consistent with past practice, (vii) any communication from the Nasdaq Stock Market with respect to the delisting of the Common Stockpractices, (viii) any cancellation making of any material loan, advance or capital contributions to or investment in any Person other than loans, advances or capital contributions to or investments in its wholly-owned subsidiaries (or advances to employees) in the ordinary course of business consistent with past practices, (ix) any damage, destruction or other casualty loss (whether or not covered by insurance) affecting the business or assets of the Company or any of its subsidiaries that has had or could reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect on the Company, (x) any agreement, commitment, arrangement or undertaking by the Company or any of its Subsidiaries of any debts or waiver of any claims or rights of material value, (ix) any sale, transfer or other disposition outside of the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangible) by the Company or any of its Subsidiaries, or (x) any agreement, whether in writing or otherwise, subsidiaries to take perform any action described in this section by the Company or any of its Subsidiaries(i) through (ix) above.

Absence of Certain Changes or Events. Since Except as set forth on Section 3.07 of the Company Disclosure Schedule, since the date of the Company Balance Sheetmost recent audited financial statements included in the Filed SEC Documents, the Company has and its Subsidiaries have conducted its business their respective businesses only in the ordinary course of business consistent with past practice practice, and there has not been: : (ia) any Company Material Adverse Change Effect or any state of facts, change, development, effect or occurrence that could reasonably be expected to the Company, result in a Company Material Adverse Effect; (iib) any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, stock or property) in respect of, any of the Company’s 's or any of its Subsidiaries’ ' capital stockstock or any redemption, retirement, acquisition or purchase of any of the Company's or any Subsidiary's capital stock or other securities; (c) any split, reverse split, combination or reclassification of any of the Company's or any of its Subsidiaries' capital stock or any issuance or the authorization of any issuance of any other securities in respect of, in lieu of, or any purchasein substitution for, redemption shares of capital stock or other acquisition securities of the Company or any of its Subsidiaries; (d) (i) any granting by the Company or any of its Subsidiaries of any of the Company’s capital stock increase in compensation or any other securities of the Company or its Subsidiaries or any optionsbenefits, warrants, calls or rights to acquire any such shares or other securities except for repurchases from employees following their termination pursuant normal increases of cash compensation prior to the terms date of their pre-existing stock option or purchase agreements, (iii) any split, combination or reclassification of any of the Company’s or any of its Subsidiaries’ capital stock, (iv) entry by the Company or any of its Subsidiaries into any licensing or other agreement with regard to the disposition of any material intellectual property other than licenses, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into this Agreement in the ordinary course of business consistent (in amount and kind) with past practice, (vii) any material change by the Company in its accounting methods, principles or practices, except as required by concurrent changes in GAAP or by the Commission, (vi) any material revaluation by the Company of any of its assets, including, without limitation, writing down the value of capitalized inventory or writing off notes or accounts receivable other than in the ordinary course of business consistent with past practice, (vii) any communication from the Nasdaq Stock Market with respect to the delisting of the Common Stock, (viii) any cancellation payment by the Company or any of its Subsidiaries of any debts or waiver bonus, except for bonuses made prior to the date of any claims or rights of material value, (ix) any sale, transfer or other disposition outside of this Agreement in the ordinary course of business consistent (in amount and kind) with past practice, in each case to any current or former director, officer, employee or consultant, (iii) any granting by the Company or any of its Subsidiaries to any current or former director, officer, employee or consultant of any properties increase in severance or assets termination pay, or (realiv) any entry by the Company or any of its Subsidiaries into, personal or mixedany amendment of, tangible or intangibleany supplement to, (A) by any employment, deferred compensation, severance, termination, employee benefit, loan, indemnification, stock repurchase, stock option, consulting or similar Contract between the Company or any of its Subsidiaries, on the one hand, and any current or (x) any agreementformer director, whether in writing officer, employee or otherwise, to take any action described in this section by consultant of the Company or any of its Subsidiaries, on the other hand, or (B) any Contract between the Company or any of its Subsidiaries, on the one hand, and any current or former director, officer, employee or consultant of the Company or any of its Subsidiaries, on the other hand, the benefits of which are contingent, or the terms of which are materially altered, upon the occurrence of a transaction involving the Company of the nature contemplated by this Agreement or the Stockholders Agreement (all such Contracts referred to in this clause (iv), being herein called, collectively, the "Benefit Agreements"); (e) any amendment of, or supplement to, any Company Stock Plan, any Stock Option, any Warrant or any Convertible Note; (f) any damage, destruction or loss, whether or not covered by insurance, in excess of $25,000 individually or in the aggregate; (g) any change in financial or tax accounting methods, principles or practices by the Company, except insofar as may have been required by a change in GAAP or Applicable Law; (h) any tax election that individually or in the aggregate could reasonably be expected to have a Company Material Adverse Effect or a material adverse effect on any of the Company's tax attributes or any settlement or compromise of any material income tax liability; (i) any revaluation by the Company of any of its material assets; (j) any entering into any settlement regarding the breach, misrepresentation, infringement or violation of, any Intellectual Property, or any modification of any existing rights with respect thereto; (k) any incurring, assumption or guaranty of any debt, claim, commitment, obligation or liability, absolute, accrued, contingent or otherwise, whether due or to become due (including any Indebtedness), except (A) current liabilities for trade or business obligations incurred in connection with the purchase of goods or services in the ordinary course of business consistent (in amount and kind) with past practice, and (B) any Indebtedness incurred under and pursuant to the Credit Facility; (l) any subjection to any Lien of any portion of the Company's or any of its Subsidiaries' assets, properties or business (whether tangible or intangible), other than (A) mechanic's, materialmen's, and similar Liens, in each case that are not delinquent or which are being actively contested in good faith by appropriate proceedings if adequate reserves with respect thereto are maintained on the books of the Company or its applicable Subsidiary, as the case may be, to the extent required by GAAP, (B) Liens arising under workers' compensation, unemployment insurance, social security, retirement, and similar legislation, in each case that are not delinquent or which are being actively contested in good faith by appropriate proceedings if adequate reserves with respect thereto are maintained on the books of the Company or its applicable Subsidiary, as the case may be, to the extent required by GAAP, and (C) statutory Liens with respect to current taxes not yet due and payable (all such Liens under clauses (A) through (C), inclusive, collectively, "Permitted Liens"); (m) any sale, assignment, lease to others or transfer or other disposition of any portion of the Company's or any of its Subsidiaries' assets, except for Inventories sold in the ordinary course of business consistent (in amount and kind) with past practice; (n) any receipt of any written notice of termination of any Designated Contract (including any Contract that would have constituted a Designated Contract but for the termination thereof prior to the date of this Agreement); (o) any discharge, cancellation or compromise of any debt, claim, commitment, liability or obligation (including any Indebtedness), or waiver or release of any right of substantial value; (p) any making of any capital expenditures or commitments therefor in excess of $50,000 individually or in the aggregate; (i) any making of any capital investment in, any loan to, or any acquisition of, any of the securities of, any other Person (or series of related capital investments, loans and acquisitions involving the same Person or such Person's Affiliates), except for overnight deposits, short-term money market investments, or (ii) any acquisition of any entity or business (whether by the acquisition of stock, the acquisition of all or a substantial portion of assets, merger or otherwise); (r) any change or authorization of any change in the articles of incorporation or bylaws (or similar organizational documents) of the Company or any of its Subsidiaries; (s) any labor union organizing activity with respect to the Company or any of its Subsidiaries, any actual or threatened employee strikes, work stoppages, slowdowns or lockouts, or any material and adverse change in the Company's or any of its Subsidiaries' relations with its employees, distributors, agents, customers or suppliers; (t) any payment or agreement to pay any brokerage or finder's fee, or any incurring of any severance pay or retention obligations by reason of this Agreement or any of the transactions contemplated hereby; (u) any making of any grant of credit to any customer or distributor on terms or in amounts materially more favorable than had been extended to that customer or distributor in the past; (v) any receipt of any written notice of any condemnation proceedings commenced with respect to any Leased Real Property or written notice as to the proposed commencement of any such proceedings; or (w) taking of any action or knowing omission of the taking of any action that would result in the occurrence of any of the foregoing.

Absence of Certain Changes or Events. Since Except for liabilities incurred in connection with this Agreement and except as disclosed in the Filed Company SEC Documents or as expressly permitted or contemplated by this Agreement, since the date of the most recent financial statements included in the Filed Company Balance SheetSEC Documents, the Company has and its Subsidiaries have conducted its business their respective businesses only in the ordinary course of business consistent with past practice practice, and there has not been: (i) been any Material Adverse Change to Change, and from such date until the Company, date hereof there has not been (iii) any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, stock or property) in with respect of, to any capital stock of the Company’s Company or any of its Subsidiaries’ capital stock, other than any declaration setting aside or payment from a wholly owned Subsidiary of the Company to the Company in the ordinary course of business consistent with past practice, (ii) any purchase, redemption or other acquisition by the Company or any of its Subsidiaries of any shares of the Company’s capital stock or any other securities of the Company or any of its Subsidiaries or any options, warrants, calls or rights to acquire any such shares or other securities except for repurchases from employees following their termination pursuant to the terms of their pre-existing stock option or purchase agreementssecurities, (iii) any split, combination or reclassification of any capital stock of the Company’s Company or any of its Subsidiaries’ Subsidiaries or any issuance or the authorization of any issuance of any other securities in respect of, in lieu of or in substitution for shares of their respective capital stock, (iv) (A) any granting by the Company or any of its Subsidiaries to any current or former director, officer, employee or consultant of the Company or any of its Subsidiaries (each a “Participant”) of any increase in compensation, bonus or fringe or other benefits or any granting of any type of compensation or benefits to any Participant not previously receiving or entitled to receive such type of compensation or benefit, except (1) in the case of employees and consultants who are neither directors nor officers, for normal increases in cash compensation in the ordinary course of business consistent with past practice or (2) as was required under any Company Benefit Agreement or Company Benefit Plan in effect as of the date of the most recent financial statements included in the Filed Company SEC Documents, (B) any granting by the Company or any of its Subsidiaries to any Participant of any right to receive any increase in change of control, severance or termination pay, (C) any entry by the Company or any of its Subsidiaries into into, or any licensing amendment or other agreement with regard to the disposition termination of any material intellectual property other than licenses, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into in the ordinary course of business consistent with past practice, (v1) any material employment, deferred compensation, consulting, severance, change by the Company in its accounting methodsof control, principles termination, retention, indemnification, loan or practices, except as required by concurrent changes in GAAP or by the Commission, (vi) any material revaluation by the Company of any of its assets, including, without limitation, writing down the value of capitalized inventory or writing off notes or accounts receivable other than in the ordinary course of business consistent with past practice, (vii) any communication from the Nasdaq Stock Market with respect to the delisting of the Common Stock, (viii) any cancellation by the Company or any of its Subsidiaries of any debts or waiver of any claims or rights of material value, (ix) any sale, transfer or other disposition outside of the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangible) by similar agreement between the Company or any of its Subsidiaries, on the one hand, and any Participant, on the other hand, or (x2) any agreement, whether in writing or otherwise, to take any action described in this section by agreement between the Company or any of its Subsidiaries, on the one hand, and any Participant, on the other hand, the benefits of which are contingent, or the terms of which are materially altered, upon the occurrence of a transaction involving the Company of a nature contemplated by this Agreement (all such agreements under this clause (C), collectively, “Company Benefit Agreements”), (D) any payment of any benefit under, or the grant of any award under, or any amendment to, or termination of, any bonus, incentive, performance or other compensation plan or arrangement, Company Benefit Agreement or Company Benefit Plan (including in respect of Company Stock Options, Company Restricted Shares, Company PSU Awards, Company Stock-Based Awards, “phantom” stock, stock appreciation rights, restricted stock, “phantom” stock rights, restricted stock units, deferred stock units, other equity or equity-based compensation, performance stock units or other stock-based or stock-related awards or the removal or modification of any restrictions in any Company Benefit Agreement or Company Benefit Plan or awards made thereunder) except as required to comply with applicable Legal Provisions or any Company Benefit Agreement or Company Benefit Plan in effect as of the date of the most recent financial statements included in the Filed Company SEC Documents, (E) the taking of any action to fund or in any other way secure the payment of compensation or benefits under any Company Benefit Plan or Company Benefit Agreement or (F) the taking of any action to accelerate the vesting or payment of any compensation or benefits under any Company Benefit Plan or Company Benefit Agreement, (v) any damage, destruction or loss to any asset of the Company or any of its Subsidiaries, whether or not covered by insurance, that individually or in the aggregate has had or would reasonably be expected to have a Material Adverse Effect, (vi) any change in accounting methods, principles or practices by the Company materially affecting its assets, liabilities or businesses, except insofar as may have been required by a change in GAAP or (vii) any material tax election or change in such election, any change in material method of accounting for tax purposes or any settlement or compromise of any material income tax liability.

Absence of Certain Changes or Events. Since the date of the Company Most Recent Balance SheetSheet Date, the Company has conducted its business only except as set forth in the ordinary course of business consistent with past practice and Schedule 4.5, there has not been: : (i) any Material Adverse Change to the Company, (ii) any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, stock or property) in respect of, any of the Company’s or any of its Subsidiaries’ capital stock, or any purchase, redemption or other acquisition by the Company or any of its Subsidiaries of any of the Company’s capital stock or any other securities of the Company or its Subsidiaries or any options, warrants, calls or rights to acquire any such shares or other securities except for repurchases from employees following their termination pursuant to the terms of their pre-existing stock option or purchase agreements, (iii) any split, combination or reclassification of any of the Company’s or any of its Subsidiaries’ capital stock, (iv) entry by the Company or any of its Subsidiaries into any licensing or other agreement with regard to the disposition of any material intellectual property other than licenses, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into in the ordinary course of business consistent with past practice, (va) any material change by the Company or its Subsidiary in its accounting methods, principles or practices, except as required by concurrent Law or by changes in GAAP or by GAAP; (b) other than in the CommissionOrdinary Course, (vi) any material revaluation entry by the Company or its Subsidiary into any material loan, lease, purchase or sale of assets, borrowing or capital expenditure; (c) any change or development in or affecting the business or operations of the Company and its Subsidiary taken as a whole that has had, or would reasonably be expected to have, a Material Adverse Effect; (d) declaration or payment of any dividends or distributions on or in respect of any of its assetscapital stock or redemption, including, without limitation, writing down the value purchase or acquisition of capitalized inventory or writing off notes or accounts receivable other than its capital stock; (e) material change in the ordinary course of business consistent with past practiceCompany’s cash management practices and its policies, (vii) any communication from the Nasdaq Stock Market practices and procedures with respect to collection of accounts receivable, establishment of reserves for uncollectible accounts, accrual of accounts receivable, inventory control, prepayment of expenses, payment of trade accounts payable, accrual of other expenses, deferral of revenue and acceptance of customer deposits; (f) material damage, destruction or loss (whether or not covered by insurance) to its property; (g) acceleration, termination, material modification to or cancellation of any Material Contract to which the delisting Company is a party or by which it is bound; (h) adoption of any plan of merger, consolidation, reorganization, liquidation or dissolution or filing of a petition in bankruptcy under any provisions of federal or state bankruptcy Law or consent to the Common Stock, filing of any bankruptcy petition against it under any similar Law; (viiii) any cancellation action by the Company to make, change or rescind any of its Subsidiaries of Tax election, amend any debts Tax Return or waiver of take any claims or rights of material valueposition on any Tax Return, (ix) take any saleaction, transfer or other disposition outside of the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangible) by the Company or any of its Subsidiaries, or (x) any agreement, whether in writing or otherwise, omit to take any action described or enter into any other transaction that would have the effect of increasing the Tax liability or reducing any Tax asset of Buyer in this section by respect of any Post-Closing Tax Period; or (j) any contract to do any of the Company foregoing, or any action or omission that would result in any of its Subsidiariesthe foregoing.

Absence of Certain Changes or Events. Since the date of the Company Balance SheetDecember 31, 2007, the Company has and its Subsidiaries have conducted its their business only in the ordinary course of business consistent with past practice and there has not been: (i) any Material Adverse Change to the Company, (ii) any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, stock or property) in respect of, any Ordinary Course of the Company’s Business and, since such date and through the date hereof, there has not occurred: (a) any Company Material Adverse Effect; (b) any amendments to or changes in the Company Charter, Company Bylaws or any Subsidiaries Governance Documents; (c) any material damage to, destruction or loss of its Subsidiaries’ capital stock, or any purchase, redemption or other acquisition by asset of the Company or any of its Subsidiaries of any of the Company’s capital stock (whether or any other securities of the Company or its Subsidiaries or any options, warrants, calls or rights to acquire any such shares or other securities except for repurchases from employees following their termination pursuant to the terms of their pre-existing stock option or purchase agreements, not covered by insurance); (iiid) any split, combination or reclassification of any of the Company’s or any of its Subsidiaries’ capital stock, (iv) entry by the Company or any of its Subsidiaries into any licensing or other agreement with regard to the disposition of any material intellectual property other than licenses, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into in the ordinary course of business consistent with past practice, (v) any material change by the Company in its accounting methods, principles or practices, except as practices with respect to the Company and its consolidated Subsidiaries other than those required by concurrent changes in GAAP or by the Commission, GAAP; (vie) any material revaluation by the Company of any of its assetsassets or any assets of its consolidated Subsidiaries, including, without limitation, including writing down the value of capitalized inventory or writing off notes or accounts receivable other than in the ordinary course Ordinary Course of business consistent with past practice, the Company’s Business; (viif) any communication from the Nasdaq Stock Market with respect to the delisting sale of the Common Stock, (viii) any cancellation by the Company or any a material amount of its Subsidiaries of any debts or waiver of any claims or rights of material value, (ix) any sale, transfer or other disposition outside of the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangible) by of the Company or any of its Subsidiaries, or ; (xg) any agreementrecalls, whether in writing field notifications, field corrections or otherwise, safety alerts with respect to take any action described in this section products manufactured by or on behalf of the Company or any of its Subsidiaries; (h) any other action or event that would have required the consent of Parent pursuant to subsections (iv)(other than in the Ordinary Course of the Company’s Business), (vii)(A)(1), (xi) or (xiii) of Section 5.1(a) or the authorization of or making any commitment to do such action or event; and (i) any business practice to materially accelerate the timing or materially increase the amount of sales or shipments of products outside of the Ordinary Course of the Company’s Business and in such a manner so as to cause the products so sold or shipped to be unable to be resold to the end-user customer or otherwise recognized as revenue of the Company under GAAP.

Absence of Certain Changes or Events. Since the date of the Company Balance SheetSheet through the date hereof, there has not been, accrued or arisen: (a) any Material Adverse Effect on the Company; (b) any acquisition by the Company has conducted or any Subsidiary of, or agreement by the Company or any Subsidiary to acquire by merging or consolidating with, or by purchasing all or substantially all of the assets of a business for an amount in excess of $250,000 or equity securities of, or by any other manner, any business or corporation, partnership, association or other business organization or division thereof; or other acquisition or agreement to acquire all or substantially all of the assets of a business for consideration in excess of $250,000 or any equity securities, or any solicitation of, or participation in, any negotiations with respect to any of the foregoing; (c) any entry into, amendment or termination by the Company or any of its business only Subsidiaries of any Contract, agreement in principle, letter of intent, memorandum of understanding or similar agreement with respect to a joint venture, strategic partnership or alliance, or supply arrangement (in each case, other than agreements entered into in the ordinary course of business consistent with past practice and there has not been: (ipractice) any Material Adverse Change material to the CompanyCompany and its Subsidiaries, taken as a whole; (iid) any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, stock or property) in respect of, any of the Company’s or any of its Subsidiaries’ capital stockstock (other than any distribution, payment or dividend by any of the Company’s Subsidiaries to the Company or to any of the other Company Subsidiaries), or any purchase, redemption or other acquisition by the Company or any of its Subsidiaries of any of the Company’s or any of its Subsidiaries’ capital stock or any other securities of the Company or its Subsidiaries or any options, warrants, calls or rights to acquire any such shares or other securities (except for repurchases from employees following their termination pursuant rights to the terms of their pre-existing stock option or purchase agreements, repurchase Company Common Stock granted to its Employee/Service Providers); (iiie) any split, combination or reclassification of any of the Company’s or any of its Subsidiaries’ capital stock, ; (ivf) entry any granting by the Company or any of its Subsidiaries into any licensing Subsidiaries, whether orally or other agreement with regard to the disposition in writing, of any (i) increase in compensation or fringe benefits payable or otherwise due to officers of the Company or any Subsidiary or (ii) material intellectual property increase in compensation or fringe benefits payable or otherwise due to any non-officer employees of the Company or any Subsidiary whose annual base salary is in excess of $100,000 other than licenses, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into in the ordinary course of business consistent with past practice; (g) any change by the Company or any of its Subsidiaries of severance, termination or bonus policies and practices (vexcluding sales commissions) or any entry by the Company or any of its Subsidiaries into, or amendment of, any currently effective employment, severance, termination or indemnification agreement or any agreement the benefits of which are contingent or the terms of which are materially altered upon the occurrence of a transaction involving the Company of the nature contemplated hereby (either alone or upon the occurrence of additional or subsequent events); (h) any material amendment or termination with respect to any Company Material Contract; (i) any Contract entered into by the Company or any of its Subsidiaries relating to its assets or business (including the acquisition or disposition of any assets or property) or any relinquishment by the Company or any of its Subsidiaries of any Contract or other right, in each case having a stated contract amount or involving obligations or entitlements with a value of more than $500,000 in each individual case (other than Contracts with customers, suppliers, distributors and representatives entered into in the ordinary course of business, consistent with past practice); (j) any material change by the Company in its accounting methods, principles or practices, except as required by concurrent changes in GAAP GAAP; (k) any debt, capital lease or other debt or equity financing transaction by the CommissionCompany or any of its Subsidiaries or entry into any agreement by the Company or any of its Subsidiaries in connection with any such transaction, except for capital leases entered into in the ordinary course of business consistent with past practice which are not, individually or in the aggregate, material to the Company and its Subsidiaries taken as a whole; (vil) any grants of any material refunds, credits, rebates or other allowances by the Company or any of its Subsidiaries to any customer, reseller or distributor, in each case, other than in the ordinary course of business consistent with past practice; (m) any material change in the level of product returns or policies relating to accounts receivable or reserves, bad debts or rights to accounts receivable experienced by the Company or any of its Subsidiaries; (n) any material restructuring activities by the Company or any of its Subsidiaries, including any material reductions in force, or any lease terminations or restructuring of contracts; (o) any license or encumbrance of any properties or assets except the license or encumbrance of property or assets which is not material, individually or in the aggregate, to the business of the Company or any of its Subsidiaries; (p) any loan, advance or capital contribution by the Company or any of its Subsidiaries to, or investment in, any Person other than (i) loans or advances to Employees/Service Providers in connection with business related travel and expenses, in each case in the ordinary course of business consistent with past practice; (ii) loans, advances or capital contributions or investments by the Company to or in any wholly owned Subsidiary, by any wholly owned Subsidiary in the Company, or by a wholly owned Subsidiary of the Company in any other wholly owned Subsidiary of the Company; or (iii) loans or advances to third parties consistent with past practice that are not, individually or in the aggregate, material to the Company and its Subsidiaries, taken as a whole; (q) any material purchases of fixed assets or other long term assets other than in the ordinary course of business and in a manner consistent with past practice; (r) any amendment of any material Tax Returns, any adoption of or change in any material election in respect of Taxes, adoption or change in any accounting method in respect of Taxes, agreement or settlement of any closing agreement relating to an Audit, or consent to any waiver of the statutory period of limitations in respect of any Audit; (s) any material revaluation, or any indication that such a revaluation is required under GAAP, by the Company of any of its assets, including, without limitation, writing down the value of capitalized inventory long-term or short-term investments, fixed assets, goodwill, intangible assets, deferred tax assets, or writing off notes or accounts receivable other than in the ordinary course of business consistent with past practice, ; (viit) any communication from significant deficiency or material weakness identified in the Nasdaq Stock Market with respect to system of internal controls utilized by the delisting of the Common Stock, Company and its Subsidiaries; or (viiiu) any cancellation commencement or settlement of any lawsuit, any overt threat of any lawsuit or other proceeding by the Company or any of its Subsidiaries of any debts or waiver of any claims or rights of material value, (ix) any sale, transfer or other disposition outside of the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangible) by the Company or any of its Subsidiaries, or (x) any agreement, whether in writing or otherwise, to take any action described in this section by the Company or any of its SubsidiariesSubsidiary.

Absence of Certain Changes or Events. Since Except as set forth on Part 3.6 of the Company Disclosure Letter, since the date of the Company Balance Sheet, the Company has conducted its business only in the ordinary course of business consistent with past practice and Sheet there has not been: : (ia) any Material Adverse Change to Effect; (b) any amendment or change in the Company, Company Charter Documents; (iic) any declaration, setting aside or payment of any dividend on, or the making of any other distribution (whether in cash, stock or property) in respect of, any the capital stock of the Company’s or any of its Subsidiaries’ capital stock, or any purchasesplit, redemption combination or other acquisition by recapitalization of the capital stock of the Company or any of its Subsidiaries direct or indirect redemption, purchase or other acquisition of any of the Company’s capital stock or any other securities of the Company or its Subsidiaries any change in any rights, preferences, privileges or restrictions of any options, warrants, calls or rights to acquire any such shares or other securities except for repurchases from employees following their termination pursuant to outstanding security of the terms of their pre-existing stock option or purchase agreements, Company; (iiid) any split, combination or reclassification of any of the Company’s or any of its Subsidiariessubsidiaries’ capital stock; (e) any grant or issuance, or promise of any grant or issuance, of any options, warrants or other rights to acquire securities from the Company or any of its subsidiaries, directly or indirectly, or any offer, issuance or sale by the Company or any of its subsidiaries of any debt or equity securities of the Company or any of its subsidiaries, except for options to purchase Company Common Stock granted in connection with the hiring of new Employees of the Company or any of its Affiliates in the ordinary course of business, which option grants were consistent with the Company’s normal guidelines for the grant of options with respect to such positions and are reflected in Part 3.2(b) of the Company Disclosure Letter; (f) any (i) grant of any severance (including change-of-control), termination pay or other amounts to or that has become payable to (or amendment to any existing arrangement with) any director, officer, Employee, contractor, consultant or agent of the Company or any of its Affiliates, (ii) increase in benefits payable under any existing severance (including change-of-control) or termination pay policies or employment, contractor or consulting agreements of the Company, or (iii) other change or increase in the compensation payable or to become payable to any of the directors, officers, Employees, contractors, consultants or agents of the Company or any of its Affiliates or in any bonus or pension, insurance or other benefit payment or arrangement (including stock awards, stock option grants, stock appreciation rights or stock option grants) made to or with any of such directors, officers, Employees, contractors, consultants or agents; (g) any acceleration or release of any vesting condition to the right to exercise any option or other right to purchase or otherwise acquire any shares of the Company’s or any of its subsidiaries’ capital stock, or any acceleration or release of any right to repurchase shares of the Company’s or any of its subsidiaries’ capital stock upon a Company Shareholder’s termination of employment or services with the Company, either contingent upon the occurrence of transactions such as the Transactions or otherwise; (ivh) entry by the Company or any of its Subsidiaries into subsidiaries into, or material modification, amendment or cancellation of, any licensing Contract for the purchase, license, sale, assignment or other agreement with regard to the disposition or transfer, of any material intellectual property of the assets (including intangible assets), properties or goodwill of the Company or any of its subsidiaries (other than licensespurchase orders for the sale of products or services, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into non-exclusive licenses of any products of the Company or any of its subsidiaries in the ordinary course of business consistent with past practice); (i) any material change in the manner in which the Company or any of its Affiliates extends discounts, credits or warranties to customers or otherwise deals with its customers; (vj) entry by the Company or any of its Affiliates into any Contract that by its terms requires or contemplates a current and/or future financial commitment, expense (inclusive of overhead expense) or obligation on the part of the Company or any of its Affiliates that involves in excess of $75,000.00 (other than purchase orders for the sale of products or services, or non-exclusive licenses of any products of the Company or any of its Affiliates in the ordinary course of business consistent with past practice); (k) any payment or discharge by the Company or any of its Affiliates of any Liability of the Company or any of its Affiliates or Encumbrance on any asset or property of the Company or any of its Affiliates of an amount in excess of $75,000.00 for any Liability or Encumbrance (other than payments in the ordinary course of business consistent with past practice); (l) any change with respect to the management, supervisory or other key personnel, contractors or agents of the Company; any termination of employment of a material number of Employees, contractors, consultants or agents; any labor dispute or claim of unfair labor practices, discriminatory practices, breaches of privacy legislation with respect to the personal information of Employees, contractors, consultants or agents or other employment-related claims involving the Company or any of its Affiliates; (m) any damage, destruction or loss of any property or material asset of the Company or any of its Affiliates, whether or not covered by insurance; (n) any material change by the Company in its accounting methods, principles or practices, except as required by concurrent changes in GAAP or by the Commission, ; (vio) any material revaluation by the Company or any of its Affiliates of any of its their material assets, including, without limitation, writing down the value of capitalized inventory or including writing off notes or accounts receivable other than in the ordinary course of business consistent with past practice, business; or (viip) any communication from the Nasdaq Stock Market with respect agreement or commitment to the delisting do any of the Common Stock, (viii) any cancellation by the Company or any of its Subsidiaries of any debts or waiver of any claims or rights of material value, (ix) any sale, transfer or other disposition outside of the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangible) by the Company or any of its Subsidiaries, or (x) any agreement, whether in writing or otherwise, to take any action described in this section by the Company or any of its Subsidiariesforegoing.

Absence of Certain Changes or Events. Since From December 31, 2007 through the date of this Agreement: (a) except as contemplated by this Agreement, the businesses of the Company Balance Sheetand its Subsidiaries have been conducted, the Company has conducted its business only in all material respects, in the ordinary course of business consistent with past practice and practice; (b) there has not been: (i) been any event, development or state of circumstances that has had, individually or in the aggregate, a Company Material Adverse Change to Effect; (c) except as set forth in Section 2.6 of the CompanyCompany Disclosure Schedule, (ii) there has not been any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, stock or property) with respect to any Company Capital Stock or any repurchase for value by the Company of any Company Capital Stock; (d) there has not been any split, combination or reclassification of any Company Capital Stock or any issuance or the authorization of any issuance of any other securities in respect of, in lieu of or in substitution for shares of Company Capital Stock; (e) except as set forth in Section 2.6 of the Company Disclosure Schedule, there has not been any sale, lease (as lessor), assignment, license, failure to maintain or other disposition of any material properties or assets, except in the ordinary course of business; (f) there have not been any amendments to or changes in the Company Charter, Company Bylaws or Subsidiary Governance Documents; (g) there has not been any change in accounting methods, principles or practices by the Company or any Subsidiary materially affecting the consolidated assets, liabilities or results of operations of the Company’s , except insofar as may have been required by a change in GAAP; (h) to the knowledge of the Company, there have not been any claims, charges or grievances filed with any Governmental Entity by any individual, or asserted or threatened by any individual, Governmental Entity or any workers’ representative organization, bargaining unit or union regarding any unfair labor practice, claim of wrongful discharge or other unlawful employment or labor practice or action with respect to the Company or any Subsidiary; (i) except as required pursuant to any existing contract set forth in Section 2.8 of the Company Disclosure Schedule, in the ordinary course of business, or set forth in Section 2.6 of the Company Disclosure Schedule, there has not been any increase in or other change to the salary, bonus or other compensation payable or to become payable by the Company to any of its officers, directors, employees or advisors, any execution of or amendment to any Employee Agreement, or any declaration, payment or commitment or obligation of any kind for the payment (whether in cash or equity) by the Company of a severance payment, change in control payment, termination payment, bonus or other additional salary or compensation (including any equity-based compensation) to any such person; (j) except as set forth in Section 2.6 of the Company Disclosure Schedule, neither the Company nor any of its Subsidiaries has commenced, settled or, to the knowledge of the Company, been named a party to any lawsuit, and neither the Company nor any of its Subsidiaries has received written notice of any threat of any lawsuit or proceeding or other investigation against the Company or any of its Subsidiaries or relating to any of their businesses, properties or assets; (k) except as set forth in Section 2.6 of the Company Disclosure Schedule, there has not been any issuance, grant, delivery, sale or purchase, or contract or agreement to issue, grant, deliver, sell or purchase, by the Company or any of its Subsidiaries’ capital stock, any shares of Company Common Stock or securities convertible into, or exercisable or exchangeable for, shares of Company Common Stock, or any purchasesubscriptions, redemption warrants, options, rights or other acquisition securities to acquire any of the foregoing; (l) except as set forth in Section 2.6 of the Company Disclosure Schedule, there has not been any grant by the Company or any of its Subsidiaries of any severance, change-in-control or termination pay (in cash or otherwise) to any employee, including any officer; (m) to the knowledge of the Company, there has not been any material damage to, destruction or loss of any material asset of the Company or any of its Subsidiaries (whether or not covered by insurance); (n) there has not been any revaluation by the Company or any of its Subsidiaries of any of the Company’s capital stock or any other securities of the Company or its Subsidiaries or any options, warrants, calls or rights to acquire any such shares or other securities except for repurchases from employees following their termination pursuant to the terms of their pre-existing stock option or purchase agreements, (iii) any split, combination or reclassification of any of the Company’s or any of its Subsidiaries’ capital stock, (iv) entry by the Company or any of its Subsidiaries into any licensing or other agreement with regard to the disposition of any material intellectual property other than licenses, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into in the ordinary course of business consistent with past practice, (v) any material change by the Company in its accounting methods, principles or practices, except as required by concurrent changes in GAAP or by the Commission, (vi) any material revaluation by the Company of any of its assets, including, without limitation, writing down including the value of capitalized inventory or writing off of any notes or accounts receivable other than in the ordinary course of business consistent with past practicebusiness; and (o) there has not been any authorization, (vii) commitment or agreement to take, any communication from the Nasdaq Stock Market with respect to the delisting of the Common Stock, (viii) any cancellation by the Company or any of its Subsidiaries of any debts or waiver of any claims or rights of material value, (ix) any sale, transfer or other disposition outside of the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangible) by the Company or any of its Subsidiaries, or (x) any agreement, whether in writing or otherwise, to take any action described in this section by the Company or any of its Subsidiariesforegoing actions.

Absence of Certain Changes or Events. Since From the date of the Company Buyer Balance SheetSheet to and including the date of this Agreement, the Company has Buyer and its Subsidiaries have conducted its business only their respective businesses and operations in the ordinary course of business consistent with past practice and there has not been: (i) any Material Adverse Change to the Company, (ii) any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, stock or property) in respect of, any of the Company’s or any of its Subsidiaries’ capital stock, or any purchase, redemption or other acquisition by the Company or neither Buyer nor any of its Subsidiaries has: (a) split, combined, or reclassified any shares of its capital stock or made any other changes in its equity capital structure; (b) purchased, redeemed, or otherwise acquired, directly or indirectly, any shares of the Company’s its capital stock or any options, rights, or warrants to purchase any such capital stock or any securities convertible into or exchangeable for any such capital stock; (c) declared, set aside, or paid any dividend or made any other securities distribution in respect of the Company shares of its capital stock, except for dividends or distributions by any of Buyer's Subsidiaries to Buyer or another of Buyer's Subsidiaries; (d) issued any shares of its Subsidiaries capital stock or granted any options, warrantsrights, calls or rights warrants to acquire purchase any such shares or other securities except for repurchases from employees following their termination pursuant to the terms of their pre-existing capital stock option or purchase agreements, (iii) any split, combination or reclassification of any of the Company’s or any of its Subsidiaries’ securities convertible into or exchangeable for any such capital stock, except for issuances of shares of Buyer Common Stock upon the exercise of options, granted on or before the date of the Buyer Balance Sheet; (ive) entry by the Company or purchased any of its Subsidiaries into business, purchased any licensing or other agreement with regard to the disposition stock of any material intellectual property corporation other than licensesBuyer, distribution agreementsor merged or consolidated with any person; (f) sold, advertising agreementsleased, sponsorship agreements licensed or merchant program agreements entered into in the ordinary course of business consistent with past practice, (v) any material change by the Company in its accounting methods, principles encumbered or practices, except as required by concurrent changes in GAAP or by the Commission, (vi) any material revaluation by the Company otherwise disposed of any of its assetsassets or properties, including, without limitation, writing down the value of capitalized inventory or writing off notes or accounts receivable other than in the ordinary course of business consistent with past practice, which sales, leases, licenses, encumbrances or other dispositions of assets other than inventory, in any event, were not material to Buyer and its Subsidiaries, taken as a whole; (viig) incurred, assumed, or guaranteed any communication from the Nasdaq Stock Market with indebtedness for money borrowed other than (A) borrowing incurred for working capital purposes under Buyer's existing revolving credit facility and (B) intercompany indebtedness; (h) changed or modified in any material respect any existing accounting method, principle or practice, other than as required by GAAP; (i) except for this Agreement, entered into any commitment to the delisting do any of the Common Stockforegoing; (j) suffered any business interruption, (viii) any cancellation by the Company damage to or any destruction of its Subsidiaries of any debts or waiver of any claims or rights of material valueproperties, (ix) any sale, transfer or other disposition outside of incident, occurrence, or event that has had or would be reasonably likely to have (after giving effect to insurance coverage), individually or in the aggregate, a Buyer Material Adverse Effect; (k) except for normal increases in the ordinary course of business consistent with past practice that, in the aggregate, do not result in a material increase in benefits or compensation expense to Buyer, increased in any manner the compensation or benefits of any properties employee who is not a director or assets officer, former employee, or independent contractor providing personal services of Buyer or its Subsidiaries (real, personal "Buyer Employee"); (l) increased the compensation or mixed, tangible benefits of any officer or intangible) by the Company director of Buyer or any of its Subsidiaries, other than consistent with past practice; or (m) entered into or (x) amended any contract, agreement, whether employment, severance or special pay arrangement with any Buyer Employee, except in writing or otherwise, to take any action described in this section by the Company or any ordinary course of its Subsidiariesbusiness consistent with past practice.

Absence of Certain Changes or Events. Since the date of the Company Balance SheetFebruary 7, 2014, the Company has Acquired Companies and their respective Subsidiaries have conducted its business their respective businesses, in all material respects, only in the ordinary course of business consistent with past practice practice, and there has not been: : (ia) any Material Adverse Change to the Company, (ii) any declaration, setting aside issuance or payment award of any dividend on, equity awards or other distribution (whether in cash, stock or property) equity-based awards in respect of, of any Equity Interests of the Company’s or any of its Subsidiaries’ capital stock, or any purchase, redemption or other acquisition by the Acquired Company or any of its Subsidiaries to any director, officer or employee of any of the Company’s capital stock or any other securities of the such Acquired Company or its Subsidiaries or any options, warrants, calls or rights to acquire any such shares or other securities except for repurchases from employees following their termination pursuant to the terms of their pre-existing stock option or purchase agreements, (iii) any split, combination or reclassification of any of the Company’s or any of its Subsidiaries’ capital stock; (b) except as required by the terms of any of the Acquired Company Benefit Plans or by applicable Law or in the ordinary course of business, (ivi) entry any granting by the Seller, any Acquired Company or any of its Subsidiaries into to any licensing Business Employee of any increase in compensation, bonus or other agreement with regard to the disposition of any material intellectual property other than licenses, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into in the ordinary course of business consistent with past practicebenefits, (vii) any material change granting by the Company in its accounting methodsSeller, principles or practices, except as required by concurrent changes in GAAP or by the Commission, (vi) any material revaluation by the Company of any of its assets, including, without limitation, writing down the value of capitalized inventory or writing off notes or accounts receivable other than in the ordinary course of business consistent with past practice, (vii) any communication from the Nasdaq Stock Market with respect to the delisting of the Common Stock, (viii) any cancellation by the Acquired Company or any of its Subsidiaries to any Business Employee of any debts increase in severance or waiver termination pay, (iii) any entry by any Acquired Company or any of its Subsidiaries into, or any amendment of, any employment, deferred compensation, consulting, severance, termination or indemnification agreement with any Business Employee, or (iv) any establishment, adoption, entry into, amendment or modification of any claims or rights Acquired Company Benefit Plan for the benefit of material value, any Business Employee; (ixc) any salechange in any material respect in accounting methods, transfer principles or practices by any Acquired Company or any of its Subsidiaries affecting its assets, liabilities or business, other disposition outside of than changes after the ordinary course of business date hereof to the extent required by a change in GAAP or regulatory accounting principles; (d) any material Tax election or change in or revocation of any properties material Tax election, amendment to any material Tax return, closing agreement with respect to Taxes, or assets (real, personal settlement or mixed, tangible or intangible) compromise of any material income Tax liability by the any Acquired Company or any of its Subsidiaries, or ; (xe) any agreement, whether material change in writing its investment or risk management or other similar policies; or (f) any agreement or commitment (contingent or otherwise, ) to take any action described in this section by the Company or do any of its Subsidiariesthe foregoing.

Absence of Certain Changes or Events. Since From the date of the Company Balance SheetSheet through the date of this Agreement, the Company has conducted its business only in the ordinary course of business consistent with past practice and there has not been: , accrued or arisen: (ia) any Material Adverse Change Effect on the Company; (b) any acquisition by the Company or any Subsidiary of, or agreement by the Company or any Subsidiary to acquire by merging or consolidating with, or by purchasing any assets or equity securities of, or by any other manner, any business or corporation, partnership, association or other business organization or division thereof, or other acquisition or agreement to acquire any assets or any equity securities that are material, individually or in the aggregate, to the business of the Company; (c) any Contract, agreement in principle, letter of intent, memorandum of understanding or similar agreement with respect to any material joint venture, strategic partnership or alliance; (iid) any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, stock or property) in respect of, any of the Company’s or any of its Subsidiaries’ capital stock, or any purchase, redemption or other acquisition by the Company or any of its Subsidiaries of any of the Company’s capital stock or any other securities of the Company or its Subsidiaries or any options, warrants, calls or rights to acquire any such shares or other securities except for repurchases from employees Employees following their termination pursuant to the terms of their pre-existing stock option or purchase agreements, ; (iiie) any split, combination or reclassification of any of the Company’s or any of its Subsidiaries’ capital stock; (f) any granting by the Company or any of its Subsidiaries, (iv) whether orally or in writing, of any increase in compensation or fringe benefits or any payment by the Company or any of its Subsidiaries of any bonus or any change by the Company or any of its Subsidiaries of severance, termination or bonus policies and practices or any entry by the Company or any of its Subsidiaries into any licensing currently effective employment, severance, termination or other indemnification agreement or any agreement the benefits of which are contingent or the terms of which are materially altered upon the occurrence of a transaction involving the Company of the nature contemplated hereby (either alone or upon the occurrence of additional or subsequent events; (g) any amendment, termination or consent with regard respect to any Company Material Contract, Contract required to be disclosed in Section 3.8 of the disposition of Company Disclosure Letter, Company Government Contract or Company Government Subcontract; (h) entry into any material intellectual property customer Contract that contains any material non-standard terms, including but not limited to, non-standard discounts, provisions for unpaid future deliverables, non-standard service requirements, future royalty payments other than licenses, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into in the ordinary course of business as is consistent with past practice, non-standard warranties or non-standard indemnification obligations; (vi) any material change by the Company in its accounting methods, principles or practices, except as required by concurrent changes in GAAP GAAP; (j) any debt, capital lease or other debt or equity financing transaction by the CommissionCompany or any of its Subsidiaries or entry into any agreement by the Company or any of its Subsidiaries in connection with any such transaction, except for capital lease and receivables financings entered into in the ordinary course of business consistent with past practice which are not individually or in the aggregate material to the Company and its Subsidiaries taken as a whole; (vik) any grants of any material refunds, credits, rebates or other allowances by the Company to any end user, customer, reseller or distributor, in each case, other than in the ordinary course of business consistent with past practice; (l) any material change in the level of product returns or factors influencing accounts receivable or warranty reserves (including any material change in warranties provided by the Company) experienced by the Company or any of its Subsidiaries; (m) any material restructuring activities by the Company or any of its Subsidiaries, including any material reductions in force, lease terminations, restructuring of employee benefits or similar actions; (n) any sale, lease, license, encumbrance or other disposition of any properties or assets except the sale, lease, license or disposition of property or assets which are not material, individually or in the aggregate, to the business of the Company or the licenses of current Company Products, in each case, in the ordinary course of business and in a manner consistent with past practice; (o) any loan or extension of credit by the Company or any of its Subsidiaries to any Person other than in the ordinary course of business and in a manner consistent with past practice; (p) any material purchases of fixed assets, spares or other long-term assets other than in the ordinary course of business and in a manner consistent with past practice; (q) adoption of or change in any material election in respect of Taxes, adoption or change in any accounting method in respect of Taxes, agreement or settlement of any claim or assessment in respect of Taxes, or extension or waiver of the limitation period applicable to any claim or assessment in respect of Taxes; or (r) any material revaluation, or any indication that such a revaluation was merited under GAAP, by the Company of any of its assets, including, without limitation, writing down the value of capitalized inventory inventory, spares, long term or short-term investments, fixed assets, goodwill, intangible assets, deferred tax assets, or writing off notes or accounts receivable other than in the ordinary course of business consistent with past practice, (vii) any communication from the Nasdaq Stock Market with respect to the delisting of the Common Stock, (viii) any cancellation by the Company or any of its Subsidiaries of any debts or waiver of any claims or rights of material value, (ix) any sale, transfer or other disposition outside of the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangible) by the Company or any of its Subsidiaries, or (x) any agreement, whether in writing or otherwise, to take any action described in this section by the Company or any of its Subsidiaries.

Absence of Certain Changes or Events. Since Between December 28, 2015 and the date of the Company Balance Sheetthis Agreement, the Company has and its Subsidiaries have conducted its business their businesses only in the ordinary course Ordinary Course of business consistent with past practice Business and there has not been: : (ia) any change, effect, event, occurrence or fact that has had or would reasonably be expected to have a Material Adverse Change to the Company, Effect; (iib) any declaration, setting aside or payment of any dividend on, or making of any other distribution (whether in cash, stock or property) in respect of, any capital stock of the Company’s ; (c) any split, combination or reclassification of any capital stock of the Company or any issuance or the authorization of its Subsidiaries’ any issuance of any other securities in lieu of or in substitution for shares of capital stock, or stock of the Company; (d) any purchaserepurchase, redemption or other acquisition by the Company or any of its Subsidiaries of any shares of the Company’s capital stock or any other securities of the Company or any of its Subsidiaries or any options, warrants, calls rights, convertible or exchangeable securities, stock-based performance units or other rights to acquire any such shares or other securities except for repurchases from employees following their termination rights that give the holder thereof any economic interest of a nature accruing to the holders of such shares, other than (w) the acquisition by the Company of shares of Company Common Stock in connection with the surrender of shares of Company Common Stock by holders of Company Stock Options in order to pay the exercise price thereof, (x) the withholding of shares of Company Common Stock to satisfy Tax obligations with respect to awards granted pursuant to the terms of their pre-existing stock option or purchase agreementsCompany Stock Plans, (iiiy) the acquisition by the Company of Company Stock Options, Company RSUs, Company DSUs, Company PSUs and Company Restricted Stock Awards in connection with the forfeiture of such awards, and (z) the acquisition by the trustee of the Company 401(k) Plan of shares of Company Common Stock in order to satisfy participant investment elections under the Company 401(k) Plan; (e) any splitchange in accounting methods, combination principles or reclassification practices by the Company or any of its Subsidiaries materially affecting the consolidated assets, liabilities or results of operations of the Company, except as required (x) by GAAP (or any interpretation thereof), including pursuant to standards, guidelines and interpretations of the Financial Accounting Standards Board or any similar organization, or (y) by Law, including Regulation S-X under the Securities Act; (f) with respect to the Company or any of its Subsidiaries, any material election relating to Taxes (including any “check-the-box” election pursuant to Treasury Regulations Section 301.7701-3), any material amendment with respect to any material Tax Return, any settlement or compromise of any material Tax liability for an amount that exceeds the amount disclosed, reflected or reserved against in the financial statements contained in the Filed SEC Documents, any request for any rulings from or the execution of any closing agreement with any Governmental Authority (except in connection with a settlement of a Tax liability for an amount that does not exceed the amount disclosed, reflected or reserved against in the financial statements contained in the Filed SEC Documents), any surrender of any right to claim a material Tax refund, any change to an annual accounting period for Tax purposes, or any change of any material accounting method for Tax purposes, except, in each case, for actions taken in the Ordinary Course of Business; (g) the commencement of any new line of business or the opening by the Company or any of its Subsidiaries of any restaurants or the Company or any of its Subsidiaries otherwise engaging in any other operations, in each case, in any country in which they did not, as of December 28, 2015, have an owned or franchised restaurant or conduct other operations; or (h) any change (other than an immaterial change) to the terms of the Company’s or any of its Subsidiaries’ capital stockpolicies or procedures with respect to its relationships with any of its Franchisees, including any system-wide or regional mandates relating to equipment or software. In addition, between September 1, 2016 and the date of this Agreement, except as required by applicable Law or the terms of any Company Benefit Plan or Company Benefit Agreement or other written agreement, in each case, set forth in the Company Disclosure Letter and in effect as of September 1, 2016, there has not been (A) any granting to any director or member of the Company Executive Team of any increase in compensation (except in the Ordinary Course of Business), (ivB) any granting to any director or member of the Company Executive Team of any increase in severance or termination pay (except to the extent of any increase in severance or termination pay as a result of the any increase in compensation in the Ordinary Course of Business), (C) any entry by the Company or any of its Subsidiaries into any licensing employment, consulting, severance, retention or termination agreement or arrangement with any director, officer or other agreement with regard to the disposition of employee, (D) any establishing, adopting, entry into or amending in any material intellectual property other than licenses, distribution agreements, advertising agreements, sponsorship agreements respect any collective bargaining agreement or merchant program agreements entered into in the ordinary course of business consistent with past practice, (v) any material change by the Company in its accounting methods, principles Benefit Plan or practices, except as required by concurrent changes in GAAP or by the Commission, (vi) any material revaluation by the Company of any of its assets, including, without limitation, writing down the value of capitalized inventory or writing off notes or accounts receivable other than in the ordinary course of business consistent with past practice, (vii) any communication from the Nasdaq Stock Market with respect to the delisting of the Common Stock, (viii) any cancellation by the Company or any of its Subsidiaries of any debts or waiver of any claims or rights of material value, (ix) any sale, transfer or other disposition outside of the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangible) by the Company or any of its SubsidiariesBenefit Agreement, or (xE) any agreement, whether in writing acting to accelerate any rights or otherwise, to take benefits under any action described in this section by the Company Benefit Plan or any of its SubsidiariesCompany Benefit Agreement.

Absence of Certain Changes or Events. Since January 1, 2011, there has not occurred any fact, circumstance, effect, change, event or development that, individually or in the aggregate, has had or would reasonably be expected to have a Company Material Adverse Effect. From January 1, 2011 to the date of this Agreement, each of the Company Balance Sheet, and the Company Subsidiaries has conducted its respective business only in the ordinary course of business consistent with past practice in all material respects, and during such period there has not been: occurred: (i) any Material Adverse Change to the Company, (iia) any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, stock or propertyproperty or any combination thereof) in respect of any capital stock or voting securities of, or other equity interests in, the Company or the capital stock or voting securities of, or other equity interests in, any of the Company’s Company Subsidiaries (other than dividends or other distributions by a direct or indirect wholly owned Company Subsidiary to its parent) or any repurchase for value by the Company of its any capital stock or voting securities of, or other equity interests in, the Company or the capital stock or voting securities of, or other equity interests in, any of the Company Subsidiaries’ capital stock; (b) any incurrence of material Indebtedness for borrowed money or any guarantee of such Indebtedness for another Person, or any purchaseissue or sale of debt securities, redemption warrants or other acquisition by rights to acquire any debt security of the Company or any Company Subsidiary other than draws on existing revolving credit facilities in the ordinary course of its Subsidiaries of business; (i) any of the Company’s capital stock or any other securities of the Company or its Subsidiaries or any optionstransfer, warrantslease, calls or rights to acquire any such shares license, sale, mortgage, pledge or other securities except for repurchases from employees following their termination pursuant to the terms of their pre-existing stock option disposal or purchase agreements, (iii) any split, combination or reclassification encumbrance of any of the Company’s or any of its the Company Subsidiaries’ capital stockproperty or assets outside of the ordinary course of business consistent with past practice with a fair market value in excess of $5,000,000 or (ii) any acquisitions of businesses, whether by merger, consolidation, purchase of property or assets or otherwise; (ivd) entry (i) any granting by the Company or any Company Subsidiary to any current or former director or officer of its Subsidiaries into the Company or any licensing or other agreement with regard to the disposition Company Subsidiary of any material intellectual property increase in compensation, bonus or fringe or other than licensesbenefits or any granting of any type of compensation or benefits to any such Person not previously receiving or entitled to receive such type of compensation or benefits, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into except in the ordinary course of business consistent with past practicepractice or as was required under any Company Benefit Plan in effect as of January 1, 2011, (vii) any material change granting by the Company or any Company Subsidiary to any Person of any rights to severance, retention, change in its control or termination compensation or benefits or any material increase therein, except with respect to new hires and promotions in the ordinary course of business and except as was required under any Company Benefit Plan in effect as of January 1, 2011, or (iii) any entry into or adoption of any material Company Benefit Plan or any material amendment of any such material Company Benefit Plan; (e) any change in accounting methods, principles or practices, except as required by concurrent changes in GAAP or by the Commission, (vi) any material revaluation practices by the Company or any Company Subsidiary, except insofar as may have been required by a change in GAAP; (f) any transfer, lease, license, sale, mortgage, pledge or other disposal or encumbrance of any of its assetsthe Company Intellectual Property owned by the Company or any Company Subsidiary, including, without limitation, writing down the value of capitalized inventory or writing off notes or accounts receivable other than in the ordinary course of business consistent with past practice, ; or (viig) any communication from the Nasdaq Stock Market material elections or changes thereto with respect to the delisting of the Common Stock, (viii) any cancellation Taxes by the Company or any of its Subsidiaries of Company Subsidiary or any debts settlement or waiver of any claims or rights of material value, (ix) any sale, transfer or other disposition outside of the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangible) compromise by the Company or any Company Subsidiary of its Subsidiariesany material Tax liability or material Tax refund, or (x) any agreement, whether other than in writing or otherwise, to take any action described in this section by the Company or any ordinary course of its Subsidiariesbusiness.

Absence of Certain Changes or Events. Since Except as and to the extent disclosed or reflected in the Company SEC Reports filed with the SEC prior to the date hereof (the "Filed Company SEC Reports"), neither the Company nor any of its Subsidiaries has any liabilities or obligations of any nature, whether or not accrued, contingent or otherwise, that would reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect on the Company. Except as and to the extent disclosed by the Company in the Filed Company SEC Reports, from June 1, 1999 through the date of the Company Balance Sheetthis Agreement, the Company has and its Subsidiaries have conducted its their business only in the ordinary and usual course of business consistent with past practice and there has not been: : (ia) any change, effect, event or occurrence which does or would reasonably be expected to have, individually or in the aggregate, a Material Adverse Change to Effect on the Company, . (iib) any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, with respect to any shares of capital stock or property) in respect of, any of the Company’s or any of its Subsidiaries’ capital stock, or any purchaserepurchase, redemption or other acquisition by the Company or any of its Subsidiaries of any Company Securities; (c) any amendment of the Company’s capital stock any term or condition of any other securities outstanding security of the Company or its Subsidiaries or any options, warrants, calls or rights to acquire any such shares or other securities except for repurchases from employees following their termination pursuant to the terms of their pre-existing stock option or purchase agreements, (iii) any split, combination or reclassification of any of the Company’s or any of its Subsidiaries’ capital stock, Subsidiaries (ivexcept for acceleration of vesting as a result of the transactions contemplated by this Agreement); (d) entry (i) any incurrence or assumption by the Company or any of its Subsidiaries into any licensing or other agreement with regard to the disposition of any material intellectual property other than licenses, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into in the ordinary course of business consistent with past practice, (v) any material change by the Company in its accounting methods, principles or practices, except as required by concurrent changes in GAAP or by the Commission, (vi) any material revaluation by the Company of any of its assets, including, without limitation, writing down the value of capitalized inventory or writing off notes or accounts receivable indebtedness for borrowed money other than in the ordinary course of business consistent with past practice, practice or (viiii) any communication from the Nasdaq Stock Market with respect to the delisting guarantee, endorsement or contractual assumption of the Common Stockliability (whether directly, (viiicontingently or otherwise) any cancellation by the Company or any of its Subsidiaries for the obligations of any debts or waiver of any claims or rights of material value, (ix) any sale, transfer or other disposition outside of person other than in the ordinary course of business consistent with past practice (other than any wholly owned Subsidiary of any properties the Company, or assets (realthe Company, personal or mixed, tangible or intangible) by the Company or any of with respect to its Subsidiaries, or (x) any agreement, whether in writing or otherwise, to take any action described in this section by the Company or any of its Subsidiaries.);

Absence of Certain Changes or Events. Since Except for liabilities incurred in connection with this Agreement or the date transactions contemplated hereby, and except as set forth in Section 3.1(g) of the Company Balance SheetDisclosure Schedule, or as disclosed in Company SEC Documents filed and publicly available prior to the date hereof (as amended to the date hereof, “Company has Filed SEC Documents”), since December 31, 2002, Company and its Subsidiaries have conducted its business their respective businesses in all material respects only in the ordinary course of business consistent with past practice and (1) with respect to subsections (i), (iii), (iv), (vi), (vii), (viii) and (ix) (in the case of subsection (ix), as it pertains to such other subsections) below, since December 31, 2002, and (2) with respect to subsections (ii), (v) and (ix) (in the case of subsection (ix), as it pertains to such other subsections) below, from September 30, 2003 to the date hereof, there has not been: : (i) any Material Adverse Change to the in Company, , (ii) any issuance of Company Stock Options or restricted shares of Company Common Stock, or any other equity-based award, to any directors, officers, Employees or consultants of Company or any of its Subsidiaries, (iii) any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, stock or property) in with respect of, to any of the Company’s capital stock of Company or any of its Subsidiaries’ capital stock, or other than regular quarterly cash dividends not in excess of $0.25 per share on Company Common Stock, and other than dividends paid by any purchase, redemption or other acquisition by the wholly owned Subsidiary of Company to Company or any other wholly owned Subsidiary of its Subsidiaries of any of the Company’s capital stock or any other securities of the Company or its Subsidiaries or any options, warrants, calls or rights to acquire any such shares or other securities except for repurchases from employees following their termination pursuant to the terms of their pre-existing stock option or purchase agreements, , (iiiiv) any split, combination or reclassification of any of the Company’s or any of its Subsidiaries’ capital stock, or any issuance or the authorization of any issuance of any other securities in respect of, in lieu of or in substitution for shares of Company’s capital stock, except for issuances of Company Common Stock pursuant to Company Stock Plans or upon the exercise of Company Stock Options awarded prior to the date hereof in accordance with their present terms, (ivv) entry (A) any granting by the Company or any of its Subsidiaries into to any licensing current or former directors, executive officers, Employees or consultants of any increase in compensation, bonus or other agreement with regard benefits, except for (x) increases to the disposition of any material intellectual property other than licenses, distribution agreements, advertising agreements, sponsorship agreements Employees who are not current or merchant program agreements entered into former directors or officers that were made in the ordinary course of business consistent with past practice, (vy) any material change as required from time to time by the Company in its accounting methods, principles or practices, except applicable law affecting wages and (z) as required by concurrent changes the terms of plans or arrangements existing prior to such date and listed in GAAP or by Section 3.1(k) of the CommissionCompany Disclosure Schedule, (viB) any material revaluation granting by the Company of any of its assets, including, without limitation, writing down the value of capitalized inventory or writing off notes or accounts receivable other than in the ordinary course of business consistent with past practice, (vii) any communication from the Nasdaq Stock Market with respect to the delisting of the Common Stock, (viii) any cancellation by the Company or any of its Subsidiaries to any such current or former directors, executive officers, Employees or consultants of any debts increase in severance or waiver of any claims termination pay, or rights of material value, (ixC) any sale, transfer or other disposition outside of the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangible) entry by the Company or any of its Subsidiaries into, or any amendment of, any employment, deferred compensation, consulting, severance, termination or indemnification agreement with any such current or former directors, Employees, officers or consultants, except as required from time to time by applicable law, (vi) other than as described in Company Filed SEC Documents, any change in any material respect in accounting methods, principles or practices by Company affecting its assets, liabilities or business, including any reserving, renewal or residual method, or estimate of practice or policy, other than changes after the date hereof to the extent required by a change in GAAP or regulatory accounting principles, (vii) any Tax election or change in or revocation of any Tax election, amendment to any Tax Return (as defined in Section 3.1(j)), closing agreement with respect to Taxes, or settlement or compromise of any Tax liability by Company or its Subsidiaries, or except as would be permitted under Section 4.1(ix), (xviii) any agreementmaterial change in investment policies, whether in writing or (ix) any agreement or commitment (contingent or otherwise, ) to take any action described in this section by the Company or do any of its Subsidiariesthe foregoing.

Absence of Certain Changes or Events. Since the date Except as set forth in Section 3.07 of the Company Balance SheetDisclosure Schedule, since December 31, 2006, the Company has and its Subsidiaries have conducted its business their respective businesses only in the ordinary course of business consistent with their past practice and practice, (a) there has not been: (i) been any Material Adverse Change to Change, and (b) from such date until the Company, date hereof there has not been (iii) any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, stock or property) in with respect of, to any capital stock of the Company’s Company or any of its Subsidiaries’ capital stock, other than dividends or distributions by a direct or indirect wholly owned Subsidiary of the Company to its stockholders, (ii) any purchase, redemption or other acquisition by the Company or any of its Subsidiaries of any shares of the Company’s capital stock or any other securities of the Company or any of its Subsidiaries or any options, warrants, calls or rights to acquire any such shares or other securities except for repurchases from employees following their termination securities, including pursuant to the terms of their pre-existing stock option or purchase agreementsCompany’s share repurchase program, (iii) any split, combination or reclassification of any capital stock of the Company’s Company or any of its Subsidiaries’ Subsidiaries or any issuance or the authorization of any issuance of any other securities in respect of, in lieu of or in substitution for shares of their respective capital stock, (iv) (A) any granting by the Company or any of its Subsidiaries to any current or former director, officer, employee or independent contractor, of the Company or any of its Subsidiaries (all such individuals, collectively, the “Company Personnel”) of any increase in compensation, bonus or fringe or other benefits, except in the ordinary course of business consistent with past practice or as was required under any Company Benefit Agreement or Company Benefit Plan, (B) any granting by the Company or any of its Subsidiaries to any Company Personnel of (1) any increase in severance or termination pay or (2) any right to receive any severance or termination pay, (C) any entry by the Company or any of its Subsidiaries into, or any amendments of, (1) any Company Benefit Agreement or (2) any Contract with any Company Personnel the benefits of which are contingent, or the terms of which are materially altered, upon the occurrence of a transaction involving the Company of a nature contemplated by this Agreement, (D) the removal or modification of any restrictions in any Company Benefit Agreement or Company Benefit Plan or awards made thereunder, except as required to comply with applicable Law or any Company Benefit Agreement or Company Benefit Plan in effect as of the date hereof, or (E) the adoption, amendment or termination of any Company Benefit Plan or entry into any licensing agreement, plan or other agreement with regard arrangement to do any of the disposition of any material intellectual property other than licenses, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into in the ordinary course of business consistent with past practiceforegoing, (v) any material damage, destruction or loss, whether or not covered by insurance, (vi) any change by the Company in its accounting methods, principles or practices, except as required by concurrent changes in GAAP or by the Commission, (vi) any material revaluation practices by the Company of any of materially affecting its assets, includingliabilities or businesses, without limitation, writing down the value of capitalized inventory or writing off notes or accounts receivable other than except insofar as may have been required by a change in the ordinary course of business consistent with past practiceGAAP, (vii) any communication from the Nasdaq Stock Market with respect to the delisting material Tax election or any settlement or compromise of the Common Stock, any material income Tax liability or (viii) any cancellation by the Company sales of real estate or restaurants, or any of its Subsidiaries of Contract with respect to any debts or waiver of any claims or rights of material value, (ix) any such sale, transfer or other disposition outside of the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangible) by the Company or any of its Subsidiaries, or (x) any agreement, whether in writing or otherwise, to take any action described in this section by the Company or any of its Subsidiaries.

Absence of Certain Changes or Events. Since the date April 30, ------------------------------------ 1995, except as contemplated in this Agreement or as set forth in Section 4.7 of the Company Balance SheetDisclosure Schedule, there has not been: (a) any Material Adverse Effect or any event, occurrence or development of a state of circumstances or facts which is reasonably likely to have a Material Adverse Effect; (b) any strike, picketing, work slowdown or other labor disturbance having a Material Adverse Effect; (c) any damage, destruction or loss (whether or not covered by insurance) with respect to any of the assets of the Company has conducted or any of its Subsidiaries having a Material Adverse Effect; (d) any repurchase, redemption or other acquisition of capital stock of the Company or any Subsidiary by the Company or any of the Subsidiaries or any declaration or payment of any dividend or other distribution in cash, stock or property with respect to the capital stock of the Company, except for purchases heretofore made pursuant to the terms of the Company's employee benefit plans and regular cash dividends paid before the date hereof; (e) any entry into any material commitment or transaction (including, without limitation, any borrowing, assumption of indebtedness, guaranty of indebtedness, or capital expenditure) other than in the ordinary course of business only and on terms consistent with past practice or as contemplated by this Agreement; (f) any transfer of, or rights granted under, any material leases, licenses, agreements, patents, trademarks, trade names or copyrights other than those transferred or granted in the ordinary course of business and consistent with past practice; (g) any mortgage, pledge, security interest or imposition of a lien or other encumbrance on any material asset of the Company or any of the Subsidiaries; (h) any change by the Company in accounting principles or methods except insofar as may have been required by a change in generally accepted accounting principles and disclosed in the SEC Reports; (i) any amendment of any material term of any outstanding security of the Company or any Subsidiary; (j) any making of any loan, advance or capital contributions to or investment in any Person other than loans, advances or capital contributions to or investments in wholly-owned Subsidiaries or made in the ordinary course of business consistent with past practices; or (k) any transaction or commitment made, or any contract or agreement entered into, by the Company or any Subsidiary relating to its assets or business (including the acquisition or disposition of any assets) or any relinquishment by the Company or any Subsidiary of any contract or other right, in either case, material to the Company and the Subsidiaries taken as a whole, other than transactions and commitments in the ordinary course of business consistent with past practice and there those contemplated by this Agreement. Since April 30, 1995, except as contemplated in this Agreement, the Company and its Subsidiaries have conducted their business only in the ordinary course and in a manner consistent with past practice and have not made any material change in the conduct of the business or operations of the Company and its Subsidiaries taken as a whole. Except as set forth in Section 4.7 of the Company Disclosure Schedule, without limiting the generality of the foregoing, the Company has not, since such date, except as set forth in the SEC Reports, made any changes in executive compensation levels or in the manner in which other employees of the Company or the Subsidiaries are compensated, paid or agreed to pay any pension, retirement allowance or other employee benefit not been: (i) required or permitted by any Material Adverse Change plan, agreement or arrangement existing on such date to the Companyany director, (ii) officer or employee, whether past or present, increased any declarationbenefits payable under existing severance or termination pay policies or employment agreements, setting aside or payment of increased any dividend oncompensation, bonus, or other distribution (whether in cashbenefits payable to directors, stock officers or property) in respect of, any employees of the Company’s or any of its Subsidiaries’ capital stock, or any purchase, redemption or other acquisition by the Company or any Subsidiary or committed itself to any collective bargaining agreement (except for renewals of its Subsidiaries existing collective bargaining agreements) or to any pension, profit-sharing, bonus, incentive, deferred compensation, stock purchase, stock option, stock appreciation right, group insurance, severance pay, retirement or other employee benefit plan, agreement or arrangement, or to any employment or consulting agreement with or for the benefit of any of the Company’s capital stock person, or any other securities of the Company or its Subsidiaries or any options, warrants, calls or rights to acquire any such shares or other securities except for repurchases from employees following their termination pursuant to the terms of their pre-existing stock option or purchase agreements, (iii) any split, combination or reclassification of amend any of the Company’s such plans or any of its Subsidiaries’ capital stock, (iv) entry by the Company or any of its Subsidiaries into any licensing or other agreement with regard to the disposition of any material intellectual property other than licenses, distribution agreements, advertising agreements, sponsorship such agreements or merchant program agreements entered into in the ordinary course of business consistent with past practice, (v) any material change by the Company in its accounting methods, principles or practices, except as required by concurrent changes in GAAP or by the Commission, (vi) any material revaluation by the Company of any of its assets, including, without limitation, writing down the value of capitalized inventory or writing off notes or accounts receivable other than in the ordinary course of business consistent with past practice, (vii) any communication from the Nasdaq Stock Market with respect to the delisting of the Common Stock, (viii) any cancellation by the Company or any of its Subsidiaries of any debts or waiver of any claims or rights of material value, (ix) any sale, transfer or other disposition outside of the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangible) by the Company or any of its Subsidiaries, or (x) any agreement, whether in writing or otherwise, to take any action described in this section by the Company or any of its Subsidiariesexistence on such date.

Absence of Certain Changes or Events. Since the date of the Company Balance SheetJanuary 1, the Company has conducted its business only in the ordinary course of business consistent with past practice and 2002, there has not been: (i) any Material Adverse Change to Effect on the Company, (ii) any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, stock or property) in respect of, any of the Company’s capital stock of the Company or any of its Subsidiaries’ capital stock, or any purchase, redemption or other acquisition by the Company or any of its Subsidiaries of any of the Company’s capital stock or any other securities of the Company or its Subsidiaries or any options, warrants, calls or rights to acquire any such shares or other securities securities, except for (A) repurchases or the redemption of Company Exchangeable Preferred Stock and (B) repurchases from employees following their termination pursuant to the terms of their pre-existing stock option or purchase agreementsContracts, (iii) any split, combination or reclassification of any of the Company’s capital stock of the Company or any of its Subsidiaries’ capital stock, (iv) (A) any granting by the Company or any of its Subsidiaries of any increase in compensation or fringe benefits, except for increases of cash compensation and option grants made in the ordinary course of business consistent with past practice or as required under existing Contracts, (B) any payment by the Company or any of its Subsidiaries of any bonus, except for bonuses made in the ordinary course of business consistent with past practice or as required under existing Contracts, or (C) any granting by the Company or any of its Subsidiaries of any increase in severance or termination pay or any entry by the Company or any of its Subsidiaries into any currently effective employment, severance, termination or indemnification agreement or any other currently effective Contract the benefits of which are contingent or the terms of which are materially altered upon the occurrence of a transaction involving the Company of the nature contemplated hereby, (v) any entry by the Company or any of its Subsidiaries into any licensing or other agreement Contracts with regard to the acquisition or disposition of any material intellectual property Intellectual Property, other than licenses, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into licenses in the ordinary course of business consistent with past practicepractice or any amendment or consent with respect to any licensing Contract filed or required to be filed by the Company with the SEC, (vvi) any material change by the Company in its accounting methods, principles or practices, except as required by concurrent changes in GAAP or by the Commissionapplicable law, or (vivii) any material revaluation by the Company of any of its assets, assets (including, without limitation, writing down the value of capitalized inventory or writing off notes or accounts receivable in an amount greater than Fifty Thousand Dollars ($50,000) in the aggregate) or any sale of assets of the Company other than in the ordinary course of business consistent with past practice, (vii) any communication from the Nasdaq Stock Market with respect to the delisting of the Common Stock, (viii) any cancellation by the Company or any of its Subsidiaries of any debts or waiver of any claims or rights of material value, (ix) any sale, transfer or other disposition outside of the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangible) by the Company or any of its Subsidiaries, or (x) any agreement, whether in writing or otherwise, to take any action described in this section by the Company or any of its Subsidiaries.

Absence of Certain Changes or Events. Since 6.11.1. Except as expressly contemplated or permitted by this Agreement, and other than the date of reasonable and customary fees and expenses incurred in connection with the Company Balance Sheettransactions contemplated by this Agreement, since January 29, 2000, the Company business of Gart and its Subsidiaries has been conducted its business only in all material respects in the ordinary course of business consistent with past practice practices, neither Gart nor any of its Subsidiaries has engaged in any transaction or series of related transactions material to Gart or its Subsidiaries taken as a whole other than in the ordinary course of business consistent with past practices, and there has not been any event, occurrence or development that, individually or in the aggregate, constitutes or would constitute a Material Adverse Effect on the Company. 6.11.2. Without limiting the generality of the foregoing Section 6.11.1, since January 29, 2000, except as set forth in Section 6.11.2 of the Gart Disclosure Schedule, there has not been: : (ia) any damage, destruction or loss to any of the assets or properties of Gart or any of its Subsidiaries that, individually or in the aggregate, constitutes a Material Adverse Change to the Company, Effect on Gart; (iib) any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, capital stock or property) or capital return in respect of, of any shares of the Company’s Gart's capital stock or any of its Subsidiaries’ capital stockredemption, or any purchase, redemption purchase or other acquisition by the Company Gart or any of its Subsidiaries of any shares of the Company’s Gart's capital stock, or any repurchase, redemption or other purchase by Gart or any of its Subsidiaries of any outstanding shares of capital stock or any other securities of the Company or its Subsidiaries or any optionsof, warrants, calls or rights to acquire any such shares or other securities except for repurchases from employees following their termination pursuant to the terms of their pre-existing stock option or purchase agreementsownership interests in, (iii) any split, combination or reclassification of any of the Company’s Gart or any of its Subsidiaries’ capital stock, or any amendment of any material term of any outstanding security of Gart or any of its Subsidiaries; (ivc) entry by any sale, assignment, transfer, lease or other disposition, or agreement to sell, assign, transfer, lease or otherwise dispose of, any of the Company assets of Gart or any of its Subsidiaries into any licensing or other agreement with regard to the disposition of any material intellectual property taken as a whole other than licenses, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into in the ordinary course of business consistent with past practicepractices; (d) any acquisition (by merger, consolidation, or acquisition of stock or assets) by Gart or any of its Subsidiaries of any corporation, partnership or other business organization or division thereof or any equity interest therein for consideration; (e) any (i) incurrence of, (vii) guarantee with respect to, or (iii) provision of credit support for, any indebtedness by Gart or any of its Subsidiaries other than pursuant to (A) the Gart Credit Facility in the ordinary course of business or (B) lease financings for equipment used in the operation of the businesses of Gart or any of its Subsidiaries in the ordinary course of business; or any creation or assumption by Gart or any of its Subsidiaries of any material Lien, other than any Permitted Lien, on any material asset; (f) any material change in any method of accounting or accounting practice (whether for financial accounting or Tax purposes) used by the Company in Gart or any of its accounting methods, principles or practices, except as required by concurrent changes in GAAP or by the Commission, Subsidiaries; (vig) any revaluing in any material revaluation by the Company respect of any of the assets of Gart or any of its assetsSubsidiaries on the Gart Financials, including, without limitation, writing down the value of capitalized any assets or inventory or writing off notes or accounts receivable other than in the ordinary course of business consistent with past practice, practices; (viih) any communication from loan, advance or capital contribution made by Gart or any of its Subsidiaries to, or investment in, any Person other than loans, advances or capital contributions, or investments of Gart made in the Nasdaq Stock Market ordinary course of business consistent with respect to the delisting of the Common Stock, past practices; (viiii) any cancellation waiver, direct or indirect, by the Company Gart or any of its Subsidiaries of (i) any debts or waiver of any claims right or rights of material value, value or (ixii) any salepayment of any material debt, transfer Liability or other disposition outside obligation owed to Gart or any of its Subsidiaries, except for non-material waivers and payments made in the ordinary course of business consistent with past practices; (j) any change in or amendment to Gart's or any of its Subsidiaries' certificate of incorporation, by-laws or other organizational documents; (k) any payment, loan or advance of any amount to or in respect of, or the sale, transfer or lease of any properties or assets (whether real, personal or mixed, tangible or intangible) by the Company to, or entering into of any agreement, arrangement or transaction with or on behalf of, any officer, director, or employee of Gart, any of its Subsidiaries, or any Affiliate of any of them, or any business or entity in which Gart, any Subsidiary or any Affiliate of any of them, or relative of any such Person, has any material, direct or indirect, interest, except for (xi) directors' fees, (ii) compensation to the officers and employees of Gart (including benefits received by such officers and employees as a result of their participation in Gart Plans) in the ordinary course of business consistent with past practices, and (iii) advancement or reimbursement of expenses in the ordinary course of business consistent with past practices; (l) any agreementmaterial modification or change in any Gart Insurance Policy that would result in a diminishment of coverage under such Gart Insurance Policy; (m) any acquisition of a fee simple interest or a leasehold or subleasehold interest in, whether in writing or otherwiseany sale, to take assignment, disposition, transfer, pledge, mortgage or lease of, any action described in this section real property owned or leased by the Company Gart or any of its Subsidiaries; (n) any issuance, sale or disposition of any capital stock or other equity interest in Gart, except upon the valid exercise of options in accordance with the terms thereof, or any issuance or grant of any options, warrants or other rights to purchase any such capital stock or equity interest, or any securities convertible into or exchangeable for such capital stock or equity interest, or any other change in the issued and outstanding capitalization of Gart; (o) any amendment, alteration or modification in the terms of any currently outstanding options, warrants or other rights to purchase any capital stock or equity interest in Gart or any securities convertible into or exchangeable for such capital stock or equity interest, including, without limitation, any reduction in the exercise or conversion price of any such rights or securities, any change to the vesting or acceleration terms of any such rights or securities, or any change to terms relating to the grant of any such rights or securities; (p) any closure, shut down or other elimination of any of Gart's stores or offices or any material change in the basic character of its business, properties or assets, other than any store closures effected or proposed to be effected as set forth in Section 6.11.2 of the Gart Disclosure Schedule; (q) any action that, if it had been taken after the date hereof, would have required the consent of the Company under Section 7.1; and (r) any agreement to take any actions specified in this Section 6.11.2, except for this Agreement.

Absence of Certain Changes or Events. Since the date Except as set forth in Section 2.9 of the Company Balance SheetDisclosure Letter, the Company has conducted its business only in the ordinary course of business consistent with past practice and since September 30, 2000, there has not been: (i) any Material Adverse Change to the Effect on Company, (ii) any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, stock or property) in respect of, any of the Company’s 's or any of its Subsidiaries’ subsidiaries' capital stock, or any purchase, redemption or other acquisition by the Company or any of its Subsidiaries of any of the Company’s 's capital stock or any other securities of the Company or its Subsidiaries subsidiaries or any options, warrants, calls or rights to acquire any such shares or other securities except for repurchases from employees following their termination pursuant to the terms of their pre-existing stock option or purchase agreements, (iii) any split, combination or reclassification of any of the Company’s 's or any of its Subsidiaries’ subsidiaries' capital stock, (iv) entry any granting by the Company or any of its Subsidiaries into any licensing or other agreement with regard to the disposition subsidiaries of any material intellectual property other than licensesincrease in compensation or fringe benefits, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into except for normal increases of cash compensation in the ordinary course of business consistent with past practice, or any payment by Company or any of its subsidiaries of any bonus, except for bonuses made in the ordinary course of business consistent with past practice, or any granting by Company or any of its subsidiaries of any increase in severance or termination pay or any entry by Company or any of its subsidiaries into any currently effective employment, severance, termination or indemnification agreement or any agreement the benefits of which are contingent or the terms of which are materially altered upon the occurrence of a transaction involving Company of the nature contemplated hereby, (v) entry by Company or any of its subsidiaries into any licensing or other agreement with regard to the acquisition or disposition of any Intellectual Property (as defined in Section 2.19) other than licenses in the ordinary course of business consistent with past practice or any amendment or consent with respect to any licensing agreement which has been filed or is required to be filed by Company with the SEC, (vi) any material change by the Company in its accounting methods, principles or practices, except as required by concurrent changes in GAAP GAAP, or by the Commission, (vivii) any material revaluation by the Company of any of its assets, including, without limitation, writing down the value of capitalized inventory or writing off notes or accounts receivable receivable, or (viii) any sale of assets of the Company other than in the ordinary course of business consistent with past practice, (vii) any communication from the Nasdaq Stock Market with respect to the delisting of the Common Stock, (viii) any cancellation by the Company or any of its Subsidiaries of any debts or waiver of any claims or rights of material value, (ix) any sale, transfer or other disposition outside of the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangible) by the Company or any of its Subsidiaries, or (x) any agreement, whether in writing or otherwise, to take any action described in this section by the Company or any of its Subsidiaries.

Absence of Certain Changes or Events. Since From the date of the Company Buyer Balance SheetSheet to and including the date of this Agreement, the Company has Buyer and its Subsidiaries have conducted its business only their respective businesses and operations in the ordinary course of business consistent with past practice and there has not been: (i) any Material Adverse Change to the Company, (ii) any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, stock or property) in respect of, any of the Company’s or any of its Subsidiaries’ capital stock, or any purchase, redemption or other acquisition by the Company or neither Buyer nor any of its Subsidiaries has: (a) split, combined, or reclassified any shares of its capital stock or made any other changes in its equity capital structure; (b) purchased, redeemed, or otherwise acquired, directly or indirectly, any shares of the Company’s its capital stock or any options, rights, or warrants to purchase any such capital stock or any securities convertible into or exchangeable for any such capital stock; (c) declared, set aside, or paid any dividend or made any other securities distribution in respect of the Company shares of its capital stock, except for dividends or distributions by any of Buyer’s Subsidiaries to Buyer or another of Buyer’s Subsidiaries; (d) issued any shares of its Subsidiaries capital stock or granted any options, warrantsrights, calls or rights warrants to acquire purchase any such shares or other securities except for repurchases from employees following their termination pursuant to the terms of their pre-existing capital stock option or purchase agreements, (iii) any split, combination or reclassification of any of the Company’s or any of its Subsidiaries’ securities convertible into or exchangeable for any such capital stock, except for issuances of shares of Buyer Common Stock upon the exercise of options, granted on or before the date of the Buyer Balance Sheet; (ive) entry by the Company or purchased any of its Subsidiaries into business, purchased any licensing or other agreement with regard to the disposition stock of any material intellectual property corporation other than licensesBuyer, distribution agreementsor merged or consolidated with any person; (f) sold, advertising agreementsleased, sponsorship agreements licensed or merchant program agreements entered into in the ordinary course of business consistent with past practice, (v) any material change by the Company in its accounting methods, principles encumbered or practices, except as required by concurrent changes in GAAP or by the Commission, (vi) any material revaluation by the Company otherwise disposed of any of its assetsassets or properties, including, without limitation, writing down the value of capitalized inventory or writing off notes or accounts receivable other than in the ordinary course of business consistent with past practice, (vii) any communication from the Nasdaq Stock Market with respect to the delisting of the Common Stockwhich sales, (viii) any cancellation by the Company or any of its Subsidiaries of any debts or waiver of any claims or rights of material valueleases, (ix) any salelicenses, transfer encumbrances or other disposition outside dispositions of assets other than inventory, in any event, were not material to Buyer and its Subsidiaries, taken as a whole; (g) incurred, assumed, or guaranteed any indebtedness for money borrowed other than intercompany indebtedness; (h) changed or modified in any material respect any existing accounting method, principle or practice, other than as required by GAAP; (i) except for normal increases in the ordinary course of business consistent with past practice that, in the aggregate, do not result in a material increase in benefits or compensation expense to Buyer, increased in any manner the compensation or benefits of any properties employee (who is not a director or assets officer), former employee, or independent contractor providing personal services of Buyer or its Subsidiaries (real, personal “Buyer Employee”); (j) increased the compensation or mixed, tangible benefits of any officer or intangible) by the Company director of Buyer or any of its Subsidiaries, other than consistent with past practice; (k) entered into or (x) amended any contract, agreement, whether employment, severance or special pay arrangement with any Buyer Employee, except in writing or otherwisethe ordinary course of business consistent with past practice; (l) except for this Agreement, entered into any commitment to take any action described in this section by the Company or do any of the foregoing; or (m) suffered any business interruption, damage to or destruction of its Subsidiariesproperties, or other incident, occurrence, or event that has had or would be reasonably likely to have (after giving effect to any insurance coverage reasonably likely to be received), individually or in the aggregate, a Buyer Material Adverse Effect.

Absence of Certain Changes or Events. Since Except as disclosed in the Corel Public Disclosure Documents filed prior to the date of the Company Balance Sheetthis Agreement, the Company since February 28, 2003, each of Corel and its Subsidiaries has conducted its business only in the ordinary course of business in a manner consistent with past practice and there has not been: : 4.6.1. any material change (ias defined in the Securities Act) any Material Adverse Change in its affairs or in its business, assets, liabilities, financial condition, results of operations or prospects (as those prospects relate to the Companyrevenue and profit outlook of the Key Software Programs and Designer); 4.6.2. any acquisition, (ii) any declaration, setting aside sale or payment transfer of any dividend on, or other distribution (whether in cash, stock or property) in respect of, any material assets of the Company’s or any of its Subsidiaries’ capital stock, or any purchase, redemption or other acquisition by the Company Corel or any of its Subsidiaries of any of the Company’s capital stock or any other securities of the Company or its Subsidiaries or any options, warrants, calls or rights to acquire any such shares or other securities except for repurchases from employees following their termination pursuant to the terms of their pre-existing stock option or purchase agreements, (iii) any split, combination or reclassification of any of the Company’s or any of its Subsidiaries’ capital stock, (iv) entry by the Company or any of its Subsidiaries into any licensing or other agreement with regard to the disposition of any material intellectual property other than licenses, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into in the ordinary course of business consistent with past practice, (v) any material change by the Company in its accounting methods, principles or practices, except as required by concurrent changes in GAAP or by the Commission, (vi) any material revaluation by the Company of any of its assets, including, without limitation, writing down the value of capitalized inventory or writing off notes or accounts receivable other than in the ordinary course of business and consistent with past practice; 4.6.3. any material change in accounting methods, practices, policies or principles (viiincluding any change in depreciation or amortization policies or rates) any communication from the Nasdaq Stock Market with respect to the delisting of the Common Stock, (viii) any cancellation by the Company Corel or any of its Subsidiaries or any revaluation by Corel of any debts of its or waiver any of its Subsidiaries' assets; 4.6.4. any declaration, setting aside, or payment of a dividend or other distribution with respect to the shares of Corel, or any direct or indirect redemption, purchase or other acquisition by Corel of any claims or rights of material value, (ix) its shares; 4.6.5. any sale, transfer or other disposition outside of the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangible) Material Contract except for an Additional Arrangement entered into by the Company Corel or any of its Subsidiaries, other than in the ordinary course of business, or any material amendment or termination of any Material Contract except for an Additional Arrangement other than amendments or terminations in the ordinary course of business, consistent with past practice; 4.6.6. any agreement or other binding commitment by Corel or any of its Subsidiaries to do any of the things described in the preceding sections 4.6.1 through 4.6.5 (x) other than negotiations with Vector and its representatives regarding the Transaction); or 4.6.7. any agreement, whether in writing agreement or otherwise, arrangement to take any action described which, if taken prior to the date of this Agreement, would have made any representation or warranty set out in this section by Agreement materially untrue or incorrect as of the Company or any of its Subsidiariesdate when made.

Absence of Certain Changes or Events. Since the date of the Company Balance Sheet, the Company has conducted its business only in the ordinary course of business consistent with past practice and Sheet there has not been: (ia) any Material Adverse Change to Effect on the Company, (iib) any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, stock or property) in respect of, any of the Company’s or any of its Subsidiaries’ capital stock, or any purchase, repurchase for value or redemption or other acquisition by the Company or any of its Subsidiaries of any of the Company’s capital stock or any other securities of the Company or its Subsidiaries or any options, warrants, calls or rights to acquire any such shares or other securities except for repurchases from employees Employees following their termination of employment pursuant to the terms of their applicable pre-existing stock option or purchase agreements, (iiic) any split, combination or reclassification of any of the Company’s or any of its Subsidiaries’ capital stock, (ivd) any granting by the Company or any of its Subsidiaries of any material (whether individually or in the aggregate) increase in compensation or fringe benefits, except for normal increases of cash compensation in the ordinary course of business consistent with past practice (other than to directors or officers of the Company), or any payment by the Company or any of its Subsidiaries of any material (whether individually or in the aggregate) bonus, except for bonuses made in the ordinary course of business consistent with past practice (other than to directors or officers of the Company), or any granting by the Company or any of its Subsidiaries of any material (whether individually or in the aggregate) increase in severance or termination pay or any entry by the Company or any of its Subsidiaries into any material (whether individually or in the aggregate) employment, severance, termination or indemnification agreement, (e) entry by the Company or any of its Subsidiaries into any licensing or other agreement with regard to the acquisition or disposition of any material intellectual property Intellectual Property (as defined in Section 2.7(a)(i)), other than licensesnon-exclusive license, supply and distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into in the ordinary course of business consistent with past practice, (vf) any material (whether individually or in the aggregate) amendment or consent with respect to any Company Material Contract in effect since the date of the Company Balance Sheet, (g) any material change by the Company in its accounting methods, principles or practices, except as required by concurrent changes in GAAP or by the Commission, (vih) any material revaluation by the Company of any of its assets, including, without limitation, writing down the value of capitalized inventory or writing off notes or accounts receivable other than in the ordinary course of business consistent with past practice, (vii) any communication from the Nasdaq Stock Market with respect to the delisting of the Common Stock, (viii) any cancellation by the Company or any of its Subsidiaries of any debts or waiver of any claims or rights of material value, (ix) any sale, transfer or other disposition outside of the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangible) by the Company or any of its Subsidiaries, or (x) any agreement, whether in writing or otherwise, to take any action described in this section by the Company or any of its Subsidiaries.

Absence of Certain Changes or Events. Since the date of the Company Balance SheetExcept as required by this ------------------------------------ Agreement, the Company has conducted its business only in the ordinary course of business consistent with past practice and since December 31, 2000, there has not been: : (ia) any event, occurrence or condition that has had, or would reasonably be expected to have, a Material Adverse Change to Effect on the Company, ; (iib) any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, stock or property) in respect of, any of the Company’s capital stock of the Company or any of its Subsidiaries’ capital stocksubsidiaries, or any purchase, redemption or other acquisition by the Company or any of its Subsidiaries of any capital stock of the Company’s capital stock Company or any other securities of the Company or any of its Subsidiaries or any optionssubsidiaries, warrants, calls or rights to acquire any such shares or other securities except for repurchases from employees Company Employees following their termination pursuant to the terms of their pre-existing stock option or purchase agreementsagreements with the Company, or any granting of any options, warrants, calls or rights to acquire any shares of capital stock of the Company or any other securities of the Company; (iiic) any split, combination or reclassification of any of the Company’s capital stock of the Company or any of its Subsidiaries’ capital stocksubsidiaries; (d) any granting by the Company or any of its subsidiaries of any increase in compensation or fringe benefits to any Company Employees, (iv) or any payment by the Company or any of its subsidiaries of any bonus to any Company Employees, or any granting by the Company or any of its subsidiaries of any increase in severance or termination pay to any Company Employees, or any entry by the Company or any of its Subsidiaries subsidiaries into any currently effective employment, severance, termination or indemnification agreement or any agreement with any Company Employees (or former Company employees) the benefits of which are contingent or the terms of which are materially altered upon the occurrence of a transaction involving the Company of the nature contemplated by this Agreement; (e) the entry by the Company or any of its subsidiaries into any material licensing or other agreement with regard to the acquisition or disposition of any material intellectual property Intellectual Property other than licenses, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into licenses in the ordinary course of business consistent business, or any amendment or consent with past practice, respect to any licensing agreement filed or required to be filed by the Company with the SEC; (vf) any material change by the Company in its accounting methods, principles or practices, except as required by concurrent changes in GAAP or by the Commission, GAAP; or (vig) any material revaluation by the Company of any of its assets, including, without limitation, writing down the value of capitalized inventory or writing off notes or accounts receivable or any sale of assets of Company other than in the ordinary course of business consistent with past practice, (vii) any communication from the Nasdaq Stock Market with respect to the delisting of the Common Stock, (viii) any cancellation by the Company or any of its Subsidiaries of any debts or waiver of any claims or rights of material value, (ix) any sale, transfer or other disposition outside of the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangible) by the Company or any of its Subsidiaries, or (x) any agreement, whether in writing or otherwise, to take any action described in this section by the Company or any of its Subsidiariesbusiness.

Absence of Certain Changes or Events. Since the Most Recent Balance Sheet Date until the date of the Company Balance Sheetthis Agreement, the each Group Company has conducted its business only businesses in all material respects in the ordinary course of business consistent with past practice and practice. Except as otherwise contemplated hereby, since the Most Recent Balance Sheet Date until the date of this Agreement there has not been: been or occurred: (ia) a Material Adverse Effect; (b) any Material Adverse Change to the Companymaking, (ii) any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, stock or property) in respect of, any equity securities of the any Group Company’s or any of its Subsidiaries’ capital stock, or any purchase, redemption or other acquisition by the any Group Company or any of its Subsidiaries equity securities (other than in respect of Tax distributions); (c) any split, combination, reclassification or recapitalization of equity securities of any Group Company; (d) any grant, issuance, sale, transfer or other disposition of any of the equity securities of any Group Company’s capital stock , or any other securities grant of the Company or its Subsidiaries or any options, warrants, calls or other rights to acquire any such shares purchase or other securities except for repurchases from employees following their termination pursuant to the terms of their pre-existing stock option obtain (including upon conversion, exchange or purchase agreements, (iiiexercise) any split, combination or reclassification of any of the equity securities of any Group Company’s ; (e) any change by any Group Company in its accounting methods, principles or practices (including any change in depreciation or amortization policies or rates or revenue recognition policies), except as required by either Law or GAAP; (f) any material revaluation by any Group Company of its Subsidiaries’ capital stockassets, (iv) entry by the Company excluding writing-off or any discounting of its Subsidiaries into any licensing notes, accounts receivable or other agreement with regard to the disposition of any material intellectual property other than licenses, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into assets in the ordinary course of business consistent with past practice; (g) any change by any Group Company in its Tax elections or accounting methods, any Group Company entering into any closing agreement, settlement or compromise of any claim or assessment, in each case in respect of Taxes, or any Group Company consenting to any extension or waiver of any limitation period with respect to any claim or assessment for Taxes or any Group Company surrendering any right to claim a Tax refund; (vh) any amendment of any Group Company’s Organizational Documents; (i) any damage, destruction or loss (whether or not covered by insurance) to the property of the Group Companies in excess of $100,000 individually or in the aggregate; (j) any investment in, or any loan, advance or capital contribution to, any other Person (other than the advancement of business costs and expenses to employees or independent contractors in the ordinary course of business); (k) any acquisition by merger or consolidation with, or purchase of a substantial portion of the assets or stock of, or by any other manner, any business or any Person; (l) any single capital expenditure or entry into any Contract or commitment therefor in excess of $100,000; (m) entry into any Contract for the purchase or lease (as lessor or lessee) of real property; (n) any sale, lease (as lessor), transfer or other disposition of, license, mortgage or pledge, or imposition of any Lien (other than Permitted Liens) on, any of its assets valued in excess of $100,000, in whole or in part; (o) any creation, incurrence, assumption or agreement to create, incur, or assume or guarantee, any indebtedness for borrowed money other than money borrowed or advanced in the ordinary course of business or under existing lines of credit; (p) any creation of assumption of any Lien (other than Permitted Liens) on any asset of the Group Companies; (q) any material increase in, entry into, termination or adoption of any Benefit Plan, other than as required by any such existing plan, by any employment agreement or by Law; (r) any material change by in the compensation of employees of any Group Company in its accounting methods, principles or practices, except other than as required by concurrent changes in GAAP employment agreements or by the Commission, any Law; (vis) any material revaluation by the Company delay in paying any payables or other liabilities of any Group Company when due or deferred expenses, in each case, outside the ordinary course of its assetsbusiness; (t) any settlement of any Actions which involve payments of consideration in excess of $100,000; or (u) any acceleration, including, without limitation, writing down the value write off or discount of capitalized inventory or writing off notes or any accounts receivable of any Group Company other than in the ordinary course of business consistent with past practice, (vii) any communication from the Nasdaq Stock Market with respect to the delisting of the Common Stock, (viii) any cancellation by the Company or any of its Subsidiaries of any debts or waiver of any claims or rights of material value, (ix) any sale, transfer or other disposition outside of the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangible) by the Company or any of its Subsidiaries, or (x) any agreement, whether in writing or otherwise, to take any action described in this section by the Company or any of its Subsidiariesbusiness.

Absence of Certain Changes or Events. Since the date of the Company Balance Sheet, the Company has conducted its business only in the ordinary course of business consistent with past practice and there has not been: , accrued or arisen: (ia) any Material Adverse Change Effect on the Company; (b) any acquisition by the Company or any Subsidiary of, or agreement by the Company or any Subsidiary to acquire by merging or consolidating with, or by purchasing any assets or equity securities of, or by any other manner, any business or corporation, partnership, association or other business organization or division thereof, or other acquisition or agreement to acquire any assets or any equity securities that are material, individually or in the aggregate, to the business of the Company, ; (iic) any declaration, setting aside or payment of any dividend onon (other than as described in Section 5.3), or other distribution (whether in cash, stock or property) in respect of, any of the Company’s or any of its Subsidiaries’ capital stock, or any purchase, redemption or other acquisition by the Company or any of its Subsidiaries of any of the Company’s capital stock or any other securities of the Company or its Subsidiaries or any options, warrants, calls or rights to acquire any such shares or other securities except for repurchases from employees Employees following their termination pursuant to the terms of their pre-existing stock option or purchase agreements, ; (iiid) any split, combination or reclassification of any of the Company’s or any of its Subsidiaries’ capital stock; (e) any granting by the Company or any of its Subsidiaries, whether orally or in writing, of any increase in compensation (ivother than annual and merit-based salary increases made in the ordinary course of business consistent with past practice and not exceeding 7.5% in the aggregate for any individual) or fringe benefits or any payment by the Company or any of its Subsidiaries of any bonus (other than quarterly employee and management bonuses pursuant to the Quarterly Bonus Award Plan set forth on Section of 3.16(b) the Company Disclosure Letter) or any change by the Company or any of its Subsidiaries of severance, termination or bonus policies and practices or any entry by the Company or any of its Subsidiaries into any licensing currently effective employment, severance, termination or other indemnification agreement with regard to or any agreement the disposition benefits of any material intellectual property other than licenses, distribution agreements, advertising agreements, sponsorship agreements which are contingent or merchant program agreements entered into in the ordinary course terms of business consistent with past practice, which are materially altered upon the occurrence of a transaction involving the Company of the nature contemplated hereby (veither alone or upon the occurrence of additional or subsequent events); (f) any material change by the Company in its accounting methods, principles or practices, except as required by concurrent changes in GAAP GAAP; (g) any debt, capital lease or other debt or equity financing transaction by the CommissionCompany or any of its Subsidiaries or entry into any agreement by the Company or any of its Subsidiaries in connection with any such transaction, except for capital lease and receivables financings entered into in the ordinary course of business consistent with past practice which are not individually or in the aggregate material to the Company and its Subsidiaries taken as a whole; (vih) any grants of any material refunds, credits, rebates or other allowances by the Company to any end user, customer, reseller or distributor, in each case, other than in the ordinary course of business consistent with past practice; (i) any material change in the level of product returns or factors influencing accounts receivable or warranty reserves (including any material change in warranties provided by the Company) experienced by the Company or any of its Subsidiaries; (j) any material restructuring activities by the Company or any of its Subsidiaries, including any material reductions in force, lease terminations, or similar actions; (k) any sale, lease, license, encumbrance or other disposition of any properties or assets except the sale, lease, license or disposition of property or assets which are not material, individually or in the aggregate, to the business of the Company or the licenses of current Company Products, in each case, in the ordinary course of business and in a manner consistent with past practice; (l) any loan or extension of credit by the Company or any of its Subsidiaries to any Person other than in the ordinary course of business and in a manner consistent with past practice; (m) any adoption of or change in any election in respect of Taxes, any adoption, change in or application to change any accounting method in respect of Taxes, any agreement or settlement of any audit, claim or assessment in respect of Taxes, any extension or waiver of the limitation period applicable to any claim or assessment in respect of Taxes, any entry into any closing agreement, any filing of any amended Return, or any failure to file any Return when due (or, alternatively, failure to file for available extensions), failure to cause any Return when filed to be complete and accurate or failure to pay any Taxes when due; or (n) any material revaluation, or any indication that such a revaluation was merited under GAAP, by the Company of any of its assets, including, without limitation, writing down the value of capitalized inventory inventory, spares, long term or short-term investments, fixed assets, goodwill, intangible assets, deferred tax assets, or writing off notes or accounts receivable other than in the ordinary course of business consistent with past practice, (vii) any communication from the Nasdaq Stock Market with respect to the delisting of the Common Stock, (viii) any cancellation by the Company or any of its Subsidiaries of any debts or waiver of any claims or rights of material value, (ix) any sale, transfer or other disposition outside of the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangible) by the Company or any of its Subsidiaries, or (x) any agreement, whether in writing or otherwise, to take any action described in this section by the Company or any of its Subsidiaries.