Common use of Absence of Certain Developments Clause in Contracts

Absence of Certain Developments. (a) Except as set forth in the attached "Developments Schedule," since August 31, 1998, Seller has conducted the Business only in the ordinary course of business consistent with past custom and practice (including, without limitation, with respect to the offering of special sales or incentive programs or the filling of its distribution channels), has incurred no liabilities other than in the ordinary course of business consistent with past custom and practice, and Seller has not: (i) sold, assigned or transferred any of its assets, except for sales of inventory in the ordinary course of business consistent with past custom and practice, or mortgaged, pledged or subjected them to any material Lien, except for Liens for current property Taxes not yet due and payable, or canceled without fair consideration any material debts or claims owing to or held by it; (ii) sold, assigned, transferred, abandoned or permitted to lapse any Government Licenses which, individually or in the aggregate, are material to the Business or any portion thereof, or any of the Proprietary Rights or other intangible assets, or disclosed any material proprietary confidential information to any Person, except in the ordinary course of business consistent with past custom and practice, or granted any license or sublicense of any rights under or with respect to any Proprietary Rights; (iii) conducted its cash management customs and practices (including, without limitation, the collection of receivables, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practice; (iv) made any loans or advances to, or guarantees for the benefit of, or entered into any transaction with PDK or any of its other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer of any assets of placing a Lien on any assets) except on an arms-length basis in the ordinary course of business consistent with past custom and practice; (v) suffered any extraordinary loss, damage, destruction or casualty loss or waived any rights of material value, whether or not covered by insurance and whether or not in the ordinary course of business or consistent with past custom and practice; (vi) received notification, or become aware of facts which would lead a reasonable person to believe, that any material customer or supplier will stop or decrease in any material respect the rate of business done with the Business; (vii) become subject to any material liabilities, except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into in the ordinary course of business consistent with past custom and practice; (viii) settled or compromised any litigation involving equitable relief or involving any money damages in excess of $50,000; or (ix) entered into any other material transaction, other than in the ordinary course of business consistent with past custom and practice. (b) No party has accelerated, terminated, modified or canceled any Assigned Contract.

Absence of Certain Developments. (a) Except as expressly disclosed in Schedule 3(g), since February 1, 1997 there has not been any material adverse change to the financial condition, business, properties, results of operations or prospects of CRA and its Subsidiaries. Except as disclosed in the Financial Statements or as set forth in Schedule 3(g), and except for this Agreement and the attached "Developments Schedule," transactions contemplated hereby, since August 31February 1, 19981997, Seller each of CRA and its Subsidiaries has conducted the Business only been operated in the ordinary course Ordinary Course of business consistent with past custom and practice (includingBusiness. Without limiting the generality of the foregoing, without limitationexcept as set forth on Schedule 3(g) or as expressly contemplated by this Agreement, with respect to the offering since February 1, 1997 none of special sales or incentive programs or the filling CRA nor any of its distribution channels), has incurred no liabilities other than in the ordinary course of business consistent with past custom and practice, and Seller has notSubsidiaries has: (i) soldexperienced any changes in any relationship with its suppliers, assigned customers, distributors, brokers, lessors or transferred any of its assetsothers, except for sales of inventory other than changes in the ordinary course Ordinary Course of business consistent with past custom and practice, or mortgaged, pledged or subjected them to any material Lien, except for Liens for current property Taxes not yet due and payable, or canceled without fair consideration any material debts or claims owing to or held by itBusiness; (ii) sold, assignedleased, transferred, abandoned or permitted to lapse assigned any Government Licenses whichof assets, individually tangible or intangible, other than for fair consideration in the aggregate, are material to the Business or any portion thereof, or any Ordinary Course of the Proprietary Rights or other intangible assets, or disclosed any material proprietary confidential information to any Person, except in the ordinary course of business consistent with past custom and practice, or granted any license or sublicense of any rights under or with respect to any Proprietary RightsBusiness; (iii) conducted its cash management customs and practices entered into any agreement, contract, lease, or license (includingor series of related agreements, without limitationcontracts, leases or licenses) involving more than $50,000.00 individually to which it is a party or by which it is bound nor modified the collection terms of receivables, payment of payables and maintenance of inventory control and pricing and credit practices any such existing contract or agreement (including, without limitation, extension of credit terms or sales discount programs)) other than in the except for usual and ordinary course purchase orders executed for merchandise held for resale in the Ordinary Course of business consistent with past custom Business and practiceleases of certain real property as expressly disclosed in Schedule 3(s)(i) or (ii)); (iv) made engaged in any loans activity which has resulted in any acceleration or advances to, delay of the collection of its accounts or guarantees for the benefit of, or entered into any transaction with PDK notes receivables or any delay in the payment of its accounts payables, in each case other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred than in the ordinary course Ordinary Course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer of any assets of placing a Lien on any assets) except on an arms-length basis in the ordinary course of business consistent with past custom and practiceBusiness; (v) (nor has any other party) accelerated, terminated, modified or cancelled any permit or agreement, contract, lease or license other than in the Ordinary Course of Business or involving more than $50,000.00 individually to which it is a party or by which it is bound; (vi) suffered any extraordinary loss, damage, destruction or casualty loss or waived any rights of material valueloss, whether or not covered by insurance and whether or not in the ordinary course of business or consistent with past custom and practice; (vi) received notificationinsurance, or become aware of facts which would lead a reasonable person to believe, that affecting any material customer property or supplier will stop assets owned or decrease in any material respect the rate of business done with the Businessused by it; (vii) become subject to adopted, modified, amended or terminated any material liabilitiesbonus, except current liabilities incurred profit-sharing, incentive, severance, or other similar plan (including any Benefit Plan), contract, or commitment for the benefit of any of its directors, officers, or employees, or otherwise made any change in the ordinary course of business and liabilities under contracts entered into employment terms (including any increase in the ordinary course base compensation) for any of business consistent with past custom its officers and practiceemployees described in ss.3(l); (viii) settled made any capital expenditure or compromised any litigation involving equitable relief other investment (or involving any money damages series of related investments) in excess of $50,000; or50,000.00 other than leasehold improvements and fixtures in retail stores made in the Ordinary Course of Business; (ix) entered into any capital lease involving more than $50,000.00 individually, issued any note, bond, or other material transactiondebt security or created, incurred, assumed, modified or guaranteed any indebtedness or other liability; (x) imposed or suffered to exist any Security Interest on any of its assets outside the Ordinary Course of Business or on any of the CRA Shares; or transferred, leased, licensed, or sold, any assets other than in the ordinary course Ordinary Course of business consistent with past custom and practice.Business; (bxi) No party has acceleratedcancelled, terminatedcompromised, waived, or released any right or claim (or series of related material rights and claims) in excess of $50,000.00 in the aggregate; (xii) made or authorized any change in its charter or by-laws; (xiii) issued, sold, or otherwise disposed of any of its capital stock, or granted, modified or canceled amended any Assigned Contractoptions, warrants, stock appreciation rights, or other rights to purchase or obtain (including upon conversion, exchange, or exercise) any of its capital stock or participate in any change in the value thereof; (xiv) made or been subject to change in its accounting practices, procedures or methods or in its cash management practices; (xv) entered into or become party to any agreement, arrangement or transaction with any of its Affiliates or any of their respective directors, officers, employees or stockholders, including, without limitation, any (i) loan or advance funds, or made any other payments, to any of its directors, officers, employees, stockholders or Affiliates or (ii) creation or discharge of any intercompany account; (xvi) paid or declared any dividend or other distribution in cash or kind with respect to their respective capital stock or redeemed, repurchased or otherwise acquired any such stock; (xvii) experienced any adverse changes with respect to the Proprietary Rights; (xviii) experienced any material changes in the amount or scope of coverage of insurance now carried by them; or (xix) committed to do any of the foregoing.

Absence of Certain Developments. (a) Except as set forth in the attached "Developments Schedule," provided on Schedule 6.7 or pursuant to this Agreement, since August December 31, 19982005, Seller has conducted the Business only in the ordinary course of business consistent with past custom and practice (including, without limitation, with respect to the offering of special sales or incentive programs or the filling of its distribution channels), has incurred no liabilities other than in the ordinary course of business consistent with past custom and practice, and Seller has not: (i) sold, assigned leased, licensed, exchanged or otherwise transferred any of its assetsthe material rights, properties or assets of Seller (except for sales of inventory in the ordinary course of business and consistent with past custom and practice, or mortgaged, pledged or subjected them to any material Lien, except for Liens for current property Taxes not yet due and payable, or canceled without fair consideration any material debts or claims owing to or held by it); (ii) soldpurchased, assignedacquired or leased any material rights, transferredproperties or assets outside the ordinary course of business or inconsistent with past practice; (iii) borrowed any amount, abandoned received credit or permitted financing or created or incurred or become subject to lapse any Government Licenses whichliability, individually or in the aggregate, are material to the Business or any portion thereofobligation, or any Indebtedness, except: (a) liabilities not in excess of the Proprietary Rights or other intangible assets, or disclosed any material proprietary confidential information to any Person, except $100,000.00 in aggregate; (b) current liabilities incurred in the ordinary course of business and consistent with past custom practice; and practice, or granted any license or sublicense of any rights (c) liabilities under or with respect to any Proprietary Rights; (iii) conducted its cash management customs and practices (including, without limitation, the collection of receivables, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than contracts entered into in the usual and ordinary course of business and consistent with past custom and practice; (iv) made any loans or advances to, extended credit or financing to, made any guarantees for the benefit of, or entered into made any transaction with PDK capital contributions to or investments in any Person in excess of its other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred $100,000.00 in the ordinary course of business or entered into any transactionaggregate, arrangement or contract (including, without limitation, any transfer of any assets of placing a Lien on any assets) except on an arms-length basis in the ordinary course of business consistent with past custom and practiceother than routine advances to employees that do not exceed $5,000.00; (v) suffered created, placed or allowed to exist a Lien upon any extraordinary lossof the material rights, damageproperties or assets of Seller, destruction or casualty loss or waived any rights of material value, whether or not covered by insurance and whether or not in the ordinary course of business or consistent with past custom and practiceexcept Permitted Liens; (vi) received notificationmade, or become aware committed or contracted to make, any capital expenditure or series of facts which would lead a reasonable person to believe, that any material customer or supplier will stop or decrease related capital expenditures in any material respect excess of $100,000.00 above the rate of business done with amounts budgeted therefor in the Businessbudget attached hereto as Schedule 6.7; (vii) become subject to paid, discharged or satisfied any material claims, liabilities, except obligations or other indebtedness (accrued, mature, contingent, direct or otherwise), other than current liabilities incurred paid in the ordinary course of business and liabilities under contracts entered into in the ordinary course of business consistent with past custom and practice; (viii) settled granted any increase in compensation to or compromised otherwise changed the employment terms for any litigation involving equitable relief of its directors, officers or involving any money damages in excess of $50,000; or (ix) entered into any other material transaction, other than in employees outside the ordinary course of business and consistent with past custom practice; (ix) amended the charter, bylaws, or other governance documents of Seller in any material respect; (x) adopted a plan of complete or partial liquidation, dissolution, consolidation, restructuring, recapitalization or other reorganization of Seller, or resolutions providing for any of the foregoing; (xi) failed to pay, satisfy and practicedischarge when due any material liabilities and Indebtedness of Seller, including the liabilities and Indebtedness as reflected on balance sheet included in the Latest Financial Statements; (xii) incurred any obligation or entered into any contract, agreement, arrangement or instrument that would be an Assumed Liability and either: (A) requires a payment by or to any Person in excess of $100,000.00; or (B) has a term of, or requires the performance of any obligations by Seller over a period in excess of, twelve (12) months; (xiii) entered into, authorized, permitted, modified or terminated any contract or agreement with any Affiliate of Seller involving payment of more than $25,000.00 per year; (xiv) experienced any material damage, destruction or loss (whether or not covered by insurance) to any of its properties or assets; (xv) changed any material accounting principles, methods or practices followed by Seller; (xvi) taken any steps to incorporate or form or organize or acquire a new Subsidiary; (xvii) engaged in any business other than the Business; or (xviii) authorized any of the foregoing. (b) No party During the last three years, Seller has acceleratednot made or authorized any bribes, terminated, modified kickback payments or canceled any Assigned Contractother illegal payments.

Absence of Certain Developments. (a) i. Except as expressly contemplated by this Agreement or as set forth in Section 4J of the attached "Developments Schedule," Disclosure Letter, since August 31the date of the Latest Balance Sheet, 1998, Seller has conducted the Business only in the ordinary course of business consistent with past custom and practice (including, without limitation, with respect to the offering of special sales or incentive programs or the filling of its distribution channels), has incurred no liabilities other than in the ordinary course of business consistent with past custom and practice, and Seller has notneither Telcom nor any Subsidiary has: (ia) soldissued any notes, assigned bonds or transferred other debt securities or any of its assetsequity securities or any securities convertible, except for sales of inventory in the ordinary course of business consistent with past custom and practice, exchangeable or mortgaged, pledged or subjected them to exercisable into any material Lien, except for Liens for current property Taxes not yet due and payable, or canceled without fair consideration any material debts or claims owing to or held by itequity securities; (iib) sold, assigned, transferred, abandoned borrowed any amount or permitted to lapse any Government Licenses which, individually incurred or in the aggregate, are material to the Business or any portion thereof, or any of the Proprietary Rights or other intangible assets, or disclosed any material proprietary confidential information to any Person, except in the ordinary course of business consistent with past custom and practice, or granted any license or sublicense of any rights under or with respect to any Proprietary Rights; (iii) conducted its cash management customs and practices (including, without limitation, the collection of receivables, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practice; (iv) made any loans or advances to, or guarantees for the benefit of, or entered into any transaction with PDK or any of its other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer of any assets of placing a Lien on any assets) except on an arms-length basis in the ordinary course of business consistent with past custom and practice; (v) suffered any extraordinary loss, damage, destruction or casualty loss or waived any rights of material value, whether or not covered by insurance and whether or not in the ordinary course of business or consistent with past custom and practice; (vi) received notification, or become aware of facts which would lead a reasonable person to believe, that any material customer or supplier will stop or decrease in any material respect the rate of business done with the Business; (vii) become subject to any material liabilities, except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into in the ordinary course of business consistent with past custom and practicebusiness; (viiic) settled discharged or compromised satisfied any litigation involving equitable relief lien or involving encumbrance or paid any money damages in excess of $50,000; or (ix) entered into any other material transactionobligation or liability, other than current liabilities paid in the ordinary course of business; (d) except as otherwise contemplated herein, declared or made any payment or distribution of cash or other property to its stockholders with respect to its stock or purchased or redeemed any shares of its stock or any warrants, options or other rights to acquire its stock; (e) mortgaged or pledged any of its properties or assets or subjected them to any lien, security interest, charge or other encumbrance, except liens for current property taxes not yet due and payable; (f) sold, assigned or transferred any of its tangible assets, except in the ordinary course of business, or canceled any debts or claims; (g) sold, assigned or transferred any patents or patent applications, trademarks, service marks, trade names, corporate names, copyrights or copyright registrations, trade secrets or other intangible assets, or disclosed any proprietary confidential information to any Person, other than pursuant to a license arrangement or agreement made in the ordinary course of business or pursuant to a non-disclosure arrangement or agreement made in the ordinary course of business or in connection with the negotiations under this Agreement; or (h) suffered any extraordinary losses or waived any rights of material value, whether or not in the ordinary course of business or consistent with past custom and practice. (b) ii. No party officer, director, employee or agent of Telcom or any of its Subsidiaries has acceleratedbeen or is authorized to make or receive, terminatednor is any such person making or receiving, modified any bribe, kickback or canceled any Assigned Contractother illegal payment related to Telcom or its Subsidiaries or the conduct of their business.

Absence of Certain Developments. (a) Except Since June 30, 1996, except as set forth disclosed in the attached "Developments Schedule," since August 31Draft 10-K, 1998, Seller has conducted the Business only in the ordinary course of business consistent with past custom and practice (including, without limitation, with respect to the offering of special sales or incentive programs Financial Statements or the filling of its distribution channels), has incurred no liabilities other than in Disclosure Schedules or as otherwise expressly contemplated therein or by this Agreement or the ordinary course of business consistent with past custom and practiceLicense Agreement, and Seller except for continuing operating losses, Alliance has not: (ia) sold, assigned changed or transferred any amended its Articles of its assets, except for sales of inventory in the ordinary course of business consistent with past custom and practice, Incorporation or mortgaged, pledged By-Laws (or subjected them to any material Lien, except for Liens for current property Taxes not yet due and payable, or canceled without fair consideration any material debts or claims owing to or held by itsimilar governing documents); (iib) sold, assigned, transferred, abandoned incurred any obligation or permitted to lapse any Government Licenses which, individually liability (fixed or in the aggregate, are material to the Business or any portion thereof, or any of the Proprietary Rights or other intangible assets, or disclosed any material proprietary confidential information to any Personcontingent), except in the ordinary course of normal trade or business consistent with past custom and practice, or granted any license or sublicense of any rights under or with respect to any Proprietary Rights; (iii) conducted its cash management customs and practices (including, without limitation, the collection of receivables, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practice; (iv) made any loans or advances to, or guarantees for the benefit of, or entered into any transaction with PDK or any of its other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer of any assets of placing a Lien on any assets) except on an arms-length basis in the ordinary course of business consistent with past custom and practice; (v) suffered any extraordinary loss, damage, destruction or casualty loss or waived any rights of material value, whether or not covered by insurance and whether or not in the ordinary course of business or consistent with past custom and practice; (vi) received notification, or become aware of facts which would lead a reasonable person to believe, that any material customer or supplier will stop or decrease in any material respect the rate of business done with the Business; (vii) become subject to any material liabilities, except current liabilities obligations incurred in the ordinary course of business and liabilities under contracts entered into in the ordinary course of business consistent with past custom and practice, none of which individually or in the aggregate is materially adverse; (viiic) settled discharged or compromised satisfied any litigation involving equitable relief material lien, security interest, charge or involving other encumbrance or paid any money damages in excess of $50,000; or material obligation or liability (ix) entered into any other material transactionfixed or contingent), other than in the ordinary course of business and consistent with past custom and practice.; (bd) No party has acceleratedmortgaged, terminatedpledged or subjected to any lien, modified security interest, charge or other encumbrance any of its material assets or properties (other than liens permitted pursuant to Section 2.7 below); (e) transferred, leased or otherwise disposed of any of its material assets or properties, except for fair consideration in the ordinary course of business and consistent with past practice, or acquired any material assets or properties, except in the ordinary course of business and consistent with past practice; (f) declared, set aside or paid any distribution (whether in cash, stock or property or any combination thereof) in respect of its capital stock or redeemed or otherwise acquired any of its capital stock or split, combined or otherwise similarly changed its capital stock or authorized the creation or issuance of or issued or sold any capital stock or any securities or obligations convertible into or exchangeable therefor, or gave any person any right to acquire any capital stock from Alliance, or agreed to take any such action (other than (i) upon the exercise of outstanding warrants or stock options, and (ii) the issuance of 248,879 shares of common stock issued in August 1997 to former shareholders of MDV Technologies, Inc. pursuant to the merger described in the Financial Statements); (g) made any investment of a capital nature, whether by purchase of stock or securities, contributions to capital, property transfers or otherwise, in any other partnership, corporation or any other entity, or purchase any material property or assets; (h) canceled or compromised any Assigned Contractdebt or claim other than in the ordinary course of business; (i) waived or released any rights of material value, including, without limitation, any patents, trademarks and trade names, trademark and trade name registrations, logos, servicemark registrations, copyright registrations, applications pending the date hereof for patent or for trademark, trade name, servicemark or copyright registrations, and other material proprietary intellectual property rights (including, but not limited to, know-how, information, proprietary rights and information) ("Intangible Rights"); (j) transferred or granted any material rights under or with respect to any Intangible Rights other than on reasonable business terms, or permitted any license, permit or other form of authorization relating to a material Intangible Right to lapse; or (k) suffered any casualty loss or damage (whether or not such loss or damage shall have been covered by insurance) which affects in any material respect its ability to conduct business; or (l) made or granted any wage or salary increase applicable to any group or classification of employees generally, entered into any employment contract with or made any loan to, or entered into any material transaction of any other nature with, any officer, or employee of Alliance, except in the ordinary course of business; or (m) suffered a Material Adverse Effect.

Absence of Certain Developments. (a) Except as set forth in the attached "Developments Schedule," Schedule 3.11, since August 31, 19982000, Seller has conducted the Business its business only in the ordinary course of business consistent with past custom and practice (including, without limitation, with respect to the offering of special sales or incentive programs or the filling of its distribution channels), has incurred no liabilities other than in the ordinary course of business consistent with past custom and practice, and Seller has not: (i) discharged or satisfied any material Lien or encumbrance or paid any material obligation or liability, other than current liabilities paid in the ordinary course of business consistent with past custom and practice, or canceled, compromised, waived or released any material right or material claim, other than in the ordinary course of business consistent with past custom or practice; (ii) sold, assigned or transferred any of its assets, except for sales of inventory in the ordinary course of business consistent with past custom and practice, or mortgaged, pledged or subjected them to any material Lien, except for Liens for current property Taxes not yet due and payable, or canceled without fair consideration any material debts or claims owing to or held by it; (iiiii) sold, assigned, transferred, abandoned or permitted to lapse any Government Licenses government licenses which, individually or in the aggregate, are material to the Business or any portion thereof, or any of the Proprietary Rights Rights, as defined below, or other intangible assets, or disclosed any material proprietary confidential information to any Person, except in the ordinary course of business consistent with past custom and practice, or granted any license or sublicense of any rights under or with respect to any Proprietary Rights; (iiiiv) conducted its cash management customs and practices (including, without limitation, the collection of receivables, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practice; (ivv) made any capital expenditures or commitments therefor such that the aggregate outstanding amount of unpaid obligations and commitments with respect thereto shall comprise in excess of $50,000.00 on the Closing Date; (vi) made any loans with or advances to, or guarantees for the benefit of, or entered into any transaction with PDK Prospect or any of its other stockholders or any employee, officer or director of Seller or PDKProspect, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to SellerProspect's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer of or any assets of or placing a Lien on any assets) except on an arms-length basis in the ordinary course of business consistent with past custom and practice; (vvii) suffered any extraordinary loss, damage, . destruction or casualty loss or waived any rights of material value, whether or not covered by insurance and whether or not in the ordinary course of business or consistent with past custom and practice; (viviii) received notification, or become aware of facts which would lead a reasonable person to believe, that any material customer or supplier will stop or decrease in any material respect the rate of business done with the Business; (viiix) borrowed any amount or incurred or become subject to any material liabilities, except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into in the ordinary course of business consistent with past custom and practice; (viiix) assumed or guaranteed any indebtedness (including capitalized lease obligations) involving more than $50,000.00 (either individually or in the aggregate); (xi) made any capital investment in, any loan to, or any acquisition of the securities or assets of any other person or taken any steps to incorporate any subsidiary; (xii) settled or compromised any litigation involving equitable relief or involving any money damages in excess of $50,00050,000.00; or (ixxiii) entered into any other material transaction, other than in the ordinary course of business consistent with past custom and practice.; (b) No party has accelerated, terminated, modified or canceled any Assigned Contract. (c) Except as disclosed on Schedule 3.11 (i) no Assigned Contract has been breached materially (and Seller has not received notice of the breach of any Assigned Contract) in any respect or canceled by the other party that has not been duly cured or reinstated, (ii) Prospect has performed all of its obligations required to be performed by it under each of the Assigned Contracts and Seller is not in receipt of any written claim of default under any Assigned Contract, (iii) no event has occurred which with the passage of time or the giving of notice or both would result in a breach or default under any Assigned Contract and (iv) to Prospect's knowledge, Prospect is not a party to any Assigned Contract which, individually or in the aggregate, could have a material adverse effect on this business to be conducted. Each Assigned Contract is valid, binding and enforceable and is in full force and effect, except to the extent enforcement thereof may be limited by applicable bankruptcy or insolvency laws or general equitable principles. (d) Purchaser has been supplied with a true and correct copy of all Assigned Contracts, together with all amendments, waivers or other changes thereto.

Absence of Certain Developments. (a) Since the Visor Balance Sheet Date, there has not been any Visor Material Adverse Effect. Except as set forth expressly contemplated hereby, since the Visor Balance Sheet Date, Visor has carried on and operated its business in the attached "Developments Schedule," since August 31, 1998, Seller has conducted the Business only all material respects in the ordinary course of business consistent with past custom practice, and practice Visor has not: (includinga) amended or modified its Organizational Documents; (b) sold, without limitationleased, assigned, transferred or purchased any material tangible assets, in each case in a single or related series of transactions, except in the ordinary course of business; (c) issued, sold, redeemed or transferred any of its capital stock or other equity securities, securities convertible into its capital stock or other equity securities or warrants, options or other rights to acquire its capital stock or other equity securities, or any bonds or debt securities; (d) prior to the date hereof, declared or paid any dividend or other distribution of the assets of Visor; (e) made or approved any material changes in its employee benefit plans or made any material changes in wages salary, or other compensation, including severance, with respect to the offering of special sales its current or incentive programs former officers, directors or the filling of its distribution channels)executive employees, has incurred no liabilities other than increases in base salaries and wages that are consistent with past practices or as required by applicable Law or any Visor Plan; (f) paid, loaned or advanced (other than the payment of compensation and benefits in the ordinary course of business consistent with past custom and practicepractice or the payment, and Seller has not: (i) sold, assigned advance or transferred any reimbursement of its assets, except for sales of inventory business expenses in the ordinary course of business consistent with past custom and practicepractice or 401(k) plan loans) any amounts to, or mortgagedsold, pledged transferred or subjected them to leased any material Lien, except for Liens for current property Taxes not yet due and payableof its assets to, or canceled without fair consideration entered into any material debts other transactions with, any of its Affiliates, or claims owing to made any loan to, or held by itentered into any other transaction with, any of its directors or officers outside the ordinary course of business or other than at arm’s length; (g) except as required by applicable Law, adopted or materially amended any Visor Plans; (h) hired or terminated any officers or employees of Visor with fixed annual compensation in excess of $150,000, with respect to non-officer employees, other than in the ordinary course of business; (i) commenced or settled any Action in which the amount in dispute is in excess of $100,000; (j) made any material change in accounting principles, methods, procedures or policies, except as required by GAAP; (k) made, changed or revoked any material Tax election, or settled or compromised any material Tax claim or liabilities, or filed any substantially amended material Tax Return; (i) authorized, proposed, entered into or agreed to enter into any plan of liquidation, dissolution or other reorganization or (ii) authorized, proposed, entered into or agreed to enter into any merger, consolidation or business combination with any Person; (m) except in the ordinary course of business, incurred or discharged any Indebtedness; (n) made capital expenditures or capital additions or betterments in excess of $100,000 in the aggregate; (o) suffered any material damage, destruction or loss, whether or not covered by insurance; (p) sold, assigned, transferred, abandoned or permitted allowed to lapse or expire any Government Licenses which, individually or in the aggregate, are material to the Business or any portion thereof, or any of the Proprietary Rights Intellectual Property rights or other intangible assetsassets owned, used or disclosed licensed by Visor in connection with any material proprietary confidential information to any Person, except in product of Visor or the ordinary course operation of business consistent with past custom and practice, or granted any license or sublicense of any rights under or with respect to any Proprietary Rightsits business; (iiiq) conducted its cash management customs and practices (includingbeen subject to any claim or threat of infringement, without limitation, the collection misappropriation or other violation by or against Visor of receivables, payment Intellectual Property rights of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms Visor or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practicea third party; (ivr) made any loans or advances to, or guarantees for materially reduced the benefit of, or entered into any transaction with PDK or any of its other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer amount of any assets of placing a Lien on any assets) except on an arms-length basis in the ordinary course of business consistent with past custom and practice; (v) suffered any extraordinary loss, damage, destruction or casualty loss or waived any rights of material value, whether or not covered insurance coverage provided by existing insurance and whether or not in the ordinary course of business or consistent with past custom and practice; (vi) received notification, or become aware of facts which would lead a reasonable person to believe, that any material customer or supplier will stop or decrease in any material respect the rate of business done with the Business; (vii) become subject to any material liabilities, except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into in the ordinary course of business consistent with past custom and practice; (viii) settled or compromised any litigation involving equitable relief or involving any money damages in excess of $50,000policies; or (ixs) entered into committed to do any other material transaction, other than in of the ordinary course of business consistent with past custom and practiceforegoing. (b) No party has accelerated, terminated, modified or canceled any Assigned Contract.

Absence of Certain Developments. (a) Since the Obalon Balance Sheet Date, there has not been any Material Adverse Effect on Obalon. Except as set forth expressly contemplated hereby, since the Obalon Balance Sheet Date, Obalon has carried on and operated its business in the attached "Developments Schedule," since August 31, 1998, Seller has conducted the Business only all material respects in the ordinary course of business consistent with past custom practice, and practice Obalon has not: (includinga) amended or modified its Organizational Documents; (b) sold, without limitationleased, assigned, transferred or purchased any material tangible assets, in each case in a single or related series of transactions, except in the ordinary course of business; (c) issued, sold, redeemed or transferred any of its capital stock or other equity securities, securities convertible into its capital stock or other equity securities or warrants, options or other rights to acquire its capital stock or other equity securities, or any bonds or debt securities; (d) prior to the date hereof, declared or paid any dividend or other distribution of the assets of Obalon; (e) made or approved any material changes in its employee benefit plans or made any material changes in wages salary, or other compensation, including severance, with respect to the offering of special sales its current or incentive programs former officers, directors or the filling of its distribution channels)executive employees, has incurred no liabilities other than increases in base salaries and wages that are consistent with past practices or as required by applicable Law or any Obalon Plan; (f) paid, loaned or advanced (other than the advance or reimbursement of business expenses in the ordinary course of business consistent with past custom and practicepractice or 401(k) plan loans) any amounts to, and Seller has not:or sold, transferred or leased any of its assets to, or entered into any other transactions with, any of its Affiliates, or made any loan to, or entered into any other transaction with, any of its directors or officers outside the ordinary course of business or other than at arm’s length; (g) except as required by applicable Law, adopted, terminated or materially amended any Obalon Plans; (h) hired or terminated any officers or employees of Obalon with annual cash compensation in excess of $100,000; (i) soldcommenced or settled any Action in which the amount in dispute is in excess of $100,000; (j) made any material change in accounting principles, assigned methods, procedures or transferred any of its assetspolicies, except for sales as required by GAAP; (k) made, changed or revoked any material Tax election, or settled or compromised any material Tax claim or liabilities, or filed any substantially amended material Tax Return; (i) authorized, proposed, entered into or agreed to enter into any plan of inventory liquidation, dissolution or other reorganization or (ii) authorized, proposed, entered into or agreed to enter into any merger, consolidation or business combination with any Person; (m) except in the ordinary course of business consistent with past custom and practicebusiness, incurred or mortgaged, pledged or subjected them to discharged any material Lien, except for Liens for current property Taxes not yet due and payable, or canceled without fair consideration any material debts or claims owing to or held by itIndebtedness; (iin) made capital expenditures or capital additions or betterments in excess of $100,000 in the aggregate; (o) suffered any material damage, destruction or loss, whether or not covered by insurance; (p) sold, assigned, transferred, abandoned or permitted allowed to lapse or expire any Government Licenses which, individually material Intellectual Property rights (other than certain pending applications that have not been allowed or in the aggregate, are material to the Business or any portion thereof, or any of the Proprietary Rights granted) or other intangible assetsassets owned, used or disclosed licensed by Obalon in connection with any material proprietary confidential information to any Person, except in product of Obalon or the ordinary course operation of business consistent with past custom and practice, or granted any license or sublicense of any rights under or with respect to any Proprietary Rightsits business; (iiiq) conducted its cash management customs and practices (includingbeen subject to any claim or written threat of infringement, without limitation, the collection misappropriation or other violation by or against Obalon of receivables, payment Intellectual Property rights of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms Obalon or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practicea third party; (ivr) made any loans or advances to, or guarantees for materially reduced the benefit of, or entered into any transaction with PDK or any of its other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer amount of any assets of placing a Lien on any assets) except on an arms-length basis in the ordinary course of business consistent with past custom and practice; (v) suffered any extraordinary loss, damage, destruction or casualty loss or waived any rights of material value, whether or not covered insurance coverage provided by existing insurance and whether or not in the ordinary course of business or consistent with past custom and practice; (vi) received notification, or become aware of facts which would lead a reasonable person to believe, that any material customer or supplier will stop or decrease in any material respect the rate of business done with the Business; (vii) become subject to any material liabilities, except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into in the ordinary course of business consistent with past custom and practice; (viii) settled or compromised any litigation involving equitable relief or involving any money damages in excess of $50,000policies; or (ixs) entered into committed to do any other material transaction, other than in of the ordinary course of business consistent with past custom and practiceforegoing. (b) No party has accelerated, terminated, modified or canceled any Assigned Contract.

Absence of Certain Developments. (a) Since the Trooper Balance Sheet Date, there has not been any Trooper Material Adverse Effect. Except as set forth expressly contemplated hereby, since the Trooper Balance Sheet Date, Trooper has carried on and operated its business in the attached "Developments Schedule," since August 31, 1998, Seller has conducted the Business only all material respects in the ordinary course of business consistent with past custom practice, and practice Trooper has not: (includinga) amended or modified its Organizational Documents; (b) sold, without limitationleased, assigned, transferred or purchased any material tangible assets, in each case in a single or related series of transactions, except in the ordinary course of business; (c) issued, sold, redeemed or transferred any of its capital stock or other equity securities, securities convertible into its capital stock or other equity securities or warrants, options or other rights to acquire its capital stock or other equity securities, or any bonds or debt securities; (d) prior to the date hereof, declared or paid any dividend or other distribution of the assets of Trooper; (e) made or approved any material changes in its employee benefit plans or made any material changes in wages salary, or other compensation, including severance, with respect to the offering of special sales its current or incentive programs former officers, directors or the filling of its distribution channels)executive employees, has incurred no liabilities other than increases in base salaries and wages that are consistent with past practices or as required by applicable Law or any Trooper Plan; (f) paid, loaned or advanced (other than the payment of compensation and benefits in the ordinary course of business consistent with past custom and practicepractice or the payment, and Seller has not: (i) sold, assigned advance or transferred any reimbursement of its assets, except for sales of inventory business expenses in the ordinary course of business consistent with past custom and practicepractice or 401(k) plan loans) any amounts to, or mortgagedsold, pledged transferred or subjected them to leased any material Lien, except for Liens for current property Taxes not yet due and payableof its assets to, or canceled without fair consideration entered into any material debts other transactions with, any of its Affiliates, or claims owing to made any loan to, or held by itentered into any other transaction with, any of its directors or officers outside the ordinary course of business or other than at arm’s length; (g) except as required by applicable Law, adopted or materially amended any Trooper Plans; (h) hired or terminated any officers or employees of Trooper with fixed annual compensation in excess of $150,000, with respect to non-officer employees, other than in the ordinary course of business; (i) commenced or settled any Action in which the amount in dispute is in excess of $5,000,000; (j) made any material change in accounting principles, methods, procedures or policies, except as required by GAAP; (k) made, changed or revoked any material Tax election, or settled or compromised any material Tax claim or liabilities, or filed any substantially amended material Tax Return; (i) authorized, proposed, entered into or agreed to enter into any plan of liquidation, dissolution or other reorganization or (ii) authorized, proposed, entered into or agreed to enter into any merger, consolidation or business combination with any Person; (m) except in the ordinary course of business, incurred or discharged any Indebtedness; (n) made capital expenditures or capital additions or betterments in excess of $35,000,000 in the aggregate; (o) suffered any material damage, destruction or loss, whether or not covered by insurance; (p) sold, assigned, transferred, abandoned or permitted allowed to lapse or expire any Government Licenses which, individually or in the aggregate, are material to the Business or any portion thereof, or any of the Proprietary Rights Intellectual Property rights or other intangible assetsassets owned, used or disclosed licensed by Trooper in connection with any material proprietary confidential information to any Person, except in product of Trooper or the ordinary course operation of business consistent with past custom and practice, or granted any license or sublicense of any rights under or with respect to any Proprietary Rightsits business; (iiiq) conducted its cash management customs and practices (includingbeen subject to any claim or written threat of infringement, without limitation, the collection misappropriation or other violation by or against Trooper of receivables, payment Intellectual Property rights of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms Trooper or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practicea third party; (ivr) made any loans or advances to, or guarantees for materially reduced the benefit of, or entered into any transaction with PDK or any of its other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer amount of any assets of placing a Lien on any assets) except on an arms-length basis in the ordinary course of business consistent with past custom and practice; (v) suffered any extraordinary loss, damage, destruction or casualty loss or waived any rights of material value, whether or not covered insurance coverage provided by existing insurance and whether or not in the ordinary course of business or consistent with past custom and practice; (vi) received notification, or become aware of facts which would lead a reasonable person to believe, that any material customer or supplier will stop or decrease in any material respect the rate of business done with the Business; (vii) become subject to any material liabilities, except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into in the ordinary course of business consistent with past custom and practice; (viii) settled or compromised any litigation involving equitable relief or involving any money damages in excess of $50,000policies; or (ixs) entered into committed to do any other material transaction, other than in of the ordinary course of business consistent with past custom and practiceforegoing. (b) No party has accelerated, terminated, modified or canceled any Assigned Contract.

Absence of Certain Developments. (a) Except as set forth on Section 4.10 of the Seller's Disclosure Schedule or except as contemplated in and consistent with the attached "Developments Schedule," terms of this Agreement since August 31, 1998the date of the Financial Statements, Seller has conducted not, in respect of the Business only Colonial Business: A. changed its accounting methods or practices (including any change in depreciation or amortization policies or rates) or revalued any of its assets; B. other than distributions necessary for Colonial, Parent or Parent's ultimate owners to pay taxes in respect of Colonial, declared or paid any dividend or distributions; C. borrowed any amount under existing lines of credit, or otherwise incurred or become subject to any indebtedness, except in the ordinary course of business and in a manner and in amounts that are in keeping with historical practice; D. discharged or satisfied any lien (other than property taxes and assessments, business and personal property taxes, mechanic's liens and similar items discharged in the ordinary course of business consistent with past custom practices) or encumbrance; E. except as is reasonably necessary for the ordinary operation of the Colonial Business and practice in a manner and in amounts that are in keeping with historical practice, mortgaged, pledged, or subjected to any lien, charge, or other encumbrance, any of Colonial's assets with a fair market value in excess of $25,000, except liens for current property taxes not yet due and payable; F. sold, assigned or transferred (including, without limitation, transfers to any employees, shareholders or affiliates) any assets or canceled any debts or claims, except in the ordinary course of business and consistent with respect past practices; G. sold, assigned or transferred any patents, trademarks, trade names, copyrights, trade secrets or other intangible assets, or disclosed any proprietary or confidential information to the offering any person other than Meritage or Buyer; H. suffered any extraordinary loss or waived any material right or claim, including any write-off or compromise of special sales any contract or incentive programs other account receivable; I. taken any other action or the filling of its distribution channels), has incurred no liabilities entered into any other transaction other than in the ordinary course of business consistent with past custom and practice, and Seller has not: (i) sold, assigned or transferred any of its assets, except for sales of inventory in the ordinary course of business consistent accordance with past custom and practice, or mortgaged, pledged or subjected them to any material Lien, except for Liens for current property Taxes not yet due and payable, or canceled without fair consideration any material debts or claims owing to or held by it; (ii) sold, assigned, transferred, abandoned or permitted to lapse any Government Licenses which, individually or in the aggregate, are material to the Business or any portion thereof, or any of the Proprietary Rights or other intangible assets, or disclosed any material proprietary confidential information to any Person, except in the ordinary course of business consistent with past custom and practice, or granted any license or sublicense of any rights under or with respect to any Proprietary Rights; (iii) conducted its cash management customs and practices (including, without limitation, the collection of receivables, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practice; (iv) made any loans or advances to, or guarantees for the benefit of, or entered into any transaction with PDK or any of its other stockholders or any an employee, shareholder, member, partner or officer or director of Seller or PDK, except for any other entity associated with the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer of any assets of placing a Lien on any assets) except on an arms-length basis in the ordinary course of business consistent with past custom and practiceColonial Business; (v) J. suffered any extraordinary losstheft, damage, destruction or casualty loss of or waived to any rights of material valueproperty or properties owned or used by it, whether or not covered by insurance and whether or not in the ordinary course of business or consistent with past custom and practiceinsurance; (vi) received notificationK. increased the annualized level of compensation of or granted any extraordinary bonuses, benefits or become aware other forms of facts which would lead a reasonable person to believe, that any material customer direct or supplier will stop or decrease in any material respect the rate of business done with the Business; (vii) become subject indirect compensation to any material liabilitiesemployee, except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into in the ordinary course of business consistent with past custom and practice; (viii) settled officer, director or compromised any litigation involving equitable relief or involving any money damages consultant that aggregate in excess of $50,00025,000, or increased, terminated or amended or otherwise modified any plans for the benefit of employees; L. except as is reasonably necessary for the ordinary operation of the Colonial Business and in a manner and in amounts that are in keeping with historical practice, made any capital expenditures or commitments for property, plant and equipment that aggregate in excess of $25,000; M. engaged or agreed to engage in any extraordinary transactions or distributions, or except as is reasonably necessary for the ordinary operation of the Colonial Business and in keeping with historical practice, entered into any contract, written or oral, that involves consideration or performance by it of a value exceeding $25,000 or a term exceeding one year; N. made any loans, advances or commitments to, or guarantees in excess of $50,000 for the benefit of, any persons; or (ix) entered into any other material transactionO. made charitable contributions or pledges, other than which in the ordinary course of business consistent with past custom and practiceaggregate exceed $10,000. (b) No party has accelerated, terminated, modified or canceled any Assigned Contract.

Absence of Certain Developments. (a) Except as set forth on the attached Schedule 4.7, since January 1, 1999, there has been no adverse change in the financial condition, operating results, assets, customer or supplier relations, employee relations or business prospects of ATG and, to the best of Sellers' Knowledge, no customer or vendor has any plans to terminate its relationship with ATG. Without limiting the generality of the preceding sentence, except as expressly contemplated by this Agreement or as set forth on the attached "Developments Schedule," Schedule 4.7, since August 31the date of the Latest Balance Sheet, 1998Sellers have not: (a) engaged in any activity which has resulted in (i) any acceleration or delay of the collection of ATG's accounts or notes receivable, Seller has conducted (ii) any delay in the payment in ATG's accounts payable or (iii) any increase in ATG's purchases of raw materials, in each case as compared with ATG's custom and practice in the conduct of the Business only immediately prior to the date of the Latest Balance Sheet; (b) discharged or satisfied any Lien or paid any obligation or liability, other than current liabilities paid in the ordinary course of business and consistent with ATG's past custom and practice practice; (includingc) mortgaged or pledged any of the ATG Shares or any Asset or subjected any of the ATG Shares or any Asset to any Lien; (d) sold, without limitationassigned, with respect to the offering conveyed, transferred, canceled or waived any property, tangible asset, Proprietary Right or other intangible asset or right of special sales or incentive programs or the filling of its distribution channels), has incurred no liabilities ATG other than in the ordinary course of business and consistent with ATG's past custom and practice, and Seller has not: (i) sold, assigned or transferred any of its assets, except for sales of inventory in the ordinary course of business consistent with past custom and practice, or mortgaged, pledged or subjected them to any material Lien, except for Liens for current property Taxes not yet due and payable, or canceled without fair consideration any material debts or claims owing to or held by it; (ii) sold, assigned, transferred, abandoned or permitted to lapse any Government Licenses which, individually or in the aggregate, are material to the Business or any portion thereof, or any of the Proprietary Rights or other intangible assets, or disclosed any material proprietary confidential information to any Person, except in the ordinary course of business consistent with past custom and practice, or granted any license or sublicense of any rights under or with respect to any Proprietary Rights; (iii) conducted its cash management customs and practices (including, without limitation, the collection of receivables, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practice; (ive) made any loans or advances to, or guarantees for the benefit of, or entered into any transaction with PDK or any of its other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer of any assets of placing a Lien on any assets) except on an arms-length basis in the ordinary course of business consistent with past custom and practice; (v) suffered any extraordinary loss, damage, destruction or casualty loss or waived any rights right of material value, whether or not covered by insurance and whether or not ATG other than in the ordinary course of business or consistent with ATG's past custom and practice; (vif) received notificationmade commitments for capital expenditures by ATG which, or become aware of facts which in the aggregate, would lead a reasonable person to believe, that any material customer or supplier will stop or decrease in any material respect the rate of business done with the Businessexceed $50,000; (viig) become subject made any loan or advance to, or guarantee for the benefit of, or any Investment in, any other Person on behalf of ATG; (h) granted any bonus or any increase in wages, salary or other compensation to any material liabilities, except current liabilities incurred employee of ATG (other than any increase in wages or salaries granted in the ordinary course of business and liabilities under contracts entered into in the ordinary course of business consistent with ATG's past custom and practicepractice granted to any employee who is not affiliated with ATG other than by reason of such Person's employment by ATG); (viiii) settled or compromised made any litigation involving equitable relief or involving any money damages in excess charitable contributions on behalf of $50,000; orATG; (ixj) suffered damages, destruction or casualty losses which, in the aggregate, exceed $50,000 (whether or not covered by insurance) to any Asset; (k) received any indication from any material supplier of ATG to the effect that such supplier will stop, or materially decrease the rate of, supplying materials, products or services to ATG (whether or not the Merger is consummated), or received any indication from any material customer of ATG to the effect that such customer will stop, or materially decrease the rate of, buying materials, products or services from ATG (whether or not the Merger is consummated); (l) entered into any other material transaction, transaction other than in the ordinary course of business and consistent with ATG's past custom and practice., or entered into any other material transaction, whether or not in the ordinary course of business, which may adversely affect ATG; (bm) No party has accelerateddeclared, terminatedset aside, modified or canceled paid any Assigned Contractdividend or made any distribution with respect to ATG's capital stock or equity interests or redeemed, purchased, or otherwise acquired any of ATG's capital stock or equity interests; (n) adopted or amended any employee benefit or welfare plan relating to the Employees; or (o) received any indication from any key employee to the effect that such key employee will terminate employment with ATG; or (p) agreed to do any act described in any of clauses 4.7(a) through (o).

Absence of Certain Developments. (a) Except as set forth disclosed on Schedule 3.11 or in the attached "Developments Schedule," Company Financial Statements or as otherwise contemplated by this Agreement, since August 31the date of the Company Latest Balance Sheet, 1998, Seller the Company has conducted its business only in the Business only ordinary course consistent with past practice and there has not occurred or been entered into, as the case may be: (i) any event having a Material Adverse Effect on the Company, (ii) any event that could reasonably be expected to prevent or materially delay the performance of the Company’s obligations pursuant to this Agreement, (iii) any material change by the Company in its accounting methods, principles or practices, (iv) any declaration, setting aside or payment of any dividend or distribution in respect of the shares of common stock of the Company or any redemption, purchase or other acquisition of any of the Company’s securities, (v) other than the establishment of the Stock Option Plan or in the ordinary course of business consistent with past custom and practice practice, (includinga) any increase in the compensation or benefits payable or to become payable to any officers or directors of the Company or (b) the establishment of any bonus, without limitationseverance, deferred compensation, pension, retirement, profit sharing, stock option, stock purchase or other employee benefit plan of the Company, (vi) other than issuances of Options pursuant to the Stock Option Plan (or shares of Company Common Stock in connection with the exercise of any Options), any issuance, grants or sale of any stock, options, warrants, notes, bonds or other securities, or entry into any agreement with respect thereto by the Company, (vii) any amendment to the offering certificate of special sales incorporation or incentive programs or bylaws of the filling of its distribution channels)Company, has incurred no liabilities (viii) other than in the ordinary course of business consistent with past custom and practice, and Seller has not: any (iw) soldcapital expenditures by the Company, assigned (x) purchase, sale, assignment or transferred transfer of any material assets by the Company, (y) mortgage, pledge or existence of its assetsany lien, encumbrance or charge on any material assets or properties, tangible or intangible of the Company, except for sales liens for Taxes not yet due and such other liens, encumbrances or charges which do not, individually or in the aggregate, have a Material Adverse Effect on the Company or the Surviving Company, or (z) cancellation, compromise, release or waiver by the Company of inventory any rights of material value or any material debts or claims, (ix) any incurrence by the Company of any material liability (absolute or contingent), except for current liabilities and obligations incurred in the ordinary course of business consistent with past custom and practice, or mortgaged, pledged or subjected them to any material Lien, except for Liens for current property Taxes not yet due and payable, or canceled without fair consideration any material debts or claims owing to or held by it; (iix) sold, assigned, transferred, abandoned or permitted to lapse any Government Licenses which, individually or in the aggregate, are material to the Business or any portion thereof, or any of the Proprietary Rights or other intangible assets, or disclosed any material proprietary confidential information to any Person, except in the ordinary course of business consistent with past custom and practice, or granted any license or sublicense of any rights under or with respect to any Proprietary Rights; (iii) conducted its cash management customs and practices (including, without limitation, the collection of receivables, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practice; (iv) made any loans or advances to, or guarantees for the benefit of, or entered into any transaction with PDK or any of its other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer of any assets of placing a Lien on any assets) except on an arms-length basis in the ordinary course of business consistent with past custom and practice; (v) suffered any extraordinary loss, damage, destruction or casualty loss or waived any rights of material valuesimilar loss, whether or not covered by insurance and whether or not in insurance, materially affecting the ordinary course of business or consistent with past custom and practice; properties of the Company, (vixi) received notification, or become aware of facts which would lead a reasonable person to believe, that any material customer or supplier will stop or decrease in any material respect the rate of business done with the Business; (vii) become subject to any material liabilities, except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into in the ordinary course of business consistent with past custom and practice; (viii) settled or compromised any litigation involving equitable relief or involving any money damages in excess of $50,000; or (ix) entered entry into any other material transactionagreement, contract, lease or license other than in the ordinary course of business consistent with past custom and practice, (xii) any termination, material modification or cancellation of any agreement, contract, lease or license to which the Company is a party or by which it is bound, (xiii) entry by the Company into any loan in excess of $10,000 with any officers or directors of the Company, (xiv) any charitable or other capital contribution by the Company or pledge therefore, (xv) entry by the Company into any transaction of a material nature other than in the ordinary course of business consistent with past practice, or (xvi) any negotiation or agreement by the Company to do any of the things described in the preceding clauses (i) through (xv). (b) No party has accelerated, terminated, modified or canceled any Assigned Contract.

Absence of Certain Developments. (a) Since the Ranger Balance Sheet Date, there has not been any Ranger Material Adverse Effect. Except as set forth expressly contemplated hereby, since the Ranger Balance Sheet Date, Ranger has carried on and operated its business in the attached "Developments Schedule," since August 31, 1998, Seller has conducted the Business only all material respects in the ordinary course of business consistent with past custom practice, and practice Ranger has not: (includinga) amended or modified its Organizational Documents; (b) sold, without limitationleased, assigned, transferred or purchased any material tangible assets, in each case in a single or related series of transactions, except in the ordinary course of business; (c) issued, sold, redeemed or transferred any of its capital stock or other equity securities, securities convertible into its capital stock or other equity securities or warrants, options or other rights to acquire its capital stock or other equity securities, or any bonds or debt securities; (d) prior to the date hereof, declared or paid any dividend or other distribution of the assets of Ranger; (e) made or approved any material changes in its employee benefit plans or made any material changes in wages, salary, or other compensation, including severance, with respect to the offering of special sales its current or incentive programs former officers, directors or the filling of its distribution channels), has incurred no liabilities executive employees other than increases in base salaries and wages that are consistent with past practices or as required by applicable Law or any Ranger Plan; (f) paid, loaned or advanced (other than the payment of compensation and benefits in the ordinary course of business consistent with past custom and practicepractice or the payment, and Seller has not: (i) sold, assigned advance or transferred any reimbursement of its assets, except for sales of inventory business expenses in the ordinary course of business consistent with past custom and practicepractice or 401(k) plan loans) any amounts to, or mortgagedsold, pledged transferred or subjected them to leased any material Lien, except for Liens for current property Taxes not yet due and payableof its assets to, or canceled without fair consideration entered into any material debts other transactions with, any of its Affiliates, or claims owing to made any loan to, or held by itentered into any other transaction with, any of its directors or officers outside the ordinary course of business or other than at arm’s length; (g) except as required by applicable Law, adopted or materially amended any Ranger Plans; (h) hired or terminated any officers or employees of Ranger with fixed annual compensation in excess of $150,000, with respect to non-officer employees, other than in the ordinary course of business; (i) commenced or settled any Action in which the amount in dispute is in excess of $5,000,000; (j) made any material change in accounting principles, methods, procedures or policies, except as required by GAAP; (k) made, changed or revoked any material Tax election, or settled or compromised any material Tax claim or liabilities, or filed any substantially amended material Tax Return; (i) authorized, proposed, entered into or agreed to enter into any plan of liquidation, dissolution or other reorganization or (ii) authorized, proposed, entered into or agreed to enter into any merger, consolidation or business combination with any Person; (m) except in the ordinary course of business, incurred or discharged any Indebtedness; (n) made capital expenditures or capital additions or betterments in excess of $35,000,000 in the aggregate; (o) suffered any material damage, destruction or loss, whether or not covered by insurance; (p) sold, assigned, transferred, abandoned or permitted allowed to lapse or expire any Government Licenses which, individually or in the aggregate, are material to the Business or any portion thereof, or any of the Proprietary Rights Intellectual Property rights or other intangible assetsassets owned, used or disclosed licensed by Ranger in connection with any material proprietary confidential information to any Person, except in product of Ranger or the ordinary course operation of business consistent with past custom and practice, or granted any license or sublicense of any rights under or with respect to any Proprietary Rightsits business; (iiiq) conducted its cash management customs and practices (includingbeen subject to any claim or written threat of infringement, without limitation, the collection misappropriation or other violation by or against Ranger of receivables, payment Intellectual Property rights of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms Ranger or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practicea third party; (ivr) made any loans or advances to, or guarantees for materially reduced the benefit of, or entered into any transaction with PDK or any of its other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer amount of any assets of placing a Lien on any assets) except on an arms-length basis in the ordinary course of business consistent with past custom and practice; (v) suffered any extraordinary loss, damage, destruction or casualty loss or waived any rights of material value, whether or not covered insurance coverage provided by existing insurance and whether or not in the ordinary course of business or consistent with past custom and practice; (vi) received notification, or become aware of facts which would lead a reasonable person to believe, that any material customer or supplier will stop or decrease in any material respect the rate of business done with the Business; (vii) become subject to any material liabilities, except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into in the ordinary course of business consistent with past custom and practice; (viii) settled or compromised any litigation involving equitable relief or involving any money damages in excess of $50,000policies; or (ixs) entered into committed to do any other material transaction, other than in of the ordinary course of business consistent with past custom and practiceforegoing. (b) No party has accelerated, terminated, modified or canceled any Assigned Contract.

Absence of Certain Developments. (a) Since December 31, 2011, there has not been any Material Adverse Effect. Except as set forth in on the attached "Developments Schedule," Schedule and except as expressly contemplated by this Agreement, since August December 31, 19982011, Seller the Company has conducted the Business only carried on and operated its business in all material respects in the ordinary course of business consistent with past custom practice, and practice the Company has not: (includinga) amended or modified its Organizational Documents; (b) subjected any of its material properties or assets to any Lien, without limitationexcept for Permitted Liens; (c) sold, leased, assigned, transferred or purchased any material tangible assets, in each case, in a single or related series of transactions, except in the ordinary course of business; (d) issued, sold, redeemed or transferred any of its capital stock or other equity securities, securities convertible into its capital stock or other equity securities or warrants, options or other rights to acquire its capital stock or other equity securities, or any bonds or debt securities; (e) prior to the date hereof, declared or paid any dividend or other distribution of the assets of the Company; (f) made or approved any material changes in its employee benefit plans or made any material changes in wages, salary, or other compensation, including severance, with respect to the offering of special sales its current or incentive programs former officers, directors, or the filling of its distribution channels), has incurred no liabilities employees other than increases in base salaries and wages that are consistent with past practices; (g) paid, loaned or advanced (other than the payment of salary and benefits in the ordinary course of business consistent with past custom and practicepractice or the payment, and Seller has not: (i) sold, assigned advance or transferred any reimbursement of its assets, except for sales of inventory business expenses in the ordinary course of business consistent with past custom and practice) any amounts to, or mortgagedsold, pledged transferred or subjected them to leased any material Lien, except for Liens for current property Taxes not yet due and payableof its assets to, or canceled without fair consideration entered into any material debts other transactions with, any of its Affiliates, or claims owing to made any loan to, or held by itentered into any other transaction with, any of its directors or officers outside the ordinary course of business or other than at arms’ length; (h) adopted or amended any Plans; (i) hired or terminated any officers or employees of the Company with fixed annual compensation in excess of $150,000; (j) commenced or settled any Action; (k) made any material change in accounting principles, methods, procedures or policies, except as required by GAAP; (l) made, changed or revoked any material Tax election or settled or compromised any Tax claim or Liability; (i) authorized, proposed, entered into or agreed to enter into any plan of liquidation, dissolution or other reorganization or (ii) authorized, proposed, entered into or agreed to enter into any merger, consolidation or business combination with any Person; (n) except in the ordinary course of business, incurred or discharged any Indebtedness; (o) made capital expenditures or capital additions or betterments in excess of $750,000 in the aggregate; (p) suffered any material damage, destruction or loss, whether or not covered by insurance; (q) sold, assigned, transferred, abandoned or permitted allowed to lapse or expire any Government Licenses which, individually or in the aggregate, are material to the Business or any portion thereof, or any of the Proprietary Rights Intellectual Property rights or other intangible assetsassets owned, used or disclosed licensed by the Company in connection with any material proprietary confidential information product of the Company or the operation of its business; (r) been subject to any Personclaim or threat of infringement, except in misappropriation or other violation by or against the Company of Intellectual Property rights of the Company or a third party; (s) materially reduced the amount of any insurance coverage provided by existing insurance policies; (t) taken any action or failed to take any action outside the ordinary course of business consistent with past custom and practicethe intent of reducing Company’s working capital as of July 31, or granted any license or sublicense of any rights under or with respect to any Proprietary Rights2012; (iiiu) conducted its cash management customs and practices (including, without limitation, the collection of receivables, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practice; (iv) made any loans or advances to, or guarantees for the benefit of, entered into or entered into any transaction with PDK or material amendment to any of its other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer of any assets of placing a Lien on any assets) except on an arms-length basis in the ordinary course of business consistent with past custom and practice;Material Contract; or (v) suffered committed to do any extraordinary loss, damage, destruction or casualty loss or waived any rights of material value, whether or not covered by insurance and whether or not in the ordinary course of business or consistent with past custom and practice; (vi) received notification, or become aware of facts which would lead a reasonable person to believe, that any material customer or supplier will stop or decrease in any material respect the rate of business done with the Business; (vii) become subject to any material liabilities, except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into in the ordinary course of business consistent with past custom and practice; (viii) settled or compromised any litigation involving equitable relief or involving any money damages in excess of $50,000; or (ix) entered into any other material transaction, other than in the ordinary course of business consistent with past custom and practiceforegoing. (b) No party has accelerated, terminated, modified or canceled any Assigned Contract.

Absence of Certain Developments. Except as expressly contemplated by this Agreement, since June 30, 2004 through the date hereof, the Company has not: (a) Except as set forth in the attached "Developments Schedule," since August 31, 1998, Seller has conducted the Business only in the ordinary course of operated its business consistent with past custom and practice (including, without limitation, with respect to the offering of special sales or incentive programs or the filling of its distribution channels), has incurred no liabilities other than in the ordinary course of business consistent with past custom and practice, and Seller has not:; (ib) sold, assigned or transferred been (nor have any of its assetsAffiliates been) the subject of any commenced, except for sales of inventory in the ordinary course of business consistent with past custom and practicepending, threatened or mortgaged, pledged proposed proceeding to condemn or subjected them to take by eminent domain or other governmental action any material Lien, except for Liens for current property Taxes not yet due and payable, or canceled without fair consideration any material debts or claims owing to or held by itAsset; (iic) sold, assigned, transferred, abandoned or permitted to lapse any Government Licenses which, individually or in the aggregate, are material to the Business or any portion thereof, or had (nor have any of the Proprietary Rights its Affiliates had) any Asset removed or other intangible assets, or disclosed been (nor have any material proprietary confidential information of its Affiliates been) subject to any Persontype of written demand or request for removal, except in the ordinary course of business consistent with past custom and practice, or granted any license or sublicense of any rights under or with respect to any Proprietary Rights; (iii) conducted its cash management customs and practices (including, without limitation, the collection of receivables, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practice; (ivd) made experienced any loans Material Adverse Effect on the Assets, the Company Stock or advances to, or guarantees for the benefit of, or entered into any transaction with PDK or any of its other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract Company; (including, without limitation, any transfer of any assets of placing a Lien on any assetse) except on an arms-length basis in the ordinary course of business consistent with past custom practice, had any party accelerate, terminate, modify, or cancel any agreement, Contract, lease, or license (or series of related agreements, Contracts, leases, and practicelicenses) to which the Company is a party or by which it is bound or had any party threaten the same; (vf) suffered borrowed any extraordinary loss, damage, destruction amount or casualty loss incurred or waived any rights of material value, whether or not covered by insurance and whether or not in the ordinary course of business or consistent with past custom and practice; (vi) received notification, or become aware of facts which would lead a reasonable person to believe, that any material customer or supplier will stop or decrease in any material respect the rate of business done with the Business; (vii) become subject to any material liabilities, except current liabilities incurred in the ordinary course of business consistent with past practice and liabilities under contracts Contracts entered into in the ordinary course of business consistent with past custom and practice; (viiig) settled mortgaged or compromised pledged any litigation involving equitable relief of the Assets or involving subjected them to any money damages in excess of $50,000; orLien, except Liens for current property taxes not yet due and payable; (ixh) entered into except for the lease of Taxi Media pursuant to Leases in the ordinary course of business, sold, leased, assigned or transferred or agreed to sell, lease, assign or transfer at some future date, or granted an option to any party to acquire, any of the Assets or securities of the Company (“Securities”) (including any options, warrants or other material transaction, other than rights therefor) or canceled any debts or claims; (i) except in the ordinary course of business consistent with past custom and practice., sold, assigned, transferred, or permitted to lapse, any rights for the use of any Intellectual Property, or disclosed any proprietary confidential information to any Person other than the Company’s advisors; (bj) No party has acceleratedmade any change in any method of accounting or accounting practice or its practices with respect to the payment or other discharge of debts; (k) suffered any extraordinary losses or waived any rights of value, terminatedwhether or not in the ordinary course of business, modified or canceled consistent with past practice; (l) made capital expenditures or commitments therefor in excess of $10,000; (m) made any Assigned Contractloans or advances to, guarantees for the benefit of or any Investments in, any Persons; (n) suffered any damage, destruction or casualty loss, not fully covered by insurance (subject to payment of the applicable deductible); (o) acquired any operating business or any assets outside of the ordinary course of business consistent with past practice or entered any commitment to do so; (p) except for this Agreement or any other agreement contemplated hereby, or any payments made in the ordinary course pursuant to Leases, entered into any other transaction (or series of related transactions) involving more than $10,000 or outside of the ordinary course of business consistent with past practice; (q) discharged or satisfied any Lien or paid any obligation or liability, other than current liabilities in the ordinary course of business consistent with past practice; (r) declared, set aside, made any payment or distribution or made any dividend of cash or other property to its stockholders or redeemed, purchased or otherwise acquired any of its Securities; or (s) except in the ordinary course of business consistent with past practice, granted to any officer or employee any increase in compensation or benefit.

Absence of Certain Developments. (a) Except as set forth in on the attached "Developments Schedule," DEVELOPMENTS SCHEDULE, since August October 31, 19981999, Seller has conducted the Business only in the ordinary course of business consistent with past custom and practice (including, without limitation, with respect to the offering of special sales or incentive programs or the filling of its distribution channels), has incurred no liabilities other than in the ordinary course of business consistent with past custom and practice, and Seller has not: (ia) soldissued any notes, assigned bonds or transferred other debt securities or any of its assetscapital stock or other equity securities or any securities or rights convertible, except for sales of inventory in the ordinary course of business consistent with past custom and practice, exchangeable or mortgaged, pledged exercisable into any capital stock or subjected them to any material Lien, except for Liens for current property Taxes not yet due and payable, or canceled without fair consideration any material debts or claims owing to or held by itother equity securities; (iib) sold, assigned, transferred, abandoned borrowed any amount or permitted to lapse any Government Licenses which, individually incurred or in the aggregate, are material to the Business or any portion thereof, or any of the Proprietary Rights or other intangible assets, or disclosed any material proprietary confidential information to any Person, except in the ordinary course of business consistent with past custom and practice, or granted any license or sublicense of any rights under or with respect to any Proprietary Rights; (iii) conducted its cash management customs and practices (including, without limitation, the collection of receivables, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practice; (iv) made any loans or advances to, or guarantees for the benefit of, or entered into any transaction with PDK or any of its other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer of any assets of placing a Lien on any assets) except on an arms-length basis in the ordinary course of business consistent with past custom and practice; (v) suffered any extraordinary loss, damage, destruction or casualty loss or waived any rights of material value, whether or not covered by insurance and whether or not in the ordinary course of business or consistent with past custom and practice; (vi) received notification, or become aware of facts which would lead a reasonable person to believe, that any material customer or supplier will stop or decrease in any material respect the rate of business done with the Business; (vii) become subject to any material liabilities, except current liabilities incurred in the ordinary course of business and consistent with past practice; (c) discharged or satisfied any material Lien or paid any material obligation or liability, other than current liabilities under contracts entered into paid in the ordinary course of business; (d) declared, set aside or made any payment or distribution of cash (including so-called "tax distributions") or other property to any of its shareholders with respect to such shareholder's capital stock or otherwise, or purchased, redeemed or otherwise acquired any shares of its capital stock or other equity securities (including any warrants, options or other rights to acquire its capital stock or other equity); (e) mortgaged or pledged any of its properties or assets or subjected them to any Lien, except for Permitted Liens; (f) sold, assigned, transferred, leased, licensed or otherwise encumbered any of its tangible assets, except in the ordinary course of business consistent with past custom and practice, or canceled any material debts or claims; (viiig) settled sold, assigned, transferred, leased, licensed or compromised otherwise encumbered any litigation involving equitable relief or involving Intellectual Property Rights, disclosed any money damages in excess of $50,000; or proprietary confidential information to any Person (ix) entered into any other material transaction, than to Buyer and its Affiliates and other than in the ordinary course of business consistent with past custom and practice.practice in circumstances in which it has imposed reasonable confidentiality restrictions), or abandoned or permitted to lapse any Intellectual Property Rights; (bh) No other than in the ordinary course of business consistent with past practice, made or granted any bonus or any wage or salary increase to any employee or group of employees (except as required by pre-existing contracts described on the attached CONTRACTS SCHEDULE), or made or granted any increase in any employee benefit plan or arrangement, or amended or terminated any existing employee benefit plan or arrangement or adopted any new employee benefit plan or arrangement or entered into, amended or terminated any collective bargaining agreement or other employment agreement; (i) implemented any plant closing or other layoff of employees that could implicate the Worker Adjustment and Retraining Notification Act, as amended, or any similar foreign, state or local law, regulation or ordinance; (j) suffered any extraordinary losses or waived any rights of material value (whether or not in the ordinary course of business or consistent with past practice) in excess of $10,000 in the aggregate; (k) made capital expenditures or commitments therefor that amount in the aggregate to more than $10,000; (l) delayed or postponed the payment of any accounts payable or commissions or any other liability or obligation or agreed or negotiated with any party has acceleratedto extend the payment date of any accounts payable or commissions or any other liability or obligation or accelerated the collection of (or discounted) any accounts or notes receivable; (m) made any loans or advances to, terminatedguaranties for the benefit of, modified or canceled any Assigned ContractInvestments in, any Person (other than advances to Seller's employees in the ordinary course of business consistent with past practice); (n) made any charitable contributions or pledges exceeding in the aggregate $5,000 or made any political contributions; (o) suffered any damage, destruction or casualty loss exceeding in the aggregate $10,000, whether or not covered by insurance; (p) made any change in any method of accounting or accounting policies that is material or that is other than in the usual, regular and ordinary course of business consistent with past practice or reversed any accruals (whether or not in the ordinary course of business or consistent with past practice); (q) made any Investment in or taken any steps to incorporate any Subsidiary; (r) amended its articles of incorporation, by-laws or other organizational documents; (s) entered into any agreement or arrangement prohibiting or restricting it from freely engaging in any business or otherwise restricting the conduct of its business anywhere in the world; (t) taken any action or failed to take any action that has, had or would reasonably be expected to have the effect of accelerating to pre-Closing periods sales to the trade or other customers that would otherwise be expected to occur after the Closing; (u) entered into, amended or terminated any contract other than in the ordinary course of business consistent with past practice, entered into any other material transaction, whether or not in the ordinary course of business or consistent with past practice, or materially changed any business practice; or (v) agreed, whether orally or in writing, to do any of the foregoing.

Absence of Certain Developments. (a) Except as set forth in Schedule 4-F or as authorized pursuant to any order entered by the attached "Developments Schedule," Bankruptcy Court, since August May 31, 19981996, Seller has Sellers have conducted the Business their business only in the ordinary course of business consistent with past custom and practice (includingtaking into account their position as debtors in possession, without limitation, with respect to the offering of special sales or incentive programs or the filling of its distribution channelsincluding their liquidity and constraints imposed by their lenders), has have incurred no liabilities other than in the ordinary course of business consistent with past custom and practicepractice (excluding liabilities directly relating to the Chapter 11 Case, such as professional fees), and Seller has have not: (i) sold, assigned or transferred any of its Sellers' assets, except for sales of inventory in the ordinary course of business consistent with past custom and practice, or mortgaged, pledged or subjected them to any material Lien, except for Liens for current property Taxes not yet due and payable, or canceled without fair consideration any material debts or claims owing to or held by itthem; (ii) sold, assigned, transferred, abandoned or permitted to lapse any Government Licenses licenses or permits which, individually or in the aggregate, are material to the Business Acquired Assets or any portion thereof, or any of the Proprietary Rights Intellectual Property, Intellectual Property Licenses or other intangible assets, or disclosed any material proprietary confidential information to any Person, except in the ordinary course of business consistent with past custom and practice, or granted any license or sublicense of any rights under or with respect to any Proprietary RightsIntellectual Property or Intellectual Property Licenses; (iii) conducted its cash management customs and practices (made or granted any increase in, or amended or terminated, any existing employee plan, program, policy or arrangement to which any Seller is a party or contributes or which any Seller maintains, including, without limitation, any Employee Benefit Plan, or adopted any new employee benefit plan or arrangement, or amended or renegotiated any existing collective bargaining agreement or entered into any new collective bargaining agreement or multi-employer plan; (iv) conducted its cash management practices (including the collection of receivables, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)practices) other than in the usual and ordinary course of business consistent with past custom and practice; practice (iv) made any loans or advances totaking into account Sellers position as debtors in possession, or guarantees for the benefit of, or entered into any transaction with PDK or any of its other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated including their liquidity and constraints imposed by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer of any assets of placing a Lien on any assets) except on an arms-length basis in the ordinary course of business consistent with past custom and practice;their lenders); or (v) suffered any extraordinary loss, damage, destruction or casualty loss or waived any rights of material value, whether or not covered by insurance and whether or not in the ordinary course of business or consistent with past custom and practice; (vi) received notification, or become aware of facts which would lead a reasonable person to believe, that any material customer or supplier will stop or decrease in any material respect the rate of business done with the Business; (vii) become subject to any material liabilities, except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into in the ordinary course of business consistent with past custom and practice; (viii) settled or compromised any litigation involving equitable relief or involving any money damages in excess of $50,000; or (ix) entered into any other material transaction, other than in the ordinary course of business consistent with past custom and practice. (b) No party (including any Seller) has accelerated, terminated, modified modified, or canceled any contract, lease, sublease, license, sublicense or other agreement set forth on the Assigned ContractContracts List.

Absence of Certain Developments. (a) Except as set forth in From the attached "Developments Schedule," since August 31Locked Box Date to the date hereof, 1998there has not been any Leakage, Seller has conducted other than (i) the Business only continued operation of the Cash Management Arrangements in the ordinary course and (ii) Permitted Leakage as defined in clauses (v), (vi) and (viii) of the definition thereof. (b) Each of the Transferred Group Members has (I) operated its business consistent with past custom and practice (including, without limitation, with respect in the Ordinary Course of Business from the Locked Box Date to the offering of special sales or incentive programs or date hereof, (II) not suffered any Material Adverse Effect since the filling of its distribution channels), has incurred no liabilities other than in the ordinary course of business consistent with past custom and practiceLocked Box Date, and Seller has not(III) not taken any of the following actions from the Locked Box Date to the date hereof: (i) (A) sold, assigned leased, assigned, licensed or transferred or otherwise disposed of any of its assets or any portion thereof or any of its Intellectual Property or any Intellectual Property Ancillary Rights, other than (1) sales of obsolete assets, except for sales assets with no book value and de minimis assets, and (2) licensing of inventory Intellectual Property or Intellectual Property Ancillary Rights in the ordinary course Ordinary Course of business consistent with past custom and practiceBusiness to customers, or (B) mortgaged, pledged or subjected them any of the foregoing to any material Lien, except for Liens for current property Taxes not yet due and payable, or canceled without fair consideration any material debts or claims owing to or held by itadditional Lien (other than Permitted Liens); (ii) soldmade, assignedgranted or promised any bonus, transferredany wage or salary increase or any other payment to any current or former employee, abandoned manager, officer or permitted to lapse any Government Licenses whichdirector, individually or contractor who is a natural person, in each case, other than in the aggregate, are material to the Business or any portion thereof, or any Ordinary Course of the Proprietary Rights or other intangible assets, or disclosed any material proprietary confidential information to any Person, except in the ordinary course of business consistent with past custom and practice, or granted any license or sublicense of any rights under or with respect to any Proprietary RightsBusiness; (iii) conducted its cash management customs and practices (includingentered into, without limitationmaterially amended or terminated any Rome Group Employee Benefit Plan, the collection of receivables, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than in as required by applicable Law or the usual and ordinary course terms of business consistent with past custom and practicesuch Rome Group Employee Benefit Plan; (iv) made any loans or advances toexcept as required by Law, entered into, or guarantees for the benefit of, or entered into any transaction with PDK or any of its other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitationamended, any transfer collective bargaining agreements or other contract with any labor union, works council or other similar employee representative group relating to any current or former employees of any assets of placing a Lien on any assets) except on an arms-length basis in the ordinary course of business consistent with past custom and practiceTransferred Group Member; (v) suffered issued, sold, granted, redeemed, delivered, disposed of, pledged or otherwise encumbered any extraordinary lossof its Ownership Interests, damageother than (A) the issuance by the Rome Entity of Rome Common Shares upon the exercise of Rome Options or vesting of Rome Equity Awards in accordance with the Rome Equity Plans, destruction (B) the grant of Rome Equity Awards under the Rome Equity Plans and (C) the lapse, forfeiture or casualty loss or waived any rights redemption of material value, whether or not covered by insurance Rome Equity Awards in accordance with the Rome Equity Plans and whether or not in the ordinary course of business or consistent with past custom and practice; (vi) received notificationmade any loans, advances or capital contributions to, or become aware investments in, any other person, other than (A) loans or capital contributions to or investments in Transferred Group Members in the Ordinary Course of facts which would lead a reasonable person to believeBusiness, that any material customer and (B) immaterial employee loans or supplier will stop or decrease advances in any material respect the rate Ordinary Course of business done with the Business; (vii) become subject to created, incurred, assumed, guaranteed or otherwise became liable in respect of any material liabilitiesindebtedness, except current liabilities incurred other than loans from Transferred Group Members in the ordinary course Ordinary Course of business and liabilities under contracts entered into in the ordinary course of business consistent with past custom and practiceBusiness; (viii) acquired by merging or consolidating with, or by purchasing a substantial portion of the equity securities or assets of, any Person or division thereof (other than inventory), or effected any business combination, recapitalization or similar transaction, or agreed in writing to do any of the foregoing; (ix) split, combined or reclassified any of its Ownership Interests; (x) hired any new, terminated (other than for cause), or modified or amended in any material respect any contract with any of its existing operating committee members, officers or directors; (xi) made or changed any election relating to Taxes, changed any annual accounting period or method of Tax accounting, settled or compromised any litigation involving equitable relief material Liability or involving claim with respect to Taxes, filed any money damages in excess of $50,000; or (ix) amended material Tax Return, entered into any closing agreement relating to any Tax, agreed to an extension of a statute of limitations in respect of any Tax, surrendered any right to claim a material Tax refund, or incurred any material liability for Taxes other than in the Ordinary Course of Business; (xii) made any material transactionchange in policies with respect to the payment of accounts payable or accrued expenses, including any acceleration or deferral of the payment thereof, as applicable, in each case, other than in the ordinary course Ordinary Course of Business; (xiii) made any material change in any cash management practices or in accounting methods, principles or practices; (xiv) amended or authorized the amendment of its Organizational Documents; (xv) waived any of the rights of the Transferred Group Members under the confidentiality provisions of any agreement related to the Transactions or any of the material rights of the Transferred Group Members under the confidentiality provisions of any other agreements entered into by the Transferred Group Members; (xvi) amended or modified in any material respect, assigned, terminated (partially or completely), granted any material waiver or material release under or given any material consent with respect to, or entered into any agreement to do any of the foregoing with respect to, any of the Material Contracts or entered into any Material Contract; (xvii) entered into any agreement or arrangement that limits or otherwise restricts in any material respect any Transferred Group Member, any of its Affiliates or any successor thereto, or that would, after the Closing Date, limit or restrict in any material respect any Transferred Group Member or any of its Affiliates from engaging in the business of the Rome Group Members as currently conducted; (xviii) abandoned, failed to defend against legal challenge, or permitted to lapse any material Intellectual Property; (xix) commenced any Action; (xx) failed to take or maintain reasonable measures consistent with past custom and practice.practice to protect the confidentiality of any trade secrets or other proprietary information included in Owned Intellectual Property; (bxxi) No party has acceleratedentered or offered to enter into any settlement, compromise or release of any Action involving any admission of wrongdoing or misconduct or payment by any Transferred Group Member of any material monetary relief or settlement; (xxii) terminated, modified failed to maintain, suffered any revocation of or canceled materially adversely amended the terms of any Assigned ContractMaterial Permit; (xxiii) adopted or entered into a plan or agreement of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization; or (xxiv) authorized, agreed, resolved or committed, whether orally or in writing, to take any of the foregoing actions.

Absence of Certain Developments. (a) Since the Union Balance Sheet Date, there has not been any Union Material Adverse Effect. Except as set forth expressly contemplated hereby, since the Union Balance Sheet Date, Union has carried on and operated its business in the attached "Developments Schedule," since August 31, 1998, Seller has conducted the Business only all material respects in the ordinary course of business consistent with past custom practice, and practice Union has not: (includinga) amended or modified its Organizational Documents; (b) sold, without limitationleased, assigned, transferred or purchased any material tangible assets, in each case in a single or related series of transactions, except in the ordinary course of business; (c) issued, sold, redeemed or transferred any of its capital stock or other equity securities, securities convertible into its capital stock or other equity securities or warrants, options or other rights to acquire its capital stock or other equity securities, or any bonds or debt securities; (d) prior to the date hereof, declared or paid any dividend or other distribution of the assets of Union; (e) made or approved any material changes in its employee benefit plans or made any material changes in wages, salary, or other compensation, including severance, with respect to the offering of special sales its current or incentive programs former officers, directors or the filling of its distribution channels), has incurred no liabilities executive employees other than increases in base salaries and wages that are consistent with past practices or as required by applicable Law or any Union Plan; (f) paid, loaned or advanced (other than the payment of compensation and benefits in the ordinary course of business consistent with past custom and practicepractice or the payment, and Seller has not: (i) sold, assigned advance or transferred any reimbursement of its assets, except for sales of inventory business expenses in the ordinary course of business consistent with past custom and practicepractice or 401(k) plan loans) any amounts to, or mortgagedsold, pledged transferred or subjected them to leased any material Lien, except for Liens for current property Taxes not yet due and payableof its assets to, or canceled without fair consideration entered into any material debts other transactions with, any of its Affiliates, or claims owing to made any loan to, or held by itentered into any other transaction with, any of its directors or officers outside the ordinary course of business or other than at arm’s length; (g) except as required by applicable Law, adopted or materially amended any Union Plans; (h) hired or terminated any officers or employees of Union with fixed annual compensation in excess of $150,000, with respect to non-officer employees, other than in the ordinary course of business; (i) commenced or settled any Action in which the amount in dispute is in excess of $100,000; (j) made any material change in accounting principles, methods, procedures or policies, except as required by GAAP; (k) made, changed or revoked any material Tax election, or settled or compromised any material Tax claim or liabilities, or filed any substantially amended material Tax Return; (i) authorized, proposed, entered into or agreed to enter into any plan of liquidation, dissolution or other reorganization or (ii) authorized, proposed, entered into or agreed to enter into any merger, consolidation or business combination with any Person; (m) except in the ordinary course of business, incurred or discharged any Indebtedness; (n) made capital expenditures or capital additions or betterments in excess of $100,000 in the aggregate; (o) suffered any material damage, destruction or loss, whether or not covered by insurance; (p) sold, assigned, transferred, abandoned or permitted allowed to lapse or expire any Government Licenses whichmaterial Intellectual Property rights or other intangible assets owned, individually used or licensed by Union in connection with any product of Union or the aggregateoperation of its business; (q) been subject to any claim or threat of infringement, are material misappropriation or other violation by or against Union of Intellectual Property rights of Union or a third party; (r) materially reduced the amount of any insurance coverage provided by existing insurance policies; or (s) committed to the Business or any portion thereof, or do any of the Proprietary Rights or other intangible assets, or disclosed any material proprietary confidential information to any Person, except in the ordinary course of business consistent with past custom and practice, or granted any license or sublicense of any rights under or with respect to any Proprietary Rights; (iii) conducted its cash management customs and practices (including, without limitation, the collection of receivables, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practice; (iv) made any loans or advances to, or guarantees for the benefit of, or entered into any transaction with PDK or any of its other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer of any assets of placing a Lien on any assets) except on an arms-length basis in the ordinary course of business consistent with past custom and practice; (v) suffered any extraordinary loss, damage, destruction or casualty loss or waived any rights of material value, whether or not covered by insurance and whether or not in the ordinary course of business or consistent with past custom and practice; (vi) received notification, or become aware of facts which would lead a reasonable person to believe, that any material customer or supplier will stop or decrease in any material respect the rate of business done with the Business; (vii) become subject to any material liabilities, except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into in the ordinary course of business consistent with past custom and practice; (viii) settled or compromised any litigation involving equitable relief or involving any money damages in excess of $50,000; or (ix) entered into any other material transaction, other than in the ordinary course of business consistent with past custom and practiceforegoing. (b) No party has accelerated, terminated, modified or canceled any Assigned Contract.

Absence of Certain Developments. (a) Except as set forth in on the attached "Developments Schedule," DEVELOPMENTS SCHEDULE, since August December 31, 1998, Seller has conducted neither of the Business only Companies has: (a) issued any notes, bonds or other debt securities or any capital stock or other equity securities or any securities or rights convertible, exchangeable or exercisable into any capital stock or other equity securities; (b) borrowed any amount or incurred or become subject to any material liabilities, except commercial loan borrowing and current liabilities incurred in the ordinary course of business and consistent with past practice; (c) discharged or satisfied any material Lien or paid any material obligation or liability, other than current liabilities or commercial loan borrowings paid in the ordinary course of business; (d) declared, set aside or made any payment or distribution of cash (including so-called "tax distributions") or other property to any of its shareholders or partners with respect to such shareholder's capital stock or partner's partnership interests or otherwise, or purchased, redeemed or otherwise acquired any shares of its capital stock or other equity securities (including any warrants, options or other rights to acquire its capital stock or other equity); (e) mortgaged or pledged any of its properties or assets or subjected them to any Lien, except for Permitted Liens; (f) sold, assigned, transferred, leased, licensed or otherwise encumbered any of its tangible assets, except in the ordinary course of business consistent with past custom practice, or canceled any material debts or claims; (g) sold, assigned, transferred, leased, licensed or otherwise encumbered any Intellectual Property Rights, disclosed any proprietary confidential information to any Person (other than to Buyers and practice (including, without limitation, with respect to the offering of special sales or incentive programs or the filling of its distribution channels), has incurred no liabilities Affiliates and other than in the ordinary course of business consistent with past custom and practicepractice in circumstances in which it has imposed reasonable confidentiality restrictions), and Seller has not:or abandoned or permitted to lapse any Intellectual Property Rights; (ih) sold, assigned made or transferred granted any bonus or any wage or salary increase to any employee or group of its assets, except for sales employees (other than any wage or salary increase to any employee of inventory the Companies whose annual compensation is less than $50,000 in the ordinary course of business and consistent with past custom practice and practiceexcept as required by pre-existing contracts described on the attached CONTRACTS SCHEDULE), or mortgaged, pledged made or subjected them to granted any material Lien, except for Liens for current property Taxes not yet due and payableincrease in any employee benefit plan or arrangement, or canceled without fair consideration amended or terminated any material debts existing employee benefit plan or claims owing to arrangement or held by itadopted any new employee benefit plan or arrangement; (ii) sold, assigned, transferred, abandoned or permitted to lapse any Government Licenses which, individually or in the aggregate, are material to the Business or any portion thereof, or any of the Proprietary Rights or other intangible assets, or disclosed any material proprietary confidential information to any Person, except in the ordinary course of business consistent with past custom and practice, or granted any license or sublicense of any rights under or with respect to any Proprietary Rights; (iii) conducted its cash management customs and practices (including, without limitation, the collection of receivables, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practice; (iv) made any loans or advances to, or guarantees for the benefit of, or entered into any transaction with PDK or any of its other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer of any assets of placing a Lien on any assets) except on an arms-length basis in the ordinary course of business consistent with past custom and practice; (vi) suffered any extraordinary loss, damage, destruction or casualty loss losses or waived any rights of material value, whether or not covered by insurance and value (whether or not in the ordinary course of business or consistent with past custom and practice) in excess of $25,000 in the aggregate; (vij) received notification, made capital expenditures or become aware of facts which would lead a reasonable person commitments therefor that amount in the aggregate to believe, that any material customer or supplier will stop or decrease in any material respect the rate of business done with the Businessmore than $25,000; (viik) become subject delayed or postponed the payment of any accounts payable or commissions or any other liability or obligation or agreed or negotiated with any party to extend the payment date of any material liabilitiesaccounts payable or commissions or any other liability or obligation or accelerated the collection of (or discounted) any accounts or notes receivable; (l) made any loans or advances to, except current liabilities incurred in guaranties for the ordinary course of business and liabilities under contracts entered into benefit of, or any Investments in, any Person (other than advances to the Companies' employees in the ordinary course of business consistent with past custom and practice); (viiim) settled made any charitable contributions or compromised pledges exceeding in the aggregate $5,000 or made any litigation involving equitable relief or involving any money damages in excess of $50,000; orpolitical contributions; (ixn) suffered any damage, destruction or casualty loss exceeding in the aggregate $25,000, whether or not covered by insurance; (o) made any change in any method of accounting or accounting policies or made any write-down in the value of its inventory that is material or that is other than in the usual, regular and ordinary course of business consistent with past practice or reversed any accruals (whether or not in the ordinary course of business or consistent with past practice); (p) made any Investment in or taken any steps to incorporate any Subsidiary; (q) amended its articles of incorporation, by-laws or other organizational documents; (r) entered into any agreement or arrangement prohibiting or restricting it from freely engaging in any business or otherwise restricting the conduct of its business anywhere in the world; (s) taken any action or failed to take any action that has, had or would reasonably be expected to have the effect of accelerating to pre-Closing periods sales to the trade or other material transaction, customers that would otherwise be expected to occur after the Closing; (t) entered into any contract other than in the ordinary course of business consistent with past custom and practice., entered into any other material transaction, whether or not in the ordinary course of business or consistent with past practice, or materially changed any business practice; or (bu) No party has acceleratedagreed, terminatedwhether orally or in writing, modified or canceled to do any Assigned Contractof the foregoing.

Absence of Certain Developments. Since the date of the Latest Balance Sheet, there has not been any Material Adverse Effect. Except (a) Except as set forth on Schedule 2.07, and/or (b) as expressly contemplated by this Agreement, the business of the Company has been operated in the attached "Developments Schedule," since August 31, 1998, Seller has conducted the Business only all material respects in the ordinary course of business consistent with past custom practice. Except as set forth on Schedule 2.07 and practice except as expressly contemplated by this Agreement, since the date of the Latest Balance Sheet until the date of this Agreement, the Company has not: (includinga) borrowed any amount under existing credit lines, without limitation, with respect to the offering of special sales or incentive programs or the filling of its distribution channels), has incurred no liabilities other than except borrowings under such credit lines in the ordinary course of business consistent with past custom and practice, and Seller has not:; (ib) mortgaged, pledged or subjected to any Lien any of its material assets, except Permitted Liens; (c) sold, assigned leased, assigned, licensed or transferred any material asset or any material portion of its tangible assets, except for sales of inventory in the ordinary course of business consistent with past custom and practice, or mortgaged, pledged or subjected them to any material Lien, except for Liens for current property Taxes not yet due and payable, or canceled without fair consideration any material debts or claims owing to or held by it; (iid) sold, leased, assigned, transferredlicensed or transferred any Company Owned Intellectual Property, abandoned or permitted to lapse any Government Licenses which, individually or except in the aggregateordinary course of business consistent with past practice or pursuant to Contractual obligations in existence on the date hereof, which Contractual obligations are material listed on Schedule 2.11(a) to the Business extent that such Contractual obligations constitute Material Contracts; (e) issued, sold, transferred or otherwise encumbered any portion thereofof its capital stock or other equity securities, securities convertible into its capital stock or other equity securities or warrants, options or other rights to acquire its capital stock or other equity securities, or any bonds or debt securities; (f) declared, set aside or paid any dividend or distribution of the Proprietary Rights property to its equityholders or made any other intangible assetspayment to its equityholders, in each case other than cash or cash equivalents; (g) made any material capital investment in, or disclosed any material proprietary confidential information to loan to, any other Person, except in the ordinary course of business consistent with past custom and practicepractice or in accordance with its existing budget for capital expenditures provided to the Buyer, or granted failed to make any license or sublicense of any rights under or with respect to any Proprietary Rights; (iii) conducted its cash management customs and practices (including, without limitation, the collection of receivables, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than in the usual and ordinary course of business material capital investment consistent with past custom its existing budget for capital expenditures and practice; (iv) made any loans or advances to, or guarantees for the benefit of, or entered into any transaction with PDK or any of its other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer of any assets of placing a Lien on any assets) except on an arms-length basis in the ordinary course of business consistent with past custom and practice; (vh) suffered any extraordinary loss, damage, destruction or casualty loss or waived any rights of material value, whether or not covered by insurance and whether or not in the ordinary course of business or consistent with past custom and practice; (vi) received notification, or become aware of facts which would lead a reasonable person to believe, that made any material customer or supplier will stop or decrease changes in any material respect the rate of business done with the Business; (vii) become subject Employee Benefit Plan or made or promised to make any material liabilitieschanges in wages, except current liabilities incurred salary or other compensation with respect to its officers, directors or employees, in the ordinary course of business and liabilities under contracts entered into each case other than changes made in the ordinary course of business consistent with past custom and practicepractice or pursuant to existing agreements or arrangements or as required to comply with applicable Law; (viiii) settled made a material change in its accounting or compromised Tax methods, practices or policies; (j) canceled or waived any litigation involving equitable relief or involving any money damages rights in excess of $50,000; or100,000 or commenced or settled any litigation involving an amount in excess of $100,000 for any one case; (ixk) purchased or sold any real property or entered into any other material transaction, other than in a new lease for real property outside the ordinary course of business consistent with past custom and practice.; (bl) No party has accelerated, terminated, modified or amended in any material respect or canceled or terminated any Assigned Material Contract, other than any renewals or extensions thereof on the same terms and conditions, expirations thereof pursuant to the terms of such Material Contract, or otherwise in the ordinary course of business; or (m) committed to do any of the foregoing.

Absence of Certain Developments. Except as specifically disclosed in the 1996 Company Financial Statements (aincluding the notes thereto) Except or as set forth in Schedule 3.10, since September 30, 1996 there has not been any Material Adverse Change. Except as specifically disclosed in the attached "Developments Schedule," 1996 Company Financial Statements (including the notes thereto) or as set forth in Schedule 3.10, and except for this Agreement and the transactions contemplated hereby, since August 31September 30, 19981996, Seller each of the Company and its Subsidiaries has conducted the Business only its business in the ordinary and usual course of business consistent with past custom and practice (includingpractices. Without limiting the generality of the foregoing, without limitationexcept as set forth on Schedule 3.10 or as expressly contemplated by this Agreement, with respect to since September 30, 1996, none of the offering of special sales or incentive programs or the filling Company nor any of its distribution channels), has incurred no liabilities other than in the ordinary course of business consistent with past custom and practice, and Seller has notSubsidiaries has: (ia) sold, assigned or transferred any of its assets, except for sales of inventory in the ordinary course of business consistent with past custom and practice, or mortgaged, pledged or subjected them to experienced any material Lienadverse change in any relationship with its suppliers, except for Liens for current property Taxes not yet due and payablecustomers, distributors, brokers, lessors or canceled without fair consideration any material debts or claims owing to or held by it; (ii) soldothers, assigned, transferred, abandoned or permitted to lapse any Government Licenses which, individually or in the aggregate, are material to the Business or any portion thereof, or any of the Proprietary Rights or other intangible assets, or disclosed any material proprietary confidential information to any Person, except in the ordinary course of business consistent with past custom and practice, or granted any license or sublicense of any rights under or with respect to any Proprietary Rights; (iii) conducted its cash management customs and practices (including, without limitation, the collection of receivables, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practice; (iv) made any loans or advances to, or guarantees for the benefit of, or entered into any transaction with PDK or any of its other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer of any assets of placing a Lien on any assets) except on an arms-length basis changes in the ordinary course of business consistent with past custom and practice; (vb) suffered any extraordinary losssold, damageleased, destruction or casualty loss or waived any rights of material value, whether or not covered by insurance and whether or not in the ordinary course of business or consistent with past custom and practice; (vi) received notificationtransferred, or become aware assigned any of facts which would lead a reasonable person to believeits assets, that any material customer tangible or supplier will stop or decrease in any material respect the rate of business done with the Business; (vii) become subject to any material liabilitiesintangible, except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into other than for fair consideration in the ordinary course of business consistent with past custom and practice; (viii) settled or compromised any litigation involving equitable relief or involving any money damages in excess of $50,000; or (ixc) entered into any other material transactionagreement, contract, lease, or license (or series of related agreements, contracts, leases or licenses) involving more than $50,000 individually to which it is a party or by which it is bound nor modified the terms of any such existing contract or agreement, other than in the ordinary course of business consistent with past custom and practice.; (bd) No party engaged in any activity which has resulted in any delay of the collection of its accounts or notes receivables or any delay in the payment of its accounts payables, in each case other than in the ordinary course of business consistent with past custom and practice; (e) (nor has any other party) accelerated, terminated, modified or canceled cancelled any Assigned Contractpermit or agreement, contract, lease or license involving more than $50,000 individually to which it is a party or by which it is bound; (f) suffered any damage, destruction or loss, whether or not covered by insurance, affecting any material property or assets owned or used by it; (g) adopted, modified, amended or terminated any bonus, profit-sharing, incentive, severance, or other similar plan (including any Employee Benefit Plan), contract, or commitment for the benefit of any of its directors, officers, or employees, or otherwise made any change in the employment terms (including any increase in the base compensation) for any of its officers and employees described in Section 3.16(a)(i) which will, in each case, survive the Closing other than, in each case, in the ordinary course of business consistent with past custom and practice; (h) made any capital expenditure or any other investment (or series of related investments) in excess of $50,000 other than in the ordinary course of business consistent with past custom and practice; (i) issued any note, bond, or other debt security or created, incurred, assumed, or guaranteed any indebtedness for borrowed money involving more than $10,000 individually other than in the ordinary course of business consistent with past custom and practice; (j) cancelled, compromised, waived, or released any right or claim (or series of related rights and claims) either involving more than $50,000 or outside the ordinary course of business consistent with past custom and practice; (k) made or authorized any change in its articles of incorporation or by-laws; (l) issued, sold, or otherwise disposed of any of its capital stock, or granted, modified or amended any options, warrants, stock appreciation rights, or other rights to purchase or obtain (including upon conversion, exchange, or exercise) any of its capital stock or participate in any change in the value thereof; (m) made or been subject to any change in its accounting practices, procedures or methods or in its cash management practices; (n) entered into or become party to any agreement, arrangement or transaction with any of its Affiliates or any of their respective directors, officers, employees or stockholders, including, without limitation, any (i) loan or advance of funds, or made any other payments, to any of its directors, officers, employees, stockholders or Affiliates, (ii) creation or discharge of any intercompany account, other than, in each case, in the ordinary course of business consistent with past custom and practice, or (iii) any payment or declaration of any dividend, redemption or other distribution with respect to their respective capital stock which is not paid in cash in full prior to the Closing Date; (o) experienced any material adverse changes with respect to the Proprietary Rights; (p) experienced any material adverse changes in the amount or scope of coverage of insurance now carried by them; or (q) committed to do any of the foregoing.

Absence of Certain Developments. (a) Except (i) as required for Seller or Parent to comply with their obligations under this Agreement, (ii) as permitted by this Agreement or (iii) as set forth in the attached "Developments Schedule," since August December 31, 19981999, Seller --------------------- the Company has conducted the Business its business only in the ordinary course of business consistent with past custom and practice (including, without limitation, with respect to the offering of special sales sales, price or incentive programs or the filling of its distribution channelsprograms), has incurred no liabilities other than in the ordinary course of business consistent with past custom and practice, and Seller the Company has not: (i) suffered a Material Adverse Effect; (ii) discharged or satisfied any material Lien or encumbrance or paid any material obligation or liability or cancelled, compromised, waived or released any material right or claim other than (i) liabilities paid in the ordinary course of business and (ii) the release of the Bank Pledge; (iii) transferred any material portion of its production to another facility operated by Parent, any of its Affiliates or any third party (except for transfers to third-party subcontractors in the ordinary course of business); (iv) sold, assigned or transferred any of its assets, except for sales of inventory in the ordinary course of business consistent with past custom and practicebusiness, or mortgaged, pledged or subjected them to any material Lien, except for the Bank Pledge and except for Liens for current property Taxes not yet due and payable, or canceled without fair consideration cancelled out of the ordinary course of business any material debts or claims owing to or held by it; (iiv) sold, assigned, transferred, abandoned or permitted to lapse any Government Licenses which, individually or in the aggregate, which are material to the Business or any portion thereofCompany's business, or sold, assigned or transferred any of the Proprietary its Intellectual Property Rights or other intangible assetsassets on an exclusive basis, or disclosed any material proprietary confidential information to any Person, except in the ordinary course of business consistent with past custom and practice, or granted any exclusive license or sublicense of any rights under or with respect to any Proprietary Intellectual Property Rights; (iiivi) conducted its cash management customs made or granted any bonus or any wage or salary increase to any employee, officer or director, or made any other material change in employment terms for any employee, officer or director, other than scheduled bonuses under the Company's 13 month bonus plan or the Company's annual incentive bonus plan and practices increases in the ordinary course of business or reassigned or transferred (including, without limitation, by terminating and rehiring) any employee of the collection Company to Parent or any of receivables, payment of payables and maintenance of inventory control and pricing and credit practices its Affiliates (including, without limitation, extension of credit terms or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practiceCompany); (ivvii) made or granted any increase in, or amended or terminated, any existing plan, program, policy or arrangement, employee benefit plan or arrangement or adopted any new employee benefit plan or arrangement, or amended or renegotiated any existing collective bargaining agreement or entered into any new collective bargaining agreement or multiemployer plan; (viii) except for any such items included in the Company's 1999-2000 capital budget aggregating $14.8 million USD, made any capital expenditures or commitments therefor such that the aggregate outstanding amount of unpaid obligations and commitments with respect thereto shall comprise in excess of $50,000.00 USD on the Closing Date; (ix) made any loans or advances to, or guarantees for the benefit of, or entered into any transaction in excess of $50,000.00 USD with PDK or any of its other stockholders or any Affiliate, employee, officer or director of Seller or PDKthe Company, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer of any assets of or placing a Lien on any assets) except on an arms-length arms'-length basis in the ordinary course of business consistent with past custom and practicebusiness; (vx) suffered any material extraordinary loss, damage, destruction or casualty loss or waived any rights of material value, whether or not covered by insurance and whether or not in the ordinary course of business or consistent with past custom and practicebusiness; (vixi) received notification, or become aware of facts which would lead a reasonable person to believe, that written notification from any material customer or supplier that such supplier will stop or decrease in any material respect the rate of doing business done with the BusinessCompany or allocate its supply of materials or products to the Company; (viixii) become subject issued or sold or agreed to issue or sell any material liabilitiesnotes, bonds or other debt securities or any equity securities or any securities convertible, exchangeable or exercisable into any equity securities; (xiii) borrowed any amount, except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into business; (xiv) created, incurred, assumed or guaranteed any Indebtedness for Borrowed Money other than Indebtedness for Borrowed Money to be paid off at the Closing; (xv) purchased, redeemed or otherwise acquired any shares of its capital stock or any warrants, options or other rights to acquire such capital stock; (xvi) made any capital investment in, any loan to, or any acquisition of the securities or assets of any other Person (other than advances to employees of the Company for travel expenses in the ordinary course of business consistent with past custom and practicebusiness) or incorporated any Subsidiary; (viiixvii) amended or authorized the amendment of its articles of association or similar governing documents; or (xviii) settled or compromised any litigation involving equitable relief or involving any money damages for an amount in excess of $50,000; or (ix) entered into 50,000.00 USD or involving any injunctive relief or other material transaction, other than in the ordinary course form of business consistent with past custom and practiceequitable relief. (b) No party (including the Company) has accelerated, terminated, modified or canceled cancelled any Assigned ContractMaterial Contract required to be set forth on the attached "Contracts Schedule." ------------------

Absence of Certain Developments. (a) Except (i) as required for Seller or Parent to comply with their obligations under this Agreement, (ii) as permitted by this Agreement or (iii) as set forth in the attached "“Developments Schedule," ” since August December 31, 19981999, Seller the Company has conducted the Business its business only in the ordinary course of business consistent with past custom and practice (including, without limitation, with respect to the offering of special sales sales, price or incentive programs or the filling of its distribution channelsprograms), has incurred no liabilities other than in the ordinary course of business consistent with past custom and practice, and Seller the Company has not: (i) suffered a Material Adverse Effect; (ii) discharged or satisfied any material Lien or encumbrance or paid any material obligation or liability or cancelled, compromised, waived or released any material right or claim other than (i) liabilities paid in the ordinary course of business and (ii) the release of the Bank Pledge; (iii) transferred any material portion of its production to another facility operated by Parent, any of its Affiliates or any third party (except for transfers to third-party subcontractors in the ordinary course of business); (iv) sold, assigned or transferred any of its assets, except for sales of inventory in the ordinary course of business consistent with past custom and practicebusiness, or mortgaged, pledged or subjected them to any material Lien, except for the Bank Pledge and except for Liens for current property Taxes not yet due and payable, or canceled without fair consideration cancelled out of the ordinary course of business any material debts or claims owing to or held by it; (iiv) sold, assigned, transferred, abandoned or permitted to lapse any Government Licenses which, individually or in the aggregate, which are material to the Business or any portion thereofCompany’s business, or sold, assigned or transferred any of the Proprietary its Intellectual Property Rights or other intangible assetsassets on an exclusive basis, or disclosed any material proprietary confidential information to any Person, except in the ordinary course of business consistent with past custom and practice, or granted any exclusive license or sublicense of any rights under or with respect to any Proprietary Intellectual Property Rights; (iiivi) conducted its cash management customs made or granted any bonus or any wage or salary increase to any employee, officer or director, or made any other material change in employment terms for any employee, officer or director, other than scheduled bonuses under the Company’s 13 month bonus plan or the Company’s annual incentive bonus plan and practices increases in the ordinary course of business or reassigned or transferred (including, without limitation, by terminating and rehiring) any employee of the collection Company to Parent or any of receivables, payment of payables and maintenance of inventory control and pricing and credit practices its Affiliates (including, without limitation, extension of credit terms or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practiceCompany); (ivvii) made or granted any increase in, or amended or terminated, any existing plan, program, policy or arrangement, employee benefit plan or arrangement or adopted any new employee benefit plan or arrangement, or amended or renegotiated any existing collective bargaining agreement or entered into any new collective bargaining agreement or multiemployer plan; (viii) except for any such items included in the Company’s 1999-2000 capital budget aggregating $14.8 million USD, made any capital expenditures or commitments therefor such that the aggregate outstanding amount of unpaid obligations and commitments with respect thereto shall comprise in excess of $50,000.00 USD on the Closing Date; (ix) made any loans or advances to, or guarantees for the benefit of, or entered into any transaction in excess of $50,000.00 USD with PDK or any of its other stockholders or any Affiliate, employee, officer or director of Seller or PDKthe Company, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer of any assets of or placing a Lien on any assets) except on an arms-length arms’-length basis in the ordinary course of business consistent with past custom and practicebusiness; (vx) suffered any material extraordinary loss, damage, destruction or casualty loss or waived any rights of material value, whether or not covered by insurance and whether or not in the ordinary course of business or consistent with past custom and practicebusiness; (vixi) received notification, or become aware of facts which would lead a reasonable person to believe, that written notification from any material customer or supplier that such supplier will stop or decrease in any material respect the rate of doing business done with the BusinessCompany or allocate its supply of materials or products to the Company; (viixii) become subject issued or sold or agreed to issue or sell any material liabilitiesnotes, bonds or other debt securities or any equity securities or any securities convertible, exchangeable or exercisable into any equity securities; (xiii) borrowed any amount, except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into business; (xiv) created, incurred, assumed or guaranteed any Indebtedness for Borrowed Money other than Indebtedness for Borrowed Money to be paid off at the Closing; (xv) purchased, redeemed or otherwise acquired any shares of its capital stock or any warrants, options or other rights to acquire such capital stock; (xvi) made any capital investment in, any loan to, or any acquisition of the securities or assets of any other Person (other than advances to employees of the Company for travel expenses in the ordinary course of business consistent with past custom and practicebusiness) or incorporated any Subsidiary; (viiixvii) amended or authorized the amendment of its articles of association or similar governing documents; or (xviii) settled or compromised any litigation involving equitable relief or involving any money damages for an amount in excess of $50,000; or (ix) entered into 50,000.00 USD or involving any injunctive relief or other material transaction, other than in the ordinary course form of business consistent with past custom and practiceequitable relief. (b) No party (including the Company) has accelerated, terminated, modified or canceled cancelled any Assigned ContractMaterial Contract required to be set forth on the attached “Contracts Schedule.”

Absence of Certain Developments. (a) Except as set forth on the attached Developments Schedule, since December 31, 2004, there has been no change, effect, circumstance, development, event or occurrence which has had or would, individually or in the attached "aggregate, reasonably be expect to have a Material Adverse Effect. Except as set forth on the Developments Schedule," Schedule and except as expressly contemplated by this Agreement, since August December 31, 19982004, Seller neither the Company nor any of its Subsidiaries has conducted the Business only engaged in any material transaction that was not in the ordinary course of business consistent with past custom practice. Without limiting the generality of the foregoing, and practice except as set forth on the Developments Schedule and except as expressly contemplated by this Agreement, since December 31, 2004, neither the Company nor any of its Subsidiaries has: (includinga) amended or modified its articles of incorporation or bylaws; (b) issued, without limitationredeemed, repurchased or sold any of its capital stock or any options, warrants, convertible or exchangeable securities, subscriptions, rights, stock appreciation rights, calls or commitment of any kind with respect to the offering of special sales or incentive programs or the filling of its distribution channels), has incurred no liabilities other than in the ordinary course of business consistent with past custom and practice, and Seller has not:capital stock; (c) (i) soldentered into, assigned amended or transferred modified any of its assetsemployment agreement, except for sales of inventory in the ordinary course of business consistent with past custom and practice, or mortgaged, pledged or subjected them to any material Lien, except for Liens for current property Taxes not yet due and payable, or canceled without fair consideration any material debts or claims owing to or held by it; (ii) sold, assigned, transferred, abandoned or permitted to lapse any Government Licenses which, individually or in the aggregate, are material to the Business or any portion thereof, or any of the Proprietary Rights deferred compensation or other intangible assets, or disclosed any material proprietary confidential information to any Person, except in the ordinary course of business consistent with past custom and practice, or granted any license or sublicense of any rights under or with respect to any Proprietary Rights; (iii) conducted its cash management customs and practices (including, without limitation, the collection of receivables, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practice; (iv) made any loans or advances to, or guarantees similar agreement which provides for the benefit of, or entered into any transaction with PDK or any of its other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer of any assets of placing a Lien on any assets) except on an arms-length basis in the ordinary course of business consistent with past custom and practice; (v) suffered any extraordinary loss, damage, destruction or casualty loss or waived any rights of material value, whether or not covered by insurance and whether or not in the ordinary course of business or consistent with past custom and practice; (vi) received notification, or become aware of facts which would lead a reasonable person to believe, that any material customer or supplier will stop or decrease in any material respect the rate of business done with the Business; (vii) become subject to any material liabilities, except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into in the ordinary course of business consistent with past custom and practice; (viii) settled or compromised any litigation involving equitable relief or involving any money damages annual base compensation in excess of $50,000; or 85,000.00, (ixii) entered into increased compensation, bonus or other benefits payable to Employees (including without limitation payments or benefits under any other material transactionexisting severance or termination pay policies or Employee Agreements), in the case of (ii), other than in the ordinary course of business consistent with past custom and practice.practice or required pursuant to any collective bargaining agreement or other contract; (bd) No party has acceleratedentered into any contract or other agreement with any labor union; (e) declared, terminatedset aside, modified paid or canceled made any Assigned Contractdistribution or payment to its stockholders with respect to its capital stock; (f) adopted a plan of liquidation, dissolution, merger, consolidation or other reorganization; (g) made any change in its accounting methods, principles or practices, other than such changes required by a change in GAAP, or changed the independent public accountants of the Company and its Subsidiaries; (h) made any loan or advance to any of its officers, directors, employees or consultants (other than in the ordinary course of business consistent with past practice) or made any other loan or advance; (i) made any commitment to pay severance, change in control or termination pay or benefits to any of its officers, directors, employees or consultants; (j) made any capital expenditures in excess of $200,000.00 in any one case or $1,000,000.00 in the aggregate; (k) incurred any indebtedness for borrowed money (other than indebtedness that will be Funded Indebtedness at the time of Closing) or entered into any guarantee with respect to any indebtedness for borrowed money; (l) made any acquisition of an equity interest in, or all or any material part of the assets, properties, or business of any other Person, other than purchases of inventory in the ordinary course of business consistent with past practice; (m) sold, assigned, licensed, transferred, leased or otherwise disposed of material assets except for the sale of inventory in the ordinary course of business consistent with past practice; (n) changed any method of Tax accounting, made or changed any Tax election, filed any Tax Return other than in a manner consistent with past practice, filed any material amended Tax Return or material claim for Tax refund, filed any ruling request or entered into any closing agreement or similar agreement with respect to Taxes or settled any audit, examination or other claim for Taxes; or (o) committed to do any of the foregoing.

Absence of Certain Developments. Since the date of the Latest Balance Sheet, there has not been any Material Adverse Change. Without limiting the generality of the foregoing, except as set forth on the attached Developments Schedule and except as expressly contemplated by this Agreement, 33 since the date of the Latest Balance Sheet, neither the Company nor any Subsidiary has: (a) Except as set forth in the attached "Developments Schedule," since August 31borrowed any amount or incurred, 1998assumed, Seller has conducted the Business only guaranteed or become subject to any liabilities (other than liabilities incurred in the ordinary course of business consistent with past custom and practice (including, without limitation, with respect to the offering of special sales or incentive programs or the filling of its distribution channels), has incurred no liabilities other than in the ordinary course of business consistent with past custom and practice, and Seller has not: (i) sold, assigned or transferred any of its assets, except for sales of inventory in the ordinary course of business consistent with past custom and practice, or mortgaged, pledged or subjected them to any material Lien, except for Liens for current property Taxes not yet due and payable, or canceled without fair consideration any material debts or claims owing to or held by it; (ii) sold, assigned, transferred, abandoned or permitted to lapse any Government Licenses which, individually or in the aggregate, are material to the Business or any portion thereof, or any of the Proprietary Rights or other intangible assets, or disclosed any material proprietary confidential information to any Person, except in the ordinary course of business consistent with past custom and practice, or granted any license or sublicense of any rights under or with respect to any Proprietary Rights; (iii) conducted its cash management customs and practices (including, without limitation, the collection of receivables, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practice; (iv) made any loans or advances to, or guarantees for the benefit of, or entered into any transaction with PDK or any of its other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer of any assets of placing a Lien on any assets) except on an arms-length basis in the ordinary course of business consistent with past custom and practice; (v) suffered any extraordinary loss, damage, destruction or casualty loss or waived any rights of material value, whether or not covered by insurance and whether or not in the ordinary course of business or consistent with past custom and practice; (vi) received notification, or become aware of facts which would lead a reasonable person to believe, that any material customer or supplier will stop or decrease in any material respect the rate of business done with the Business; (vii) become subject to any material liabilities, except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into in the ordinary course of business consistent with past custom practice and borrowings from banks (or similar financial institutions) necessary to meet ordinary course working capital requirements consistent with past practice); (viiib) settled mortgaged, pledged or compromised subjected to any litigation involving equitable relief or involving Lien any money damages in excess portion of $50,000; orits assets, except Permitted Liens; (ixc) entered into sold, leased, assigned or transferred any other material transactionportion of its assets, other than tangible or intangible, except in the ordinary course of business consistent with past custom and practice.; (bd) No party has accelerated, terminated, modified terminated or canceled any Assigned Contract.agreement, contract, lease or license that either is listed on the Contracts Schedule or would be required to be listed on the Contracts Schedule if such agreement, contract, lease or license had not been terminated or canceled; (e) sold, assigned, granted or transferred any Intellectual Property, or granted a license or sublicense to any rights thereunder or with respect thereto to a third party, except in the ordinary course of business consistent with past practice; (f) suffered any extraordinary losses or waived any rights of material value; (g) made any capital investment in, or any material loan to, any other Person outside the ordinary course of business consistent with past practice; (h) made or authorized any change to its charter or bylaws; (i) issued, sold or transferred any of its capital stock or other equity securities, securities convertible into its capital stock or other equity securities or warrants, options or other rights to acquire its capital stock or other equity securities, or any bonds or debt securities; (j) declared, set aside, or paid any dividend or made any distribution with respect to its capital stock (whether in cash or in kind) or redeemed, purchased, or otherwise acquired any of its capital stock, except for dividends or distributions made by Subsidiaries to their respective parents in the ordinary course of business consistent with past practice;

Absence of Certain Developments. (a) Except as set forth in on Schedule 4.16 and actions taken to effect the attached "Developments Schedule," since August 31transactions contemplated by this Agreement and any other Transaction Documents (including the Restructuring), 1998from January 26, Seller 2017 through the Agreement Date, (i) there has conducted not been any Material Adverse Effect, (ii) the Business only has been conducted in the ordinary course of business consistent with past custom practice in all material respects, and practice (includingiii) none of Seller, without limitationany Other Seller or any Purchased Entity has taken any of the following actions or entered into any agreement to do any of the following (nor has any of the following occurred): (a) amended or modified the Organizational Documents of any Purchased Entity; (b) transferred, sold, leased, licensed or otherwise conveyed or disposed of, abandoned or allowed to lapse (other than at the expiration by its non-extendable and non-renewable term), or subjected to any Lien (other than, with respect to the offering of special sales or incentive programs or the filling of its distribution channelsPurchased Assets, Permitted Liens), has incurred no liabilities other than in the ordinary course of business consistent with past custom and practice, and Seller has not: (ix) sold, assigned or transferred any of its assetsthe Purchased Shares or (y) the Purchased Assets (or assets or property which would have been Purchased Assets, except but for sales of inventory such transfer or disposition), in the ordinary course of business consistent with past custom and practice, or mortgaged, pledged or subjected them to any material Lien, except for Liens for current property Taxes not yet due and payable, or canceled without fair consideration any material debts or claims owing to or held by it; (ii) sold, assigned, transferred, abandoned or permitted to lapse any Government Licenses whicheach case, individually or in the aggregate, are material to the Business or any portion thereofBusiness, or any assets of Seller or its Subsidiaries that would be material to the Proprietary Rights applicable Purchased Entity’s rights under the Transaction Documents or subject to the IPMA, in each case, other intangible assetsthan (A) Ordinary Course Outbound Licenses, (B) sales or disclosed any material proprietary confidential information to any Person, except dispositions of obsolete or inoperable Purchased Assets in the ordinary course of business consistent with past custom and practicebusiness, or granted (C) other than with respect to material Intellectual Property Rights, any transfer, sale, lease, license or sublicense other transfers, sales, leases, licenses, conveyances and dispositions made in the ordinary course of business; (c) changed, modified or issued any capital stock or other equity interests (including for any restricted stock, restricted stock unit, performance stock unit, phantom stock, stock appreciation rights, rights to share in the profits or distributions or other similar rights), voting interest or securities convertible into or exchangeable or exercisable for, or subscriptions, rights or options with respect to, or warrants to purchase, or other similar agreements or commitments relating to, the capital stock or other equity interests or voting interest of any rights under Purchased Entity or authorized any of the foregoing; (d) (x) with respect to any Proprietary RightsPurchased Entity, declared, set aside, or paid any dividend or other distribution other than to the extent paid in full in cash prior to the Closing; or (y) redeemed, purchased or otherwise acquired any outstanding shares of any capital stock or other equity interest of any Purchased Entity, other than to the extent paid in full in cash prior to the Closing; (iiie) conducted with respect to any Purchased Entity, adopted a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other reorganization under local Law; (f) has made, changed or revoked any material Tax election, elected or changed any method of accounting for Tax purposes, changed any annual Tax accounting period, settled any audit, assessment, dispute, proceeding or investigation in respect of a material amount of Taxes, surrendered any right to claim a material Tax refund, relief or credit, filed any amended Tax Return, entered into or amended any Tax Sharing Agreement, initiated any voluntary disclosure to any Taxing Authority, entered into any contractual obligation in respect of Taxes with any Governmental Authority, settled or compromised any Tax claim or assessment, consented to any extension or waiver of the limitation period applicable to any Tax claim or assessment (other than customary extensions of time to file), or taken or omitted to take any other action, if any such action or omission would have the effect of increasing the Tax liability (or reducing any Tax Asset) of any Purchased Entity or for which Buyer or any of its cash management customs and practices Subsidiaries would be responsible, or would otherwise acquire pursuant to this Agreement, where “Tax Asset” shall mean any net operating loss, net capital loss, investment Tax credit, or any other credit or Tax attribute which could reduce Taxes (including, without limitation, deductions and credits related to alternative minimum Taxes), in each case with respect to any Purchased Entity, as would (a) reasonably be expected to have a continuing impact on any Purchased Entity following the collection Closing Date that would be material to the Business or (b) be a Purchased Asset or Assumed Liability that would be material or as would reasonably be expected to materially increase any Tax Liability (or materially decrease any Tax benefit) of receivables, payment of payables the Business or Buyer and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than in its Subsidiaries following the usual and ordinary course of business consistent with past custom and practiceClosing; (ivg) made any loans or advances to, or guarantees for the benefit suffered material destruction of, damage to or entered into any transaction with PDK or any of its other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer loss of any material assets of placing a Lien on any assets) except on an arms-length basis in the ordinary course of business consistent with past custom and practice; Business (v) suffered any extraordinary loss, damage, destruction or casualty loss or waived any rights of material value, whether or not covered by insurance and whether insurance), or not in the ordinary course loss of any material business or consistent with past custom and practice; (vi) received notification, or become aware customer of facts which would lead a reasonable person to believe, that any material customer or supplier will stop or decrease in any material respect the rate of business done with the Business; (vii) become subject to any material liabilities, except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into in the ordinary course of business consistent with past custom and practice; (viii) settled or compromised any litigation involving equitable relief or involving any money damages in excess of $50,000; or (ixh) entered into acquired or agreed to acquire by merging or consolidating with, or by purchasing any other equity interest in or material transactionportion of the assets of, other than in the ordinary course of any business consistent with past custom and practiceor Person or division thereof. (b) No party has accelerated, terminated, modified or canceled any Assigned Contract.

Absence of Certain Developments. (a) Except as set forth in on the attached "Developments Schedule," , since August 31November 30, 19982004, Seller the Company has conducted the Business only not: (a) issued any notes, bonds or other debt securities or any equity securities or any securities or rights convertible, exchangeable or exercisable into any capital stock or other equity securities; (b) incurred any Indebtedness or become subject to any material Liabilities, except current Liabilities and Floorplan Indebtedness incurred in the ordinary course of business consistent with past custom and practice practice; (includingc) discharged or satisfied any material Lien or paid any material obligation or Liability, without limitation, with respect to the offering of special sales or incentive programs or the filling of its distribution channels), has incurred no liabilities other than in the ordinary course of business consistent with past custom and practice, and Seller has not:; (id) solddeclared, assigned set aside or transferred made any payment, loan, advance, or distribution of cash (including so-called “tax distributions”) or other property to any of its assets, except for sales of inventory in the ordinary course of business consistent stockholders with past custom and practicerespect to such stock or otherwise, or mortgagedpurchased, redeemed or otherwise acquired any of its capital stock (including any warrants, options or other rights to acquire its capital stock); (e) mortgaged or pledged any of its properties or assets or subjected them to any material Lien, except for Liens for current property Taxes not yet due and payable, or canceled without fair consideration any material debts or claims owing to or held by itPermitted Liens; (iif) sold, assigned, transferred, abandoned leased, licensed or permitted to lapse any Government Licenses which, individually or in the aggregate, are material to the Business or any portion thereof, or otherwise encumbered any of the Proprietary Rights or other intangible assets, or disclosed any its material proprietary confidential information to any Persontangible assets used in its current business operations, except in the ordinary course of business consistent with past custom and practice, or granted any license or sublicense of any rights under or with respect to any Proprietary Rights; (iii) conducted its cash management customs and practices (including, without limitation, the collection of receivables, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practice; (ivg) made sold, assigned, transferred, leased, licensed or otherwise encumbered any loans or advances to, or guarantees for the benefit of, or entered into any transaction with PDK or any of its material Intellectual Property other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer of any assets of placing a Lien on any assets) except on an arms-length basis than in the ordinary course of business consistent with past custom and practicepractice or abandoned or permitted to lapse any material Intellectual Property; (vh) made or granted any bonus or any wage or salary increase to any employee or group of employees (except for general increases consistent with past practice or as required by pre-existing contracts described on the attached Contracts Schedule); (i) implemented any plant closing or other layoff of employees that, without additional plant closings, layoffs, or terminations of employment after Closing, violates the Worker Adjustment and Retraining Notification Act, as amended, or any similar foreign, state or local law, regulation or ordinance (collectively, the “WARN Act”); (j) suffered any extraordinary loss, damage, destruction or casualty loss or waived any rights of material value, whether or not covered by insurance and losses (whether or not in the ordinary course of business or consistent with past custom and practice) in excess of $50,000 in the aggregate; (vik) received notification, made any capital expenditure or become aware of facts which would lead a reasonable person commitments therefor that amount in the aggregate to believe, that any material customer or supplier will stop or decrease in any material respect the rate of business done with the Businessmore than $50,000; (viil) become subject made any loans or advances to, guaranties for the benefit of, or any Investments in, any Person (other than advances to any material liabilities, except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into employees in the ordinary course of business consistent with past custom and practice); (viiim) settled made any charitable contributions or compromised pledges exceeding in the aggregate $10,000 or made any litigation involving equitable relief or involving any money damages in excess of $50,000; orpolitical contributions; (ixn) entered into suffered any other damage, destruction or casualty loss exceeding in the aggregate $10,000, whether or not covered by insurance; (o) except as reflected in the attached Financial Statements Schedule, made any change in any method of accounting or accounting policies or made any write-down in the value of its inventory or accounts receivable that is material transaction, or that is other than in the usual, regular and ordinary course of business consistent with past custom and practice or reversed any accruals except in the ordinary course of business or consistent with past practice.; (bp) No party has accelerated, terminated, modified made any Investment in any other Person; (q) taken any steps to form any Subsidiary; (r) amended its constituent documents; (s) entered into any agreement or canceled arrangement prohibiting it from freely engaging in business in any Assigned Contractjurisdiction in the world; or (t) entered into any binding agreement to do any of the foregoing.

Absence of Certain Developments. (a) Except as set forth in the attached "Developments Schedule," since August Since December 31, 1998, Seller there has conducted been: (a) no material adverse change in the Business only condition or reasonably foreseeable prospects (financial or otherwise) of the Borrower or its subsidiaries and affiliates or in the assets, liabilities, properties or business of the Borrower or its subsidiaries and affiliates; (b) no declaration, setting aside or payment of any dividend or other distribution with respect to, or any direct or indirect redemption or acquisition of, any ownership interest in the Borrower or its subsidiaries and affiliates; (c) no waiver of any valuable right of the Borrower or its subsidiaries and affiliates or cancellation of any material debt or claim held by the Borrower or its subsidiaries and affiliates; (d) no material loan by the Borrower or its subsidiaries and affiliates to any officer, director, employee or shareholder of the Borrower or its subsidiaries and affiliates, or any agreement or commitment therefor; (e) no increase, direct or indirect, in the compensation paid or payable to any officer, director, employee, agent or shareholder of the Borrower or its subsidiaries and affiliates (other than salary increases in the ordinary course of business consistent with past custom practice); (f) no material loss, destruction or damage to any property of the Borrower or its subsidiaries and practice affiliates, whether or not insured; (includingg) no labor trouble involving the Borrower or its subsidiaries and affiliates and no material change in the senior management or other key personnel of the Borrower or its subsidiaries and affiliates, without limitation, with respect to the offering of special sales or incentive programs or the filling terms and conditions of its distribution channels), has incurred no liabilities other than in the ordinary course of business consistent with past custom and practicetheir employment, and Seller has not: (ih) sold, assigned or transferred any of its assets, except for sales of inventory in the ordinary course of business consistent with past custom and practice, or mortgaged, pledged or subjected them to any material Lien, except for Liens for current property Taxes not yet due and payable, or canceled without fair consideration any material debts or claims owing to or held by it; (ii) sold, assigned, transferred, abandoned or permitted to lapse any Government Licenses which, individually or in the aggregate, are material to the Business or any portion thereof, or any of the Proprietary Rights or other intangible assets, or disclosed any material proprietary confidential information to any Person, except in the ordinary course of business consistent with past custom and practice, or granted any license or sublicense of any rights under or with respect to any Proprietary Rights; (iii) conducted its cash management customs and practices (including, without limitation, the collection of receivables, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practice; (iv) made any loans or advances to, or guarantees for the benefit of, or entered into any transaction with PDK or any of its other stockholders or any employee, officer or director of Seller or PDK, except for the transactions as contemplated by this Agreement and for advances consistent with past custom and practice made or otherwise disclosed to Seller's employeesthe Lenders in writing prior to the date hereof, officers and directors for travel expenses incurred in the ordinary course of business no acquisition or entered into any transaction, arrangement or contract (including, without limitation, any transfer disposition of any assets of placing a Lien on (or any assets) except on an arms-length basis in the ordinary course of business consistent with past custom and practice; (v) suffered any extraordinary losscontract or arrangement therefor), damage, destruction time brokerage or casualty loss or waived any rights of material value, whether or not covered by insurance and whether or not in the ordinary course of business or consistent with past custom and practice; (vi) received notification, or become aware of facts which would lead a reasonable person to believe, that any material customer or supplier will stop or decrease in any material respect the rate of business done with the Business; (vii) become subject to any material liabilities, except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into in the ordinary course of business consistent with past custom and practice; (viii) settled or compromised any litigation involving equitable relief or involving any money damages in excess of $50,000; local marketing agreement or (ix) entered into any other material transaction, other than in the ordinary course of business consistent with past custom and practice. (b) No party has accelerated, terminated, modified or canceled any Assigned Contract.

Absence of Certain Developments. (a) Except as set forth disclosed in the attached "Developments Schedule," Company Financial Statements or as otherwise contemplated by this Agreement, since August 31the Latest Company Balance Sheet, 1998, Seller the Company has conducted the Business its business only in the ordinary course of business consistent with past custom practice and practice there has not occurred (includinga) any event having a Material Adverse Effect on the Company or likely to have a Material Adverse Effect on the Surviving Company, (b) any event that would reasonably be expected to prevent or materially delay the performance of the Company’s obligations pursuant to this Agreement, (c) any material change by the Company in its accounting methods, principles or practices, (d) any declaration, setting aside or payment of any dividend or distribution in respect of the shares of capital stock of the Company or any redemption, purchase or other acquisition of any of the Company’s securities, (e) any increase in the compensation or benefits or establishment of any bonus, insurance, severance, deferred compensation, pension, retirement, profit sharing, option (including without limitationlimitation the granting of options, appreciation rights, performance awards or restricted membership interest awards), membership-interest purchase or other employee benefit plan of the Company, or any other increase in the compensation payable or to become payable to any employees, managers, officers, consultants, directors or governors of the Company, (f) other than issuances of options pursuant to duly adopted option plans, any issuance, grant or sale of any stock, options, warrants, notes, bonds or other securities, or entry into any agreement with respect thereto by the Company, (g) any amendment to the offering Company’s articles of special sales organization, member control agreement or incentive programs or the filling of its distribution channels)bylaws, has incurred no liabilities (h) other than in the ordinary course of business consistent with past custom and practice, any (1) purchase, sale, assignment or transfer of any material assets by the Company, (2) mortgage, pledge or existence of any lien, encumbrance or charge on any material assets or properties, tangible or intangible, of the Company, except for liens for taxes not yet due and Seller has not: such other liens, encumbrances or charges which, individually or in the aggregate, do not have a Material Adverse Effect on the Company and would not have a Material Adverse Effect on the Surviving Company, or (3) cancellation, compromise, release or waiver by the Company of any rights of material value or any material debts or claims, (i) sold, assigned any incurrence by the Company of any material liability (absolute or transferred any of its assetscontingent), except for sales of inventory current liabilities and obligations incurred in the ordinary course of business consistent with past custom and practice, or mortgaged, pledged or subjected them to any material Lien, except for Liens for current property Taxes not yet due and payable, or canceled without fair consideration any material debts or claims owing to or held by it; (iij) sold, assigned, transferred, abandoned or permitted to lapse any Government Licenses which, individually or in the aggregate, are material to the Business or any portion thereof, or any of the Proprietary Rights or other intangible assets, or disclosed any material proprietary confidential information to any Person, except in the ordinary course of business consistent with past custom and practice, or granted any license or sublicense of any rights under or with respect to any Proprietary Rights; (iii) conducted its cash management customs and practices (including, without limitation, the collection of receivables, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practice; (iv) made any loans or advances to, or guarantees for the benefit of, or entered into any transaction with PDK or any of its other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer of any assets of placing a Lien on any assets) except on an arms-length basis in the ordinary course of business consistent with past custom and practice; (v) suffered any extraordinary loss, damage, destruction or casualty loss or waived any rights of material valuesimilar loss, whether or not covered by insurance and whether or not in insurance, materially affecting the ordinary course of business or consistent with past custom and practice; properties of the Company, (vik) received notification, or become aware of facts which would lead a reasonable person to believe, that any material customer or supplier will stop or decrease in any material respect the rate of business done with the Business; (vii) become subject to any material liabilities, except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into in the ordinary course of business consistent with past custom and practice; (viii) settled or compromised any litigation involving equitable relief or involving any money damages in excess of $50,000; or (ix) entered entry into any other material transactionagreement, contract, lease or license other than in the ordinary course of business consistent with past custom and practice, (l) any acceleration, termination, modification or cancellation of any agreement, contract, lease or license to which the Company is a party or by which it is bound, (m) entry by the Company into any loan or other transaction with any officers, managers, directors, governors or employees of the Company, (n) entry by the Company into any transaction of a material nature other than in the ordinary course of business consistent with past practice, or (o) any negotiation or agreement by the Company to do any of the things described in the preceding clauses (a) through (o). (b) No party has accelerated, terminated, modified or canceled any Assigned Contract.

Absence of Certain Developments. (a) Except as set forth disclosed in the attached "Developments Schedule," Company SEC Filings or as otherwise contemplated by this Agreement, since August 31the date of the Company Latest Balance Sheet, 1998, Seller the Company has conducted its business only in the Business only ordinary course consistent with past practice and there has not occurred or been entered into, as the case may be: (i) any event having a Material Adverse Effect on the Company, (ii) any event that would reasonably be expected to prevent or materially delay the performance of the Company’s obligations pursuant to this Agreement, (iii) any material change by the Company in its accounting methods, principles or practices, (iv) any declaration, setting aside or payment of any dividend or distribution in respect of the shares of capital stock of the Company or any redemption, purchase or other acquisition of any of the Company’s securities, other than the special dividend referred to in Section 6.2(g), (v) any increase in the compensation or benefits payable or to become payable to any officers or directors of the Company or establishment or modification of any Compensatory Plan, (vi) any issuance, grant or sale of any stock, options, warrants, notes, bonds or other securities, or entry into any agreement with respect thereto by the Company, (vii) any amendment to the certificate of incorporation or bylaws of the Company, other than the Company Charter Amendments, (viii) any (w) capital expenditures by the Company, (x) purchase, sale, assignment or transfer of any material assets by the Company, (y) mortgage, pledge or existence of any lien, encumbrance or charge on any material assets or properties, tangible or intangible, of the Company, except for liens for Taxes not yet due, or (z) cancellation, compromise, release or waiver by the Company of any rights of material value or any material debts or claims, (ix) any incurrence by the Company of any material liability (absolute or contingent), except for current liabilities and obligations incurred in the ordinary course of business consistent with past custom and practice (including, without limitation, with respect to the offering of special sales or incentive programs or the filling of its distribution channels), has incurred no which liabilities other than in the ordinary course of business consistent with past custom and practice, and Seller has not: (i) sold, assigned or transferred any of its assets, except for sales of inventory in the ordinary course of business consistent with past custom and practice, or mortgaged, pledged or subjected them to any material Lien, except for Liens for current property Taxes are not yet due and payable, or canceled without fair consideration any material debts or claims owing to or held by it; (ii) sold, assigned, transferred, abandoned or permitted to lapse any Government Licenses whichmaterial, individually or in the aggregate, are material and will have been paid, discharged and satisfied at or prior to the Business or any portion thereofClosing), or any of the Proprietary Rights or other intangible assets, or disclosed any material proprietary confidential information to any Person, except in the ordinary course of business consistent with past custom and practice, or granted any license or sublicense of any rights under or with respect to any Proprietary Rights; (iiix) conducted its cash management customs and practices (including, without limitation, the collection of receivables, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practice; (iv) made any loans or advances to, or guarantees for the benefit of, or entered into any transaction with PDK or any of its other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer of any assets of placing a Lien on any assets) except on an arms-length basis in the ordinary course of business consistent with past custom and practice; (v) suffered any extraordinary loss, damage, destruction or casualty loss or waived any rights of material valuesimilar loss, whether or not covered by insurance and whether or not in insurance, materially affecting the ordinary course of business or consistent with past custom and practice; properties of the Company, (vixi) received notification, or become aware of facts which would lead a reasonable person to believe, that any material customer or supplier will stop or decrease in any material respect entry by the rate of business done with the Business; (vii) become subject to any material liabilities, except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into in the ordinary course of business consistent with past custom and practice; (viii) settled or compromised any litigation involving equitable relief or involving any money damages in excess of $50,000; or (ix) entered Company into any other material transactionagreement, contract, lease or license, other than the Original Term Sheet, Escrow Agreement No. 1, the Amended and Restated Term Sheet and Escrow Agreement No. 2, (xii) any acceleration, termination, modification or cancellation of any agreement, contract, lease or license to which the Company is a party or by which any of them is bound, (xiii) entry by the Company into any loan or other transaction with any officers, directors or employees of the Company, (xiv) any charitable or other capital contribution by the Company or pledge therefore, (xv) entry by the Company into any transaction of a material nature or (xvi) any negotiation or agreement by the Company to do any of the things described in the ordinary course of business consistent with past custom and practicepreceding clauses (i) through (xv). (b) No party has accelerated, terminated, modified or canceled any Assigned Contract.

Absence of Certain Developments. (a) Since December 31, 2004, there has occurred no fact, event or circumstance which has had or would reasonably be expected to have a Material Adverse Effect. Except as expressly contemplated by this Agreement and as set forth in the on Schedule 2.9 attached "Developments Schedule," hereto, since August December 31, 19982004, Seller the Company has conducted the Business its business only in the ordinary course of business consistent with past custom and practice (including, without limitation, with respect to the offering of special sales or incentive programs or the filling of its distribution channels), has incurred no liabilities other than in the ordinary course of business consistent with past custom and practice, and Seller the Company has not: (ia) authorized for issuance, issued, sold, assigned or transferred any of its assets, except for sales of inventory in the ordinary course of business consistent with past custom and practice, or mortgaged, pledged or subjected them to any material Lien, except for Liens for current property Taxes not yet due and payable, or canceled without fair consideration any material debts or claims owing to or held by it; (ii) sold, assigned, transferred, abandoned or permitted to lapse any Government Licenses which, individually or in the aggregate, are material to the Business or any portion thereof, or any of the Proprietary Rights or other intangible assets, or disclosed any material proprietary confidential information to any Person, except in the ordinary course of business consistent with past custom and practicedelivered, or granted any license notes, bonds or sublicense of other debt securities or any capital stock or other equity securities or any securities or rights under convertible, exchangeable or with respect to exercisable into any Proprietary Rightscapital stock or other equity securities; (iiib) conducted its cash management customs and practices (including, without limitation, the collection of receivables, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practiceincurred any Indebtedness; (ivc) made discharged or satisfied any loans Lien or advances topaid any material obligation or Liability, or guarantees for the benefit of, or entered into any transaction with PDK or any of its other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer of any assets of placing a Lien on any assets) except on an arms-length basis than current Liabilities paid in the ordinary course of business consistent with past custom and practice; (vd) suffered declared, set aside or made any extraordinary losspayment or distribution of cash or other property with respect to its capital stock or other equity securities or purchased, damageredeemed or otherwise acquired any shares of its capital stock or other equity securities (including any warrants, destruction options or casualty loss other rights to acquire its capital stock or waived any rights of material value, whether or not covered by insurance and whether or not in the ordinary course of business or consistent with past custom and practiceother equity securities); (vie) received notificationsold, assigned, transferred, leased, licensed, failed to maintain or abandoned any of its assets, tangible or intangible, , or become aware taken any action that could reasonably be expected to cause the loss, lapse or abandonment of facts which would lead a reasonable person to believe, that any material customer or supplier will stop or decrease in any material respect the rate of business done with the Business; (vii) become subject to any material liabilitiesCompany Intellectual Property Rights, except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into in the ordinary course of business consistent with past custom and practice; (viiif) settled made or compromised granted any litigation involving equitable relief bonus or involving any money damages in excess wage or salary increase to, or changed any material employment or retention terms with, any employee or group of $50,000; or employees or contractors, including salespersons (ix) entered into any other material transaction, other than bonuses and wage increases in the ordinary course of business consistent with past custom and practice.), entered into or increased amount or duration of any severance arrangement, or made or granted any increase in any employee benefit plan or arrangement, or amended or terminated any existing employee benefit plan or arrangement or adopted any new employee benefit plan or arrangement, or entered into, modified or terminated any collective bargaining agreement or relationship; (bg) No party made capital expenditures or commitments therefor in excess of $200,000 in the aggregate (but has made all capital expenditures required to be made in the ordinary course to preserve and maintain the business of the Company); (h) made any loans or advances to, guarantees for the benefit of, or any Investments in, any Persons or formed any Subsidiary; (i) suffered any damage, destruction or casualty loss exceeding $10,000 in the aggregate, whether or not covered by insurance, or experienced any material changes in the amount and scope of insurance coverage; (j) made any change in its cash management practices or in any method of accounting or accounting policies, or made any write-down in the value of its inventory that is material or outside of the ordinary course of business consistent with past custom and practice; (k) other than compensation paid in the ordinary course of business, consistent with past custom and practice, directly or indirectly engaged in any transaction or entered into, amended or terminated, any arrangement with any of its officers, directors, shareholders or other Affiliates; (l) amended its charter, bylaws or other organizational documents; (m) taken any action or omitted to take any action which act or omission would reasonably be expected to have a Material Adverse Effect; (n) entered into any new line of business, or incurred or committed to incur any capital expenditures, obligations or Liabilities in connection therewith; (o) entered into any acquisition agreement or agreement to acquire by merger, consolidation or otherwise, or agreement to acquire a substantial portion of the assets of, or in any other manner, any business of any other Person; (p) cancelled or waived (i) any right material to the operation of its business or (ii) any debts or claims against any of its Affiliates; (q) accelerated, terminated, modified or cancelled any agreement, contract, lease, license or other arrangement involving more than $25,000; (r) delayed, postponed or canceled the payment of accounts payable or any Assigned Contractother Liability; or (s) agreed, whether orally or in writing, to do any of the foregoing.

Absence of Certain Developments. (a) Except as expressly contemplated by this Agreement or as set forth in on the attached "Developments Schedule," DEVELOPMENTS SCHEDULE, since August 31September 30, 19982003, Seller has conducted neither the Business only in the ordinary course of business consistent with past custom and practice (including, without limitation, with respect to the offering of special sales or incentive programs or the filling Company nor any of its distribution channels), has incurred no liabilities other than in the ordinary course of business consistent with past custom and practice, and Seller has notSubsidiaries has: (i) soldissued any notes, assigned bonds or transferred other debt securities or any of its assetscapital stock or other equity securities or any securities or rights convertible, except for sales of inventory in the ordinary course of business consistent with past custom and practice, exchangeable or mortgaged, pledged exercisable into any capital stock or subjected them to any material Lien, except for Liens for current property Taxes not yet due and payable, or canceled without fair consideration any material debts or claims owing to or held by itother equity securities; (ii) sold, assigned, transferred, abandoned borrowed any amount or permitted to lapse any Government Licenses which, individually incurred or in the aggregate, are material to the Business or any portion thereof, or any of the Proprietary Rights or other intangible assets, or disclosed any material proprietary confidential information to any Person, except in the ordinary course of business consistent with past custom and practice, or granted any license or sublicense of any rights under or with respect to any Proprietary Rights; (iii) conducted its cash management customs and practices (including, without limitation, the collection of receivables, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practice; (iv) made any loans or advances to, or guarantees for the benefit of, or entered into any transaction with PDK or any of its other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer of any assets of placing a Lien on any assets) except on an arms-length basis in the ordinary course of business consistent with past custom and practice; (v) suffered any extraordinary loss, damage, destruction or casualty loss or waived any rights of material value, whether or not covered by insurance and whether or not in the ordinary course of business or consistent with past custom and practice; (vi) received notification, or become aware of facts which would lead a reasonable person to believe, that any material customer or supplier will stop or decrease in any material respect the rate of business done with the Business; (vii) become subject to any material liabilities, except current liabilities incurred in the ordinary course of business and consistent with past practice; (iii) discharged or satisfied any material Lien (other than Permitted Encumbrances) or paid any material obligation or liability, other than current liabilities under contracts entered into paid in the ordinary course of business; (iv) declared, set aside or made any payment or distribution of cash or other property to any of the Company's stockholders with respect to such stockholder's capital stock or otherwise, or purchased, redeemed or otherwise acquired any shares of its capital stock or other equity securities (including any warrants, options or other rights to acquire its capital stock or other equity securities); (v) mortgaged or pledged any of its properties or assets or subjected them to any Lien, except for Permitted Encumbrances; (vi) sold, assigned, leased, licensed or otherwise transferred any of its tangible assets, except in the ordinary course of business consistent with past custom practice and for fair value; (vii) canceled, compromised, waived, or released any material right or claim (other than in the ordinary course of business and consistent with past practice); (viii) settled sold, assigned, transferred, leased, licensed (other than licenses to its customers in the ordinary course of business in accordance with the Company's standard terms and conditions) or compromised otherwise encumbered any litigation involving equitable relief Intellectual Property Rights, disclosed any proprietary confidential information to any Person (other than to the Purchasers and other than in the ordinary course of business consistent with past practice in circumstances in which it has imposed reasonable confidentiality restrictions), or involving abandoned or permitted to lapse any money damages material Intellectual Property Rights; (ix) made or granted any bonus or any wage or salary increase to any employee or group of employees (except (a) to non-management employees in the ordinary course of business consistent with past practice or (b) as required by pre-existing contracts described on the attached CONTRACTS SCHEDULE), or made or granted any increase in any employee benefit plan or arrangement, or amended or terminated any existing employee benefit plan or arrangement or adopted any new employee benefit plan or arrangement; (x) suffered any extraordinary losses in excess of $50,000; or100,000 in the aggregate; (ixxi) entered into made capital expenditures or commitments therefor that aggregate in excess of $250,000; (xii) delayed or postponed the payment of any accounts payable or commissions or any other material transactionliability or obligation or agreed or negotiated with any party to extend the payment date of any accounts payable or commissions or any other liability or obligation or accelerated the collection of (or discounted) any accounts or notes receivable, other than in the ordinary course of business consistent with past custom and practice.; (bxiii) No party has acceleratedmade any loans or advances to (other than advances to the Company's employees or money market fund investments in the ordinary course of business consistent with past practice), terminatedguarantees for the benefit of, modified or canceled any Assigned ContractInvestments in, any Person (including incorporation of any Subsidiary); (xiv) made any charitable contributions or pledges exceeding in the aggregate $100,000 or made any political contributions; (xv) suffered any damage, destruction or casualty loss exceeding in the aggregate $100,000, whether or not covered by insurance; (xvi) made any change in any method of accounting or accounting policies that is material or that is other than in the usual, regular and ordinary course of business consistent with past practice and its Licenses or reversed any accruals (whether or not in the ordinary course of business or consistent with past practice); (xvii) amended its certificate of incorporation, bylaws or other organizational documents; (xviii) entered into any agreement or arrangement prohibiting or restricting it from freely engaging in any business or otherwise restricting the conduct of its business; (xix) entered into any Material Contract other than in the ordinary course of business consistent with past practice and its Licenses, entered into any other material transaction, whether or not in the ordinary course of business or consistent with past practice, or materially changed any business practice; or (xx) agreed, whether orally or in writing, to do any of the foregoing.

Absence of Certain Developments. (a) Except as set forth in on Schedule 5.8 of the attached "Developments Seller Disclosure Schedule," since August , between December 31, 19982011 and the date of this Agreement, Seller has conducted none of the Business only Company or any of its Subsidiaries has: (a) issued any notes, bonds or other debt securities or any Capital Stock or other equity securities or any securities or rights convertible, exchangeable or exercisable into any Capital Stock or other equity securities; (b) borrowed any amount or incurred or become subject to any liabilities for borrowed money, except Indebtedness incurred in the ordinary course of business consistent with past custom and practice practice; (including, without limitation, with respect to the offering of special sales c) discharged or incentive programs or the filling of its distribution channels), has incurred no liabilities satisfied any Lien (other than any Permitted Lien) or paid any material obligation or material liability, other than current liabilities paid in the ordinary course of business consistent with past custom and practice, and Seller has not:business; (id) solddeclared, assigned set aside or transferred made any payment or distribution of cash or other property to any of its assets, except for sales of inventory in the ordinary course of business consistent stockholders with past custom and practicerespect to its Capital Stock or otherwise, or mortgagedpurchased, redeemed or otherwise acquired, any Capital Stock or other equity securities (including any warrants, options or other rights to acquire its Capital Stock or other equity); (e) mortgaged or pledged any of its properties or assets or subjected them to any material Lien, except for Liens for current property Taxes not yet due and payable, or canceled without fair consideration any material debts or claims owing to or held by itPermitted Liens; (iif) sold, assigned, transferred, abandoned or permitted to lapse any Government Licenses which, individually or in the aggregate, are material to the Business or any portion thereof, or any of the Proprietary Rights or other intangible assets, or disclosed any material proprietary confidential information to any Person, except in the ordinary course of business consistent with past custom and practice, sold, assigned, transferred, leased, licensed or granted otherwise encumbered any license of its tangible or sublicense of intangible assets, or canceled any rights under debts or with respect to any Proprietary Rightsclaims; (iiig) conducted its cash management customs and practices (includingi) sold, without limitationassigned, transferred, leased, licensed or otherwise encumbered any Intellectual Property Rights necessary for or used in the collection of receivablesBusiness, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practice; (iv) made any loans or advances to, or guarantees for the benefit of, or entered into any transaction with PDK or any of its other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business business; (ii) disclosed any proprietary confidential information or entered into trade secrets to any transaction, arrangement or contract Person (including, without limitation, any transfer of any assets of placing a Lien on any assetsother than to Buyer and its Affiliates) except on an armspursuant to a valid non-length basis disclosure or confidentiality agreement; or (iii) abandoned or permitted to lapse any Intellectual Property Rights (including registrations and applications for registrations of Intellectual Property Rights) necessary for or used in the Business, other than in the ordinary course of business; (h) except in the ordinary course of business consistent with past custom and practicepractice or as required by pre-existing contracts described on Schedule 5.8(h) of the Seller Disclosure Schedule, (i) made or granted any bonus, or any wage, salary or other compensation increase to any employee or group of employees (ii) made or granted any increase in any employee benefit plan or arrangement, (iii) amended or (iv) terminated any existing employee benefit plan or arrangement or adopted any new employee benefit plan or arrangement; (vi) suffered any extraordinary loss, damage, destruction losses or casualty loss or knowingly waived any material rights of material value, whether or not covered by insurance and value (whether or not in the ordinary course of business or consistent with past custom and practice); (vij) received notification, or become aware of facts which would lead a reasonable person to believe, that any material customer or supplier will stop or decrease in any material respect the rate of business done with the Business; (vii) become subject to any material liabilities, except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into in the ordinary course of business consistent with past custom and practice; (viii) settled or compromised any litigation involving equitable relief or involving any money damages made unfunded commitments for capital expenses in excess of $50,000; or100,000 in the aggregate; (ixk) entered into delayed or postponed the payment of any accounts payable or any other material transaction, liability or obligation or agreed or negotiated with any party to extend the payment date of any accounts payable or any other liability or obligation or accelerated the collection of (or discounted) any accounts or notes receivable; (l) other than in the ordinary course of business consistent with past custom and practice., made any loans or advances to, guaranties for the benefit of, or any Investments in, any Person; (bm) No party made any charitable contributions or pledges exceeding in the aggregate $50,000 or made any political contributions; (n) suffered any damage, destruction or casualty loss exceeding in the aggregate $100,000, whether or not covered by insurance; (o) made any material change in any accounting principles; (p) made any Investment in or incorporated or organized any Subsidiary of a Company Entity; (q) taken any action, or failed to take any action that has acceleratedhad or could reasonably be expected to have the effect of accelerating to pre-Closing periods sales to customers (including any failure to market and sell its products in normal commercial quantities and through normal commercial channels prior to the Closing); (r) entered into any Material Contract other than in the ordinary course of business consistent with past practice, terminatedor entered into any other material transaction, modified whether or canceled not in the ordinary course of business or consistent with past practice, or changed in any Assigned Contractmaterial respect any business practice in anticipation of the transactions contemplated hereby or otherwise; (s) made or changed any Tax election, changed any accounting methods or periods, filed any amended Tax Return, entered into any closing agreement with respect to Taxes, settled any Tax Claim or assessment, surrendered any right to claim a refund of Taxes, consented to any extension or waiver of the limitation period applicable to any Tax Claim or assessment; or (t) agreed, whether orally or in writing, to take any of the foregoing actions described in clauses (a) through (s) above.

Absence of Certain Developments. (a) Except as expressly contemplated by this Agreement or as set forth in on the attached "Developments Schedule," , since August 31June 30, 19981996, Seller has conducted neither the Business only in the ordinary course of business consistent with past custom and practice (including, without limitation, with respect to the offering of special sales Company nor or incentive programs or the filling --------------------- any of its distribution channels), has incurred no liabilities other than in the ordinary course of business consistent with past custom and practice, and Seller has notSubsidiaries has: (i) soldissued any notes, assigned bonds or transferred other debt securities or any of its assetscapital stock or other equity securities or any securities or rights convertible, except for sales of inventory in the ordinary course of business consistent with past custom and practice, exchangeable or mortgaged, pledged exercisable into any capital stock or subjected them to any material Lien, except for Liens for current property Taxes not yet due and payable, or canceled without fair consideration any material debts or claims owing to or held by itother equity securities; (ii) sold, assigned, transferred, abandoned borrowed any amount or permitted to lapse any Government Licenses which, individually incurred or in the aggregate, are material to the Business or any portion thereof, or any of the Proprietary Rights or other intangible assets, or disclosed any material proprietary confidential information to any Person, except in the ordinary course of business consistent with past custom and practice, or granted any license or sublicense of any rights under or with respect to any Proprietary Rights; (iii) conducted its cash management customs and practices (including, without limitation, the collection of receivables, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practice; (iv) made any loans or advances to, or guarantees for the benefit of, or entered into any transaction with PDK or any of its other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer of any assets of placing a Lien on any assets) except on an arms-length basis in the ordinary course of business consistent with past custom and practice; (v) suffered any extraordinary loss, damage, destruction or casualty loss or waived any rights of material value, whether or not covered by insurance and whether or not in the ordinary course of business or consistent with past custom and practice; (vi) received notification, or become aware of facts which would lead a reasonable person to believe, that any material customer or supplier will stop or decrease in any material respect the rate of business done with the Business; (vii) become subject to any material liabilities, except current liabilities incurred in the ordinary course of business and consistent with past practice; (iii) discharged or satisfied any material Lien or paid any material obligation or liability, other than current liabilities under contracts entered into paid in the ordinary course of business; (iv) declared, set aside or made any payment or distribution of cash or other property to any Shareholder with respect to such Shareholder's capital stock or other equity securities or purchased, redeemed or otherwise acquired any shares of its capital stock or other equity securities (including any warrants, options or other rights to acquire its capital stock or other equity securities); (v) mortgaged or pledged any of its properties or assets or subjected them to any Lien, except for Permitted Encumbrances; (vi) sold, assigned, transferred, leased, licensed or otherwise encumbered any of its tangible assets, except in the ordinary course of business consistent with past custom and practice, or canceled any material debts or claims; (viiivii) settled sold, assigned, transferred, leased, licensed or compromised otherwise encumbered any litigation involving equitable relief Intellectual Property Rights or involving other intangible assets, disclosed any money damages in excess of $50,000; or material proprietary confidential information to any Person (ix) entered into any other material transaction, than to the Purchasers and other than in the ordinary course of business consistent with past custom and practice.practice in circumstances in which it has imposed reasonable confidentiality restrictions), or abandoned or permitted to lapse any Intellectual Property Rights; (bviii) No made or granted any bonus or any wage or salary increase to any employee or group of employees (except as required by pre-existing contracts described on the attached Contracts Schedule), or made or granted any increase ------------------ in any employee benefit plan or arrangement, or amended or terminated any existing employee benefit plan or arrangement or adopted any new employee benefit plan or arrangement; (ix) suffered any extraordinary losses or waived any rights of material value (whether or not in the ordinary course of business or consistent with past practice) in excess of $25,000 in the aggregate; (x) made capital expenditures or commitments therefor that aggregate in excess of $200,000; (xi) delayed or postponed the payment of any accounts payable or any other liability or obligation or agreed or negotiated with any party has acceleratedto extend the payment date of any accounts payable or accelerated the collection of any accounts or notes receivable; (xii) made any loans or advances to, terminatedguarantees for the benefit of, modified or canceled any Assigned ContractInvestments in, any Persons (other than advances to the Company's employees in the ordinary course of business consistent with past practice); (xiii) made any charitable contributions or pledges exceeding in the aggregate $10,000; (xiv) suffered any damage, destruction or casualty loss exceeding in the aggregate $25,000, whether or not covered by insurance; (xv) made any change in any method of accounting or accounting policies, other than those required by GAAP which have been disclosed in writing to the Purchasers, or made any write-down in the value of its inventory that is material or that is other than in the usual, regular and ordinary course of business consistent with past practice; (xvi) made any Investment in or taken any steps to incorporate any Subsidiary; (xvii) amended its articles of incorporation, by-laws or other organizational documents; (xviii) entered into any agreement or arrangement prohibiting or restricting it from freely engaging in any business or otherwise restricting the conduct of its business; (xix) entered into any contract other than in the ordinary course of business consistent with past practice, entered into any other material transaction, whether or not in the ordinary course of business or consistent with past practice or materially changed any business practice; or (xx) agreed, whether orally or in writing, to do any of the foregoing.

Absence of Certain Developments. (a) Except as set forth on Schedule 4.8: (a) since the Latest Balance Sheet Date, except for the Excluded Assets or the disposition of obsolete equipment, neither Sellers nor any Company has sold, leased, transferred or assigned any of the material assets of any Company, tangible or intangible, other than for reasonable consideration in the attached "Developments Schedule," Ordinary Course of Business; (b) since August 31the Latest Balance Sheet Date, 1998no Company has entered into any Contract (or series of related Contracts with the same Person), Seller that is not terminable upon ninety (90) days’ written notice or less without penalty or acceleration of any obligations thereunder, obligating a Company to make aggregate annual payment of more than $[*] that is outside the Ordinary Course of Business; (c) since the Latest Balance Sheet Date, no Person (including Sellers or any Company) has conducted accelerated, suspended, terminated, materially and adversely modified or canceled any Contract (or series of related Contracts with the Business only same Person) obligating a Person to make aggregate annual payments to a Company of more than $[*] to which any Company is a party or by which it is bound; (d) since the Last Fiscal Year End, other than in the ordinary course Ordinary Course of business consistent Business, no material Encumbrance has been imposed on any asset of any Company; (e) since the Latest Balance Sheet Date, no Company has made any capital expenditure (or series of related capital expenditures with past custom the same Person) outside the Ordinary Course of Business or made any capital investment in, any loan to, or any acquisition of the securities or assets of, any other Person (or series of related capital investments, loans and practice acquisitions with the same Person) outside the Ordinary Course of Business; (includingf) since the Latest Balance Sheet Date, without limitationother than advances on existing credit facilities in the Ordinary Course of Business, no Company has created, incurred, assumed or guaranteed any Indebtedness; (g) since the Latest Balance Sheet Date, no Company has delayed, postponed or accelerated the payment of accounts payable or other liabilities or the receipt of any accounts receivable, in each case in any material respect, except in the Ordinary Course of Business; (h) since the Latest Balance Sheet Date, other than with respect to the offering Excluded Assets, no Company has canceled, compromised, waived or released any material right or claim (or series of special sales related rights or incentive programs or claims related to the filling of its distribution channels), has incurred no liabilities other than same Person) except in the ordinary course Ordinary Course of business consistent with past custom and practice, and Seller has not:Business; (i) soldsince the Latest Balance Sheet Date, assigned there has been no change made, or transferred any of its assetsauthorized to be made, except for sales of inventory in the ordinary course Organizational Documents of business consistent with past custom and practice, or mortgaged, pledged or subjected them to any material Lien, except for Liens for current property Taxes not yet due and payable, or canceled without fair consideration any material debts or claims owing to or held by itCompany; (iij) soldsince the Latest Balance Sheet Date, assignedno Company has experienced any damage, transferred, abandoned destruction or permitted to lapse any Government Licenses which, individually or loss (not covered by insurance) in excess of $[*] in the aggregate, are material aggregate to the Business or any portion thereof, or any of the Proprietary Rights or other intangible assets, or disclosed any material proprietary confidential information to any Person, except in the ordinary course of business consistent with past custom and practice, or granted any license or sublicense of any rights under or with respect to any Proprietary Rightsits property; (iiik) conducted its cash management customs and practices (includingsince the Latest Balance Sheet Date, without limitation, the collection of receivables, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practice; (iv) no Company has made any loans or advances loan to, or guarantees for the benefit of, or entered into any other transaction with PDK with, any Seller, any Business Employee or any Company’s directors, officers, employees or independent contractors, or any Affiliate of the foregoing, other than those contemplated by the Agreement, advances in the Ordinary Course of Business, not exceeding $[*] in the aggregate, to Business Employees that are not Sellers, Affiliates of any Seller, or officers, managers or directors of any Company; (l) since the Latest Balance Sheet Date, no Company has entered into any Plan or any other employment, consulting, severance, retention, change in control or indemnification agreements; (m) since the Last Fiscal Year End, no Company has entered into, or become bound by, any collective bargaining agreement or other obligation to any labor organization or employee representative, in each case, whether written or oral, or materially modified the terms of any such existing agreement except as required by applicable Law and there has not been any material work stoppages, strikes or threats thereof; (n) since the Last Fiscal Year End, no Company has made any material change in accounting principles; (o) since the Last Fiscal Year End, to Seller’s Knowledge, no written complaint or investigation against any Company has been commenced by any Governmental Entity; (p) since the Latest Balance Sheet Date, there has been no increase to the salary, wage or other compensation or level of benefits payable or to become payable by any Company to any of its other stockholders officers, managers, directors, Business Employees, agents or Independent Contractors (including any Seller, in their capacities as such) except in the Ordinary Course of Business; (q) since the Last Fiscal Year End, no Material Adverse Effect has occurred; (r) since the Last Fiscal Year End, no Company has received any written notice from any material supplier, Governmental Entity or any employeeother Person, officer the result of which would materially and adversely impact the Business; (s) since the Latest Balance Sheet Date, no Company has issued, sold or director otherwise disposed of Seller any of its Ownership Interests, or PDKgranted any Ownership Interests, including any options, warrants or other rights to purchase or obtain (including upon conversion, exchange or exercise) any of its Ownership Interests; [*] Please refer to footnote 1 on page 1 of this Exhibit 2.5 (t) since the Last Fiscal Year End, except in the Ordinary Course of Business, no Company has (i) made any settlement of or compromised any Tax liability, changed or revoked any Tax election or Tax method of accounting, made any new Tax election or adopted any new Tax method of accounting; (ii) surrendered any right to claim a refund of Taxes; (iii) consented to any extension or waiver of the limitation period applicable to any Tax claim or assessment; or (iv) taken any other action that would have the effect of increasing the Tax liability of any Company for any period (or portion thereof) beginning after the Closing Date; (u) since the Latest Balance Sheet Date, except for the transactions contemplated by this Agreement and for advances consistent Cash Sweep, no Company has declared, set aside or paid any dividend or made any distribution with past custom and practice made respect to Seller's employeesits Ownership Interests (whether in cash or in kind) or redeemed, officers and directors for travel expenses incurred in the ordinary course purchased or otherwise acquired any of business its Ownership Interests or entered into split, combined or reclassified any transaction, arrangement or contract (including, without limitation, any transfer of any assets of placing a Lien on any assets) except on an arms-length basis in the ordinary course of business consistent with past custom and practiceits Ownership Interests; (v) suffered since the Latest Balance Sheet Date, except as part of the requirements of the Closing, no Company has discharged or satisfied any extraordinary lossEncumbrance or paid any liability, damage, destruction or casualty loss or waived any rights of material value, whether or not covered by insurance and whether or not other than current liabilities paid in the ordinary course Ordinary Course of business or consistent with past custom and practice; (vi) received notification, or become aware of facts which would lead a reasonable person to believe, that any material customer or supplier will stop or decrease in any material respect the rate of business done with the Business; (viiw) become subject since the Latest Balance Sheet Date, except as required by applicable Law, no Company has adopted or terminated or made any material amendment or modification to any material liabilities, except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into in the ordinary course of business consistent with past custom and practicePlans; (viiix) settled since the Latest Balance Sheet Date, no Company has taken any action outside of the Ordinary Course of Business, except for actions explicitly permitted, contemplated or compromised any litigation involving equitable relief or involving any money damages in excess of $50,000required by this Agreement; orand (ixy) entered into since the Latest Balance Sheet Date or the Last Fiscal Year End (as applicable), neither Sellers nor any other material transaction, other than Company has committed or agreed (in writing or otherwise) to take any of the ordinary course of business consistent with past custom and practiceactions described in this Section 4.8. (b) No party has accelerated, terminated, modified or canceled any Assigned Contract.

Absence of Certain Developments. (a) Except as set forth on SCHEDULE 6.18, since December 30, 2002, the Business has been carried on in the attached "Developments Schedule," since August 31ordinary course and consistent with past practice (except for such changes or effects resulting from or arising in connection with changes or conditions affecting similarly situated companies in the critical care medical device industry and changes in economic, 1998regulatory or political conditions generally) and neither the Company nor any of its Subsidiaries have, Seller has conducted with respect to the Business only Business: (a) borrowed any amount or incurred or become subject to any obligations or liabilities (whether absolute or contingent), or given any guarantee or indemnity outside the ordinary course of business, except liabilities incurred in the ordinary course of business consistent with past custom business; (b) mortgaged, pledged or subjected to any lien, charge or any other encumbrance, any portion of its properties or assets used in the Business, except Permitted Liens and practice Permitted Encumbrances; (c) sold, leased, assigned or transferred (including, without limitation, with respect transfers to any Employees or Subsidiaries of the offering Company) any of special sales the tangible or incentive programs or intangible assets used in the filling of its distribution channels), has incurred no liabilities other than Business (except for inventory sold in the ordinary course of business consistent with past custom and practice, and Seller has not: (i) sold, assigned or transferred any having a value in excess of its assets, except for sales of inventory in the ordinary course of business consistent with past custom and practice, or mortgaged, pledged or subjected them to any material Lien, except for Liens for current property Taxes not yet due and payable, $500,000 or canceled without fair consideration any material debts or claims owing to or held by itit in excess of $500,000; (iid) soldsuffered any theft, assigneddamage, transferred, abandoned destruction or permitted casualty loss to lapse any Government Licenses which, individually or the tangible assets used in the aggregateBusiness, are whether or not covered by insurance, having a value in excess of $500,000; (e) entered into, amended or terminated any material to lease, license agreement, contract, agreement, permit or commitment in connection with the Business or any portion thereof, or any of the Proprietary Rights or other intangible assets, or disclosed any material proprietary confidential information to any Person, except than in the ordinary course of business consistent and in accordance with past custom and practice; (f) entered into any substantial transaction with any officer, director or Employee thereof or an entity in which any such Person has a substantial interest; (g) consistent with past practices, entered into any employment contract or collective bargaining agreement, written or oral, or changed in any other material respect employment terms for any Employee or made or granted any license bonus or sublicense of any rights under wage, salary or with respect compensation increase to any Proprietary Rightsdirector, officer, Employee or sales representative, group of Employees or consultant (except for annual salary and wage increases and bonuses paid in the ordinary course of business); (iiih) incurred intercompany charges or conducted its cash management customs and practices (including, without limitation, including the collection of receivables, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension payment of credit terms or sales discount programs)payables) other than in the usual and ordinary course of business consistent in accordance with past custom and practice; (ivi) made any loans non-budgeted capital expenditures (or advances tocommitments therefor), or guarantees for other than capital expenditures which are reasonably necessary to allow the benefit of, or entered into any transaction with PDK or any of its other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made Business to Seller's employees, officers and directors for travel expenses incurred operate in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer of any assets of placing a Lien on any assets) except on an arms-length basis in the ordinary course of business consistent accordance with past custom and practice; (v) suffered any extraordinary loss, damage, destruction or casualty loss or waived any rights of material value, whether or not covered by insurance and whether or not in the ordinary course of business or consistent with past custom and practice; (vi) received notification, or become aware of facts which would lead a reasonable person to believe, that any material customer or supplier will stop or decrease in any material respect the rate of business done with the Business; (vii) become subject to any material liabilities, except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into in the ordinary course of business consistent with past custom and practice; (viii) settled or compromised any litigation involving equitable relief or involving any money damages aggregate in excess of $50,000250,000; (j) entered into any lease of capital equipment or real estate involving rental in excess of $500,000 per annum with a term exceeding two years; (k) performed any acts punishable under the Foreign Corrupt Practices Act or under the OECD Convention on Combating Bribery of Foreign Public Officials in International Business Transactions; or (ixl) entered into agreed to do any other material transaction, other than in of the ordinary course of business consistent with past custom and practiceforegoing. (b) No party has accelerated, terminated, modified or canceled any Assigned Contract.

Absence of Certain Developments. (a) Except as set forth on Schedule 2.23 attached hereto and except as expressly contemplated by this Agreement, since April 26, 2009: (a) no Seller has, suffered any theft, damage, destruction or casualty loss in excess of $100,000 to any Transferred Assets, whether or not covered by insurance or suffered any material damage or destruction to its Books and Records; (b) no Seller has, exclusively with respect to the Business, incurred any Liabilities, except Liabilities incurred in the attached "Developments Schedule," since August 31Ordinary Course of Business, 1998bankruptcy costs and expenses relating to this Agreement and the transactions contemplated hereby; (c) no Seller has, Seller has conducted exclusively with respect to the Business only in the ordinary course of business consistent with past custom and practice Business, sold, leased, assigned or transferred (including, without limitation, with respect transfers to the offering stockholders, holders of special sales ownership interests or incentive programs or the filling any Insider) a portion of its distribution channels), has incurred no liabilities other than in the ordinary course of business consistent with past custom and practice, and Seller has not: (i) sold, assigned or transferred any of its tangible assets, except for sales of inventory Inventory, which, prior to the commencement of the Bankruptcy Case, were conducted in the ordinary course Ordinary Course of business consistent with past custom and practice, or mortgaged, pledged or subjected them to any material Lien, except for Liens for current property Taxes not yet due and payableBusiness, or canceled without fair consideration any material debts or claims owing to or held by it; (iid) no Seller has sold, assigned, transferred, abandoned licensed or permitted transferred (including transfers to lapse any Government Licenses which, individually or in the aggregate, are material to the Business stockholders or any portion thereofInsider) any Transferred IP owned by, issued to or any of the Proprietary Rights or other intangible assets, licensed to it or disclosed any material proprietary confidential information to any Person, except in the ordinary course of business consistent with past custom and practice, or granted any license or sublicense of any rights under or with respect to any Proprietary Rightsthe Business (other than pursuant to agreements requiring the disclosure to maintain the confidentiality of and preserving all its rights in such confidential information); (iiie) conducted its cash management customs and practices (includingno Seller has, without limitationexclusively with respect to the Business, the collection of receivablesentered into, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms amended or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practice; (iv) made any loans or advances to, or guarantees for the benefit of, or entered into any transaction with PDK or any of its other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer of any assets of placing a Lien on any assets) except on an arms-length basis in the ordinary course of business consistent with past custom and practice; (v) suffered any extraordinary loss, damage, destruction or casualty loss or waived any rights of material value, whether or not covered by insurance and whether or not in the ordinary course of business or consistent with past custom and practice; (vi) received notification, or become aware of facts which would lead a reasonable person to believe, that terminated any material customer lease, contract, agreement or supplier will stop or decrease in any material respect the rate of business done with the Business; (vii) become subject to any material liabilities, except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into in the ordinary course of business consistent with past custom and practice; (viii) settled or compromised any litigation involving equitable relief or involving any money damages in excess of $50,000; or (ix) entered into any other material transactioncommitment, other than in the ordinary course Ordinary Course of business consistent with past custom and practice.Business; (bf) No party no Seller has acceleratedcommitted to do any of the foregoing; (g) no Seller has, terminatedexclusively with respect to the Business, modified suffered any product liability or canceled any Assigned Contractrecall liabilities reasonably expected to result in a Liability in excess of $1,000,000 in the aggregate; and (h) there has not occurred a Material Adverse Change.

Absence of Certain Developments. (a) Except as set forth in the attached "Further Developments Schedule," , since August 31the date of the 2003 Balance Sheet, 1998, Seller the Company and each of its Subsidiaries has conducted the Business its business only in the ordinary course of business consistent with past custom and practice (including, without limitation, with respect to the offering of special sales or incentive programs or the filling of its distribution channels), has incurred no liabilities other than in the ordinary course of business consistent with past custom and practice, and Seller has notneither the Company nor any of its Subsidiaries has: (i) solddischarged or satisfied any material Lien or paid any material obligation or liability, assigned or transferred any of its assets, except for sales of inventory other than current liabilities paid in the ordinary course of business consistent with past custom and practice, or canceled, compromised, waived or released any material right or material claim; (ii) sold, assigned, licensed or transferred any of its assets (except for sales of (A) inventory in the ordinary course of business consistent with past custom and practice or (B) obsolete equipment in the ordinary course of business consistent with past custom and practice where the value of such obsolete equipment does not exceed $25,000 individually or $100,000 in the aggregate for all such sales) or mortgaged, pledged or subjected them to any material Lien, except for Liens for current property Taxes not yet due and payablePermitted Liens, or canceled without fair consideration any material debts or material claims owing to or held by it; (iiiii) sold, assigned, transferred, abandoned or permitted to lapse any Government Licenses which, individually or in the aggregate, are material to the Business or any portion thereofBusiness, or any of the Proprietary Rights or other intangible assets, or disclosed any material proprietary confidential information to any Person, except in the ordinary course of business consistent with past custom and practice, or granted any license or sublicense of any rights under or with respect to any Proprietary Rights; (iiiiv) made or granted any bonus or any wage or salary increase to any employee, trustee, officer or director, or made any other material change in employment terms for any employee, trustee, officer or director; (v) made or granted any increase in, or amended or terminated, any existing plan, program, policy or arrangement, including without limitation, any Plan (as defined in Section 5.18(a)), employee benefit plan or arrangement or adopted any new employee benefit plan or arrangement, or amended or renegotiated any existing collective bargaining agreement or entered into any new collective bargaining agreement or multiemployer plan, or except as may be required under applicable law; (vi) conducted its cash management customs and practices (including, without limitation, the collection of receivables, payment of payables and payables, maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practice; (ivvii) made any capital expenditures or commitments therefor such that the aggregate outstanding amount of unpaid obligations and commitments with respect thereto shall comprise in excess of $50,000 on the Closing Date; (viii) made any loans or advances to, or guarantees Guaranties for the benefit of, or entered into any transaction with PDK or any of its other stockholders or any employee, officer or director of Seller or PDKInsider, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, trustees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer of any assets of or placing a Lien on any assets) except on an arms-length basis in the ordinary course of business consistent in accordance with past custom and practice; (vix) suffered any extraordinary loss, damage, destruction or casualty loss or waived any rights of material value, whether or not covered by insurance and whether or not in the ordinary course of business or consistent with past custom and practice; (vix) received notification, or become aware of facts which would lead a reasonable person to believe, that any material customer or supplier will stop or decrease in any material respect the rate of business done with the BusinessCompany or any of its Subsidiaries or recorded any sales revenues pursuant to transactions in which the purchaser of such products has the right to return such products at a future date (other than pursuant to the terms and conditions of the Company’s and its Subsidiaries’ standard warranty terms); (viixi) issued or sold or agreed to issue or sell any notes, bonds or other debt securities or any equity securities or any securities convertible, exchangeable or exercisable into any equity securities; (xii) borrowed any amount or incurred or become subject to any material liabilities, except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into in the ordinary course of business consistent with past custom and practicepractices; (viiixiii) settled declared, set aside or compromised paid any litigation involving equitable relief dividend or involving distribution of cash or other property to any money damages in excess shareholders of $50,000; orthe Company or stockholders of any of any of its Subsidiaries with respect to its shares of beneficial ownership or stock, as the case may be (except that a wholly-owned Subsidiary of the Company may declare and pay a cash dividend to the Company) or purchased, redeemed or otherwise acquired any shares of its shares of beneficial interest or capital stock or any warrants, options or other rights to acquire its shares of beneficial interest or stock, or made any other payments to any shareholder of the Company or any of its Subsidiaries; (ixxiv) made any capital investment in, any loan to, or any acquisition of the securities or assets of any other Person or taken any steps to incorporate any Subsidiary; (xv) amended or authorized the amendment of the Declaration of Trust, articles of organization, bylaws or other organizational documents, as applicable, of the Company or any of its Subsidiaries; (xvi) entered into any other material transaction, other than in the ordinary course of business consistent with past custom and practice; or (xvii) agreed or committed to any of the foregoing. (b) No party (including the Company or any of its Subsidiaries) has accelerated, terminated, modified or canceled any Assigned Contractcontract, lease, sublease, license, sublicense or other agreement set forth on the attached “Contracts Schedule.”

Absence of Certain Developments. Since the Balance Sheet Date, the business of the Company has been operated in the ordinary course, consistent with past practices. As amplification and not limitation of the foregoing, since the Balance Sheet Date, the Company has not: (a) Except as set forth borrowed any amount or incurred or become subject to any liability or obligation in the attached "Developments Schedule," since August 31excess of $1,000 (whether absolute, 1998accrued, Seller has conducted the Business only contingent or otherwise and whether due or to become due), except (i) current liabilities incurred in the ordinary course of business consistent with past custom practices, and practice (ii) liabilities under contracts entered into in the ordinary course of business consistent with past practices; (b) mortgaged, pledged or subjected to any lien, charge or any other encumbrance, any of its assets, except (i) liens for current property taxes not yet due and payable, (ii) liens imposed by law and incurred in the ordinary course of business consistent with past practices for obligations not yet due to carriers, warehousemen, laborers, materialmen and the like, (iii) liens in respect of pledges or deposits under workers' compensation laws or (iv) liens set forth in Section 2.11 in the Disclosure Schedule, all of which liens in clauses (i) through (iv) are less than $10,000 in the aggregate; (c) discharged or satisfied any lien or encumbrance or paid any liability, in each case with a value in excess of $3,000, other than current liabilities paid in the ordinary course of business consistent with past practices; (d) sold, assigned, leased, licensed, transferred or otherwise disposed of (including, without limitation, transfers to any employees, affiliates or shareholders) any tangible assets which, individually or in the aggregate, have a fair market value in excess of $1,000 or canceled any debts or claims, in each case, except in the ordinary course of business consistent with respect past practices; (e) sold, assigned, leased, licensed, transferred or otherwise disposed of (including, without limitation, transfers to any employees, affiliates or shareholders) any patents, trademarks, trade names, copyrights, trade secrets or other intangible assets; (f) disclosed to any person, other than Buyer or authorized representatives of Buyer, any proprietary confidential information, other than pursuant to a confidentiality agreement prohibiting the offering use and further disclosure of special sales such information, which agreements are identified in Section 2.11 of the Disclosure Schedule and are in full force and effect on the date hereof; (g) waived any rights of material value or incentive programs suffered any extraordinary losses or the filling of its distribution channels), has incurred no liabilities adverse changes in collection loss experience; (h) taken any other action or entered into any other transaction other than in the ordinary course of business consistent with past custom and practicepractices, and Seller has not:or entered into any transaction with any "insider" (as defined in Section 2.23) other than the transactions contemplated by this Agreement; (i) soldsuffered any material theft, assigned damage, destruction, casualty or transferred loss of or to any of its assetsproperty or properties owned or used by it, whether or not covered by insurance; (j) made, granted, promised or announced any bonus or any wage, salary or compensation increase to any director, officer, or employee, or consultant or made or granted any increase in any employee benefit plan or arrangement, or amended or terminated any existing employee benefit plan or arrangement, or adopted any new employee benefit plan or arrangement, or made any commitment or incurred any liability to any labor organization, except for sales the wage, salary or compensation increases set forth in Section 2.11 of inventory in the ordinary course of business consistent with past custom and practice, or mortgaged, pledged or subjected them to any material Lien, except for Liens for current property Taxes not yet due and payable, or canceled without fair consideration any material debts or claims owing to or held by itDisclosure Schedule; (iik) sold, assigned, transferred, abandoned made any single capital expenditure or permitted to lapse any Government Licenses which, individually or commitment therefor in the aggregate, are material to the Business or any portion thereof, or any excess of the Proprietary Rights or other intangible assets, or disclosed any material proprietary confidential information to any Person, except in the ordinary course of business consistent with past custom and practice, or granted any license or sublicense of any rights under or with respect to any Proprietary Rights$5,000; (iii) conducted its cash management customs and practices (including, without limitation, the collection of receivables, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practice; (ivl) made any loans or advances to, or guarantees for the benefit of, any persons such that the aggregate amount of such loans, advances or guarantees at any time outstanding is in excess of $1,000; (m) made charitable contributions or pledges which, individually or in the aggregate, exceed $1,000; (n) made any change in accounting or tax principles or practices from those utilized in the preparation of the Latest Financial Statements or the Returns referred to in Section 2.15(a); (o) experienced any amendment, modification or termination of any existing, or entered into any transaction with PDK new, contract, agreement, plan, lease, license, permit or any of its other stockholders franchise which is, either individually or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business aggregate, material to its business, operations, financial position or entered into any transaction, arrangement or contract (including, without limitation, any transfer of any assets of placing a Lien on any assets) except on an arms-length basis prospects other than in the ordinary course of business consistent with past custom and practicepractices; (vp) suffered experienced any extraordinary losslabor dispute material to its business, damageoperations, destruction financial position or casualty loss or waived any rights of material value, whether or not covered by insurance and whether or not in the ordinary course of business or consistent with past custom and practiceprospects; (viq) received notification, or become aware of facts which would lead a reasonable person to believe, that any material customer or supplier will stop or decrease in any material respect the rate of business done with the Business; (vii) become subject to any material liabilities, except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into other than in the ordinary course of business consistent with past custom and practice, experienced any change in any assumption underlying or method of calculating, any bad debt, inventory, warranty, contingency or other reserve; (viiir) settled written off as uncollectible any note or compromised account receivable, or canceled any litigation involving equitable relief or involving any money damages in excess of $50,000; or (ix) entered into any other material transactiondebts, other than in the ordinary course of business consistent with past custom and practice.practices; (bs) No party has acceleratedfailed to replace or replenish inventory or supplies as such inventory or supplies may have been depleted from time to time, terminatedcollect accounts receivable, modified pay accounts payable or canceled shorten or lengthen the customary payment cycles for any Assigned Contractof its payables or receivables or otherwise manage its working capital accounts in the ordinary course of business consistent with past practices; (t) other than in the ordinary course of business consistent with past practice, experienced any write-down or write-up of the value of any inventories, receivables or other assets, or revalued any of its assets; (u) failed to maintain all material assets in accordance with good business practice and in good operating condition and repair, ordinary wear and tear excepted; or (v) other than in the ordinary course of business consistent with past practice, discontinued or altered, in any material respect, its advertising or promotional activities or its pricing and purchasing policies.

Absence of Certain Developments. (a) Except as set forth in the attached "“Developments Schedule," ” since August March 31, 19982015, Seller in each case other than in connection with the transactions contemplated by this Agreement, the Company Group has conducted not: (a) suffered an event, occurrence or development that has had, or would reasonably be expected to have, individually or in the Business only aggregate, a Material Adverse Effect; (b) sold, leased, assigned, licensed or transferred any of its tangible material assets or portion thereof (other than in the ordinary course of business and other than sales of obsolete assets or assets with no book value) or mortgaged, pledged or subjected them to any additional Lien, except for Permitted Liens; (c) acquired or agreed to acquire by merging or consolidating with, or by purchasing all or a material equity or voting interest in, or by purchasing all or a substantial portion of the assets of, any business or any Person or division thereof (other than inventory) or otherwise acquire or license any assets or properties (other than inventory or non-exclusive licenses of Proprietary Rights in the ordinary course of business consistent with past custom and practice practice), in each case for consideration in excess of $250,000 for any individual acquisition or $500,000 in the aggregate; (includingd) made any change (or filed a request to make any such change) in any method of Tax accounting or any annual Tax accounting period; made, without limitationchanged or rescinded any Tax election; surrendered any right to claim for a Tax refund; file any amended Tax Return; entered into any closing agreement, settle or compromise any proceeding with respect to any Tax claim or assessment relating to the offering of special sales Company or incentive programs or the filling any of its distribution channels)Subsidiaries; or waived or extended the statute of limitations in respect of any Taxes; (e) changed any of the accounting methods, has incurred no liabilities principles or practices used in the preparation of the Financial Statements, except as required by a change in any applicable law or GAAP; (f) changed the Company’s cash management practices or its policies, 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 than expenses, deferral of revenue and acceptance of customer deposits; (g) commenced, settled or agreed to settle any material judgment in any action or proceeding concerning the Company Group; (i) assigned, sold, granted any security interest in, to or under, abandoned, disclaimed, dedicated to the public or failed to timely maintain under any material Company Owned Proprietary Rights, including failed to perform or caused to be performed all applicable filings, recordings and other acts, or paid all required fees and Taxes, to maintain and protect its interest in the Company Owned Proprietary Rights, or (ii) granted to any Person any license with respect to any Company Owned Proprietary Rights, except non-exclusive licenses granted in the ordinary course of business consistent with past custom and practice, and Seller has not:; (i) soldmade, assigned granted, accelerated or transferred promised any bonus or any wage or salary increase to any employee, officer or director, or made, granted or promised any other change in employment terms for any employee, officer or director, other than (i) routine annual wage increases in the ordinary course of its assetsbusiness for non-exempt employees only that are consistent in all material respects with past custom and practice and which would not result in an increase in compensation expense of the Company Group for non-exempt employees in excess of 2% over such amounts for fiscal 2015, (ii) pursuant to such arrangements as shall have been entered into prior to the date of this Agreement as set forth on the Contracts Schedule, (iii) the hiring of new or replacement employees in the ordinary course of business but only if the compensation expense of the Company Group would remain within the Budget following the hiring of such employees; or (iv) bonuses or other amounts that reduce Aggregate Initial Consideration; (j) created, incurred, assumed or guaranteed any Indebtedness, except for sales borrowing in the ordinary course of inventory business under the (i) Credit Agreement, dated December 20, 2011, among the Company, Sheplers, Inc., and the other parties thereto, (ii) Term Loan Agreement, dated December 20, 2011, among the Company, Sheplers, Inc. and the other parties thereto or (iii) Note Purchase Agreement, dated December 20, 2011, among the Company, Sheplers, Inc. and the other parties thereto, each as in effect on the date hereof; (k) entered into any contract that would be a Company Contract or Company Proprietary Rights Contract if it had been entered into prior to the date hereof, or materially amended or modified or terminated (other than any expiration in accordance with its terms) any Company Contract or Company Proprietary Rights Contract, except, in each case, in the ordinary course of business consistent with past custom and practice, or mortgaged, pledged or subjected them to any material Lien, except for Liens for current property Taxes not yet due and payable, or canceled without fair consideration any material debts or claims owing to or held by it; (iil) sold, assigned, transferred, adopted or implemented a plan of liquidation or dissolution; (m) entered into a new line of business or abandoned or permitted to lapse discontinued an existing line of business; (n) split, combined or reclassified any Government Licenses whichshares of capital stock; (o) redeemed, individually purchased or acquired capital stock other than purchases of Company Stock from employees in connection with the aggregatetermination of such employees’ employment; (p) issued, are material to the Business sold or otherwise disposed of any portion thereof, or any of the Proprietary Rights or other intangible assets, or disclosed any material proprietary confidential information to any Person, except in the ordinary course of business consistent with past custom and practicecapital stock, or granted any license options, warrants or sublicense other rights to purchase or obtain (including upon conversion, exchange or exercise) any of any rights under or with respect to any Proprietary Rightsits capital stock; (iiiq) conducted its cash management customs and practices (including, without limitation, made any capital expenditures in excess of the collection of receivables, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than amount set forth in the usual and ordinary course of business consistent with past custom and practiceBudget; (ivr) imposed any Lien (other than a Permitted Lien) upon any of the Company Group’s properties, capital stock or assets, tangible or intangible; (s) adopted, modified or terminated any: (i) employment, severance, retention or other agreement with any current or former employee, officer, director, independent contractor or consultant, (ii) employee benefit plan or (iii) collective bargaining or other agreement with an employee union, in each case whether written or oral; (t) made any loans loan to (or advances forgiveness of any loan to, or guarantees for the benefit of), or entered into any other transaction with PDK or with, any of its other stockholders or any employeestockholders, officer or director of Seller or PDKAffiliates, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employeesdirectors, officers and directors for travel expenses incurred in the ordinary course of business employees; (u) suffered any material damage, destruction or entered into any transaction, arrangement loss (whether or contract (including, without limitation, any transfer of any assets of placing a Lien on any assetsnot covered by insurance) except on an arms-length basis in the ordinary course of business consistent with past custom and practiceto its property; (v) suffered any extraordinary loss, damage, destruction amended or casualty loss authorized the amendment of its certificate of incorporation or waived any rights of material value, whether or not covered by insurance and whether or not in the ordinary course of business or consistent with past custom and practice; (vi) received notification, or become aware of facts which would lead a reasonable person to believe, that any material customer or supplier will stop or decrease in any material respect the rate of business done with the Business; (vii) become subject to any material liabilities, except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into in the ordinary course of business consistent with past custom and practice; (viii) settled or compromised any litigation involving equitable relief or involving any money damages in excess of $50,000bylaws; or (ixw) entered into any other material transactioncontract to do any of the foregoing, other than or any action or omission that would result in any of the ordinary course of business consistent with past custom and practiceforegoing. (b) No party has accelerated, terminated, modified or canceled any Assigned Contract.

Absence of Certain Developments. Other than the sale process conducted by the Company and its affiliates (a) Except including the transactions contemplated by this Agreement), as set forth in the attached "Developments Schedule," since August 31expressly permitted by this Agreement, 1998, Seller has conducted the Business only or in the ordinary course of business consistent with past custom and practice (includingor as set forth in Schedule 3.7, without limitationsince April 1, 2018 until the date hereof, there has not been, with respect to the offering Company, any: (a) event, occurrence or development that has had, or could reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect; (b) amendment of special sales the Articles of Incorporation, bylaws or incentive programs other organizational documents of the Company; (c) split, combination or reclassification of any shares of capital stock of the filling Company (or, in the case of the Subsidiaries, the equity securities of each such Subsidiary); (d) issuance, sale or other disposition of any of its distribution channelscapital stock, or grant of any options, warrants or other rights to purchase or obtain (including upon conversion, exchange or exercise) any of its capital stock; (e) declaration or payment of any cash or non-cash dividends or distributions on or in respect of the capital stock of the Company (or, in the case of the Subsidiaries, the equity securities of each such Subsidiary); (f) material change in any method of accounting or accounting practice of the Company, has except as required by GAAP or as disclosed in the notes to the Company Financial Statements; (g) material change in the Company’s cash management practices and its policies, 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; (h) incurrence, assumption or guarantee of any indebtedness for borrowed money except unsecured current obligations or liabilities incurred no liabilities other than in the ordinary course of business consistent with past custom and practice, and Seller has not:; (i) soldtransfer, assigned assignment, sale or transferred other disposition of any of the assets shown or reflected in the Company Financial Statements or cancellation of any debts or entitlements; (j) transfer, assignment or grant of any license or sublicense of any material rights under or with respect to any Company Intellectual Property Rights (other than non-exclusive licenses granted by the Company or any of its assets, except for sales of inventory Subsidiaries in the ordinary course of business consistent with past custom and practice, or mortgaged, pledged or subjected them to any material Lien, except for Liens for current property Taxes not yet due and payable, or canceled without fair consideration any material debts or claims owing to or held by itbusiness); (iik) soldmaterial damage, assigned, transferred, abandoned destruction or permitted loss (whether or not covered by insurance) to lapse any Government Licenses which, individually or in the aggregate, are material to the Business or any portion thereofits property; (l) capital investment in, or any loan to, any other Person; (m) acceleration, termination, material modification to or cancellation of any material Contract (other than any Company Benefit Plan) to which the Company is a party or by which it is bound, or entry into a material Contract (other than any Company Benefit Plan); (n) capital expenditures in excess of $75,000; (o) imposition of any Lien upon any of the Proprietary Rights Company properties, units or assets, tangible or intangible; (p) except as otherwise specified on Schedule 3.7(p) (i) grant of any bonuses, whether monetary or otherwise, or increase in any wages, salary, severance, pension or other intangible assetscompensation or benefits in respect of its employees, officers, directors, consultants or independent contractors, other than (A) as provided for in any written agreements, programs or policies or Company Benefit Plan, (B) as required by applicable Law or (C) in connection with a new hire or a promotion, (ii) entry into or amendment of any written employment agreement or change in the written terms of employment for any employee (other than in connection with a new hire, a promotion or a demotion) or any involuntary termination of any employees (other than for cause), or disclosed (iii) acceleration of the vesting or payment of any compensation or benefit for any employee, member, manager, consultant or independent contractor, other than as provided for in any written agreements, programs or policies or Company Benefit Plan or as required by applicable Law; (q) except as otherwise specified on Schedule 3.7(q), adoption, modification or termination of any: (i) written Company policies concerning employment, severance or retention of employees, (ii) written Contracts or other written agreements concerning the officers of the Company with respect to such officers’ employment with the Company, (iii) Company Benefit Plan or (iv) collective bargaining or other agreements with a Union other than as provided for in any written agreements or required by applicable Law, in each case, the effect of which would have a material proprietary confidential information effect on the Company’s business; (r) loan to (or forgiveness of any Personloan to) any of its shareholders, directors, officers or employees; (s) except as otherwise specified on Schedule 3.7(s), entry into a new line of business or abandonment or discontinuance of existing lines of business; (t) 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 filing of any bankruptcy petition against it under any similar Law; (u) except as set forth in Schedule 3.7(u), purchase, lease or other acquisition of the right to own, use or lease any property or assets for an amount in excess of $200,000.00 (in the case of a lease, per annum), except in the ordinary course of business consistent with past custom and practice, or granted any license or sublicense of any rights under or with respect to any Proprietary Rights; (iii) conducted its cash management customs and practices (including, without limitation, the collection of receivables, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practice; (iv) made any loans or advances to, or guarantees for the benefit of, or entered into any transaction with PDK or any of its other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer of any assets of placing a Lien on any assets) except on an arms-length basis in the ordinary course of business consistent with past custom and practice; (v) suffered acquisition by merger or consolidation with, or by purchase of a substantial portion of the assets or stock of, any extraordinary loss, damage, destruction or casualty loss or waived any rights of material value, whether or not covered by insurance and whether or not in the ordinary course of business or consistent with past custom and practiceany Person or any division thereof; (viw) received notificationaction by the Company or any of its Subsidiaries to make, change or become aware rescind any Tax election, amend any Tax Return or take any other similar action that would have the effect of facts which would lead causing a reasonable person to believe, that any material customer or supplier will stop or decrease change in any material Tax liability or Tax asset of Parent, the Company or any of its Subsidiaries in respect the rate of business done with the Business; (vii) become subject to any material liabilities, except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into in the ordinary course of business consistent with past custom and practice; (viii) settled or compromised any litigation involving equitable relief or involving any money damages in excess of $50,000Post-Closing Tax Period; or (ixx) entered into taking of any other material transaction, other than action or omitting to take any action that would result in any of the ordinary course of business consistent with past custom and practiceforegoing. (b) No party has accelerated, terminated, modified or canceled any Assigned Contract.

Absence of Certain Developments. Except for the execution and delivery of this Agreement and the transactions to take place pursuant hereto on or prior to the Closing Date or as disclosed in SECTION 2.11 of the Disclosure Schedule, since April 30, 2002 neither the Company nor Lucas has: (a) Except as set forth in the attached "Developments Schedule," since August 31, 1998, Seller has conducted the Business only borrowed any amount or incurred or become suxxxxx to any liability except (i) current liabilities incurred in the ordinary course of business consistent with past custom and practice (ii) liabilities under contracts entered into in the ordinary course of business; (b) granted any Lien or any other encumbrance on any of the Acquired Assets except (i) Liens for current property taxes not yet due and payable, (ii) Liens imposed by law and incurred in the ordinary course of business for obligations not yet due to carriers, warehousemen, laborers, materialmen and the like, or (iii) Liens in respect of pledges or deposits under workers' compensation laws; (c) discharged or satisfied any Lien or paid any liability other than current liabilities paid in the ordinary course of business; (d) sold, assigned or transferred (including, without limitation, with respect transfers to any employees, Affiliates, shareholders or members) any tangible assets of the offering of special sales or incentive programs or the filling of its distribution channels), has incurred no liabilities other than in the ordinary course of business consistent with past custom and practice, and Seller has not: (i) sold, assigned or transferred any of its assets, Business except for sales of inventory in the ordinary course of business consistent with past custom and practicebusiness; (e) disclosed, or mortgaged, pledged or subjected them to any material LienPerson other than its employees, except for Liens for current property Taxes not yet due agents and payablerepresentatives, Buyer or authorized representatives of Buyer, any proprietary confidential information, other than pursuant to a confidentiality agreement prohibiting the use or further disclosure of such information, which agreements are identified in the Disclosure Schedule under the caption referencing this Section 2.09(e) and are in full force and effect on the date hereof; (f) modified or canceled without fair consideration any material debts or claims owing to or held by it; (ii) sold, assigned, transferred, abandoned or permitted to lapse any Government Licenses which, individually or in the aggregate, are material to the Business or any portion thereof, or any of the Proprietary Rights or other intangible assets, or disclosed any material proprietary confidential information to any Person, except in the ordinary course of business consistent with past custom and practice, or granted any license or sublicense of any rights under or with respect to any Proprietary Rights; (iii) conducted its cash management customs and practices (including, without limitation, the collection of receivables, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practice; (iv) made any loans or advances to, or guarantees for the benefit of, or entered into any transaction with PDK or any of its other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer of any assets of placing a Lien on any assets) except on an arms-length basis in the ordinary course of business consistent with past custom and practice; (v) suffered any extraordinary loss, damage, destruction or casualty loss or waived any rights of material valuevalue or suffered any extraordinary losses or adverse changes in collection loss experience, whether or not covered by insurance and whether or not in the ordinary course of business or consistent with past custom and practice; (vig) received notificationentered into any transaction, or become aware of facts which would lead a reasonable person to believemodified any agreement, that arrangement or understanding, with any material customer or supplier will stop or decrease in any material respect the rate of business done with the BusinessInsider; (viih) become subject to entered into, terminated or modified any other material liabilities, agreement except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into in the ordinary course of business consistent with past custom and practice; (viiii) settled suffered any material theft, damage, destruction or compromised loss of or to any litigation involving equitable relief property or involving any money damages properties owned or used by it in excess of $50,000; orconnection with the Business, whether or not covered by insurance; (ixj) made or granted any bonus or any wage, salary or compensation increase to any director, officer, employee with a base salary or base compensation of more than $5,000 per year, or consultant; (k) entered into or modified any other material transactionemployment agreement, other than in the ordinary course of business consistent arrangement or understanding with past custom and practice.any director, officer or employee; (b1) No party has acceleratedmade or granted any increase in any employee benefit plan or arrangement, terminatedor amended or terminated any existing employee benefit plan or arrangement, modified or canceled adopted any Assigned Contract.new employee benefit plan or arrangement or made any commitment or incurred any liability to any labor organization;

Absence of Certain Developments. (a) Except as set forth in for the attached "Developments Schedule," transactions contemplated by this Agreement, since August October 31, 19982020, Seller has conducted the neither SamCo nor MII Life’s Spending Account Business only in the ordinary course of business consistent with past custom and practice (including, without limitation, with respect to the offering of special sales or incentive programs or the filling of its distribution channels), has incurred no liabilities other than in the ordinary course of business consistent with past custom and practice, and Seller has nothas: (ia) sold, assigned or otherwise transferred any Accounts, or disposed of or permitted to lapse any rights in any Permit owned, purported to be owned or used by such Seller primarily with respect to its assetsSpending Account Business, except for sales of inventory other than in the ordinary course Ordinary Course of business consistent with past custom and practiceBusiness, or mortgaged, pledged or subjected them to acquired any material Lien, except for Liens for current property Taxes not yet due and payable, or canceled without fair consideration any material debts or claims owing to or held by itAccounts outside of the Ordinary Course of Business; (iii) disposed of, sold, assigned, transferred, abandoned licensed, abandoned, granted, pledged, encumbered, dedicated to the public domain or permitted to lapse any Government Licenses whichrights in any Owned Intellectual Property, individually or other than non-exclusive licenses granted in the aggregate, are material to the Business or any portion thereofOrdinary Course of Business, or (ii) disclosed any of the Proprietary Rights Trade Secrets or Source Code to a third party, other than pursuant to a valid and binding confidentiality agreement or other intangible assets, binding obligation of confidentiality that MII Life or disclosed any material proprietary confidential information to any Person, except SamCo entered into in the ordinary course Ordinary Course of business consistent with past custom and practice, or granted any license or sublicense of any rights under or with respect to any Proprietary RightsBusiness; (iiic) conducted its cash management customs and practices (includingsuffered, without limitation, sustained or incurred any material Loss related to the collection of receivables, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practice; (iv) made any loans or advances to, or guarantees for the benefit of, or entered into any transaction with PDK or any of its other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer of any assets of placing a Lien on any assets) except on an arms-length basis in the ordinary course of business consistent with past custom and practice; (v) suffered any extraordinary loss, damage, destruction or casualty loss Accounts or waived or released any rights of material valueright or claim related to the Accounts, whether or not covered by insurance and in each case whether or not in the ordinary course Ordinary Course of business Business; (d) engaged in any transaction related to the Purchased Accounts not in the Ordinary Course of Business; (e) subjected any of the Acquired Assets to any Encumbrance (other than Permitted Encumbrances); (f) waived, released, instituted, settled or agreed to settle any Proceeding; (g) failed to keep in full force and effect insurance in amount and scope of coverage consistent with past custom and practice; (vih) received notificationnotice from any customer, Governmental Body or any other Person, or become aware of facts any group thereof, which would lead a reasonable person is reasonably expected to believe, that any be material customer or supplier will stop or decrease in any material respect to the rate of business done with the Spending Account Business; (viii) become subject (i) acquired or agreed to acquire by merging or consolidating with, or by purchasing a substantial portion of the assets of, or by any other manner, directly or indirectly, any Person or business or any corporation, limited liability company, partnership, joint venture, association or other business organization or division thereof, or (ii) entered into any Contract with respect to any material liabilities, except current liabilities incurred in of the ordinary course of business and liabilities under contracts entered into in the ordinary course of business consistent with past custom and practiceforegoing; (viiij) settled materially amended any Assumed Contract or compromised terminated any litigation involving equitable relief material Contract related to the Spending Account Business or involving waived, released or assigned any money damages in excess of $50,000material rights or claims thereunder; (k) changed or modified existing credit, collection or payment policies, procedures and practices; (l) made any material change to its accounting methods, principles or practices or to the working capital policies applicable to the Spending Account Business, except as required by GAAP; or (ixm) entered into taken any other material transaction, other than action or omitted to take any action that would result in the ordinary course occurrence of business consistent with past custom and practiceany of the foregoing. (b) No party has accelerated, terminated, modified or canceled any Assigned Contract.

Absence of Certain Developments. (a) Except as set forth disclosed in the attached "Developments Schedule," Company Financial Statements or as otherwise contemplated by this Agreement, since August 31the date of the Company Latest Balance Sheet, 1998, Seller the Company has conducted the Business its business only in the ordinary course of business consistent with past custom practice and practice there has not occurred or been entered into, as the case may be: (includingi) any event having a Material Adverse Effect on the Company, without limitation(ii) any event that could reasonably be expected to prevent or materially delay the performance of the Company’s obligations pursuant to this Agreement, with (iii) any material change by the Company in its accounting methods, principles or practices, (iv) any declaration, setting aside or payment of any dividend or distribution in respect to of the offering shares of special sales common stock of the Company or incentive programs any redemption, purchase or other acquisition of any of the filling of its distribution channels)Company’s securities, has incurred no liabilities (v) other than in the ordinary course of business consistent with past custom and practice, and Seller has not: (ia) sold, assigned or transferred any of its assets, except for sales of inventory increase in the ordinary course of business consistent with past custom and practice, compensation or mortgaged, pledged benefits payable or subjected them to become payable to any material Lien, except for Liens for current property Taxes not yet due and payable, officers or canceled without fair consideration any material debts or claims owing to or held by it; (ii) sold, assigned, transferred, abandoned or permitted to lapse any Government Licenses which, individually or in the aggregate, are material to the Business or any portion thereof, or any directors of the Proprietary Rights Company or (b) the establishment of any bonus, severance, deferred compensation, pension, retirement, profit sharing, stock option, stock purchase or other intangible assetsemployee benefit plan of the Company, or disclosed any material proprietary confidential information to any Person, except in the ordinary course of business consistent with past custom and practice, or granted any license or sublicense of any rights under or with respect to any Proprietary Rights; (iii) conducted its cash management customs and practices (including, without limitation, the collection of receivables, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)vi) other than issuances of stock options pursuant to the 2003 Plan (or shares of Company Common Stock in connection with the usual exercise of any stock options) and ordinary course in connection with the Private Placement, any issuance, grants or sale of business consistent with past custom and practice; (iv) made any loans stock, options, warrants, notes, bonds or advances toother securities, or guarantees for the benefit of, or entered entry into any transaction agreement with PDK or any of its other stockholders or any employeerespect thereto by the Company, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer of any assets of placing a Lien on any assets) except on an arms-length basis in the ordinary course of business consistent with past custom and practice; (v) suffered any extraordinary loss, damage, destruction or casualty loss or waived any rights of material value, whether or not covered by insurance and whether or not in the ordinary course of business or consistent with past custom and practice; (vi) received notification, or become aware of facts which would lead a reasonable person to believe, that any material customer or supplier will stop or decrease in any material respect the rate of business done with the Business; (vii) become subject other than as contemplated by Section 3.1 hereof, any amendment to any material liabilitiesthe certificate of incorporation or bylaws of the Company, except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into in the ordinary course of business consistent with past custom and practice; (viii) settled or compromised any litigation involving equitable relief or involving any money damages in excess of $50,000; or (ix) entered into any other material transaction, other than in the ordinary course of business consistent with past custom practice, any (w) capital expenditures by the Company, (x) purchase, sale, assignment or transfer of any material assets by the Company, (y) mortgage, pledge or existence of any lien, encumbrance or charge on any material assets or properties, tangible or intangible of the Company, except for liens for Taxes not yet due and such other liens, encumbrances or charges which do not, individually or in the aggregate, have a Material Adverse Effect on the Company or the Surviving Company, or (z) cancellation, compromise, release or waiver by the Company of any rights of material value or any material debts or claims, (ix) any incurrence by the Company of any material liability (absolute or contingent), except for current liabilities and obligations incurred in the ordinary course of business consistent with past practice, (x) damage, destruction or similar loss, whether or not covered by insurance, materially affecting the business or properties of the Company, (xi) other than in connection with the Private Placement and this Agreement, entry into any agreement, contract, lease or license other than in the ordinary course of business consistent with past practice, (xii) any termination, material modification or cancellation of any agreement, contract, lease or license to which the Company is a party or by which it is bound, (xiii) entry by the Company into any loan in excess of $10,000 with any officers or directors of the Company, (xiv) any charitable or other capital contribution by the Company or pledge therefore, (xv) entry by the Company into any transaction of a material nature other than in the ordinary course of business consistent with past practice, or (xvi) any negotiation or agreement by the Company to do any of the things described in the preceding clauses (i) through (xv). (b) No party has accelerated, terminated, modified or canceled any Assigned Contract.

Absence of Certain Developments. (a) Except as expressly set forth in the attached "Developments Schedule," on Schedule 4.7, since August 31, 19982007 (or such other date as set forth below): (i) there has not been any damage, destruction or loss, whether or not covered by insurance, with respect to the property and assets of either UBES or UBEI, having a replacement cost of more than $5,000 for any single loss or $50,000 for all such losses; (ii) there has not been any declaration, setting aside or payment of any distribution in respect of the membership interests in UBES or UBEI or any repurchase, redemption or other acquisition by any of the Seller or UBES of UBEI of any outstanding membership interests or other securities of, or other ownership interest in, either UBES or UBEI; (iii) neither of UBES nor UBEI nor Seller, with respect to any current or former Seller employee involved in the UBES Business or UBEI Business, has conducted (A) awarded or paid any bonuses to employees of UBES or UBEI with respect to the fiscal year ended on the UBES Balance Sheet or the UBEI Balance Sheet, respectively, or with respect to the current fiscal year of UBES or UBEI, respectively, except to the extent accrued on the Interim Balance Sheet, (B) entered into any employment, deferred compensation, severance or similar agreement (nor amended any such agreement) except to the extent accrued on the Interim Balance Sheet; (iv) there has not been any change by UBES or UBEI (or Seller as to the Business only only) in accounting or Tax reporting principles, methods or policies; (v) neither of UBES nor UBEI has entered into any transaction or Material Contract or conducted its business (with respect to any of the above, other than in the Ordinary Course of Business consistent with past practice); (vi) neither of UBES nor UBEI has failed to promptly pay and discharge current liabilities in the Ordinary Course of Business consistent with past practices, except for liabilities that were or are being disputed in good faith by appropriate proceedings and, if material, are reflected in the Interim Balance; (vii) neither of UBES nor UBEI has made any loans, advances or capital contributions to, or investments in, any Person or paid any fees or expenses to Seller or any Affiliate of Seller other than as reflected in the Interim Balance Sheet; (viii) none of Seller, UBES or UBEI, as to UBES or UBEI or the assets of UBES or UBEI, has mortgaged, pledged or subjected to any Lien any of their assets, respectively, other than any Lien constituting a purchase money security interest with respect to any assets acquired in the Ordinary Course of Business after October 19, 2007, or acquired any assets or sold, assigned, transferred, conveyed, leased or otherwise disposed of in the ordinary course of business consistent with past custom practice; (ix) neither of UBES nor UBEI has discharged or satisfied any Lien, or paid any obligation or liability (fixed or contingent), except in the Ordinary Course of Business consistent with past practice; (x) since August 31, 2007, none of Seller, UBES or UBEI has canceled or compromised any account receivable, debt or claim or amended, canceled, terminated, relinquished, waived or released any Contract or right except in the Ordinary Course of Business consistent with past practice other than as has been provided to Buyer in writing; (xi) neither of UBES nor UBEI has made or committed to make any capital expenditures or capital additions or betterments not reflected in the balance sheet in excess of $5,000 individually or $50,000 in the aggregate; (xii) neither of UBES nor UBEI entered into or extended existing customer contracts for a period exceeding one year or having a projected annual revenue of greater than $250,000; (xiii) neither of UBES nor UBEI has instituted, become a party to, been threatened with, have Knowledge of any claim, or settled any material Legal Proceeding; (xiv) neither of UBES nor UBEI has amended, modified or waived any term or provision of any lease or other agreement between it and practice Seller or an Affiliate of Seller, or, since October 19, 2007,any other Person, other than waivers that may have been granted in the Ordinary Course of Business with respect to immaterial issues involving such leases or other agreements or the termination of any marketing or procurement agreements between Seller or Seller’s Affiliates and UBES or UBEI; (includingxv) none of Seller, without limitationUBES or UBEI has made or revoked any Tax election, or settled or compromised any Tax dispute; (xvi) except with respect to East Kansas Agri-Energy, LLC and LifeLine Foods, LLC, none of Seller, UBES or UBEI is aware of, or has received formal notice of termination pursuant to the notice provisions of any of the Material Contracts, and none of Seller, UBES or UBEI has received notice from, or given notice to, any of such vendors, suppliers, or customers with respect to the offering of special sales or incentive programs or the filling of its distribution channels), has incurred no liabilities other than in the ordinary course of business consistent with past custom and practice, and Seller has not: (i) sold, assigned or transferred any of its assets, except for sales of inventory in the ordinary course of business consistent with past custom and practicetermination of, or mortgagedintent to terminate, pledged or subjected them to any material Lien, except for Liens for current property Taxes not yet due and payable, or canceled without fair consideration any material debts or claims owing to or held by itbusiness relationship with either of UBES nor UBEI; (iixvii) sold, assigned, transferred, abandoned or permitted to lapse any Government Licenses which, individually or in the aggregate, are material to the Business or any portion thereof, or any neither of the Proprietary Rights or other intangible assets, or disclosed any material proprietary confidential information to any Person, except in the ordinary course of business consistent with past custom and practice, or granted any license or sublicense of any rights under or with respect to any Proprietary Rights; (iii) conducted its cash management customs and practices (including, without limitation, the collection of receivables, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practice; (iv) made any loans or advances to, or guarantees for the benefit of, or UBES nor UBEI has entered into any transaction Contracts with PDK Seller or any of its other stockholders or any employee, officer or director Affiliate of Seller or PDKpredecessors or successors of Seller, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer of any assets of placing a Lien on any assets) except on an arms-length basis in the ordinary course of business consistent with past custom and practice;its Affiliates; and (vxviii) suffered any extraordinary lossneither Seller, damage, destruction or casualty loss or waived any rights of material value, whether or not covered by insurance and whether or not in the ordinary course of business or consistent with past custom and practice; (vi) received notification, or become aware of facts UBES nor UBEI have agreed to anything which would lead a reasonable person to believe, that contravene any material customer or supplier will stop or decrease information set forth in any material respect the rate of business done with the Business; (vii) become subject to any material liabilities, except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into in the ordinary course of business consistent with past custom and practice; (viii) settled or compromised any litigation involving equitable relief or involving any money damages in excess of $50,000; or (ix) entered into any other material transaction, other than in the ordinary course of business consistent with past custom and practicethis Section 4.7. (b) No party has accelerated, terminated, modified or canceled any Assigned Contract.

Absence of Certain Developments. (a) Except as expressly ------------------------------- contemplated by this Agreement or as set forth in on the attached "Developments ------------ Schedule," , to the Knowledge of the Company and the Shareholders, since August 31September -------- 30, 19981996, Seller each of the Company and its Subsidiaries has conducted the Business its business only in the ordinary course of business consistent with past custom and practice (including, without limitation, with respect to the offering of special sales or incentive programs or the filling of its distribution channels), has incurred no liabilities other than in the ordinary course of business consistent with past custom and practice, and Seller each of the Company and its Subsidiaries has not: (i) soldissued any notes, assigned bonds or transferred other debt securities or any of its assetscapital stock or other equity securities or any securities or rights convertible, except for sales of inventory exchangeable or exercisable into any capital stock or other equity securities; (ii) incurred any Indebtedness, other than any Indebtedness incurred in the ordinary course of business consistent with past custom and practice, or mortgaged, pledged or subjected them to any material Lien, except for Liens for current property Taxes not yet due and payable, or canceled without fair consideration any material debts or claims owing to or held by it; (ii) sold, assigned, transferred, abandoned or permitted to lapse any Government Licenses which, individually or in the aggregate, are material to the Business or any portion thereof, or any of the Proprietary Rights or other intangible assets, or disclosed any material proprietary confidential information to any Person, except in the ordinary course of business consistent with past custom and practice, or granted any license or sublicense of any rights under or with respect to any Proprietary Rights; (iii) conducted its cash management customs and practices (includingdischarged or satisfied any material Lien or paid any material obligation or liability, without limitation, the collection of receivables, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than current liabilities paid in the usual and ordinary course of business consistent with past custom and practice; (iv) declared, set aside or made any loans payment or advances todistribution of cash or other property to the Shareholders with respect to their capital stock or other equity securities or purchased, redeemed or guarantees for the benefit ofotherwise acquired any shares of its capital stock or other equity securities (including any warrants, options or entered into any transaction with PDK other rights to acquire its capital stock or other equity securities); (v) mortgaged or pledged any of its other stockholders properties or assets or subjected them to any employee, officer or director of Seller or PDKLien, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employeesPermitted Liens; (vi) sold, officers and directors for travel expenses incurred in the ordinary course assigned, transferred, leased, licensed or abandoned any of business its assets, tangible or entered into any transaction, arrangement or contract intangible (including, without limitation, any transfer of any assets of placing a Lien on any assets) the Intellectual Property Rights), except on an arms-length basis in the ordinary course of business consistent with past custom and practice; (vvii) made or granted any bonus or any wage or salary increase to any employee or group of employees (except as required by pre-existing contracts described on the attached Contracts Schedule), or made or granted ------------------ any increase in any employee benefit plan or arrangement (except as required by the plan documents), or amended or terminated any existing employee benefit plan or arrangement or adopted any new employee benefit plan or arrangement; (viii) entered into any long-term paper supply contracts or otherwise purchased or committed to purchase paper in excess of the Company's forecasted needs for the 90-day period following the date of such contract or such purchase or commitment; (ix) made capital expenditures or commitments therefor that aggregate in excess of $250,000; (x) delayed, postponed or cancelled the payment of any accounts payable or any other liability or obligation (other than as a result of a good faith dispute) or agreed or negotiated with any party to extend the payment date of any accounts payable or accelerated the collection of any accounts or notes receivable; (xi) except with respect to OpCo and other than the endorsement of checks in the ordinary course of business, made any loans or advances to, Guarantees for the benefit of, or any Investments in, any Persons or formed any Subsidiary; (xii) suffered any extraordinary loss, damage, destruction or casualty loss or waived any rights of material valueexceeding in the aggregate $500,000, whether or not covered by insurance and whether insurance, or not experienced any material reductions in the ordinary course coverage amount and scope of business or consistent with past custom and practiceinsurance coverage; (vixiii) received notificationmade any change in any method of accounting or accounting policies, other than those required by GAAP which have been disclosed in writing to the Purchaser, or become aware of facts which would lead a reasonable person to believe, that made any material customer or supplier will stop or decrease in any material respect the rate of business done with the Business; (vii) become subject to any material liabilities, except current liabilities incurred write-down in the ordinary course value of business and liabilities under contracts entered into its inventory that is material or that is other than in the ordinary course of business consistent with past custom and practice; (viiixiv) settled directly or compromised indirectly engaged in any litigation involving equitable relief transaction or involving entered into any money damages in excess arrangement with any officer, director, partner, shareholder or other Affiliate of $50,000the Company; (xv) except as contemplated hereby, amended its articles of incorporation, bylaws or other organizational documents; or (ixxvi) entered into agreed, whether orally or in writing, to do any other material transaction, other than in of the ordinary course of business consistent with past custom and practiceforegoing. (b) No party has accelerated, terminated, modified or canceled any Assigned Contract.

Absence of Certain Developments. Since the Balance Sheet Date, neither Imagyn nor either Seller has, in each case, with respect to the Assets or the Business: (a) Except as set forth in the attached "Developments Schedule," since August 31, 1998, Seller has conducted the Business only borrowed any amount or incurred or become subject to any liability except (i) current liabilities incurred in the ordinary course of business consistent with past custom of the Business and practice (ii) liabilities under contracts entered into in the ordinary course of business of the Business; (b) mortgaged, pledged or subjected to any lien, charge or any other encumbrance ("Liens"), any of the Assets; (c) discharged or satisfied any Liens or paid any liability, other than current liabilities paid in the ordinary course of business of the Business; (d) sold, assigned or transferred (including, without limitation, with respect transfers to any employees, affiliates or shareholders) any tangible assets of the Business or canceled any debts or claims, except in the ordinary course of business of the Business; (e) sold, assigned or transferred (including, without limitation, transfers to any employees, affiliates or shareholders) any patents, trademarks, trade names, copyrights, CE mxxxx, xxade secrets or other intangible assets used in or held for use in the Business; (f) disclosed, to any person other than Buyer and authorized representatives of Buyer, any proprietary confidential information of the Business or otherwise related to the offering Assets, other than pursuant to a confidentiality agreement prohibiting the use or further disclosure of special sales such information, which agreement is identified in the Disclosure Schedule and is in full force and effect on the date; (g) waived any rights of material value or incentive programs suffered any extraordinary losses or adverse changes in collection loss experience, whether or not in the filling ordinary course of its distribution channels), has incurred no liabilities business or consistent with past practice; (h) taken any other action or entered into any other transaction other than in the ordinary course of business consistent with past custom and practice, and Seller has not: (i) sold, assigned or transferred any of its assets, except for sales of inventory in the ordinary course of business consistent accordance with past custom and practice, or mortgaged, pledged or subjected them to entered into any material Lien, except for Liens for current property Taxes not yet due transaction with any "insider" (as defined in Section 4.20) other than employment arrangements otherwise disclosed in this Agreement and payablethe Disclosure Schedule, or canceled without fair consideration any material debts or claims owing to or held the transactions contemplated by itthis Agreement; (iii) soldsuffered any material theft, assigneddamage, transferred, abandoned destruction or permitted to lapse any Government Licenses which, individually loss of or in the aggregate, are material to the Business Assets or any portion thereofproperty or properties owned or used by it in connection with the Business, whether or any of the Proprietary Rights or other intangible assets, or disclosed any material proprietary confidential information to any Person, except in the ordinary course of business consistent with past custom and practice, not covered by insurance; (j) made or granted any license bonus or sublicense of any rights under wage, salary or with respect compensation increase to any Proprietary Rightsemployee of the Business who earns more than $50,000 per year, or consultant or made or granted any increase in any employee benefit plan or arrangement, or amended or terminated any existing employee benefit plan or arrangement, or adopted any new employee benefit plan or arrangement or made any commitment or incurred any liability to any labor organization; (iiik) conducted its cash management customs and practices (including, without limitation, the collection made any single capital expenditure or commitment therefor in excess of receivables, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practice$10,000; (ivl) made any loans or advances to, or guarantees for the benefit of, any persons such that the aggregate amount of such loans, advances or entered into guarantees at any transaction with PDK or any of its other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer of any assets of placing a Lien on any assets) except on an arms-length basis in the ordinary course of business consistent with past custom and practice; (v) suffered any extraordinary loss, damage, destruction or casualty loss or waived any rights of material value, whether or not covered by insurance and whether or not in the ordinary course of business or consistent with past custom and practice; (vi) received notification, or become aware of facts which would lead a reasonable person to believe, that any material customer or supplier will stop or decrease in any material respect the rate of business done with the Business; (vii) become subject to any material liabilities, except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into in the ordinary course of business consistent with past custom and practice; (viii) settled or compromised any litigation involving equitable relief or involving any money damages time outstanding is in excess of $50,00010,000; or (ixm) entered into agreed or committed to any other material transaction, other than of the actions referred to in the ordinary course of business consistent with past custom and practiceclauses (a) through (l) above. (b) No party has accelerated, terminated, modified or canceled any Assigned Contract.

Absence of Certain Developments. (a) Except as expressly contemplated by this Agreement or as set forth in on the attached "Developments Schedule," DEVELOPMENTS SCHEDULE, since August July 31, 19981997, Seller has conducted the Business only in the ordinary course of business consistent with past custom and practice (including, without limitation, with respect to the offering of special sales or incentive programs or the filling of its distribution channels), has incurred no liabilities other than in the ordinary course of business consistent with past custom and practice, and Seller Company has not: (i) soldissued any notes, assigned bonds or transferred other debt securities or any of its assetscapital stock or other equity securities or any securities or rights convertible, except for sales of inventory in the ordinary course of business consistent with past custom and practice, exchangeable or mortgaged, pledged exercisable into any capital stock or subjected them to any material Lien, except for Liens for current property Taxes not yet due and payable, or canceled without fair consideration any material debts or claims owing to or held by itother equity securities; (ii) sold, assigned, transferred, abandoned borrowed any amount or permitted to lapse any Government Licenses which, individually incurred or in the aggregate, are material to the Business or any portion thereof, or any of the Proprietary Rights or other intangible assets, or disclosed any material proprietary confidential information to any Person, except in the ordinary course of business consistent with past custom and practice, or granted any license or sublicense of any rights under or with respect to any Proprietary Rights; (iii) conducted its cash management customs and practices (including, without limitation, the collection of receivables, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practice; (iv) made any loans or advances to, or guarantees for the benefit of, or entered into any transaction with PDK or any of its other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer of any assets of placing a Lien on any assets) except on an arms-length basis in the ordinary course of business consistent with past custom and practice; (v) suffered any extraordinary loss, damage, destruction or casualty loss or waived any rights of material value, whether or not covered by insurance and whether or not in the ordinary course of business or consistent with past custom and practice; (vi) received notification, or become aware of facts which would lead a reasonable person to believe, that any material customer or supplier will stop or decrease in any material respect the rate of business done with the Business; (vii) become subject to any material liabilities, except current liabilities incurred in the ordinary course of business consistent with past practice and liabilities under contracts entered into in the ordinary course of business; (iii) discharged or satisfied any material Lien or paid any material obligation or liability, other than current liabilities paid in the ordinary course of business; (iv) declared, set aside or made any payment or distribution of cash or other property to any of the Company's shareholders with respect to such shareholder's capital stock or other equity securities or purchased, redeemed or otherwise acquired any shares of its capital stock or other equity securities (including any warrants, options or other rights to acquire its capital stock or other equity securities); (v) mortgaged or pledged any of its properties or assets or subjected them to any Lien, except for Permitted Encumbrances; (vi) sold, assigned, transferred, leased, licensed or otherwise encumbered any of its material tangible assets, except in the ordinary course of business consistent with past custom and practice, or canceled any material debts or claims; (viiivii) settled sold, assigned, transferred, leased, licensed or compromised otherwise encumbered any litigation involving equitable relief Intellectual Property Rights or involving other intangible assets, disclosed any money damages in excess of $50,000; or material proprietary confidential information to any Person (ix) entered into any other material transaction, than to the Purchasers and other than in the ordinary course of business consistent with past custom and practice.practice in circumstances in which it has imposed reasonable confidentiality restrictions), or abandoned or knowingly permitted to lapse any Intellectual Property Rights; (bviii) No made or granted any bonus or any wage or salary increase to any employee or group of employees (except as required by pre-existing contracts described on the attached CONTRACTS SCHEDULE or in the ordinary course of business consistent with past practice), or made or granted any increase in any employee benefit plan or arrangement, or amended or terminated any existing employee benefit plan or arrangement or adopted any new employee benefit plan or arrangement; (ix) suffered any extraordinary losses or waived any rights of material value (whether or not in the ordinary course of business or consistent with past practice); (x) made capital expenditures or commitments therefor that aggregate in excess of $250,000; (xi) delayed or postponed the payment of any accounts payable or any other liability or obligation or agreed or negotiated with any party has acceleratedto extend the payment date of any accounts payable or accelerated the collection of any accounts or notes receivable; (xii) made any loans or advances to, terminatedguarantees for the benefit of, modified or canceled any Assigned ContractInvestments in, any Persons (other than advances to the Company's employees in the ordinary course of business consistent with past practice); (xiii) made any charitable contributions or pledges exceeding in the aggregate $10,000; (xiv) suffered any damage, destruction or casualty loss exceeding in the aggregate $25,000, whether or not covered by insurance; (xv) made any change in any method of accounting or accounting policies, other than those required by GAAP which have been disclosed in writing to the Purchasers, or made any write-down in the value of its inventory that is material or that is other than in the usual, regular and ordinary course of business consistent with past practice; (xvi) made any Investment in or taken any steps to incorporate any Subsidiary; (xvii) amended its articles of incorporation, by-laws or other organizational documents; (xviii) entered into any agreement or arrangement prohibiting or restricting it from freely engaging in any business or otherwise restricting the conduct of its business; (xix) entered into any contract other than in the ordinary course of business consistent with past practice, entered into any other material transaction, whether or not in the ordinary course of business or consistent with past practice, or materially changed any business practice; or (xx) agreed, whether orally or in writing, to do any of the foregoing.

Absence of Certain Developments. (a) Since the Union Balance Sheet Date, there has not been any Union Material Adverse Effect. Except as set forth expressly contemplated hereby, since the Union Balance Sheet Date, Union has carried on and operated its business in the attached "Developments Schedule," since August 31, 1998, Seller has conducted the Business only all material respects in the ordinary course of business consistent with past custom practice, and practice Union has not: (includinga) amended or modified its Organizational Documents; (b) sold, without limitationleased, assigned, transferred or purchased any material tangible assets, in each case in a single or related series of transactions, except in the ordinary course of business; (c) issued, sold, redeemed or transferred any of its capital stock or other equity securities, securities convertible into its capital stock or other equity securities or warrants, options or other rights to acquire its capital stock or other equity securities, or any bonds or debt securities; (d) prior to the date hereof, declared or paid any dividend or other distribution of the assets of Union; (e) made or approved any material changes in its employee benefit plans or made any material changes in wages, salary, or other compensation, including severance, with respect to the offering of special sales its current or incentive programs former officers, directors or the filling of its distribution channels), has incurred no liabilities executive employees other than increases in base salaries and wages that are consistent with past practices or as required by applicable Law or any Union Plan; (f) paid, loaned or advanced (other than the payment of compensation and benefits in the ordinary course of business consistent with past custom and practicepractice or the payment, and Seller has not: (i) sold, assigned advance or transferred any reimbursement of its assets, except for sales of inventory business expenses in the ordinary course of business consistent with past custom and practicepractice or 401(k) plan loans) any amounts to, or mortgagedsold, pledged transferred or subjected them to leased any material Lien, except for Liens for current property Taxes not yet due and payableof its assets to, or canceled without fair consideration entered into any material debts other transactions with, any of its Affiliates, or claims owing to made any loan to, or held by itentered into any other transaction with, any of its directors or officers outside the ordinary course of business or other than at arm’s length; (g) except as required by applicable Law, adopted or materially amended any Union Plans; (h) hired or terminated any officers or employees of Union with fixed annual compensation in excess of $150,000, with respect to non-officer employees, other than in the ordinary course of business; (i) commenced or settled any Action in which the amount in dispute is in excess of $100,000; (j) made any material change in accounting principles, methods, procedures or policies, except as required by GAAP; (k) made, changed or revoked any material Tax election, or settled or compromised any material Tax claim or liabilities, or filed any substantially amended material Tax Return; (i) authorized, proposed, entered into or agreed to enter into any plan of liquidation, dissolution or other reorganization or (ii) authorized, proposed, entered into or agreed to enter into any merger, consolidation or business combination with any Person; (m) except in the ordinary course of business, incurred or discharged any Indebtedness; (n) made capital expenditures or capital additions or betterments in excess of $100,000 in the aggregate; (o) suffered any material damage, destruction or loss, whether or not covered by insurance; (p) sold, assigned, transferred, abandoned or permitted allowed to lapse or expire any Government Licenses which, individually or in the aggregate, are material to the Business or any portion thereof, or any of the Proprietary Rights Intellectual Property rights or other intangible assetsassets owned, used or disclosed licensed by Union in connection with any material proprietary confidential information to any Person, except in product of Union or the ordinary course operation of business consistent with past custom and practice, or granted any license or sublicense of any rights under or with respect to any Proprietary Rightsits business; (iiiq) conducted its cash management customs and practices (includingbeen subject to any claim or threat of infringement, without limitation, the collection misappropriation or other violation by or against Union of receivables, payment Intellectual Property rights of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms Union or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practicea third party; (ivr) made any loans or advances to, or guarantees for materially reduced the benefit of, or entered into any transaction with PDK or any of its other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer amount of any assets of placing a Lien on any assets) except on an arms-length basis in the ordinary course of business consistent with past custom and practice; (v) suffered any extraordinary loss, damage, destruction or casualty loss or waived any rights of material value, whether or not covered insurance coverage provided by existing insurance and whether or not in the ordinary course of business or consistent with past custom and practice; (vi) received notification, or become aware of facts which would lead a reasonable person to believe, that any material customer or supplier will stop or decrease in any material respect the rate of business done with the Business; (vii) become subject to any material liabilities, except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into in the ordinary course of business consistent with past custom and practice; (viii) settled or compromised any litigation involving equitable relief or involving any money damages in excess of $50,000policies; or (ixs) entered into committed to do any other material transaction, other than in of the ordinary course of business consistent with past custom and practiceforegoing. (b) No party has accelerated, terminated, modified or canceled any Assigned Contract.

Absence of Certain Developments. (a) Since the Balance Sheet Date, there has not occurred any Material Adverse Effect. Except as set forth in Section 4.06 of the attached "Developments Schedule," Disclosure Schedule and except as expressly contemplated by this Agreement, since August 31the Balance Sheet Date, 1998, Seller the Company has conducted its business in the Business only ordinary course, consistent with past practice, and the Company has not: (a) mortgaged, pledged or subjected to any Lien any of its material assets, except Permitted Liens; (b) sold, assigned or transferred any material portion of its tangible assets, except in the ordinary course of business consistent with past custom and practice; (c) issued, sold, redeemed or transferred any of its Equity Interests, securities convertible into its Equity Interests or other equity securities or warrants, options or other rights to acquire its Equity Interests or other equity securities, or any bonds or debt securities; (d) amended its certificate of formation or operating agreement or other applicable organizational documents; (e) acquired by merger, equity purchase or consolidation with, or by purchase of a substantial portion of the assets or stock of, or by any other manner, any business or any division thereof; (f) made any material capital investment in, or any material loan to, any other Person; (g) made any material capital expenditures or commitments therefor, except in the ordinary course of business consistent with past practice or pursuant to its existing capital expenditure budget; (includingh) deferred an capital expenditures, without limitationexcept in the ordinary course of business consistent with past practice; (i) made any changes in wages, salary or other compensation with respect to its officers, directors or employees, in each case other than changes made in the offering ordinary course of special sales business consistent with past practice or incentive programs pursuant to existing agreements or arrangements listed on Section 4.10 of the filling Disclosure Schedule; (j) paid, loaned or advanced (other than the payment of salary and benefits, the payment, advancement or reimbursement of expenses in the ordinary course of business consistent with past practice) any amounts to, or sold, transferred or leased any of its distribution channels)assets to, has incurred no liabilities or entered into any other transactions with, any of its Affiliates other than in the ordinary course of business consistent with past custom and practice, and Seller has not:; (ik) soldcommenced or settled any litigation involving an amount in excess of $75,000 for any one case; (l) cancelled or waived any claims with a potential value in excess of $75,000, assigned or transferred any of its assets, except for sales of inventory other than in the ordinary course of business consistent with past custom and practice, or mortgaged, pledged or subjected them to any material Lien, except for Liens for current property Taxes not yet due and payable, or canceled without fair consideration any material debts or claims owing to or held by itbusiness; (iim) soldterminated, assigned, transferredamended, abandoned or permitted to lapse any Government Licenses which, individually or in the aggregate, are material to the Business or any portion thereof, or any of the Proprietary Rights or other intangible assets, or disclosed any material proprietary confidential information to any Person, except in the ordinary course of business consistent with past custom and practice, or granted any license or sublicense of any rights under or with respect to any Proprietary Rights; (iii) conducted its cash management customs and practices (including, without limitation, the collection of receivables, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practice; (iv) made any loans or advances to, or guarantees for the benefit of, or entered into any transaction with PDK or any of its other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer of any assets of placing a Lien on any assets) except on an arms-length basis in the ordinary course of business consistent with past custom and practice; (v) suffered any extraordinary loss, damage, destruction or casualty loss canceled or waived any rights of material value, whether or not covered by insurance and whether or not in the ordinary course of business or consistent with past custom and practice; (vi) received notification, or become aware of facts which would lead a reasonable person to believe, that right under any material customer or supplier will stop or decrease in any material respect the rate of business done with the Business; (vii) become subject to any material liabilities, except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into in the ordinary course of business consistent with past custom and practice; (viii) settled or compromised any litigation involving equitable relief or involving any money damages in excess of $50,000; or (ix) entered into any other material transactionMaterial Contract, other than in the ordinary course of business consistent with past custom and practice.; (bn) No party has acceleratedchanged its accounting methods or principles theretofore adopted, terminatedexcept as required by GAAP and reflected in the Financial Statements; (o) experienced any damage, modified destruction or canceled casualty loss (other than those covered by insurance) with respect to any Assigned Contractof the assets or properties of the Company that, individually or in the aggregate with respect to the Company, exceeds $75,000; (p) made any material change to its Benefit Plans or the benefits payable thereunder; (q) experienced any labor grievances or similar claims filed; (r) accelerated the collection of or discounted any accounts receivable, or made any material change in the terms of payment by its patients/payors for any services it performs the effect of which is to enable it to receive payment or recognize revenues in its statement of operations for any period ending on or before the Closing Date which, but for that change, it would not so receive or recognize before a period beginning after the Closing Date; (s) terminated (other than for cause) the employment of any officer, executive, or employee of the Company with annual compensation in excess of $175,000, or otherwise implemented any reductions in force, layoffs, early retirement programs, or other voluntary or involuntary employment termination programs (other than individual employee terminations in the ordinary course of business consistent with past practice); (t) delayed the payment of or made any material change in its practices with respect to timely payment of accounts payable or other obligations payable to vendors, suppliers or other third parties; (u) made or changed any material Tax election, changed an annual accounting period, adopted or changed any accounting method, filed any amended Tax Return, entered into any closing agreement, settled any Tax claim or assessment, surrendered any right to claim a refund of Taxes, consented to any extension or waiver of the limitation period applicable to any Tax claim or assessment, or taken any other similar action relating to the filing of any Tax Return or the payment of any tax; or (v) committed to do any of the foregoing.

Absence of Certain Developments. (a) Since the SeaSpine Balance Sheet Date, there has not been any SeaSpine Material Adverse Effect. (b) Except as set forth expressly contemplated by this Agreement, since the SeaSpine Balance Sheet Date, each of SeaSpine and its Subsidiaries has carried on and operated its business in the attached "Developments Schedule," since August 31, 1998, Seller has conducted the Business only all material respects in the ordinary course of business consistent with past custom and practice (including, without limitation, with respect to the offering of special sales or incentive programs or the filling of its distribution channels), has incurred no liabilities other than in the ordinary course of business consistent with past custom and practice, and Seller has notnone of them has: (i) sold, assigned amended or transferred any of modified its assets, except for sales of inventory in the ordinary course of business consistent with past custom and practice, or mortgaged, pledged or subjected them to any material Lien, except for Liens for current property Taxes not yet due and payable, or canceled without fair consideration any material debts or claims owing to or held by itOrganizational Documents; (ii) sold, leased, assigned, transferred, abandoned transferred or permitted to lapse purchased any Government Licenses which, individually or in the aggregate, are material to the Business or any portion thereof, or any of the Proprietary Rights or other intangible tangible assets, in each case in a single or disclosed any material proprietary confidential information to any Personrelated series of transactions, except in the ordinary course of business consistent with past custom and practice, or granted any license or sublicense of any rights under or with respect to any Proprietary Rights; (iii) conducted issued, sold, redeemed or transferred any of its cash management customs and practices (includingcapital stock or other equity securities, without limitationsecurities convertible into its capital stock or other equity securities or warrants, the collection of receivablesoptions or other rights to acquire its capital stock or other equity securities, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practiceany bonds or debt securities; (iv) declared or paid any dividend or other distribution of the assets of SeaSpine; (v) made or approved any material changes in its Plans or made any loans or advances tomaterial changes in wages, salary, or guarantees for the benefit ofother compensation, including severance, with respect to its current or entered into any transaction with PDK former officers, directors or any of its executive employees other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement than increases in base salaries and for advances wages that are consistent with past custom practices or as required by applicable Law or any SeaSpine Plan; (vi) paid, loaned or advanced (other than the payment of compensation and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer of any assets of placing a Lien on any assets) except on an arms-length basis benefits in the ordinary course of business consistent with past custom and practice; (v) suffered any extraordinary losspractice or the payment, damage, destruction advance or casualty loss or waived any rights of material value, whether or not covered by insurance and whether or not in the ordinary course reimbursement of business or consistent with past custom and practice; (vi) received notification, or become aware of facts which would lead a reasonable person to believe, that any material customer or supplier will stop or decrease in any material respect the rate of business done with the Business; (vii) become subject to any material liabilities, except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into expenses in the ordinary course of business consistent with past custom and practicepractice or 401(k) plan loans) any amounts to, or sold, transferred or leased any of its assets to, or entered into any other transactions with, any of its Affiliates, or made any loan to, or entered into any other transaction with, any of its directors or officers outside the ordinary course of business or other than at arm’s length; (vii) except as required by applicable Law, adopted or materially amended any SeaSpine Plans; (viii) settled hired or compromised terminated any litigation involving equitable relief of its officers or involving any money damages employees with fixed annual compensation in excess of $50,000; or (ix) entered into any other material transaction350,000, with respect to non-officer employees, other than in the ordinary course of business consistent with past custom and practice.; (bix) No party has acceleratedcommenced or settled any Action in which the amount in dispute is in excess of $1,000,000; (x) made any material change in accounting principles, terminatedmethods, modified procedures or canceled policies, except as required by GAAP; (xi) made, changed or revoked any Assigned Contractmaterial Tax election, or settled or compromised any material Tax claim or liabilities, or filed any substantially amended material Tax Return; (i) authorized, proposed, entered into or agreed to enter into any plan of liquidation, dissolution or other reorganization or (ii) authorized, proposed, entered into or agreed to enter into any merger, consolidation or business combination with any Person; (xiii) except in the ordinary course of business consistent with past practice, incurred or discharged any Indebtedness; (xiv) other than spinal or orthopedic implant set and instrument purchases, made capital expenditures individually in excess of $500,000; (xv) suffered any material damage, destruction or loss, whether or not covered by insurance; (xvi) sold, assigned, transferred, abandoned or allowed to lapse or expire any material Intellectual Property rights or other intangible assets owned, used or licensed by SeaSpine or any of its Subsidiaries in connection with any product of SeaSpine or any of its Subsidiaries or the operation of any of their businesses; (xvii) been subject to any written claim or written threat of infringement, misappropriation or other violation by or against SeaSpine or any of its Subsidiaries of Intellectual Property rights of SeaSpine or any of its Subsidiaries or a third party; (xviii) materially reduced the amount of any insurance coverage provided by existing insurance policies; or (xix) committed to do or take any of the actions described in the foregoing clauses (i) through (xviii).

Absence of Certain Developments. Other than the sale process conducted by the Company and its affiliates (a) Except including the transactions contemplated by this Agreement), as set forth in the attached "Developments Schedule," since August 31expressly permitted by this Agreement, 1998, Seller has conducted the Business only or in the ordinary course of business consistent with past custom and practice (includingor as set forth in Schedule 3.7, without limitationsince January 1, 2016 until the date hereof, there has not been, with respect to the offering Company, any: (a) event, occurrence or development that has had, or could reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect; (b) amendment of special sales the Certificate of Incorporation, bylaws or incentive programs other organizational documents of the Company; (c) split, combination or reclassification of any shares of capital stock of the filling Company (or, in the case of the Subsidiaries, the equity securities of each such Subsidiary); (d) issuance, sale or other disposition of any of its distribution channelscapital stock, or grant of any options, warrants or other rights to purchase or obtain (including upon conversion, exchange or exercise) any of its capital stock; (e) declaration or payment of any cash or non-cash dividends or distributions on or in respect of the capital stock of the Company (or, in the case of the Subsidiaries, the equity securities of each such Subsidiary); (f) material change in any method of accounting or accounting practice of the Company, has except as required by GAAP or as disclosed in the notes to the Company Financial Statements; (g) material change in the Company’s cash management practices and its policies, 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; (h) incurrence, assumption or guarantee of any indebtedness for borrowed money except unsecured current obligations or liabilities incurred no liabilities other than in the ordinary course of business consistent with past custom and practice, and Seller has not:; (i) soldtransfer, assigned assignment, sale or transferred other disposition of any of the assets shown or reflected in the Company Financial Statements or cancellation of any debts or entitlements; (j) transfer, assignment or grant of any license or sublicense of any material rights under or with respect to any Company Intellectual Property Rights (other than non-exclusive licenses granted by the Company or any of its assets, except for sales of inventory Subsidiaries in the ordinary course of business consistent with past custom and practice, or mortgaged, pledged or subjected them to any material Lien, except for Liens for current property Taxes not yet due and payable, or canceled without fair consideration any material debts or claims owing to or held by itbusiness); (iik) soldmaterial damage, assigned, transferred, abandoned destruction or permitted loss (whether or not covered by insurance) to lapse any Government Licenses which, individually or in the aggregate, are material to the Business or any portion thereofits property; (l) capital investment in, or any loan to, any other Person; (m) acceleration, termination, material modification to or cancellation of any material Contract (other than any Company Benefit Plan) to which the Company is a party or by which it is bound, or entry into a material Contract (other than any Company Benefit Plan); (n) capital expenditures in excess of $75,000; (o) imposition of any Encumbrance upon any of the Proprietary Rights Company properties, units or assets, tangible or intangible; (p) (i) grant of any bonuses, whether monetary or otherwise, or increase in any wages, salary, severance, pension or other intangible assetscompensation or benefits in respect of its employees, officers, directors, consultants or independent contractors, other than (A) as provided for in any written agreements, programs or policies or Company Benefit Plan, (B) as required by applicable Law or (C) in connection with a new hire or a promotion, (ii) entry into or amendment of any written employment agreement or change in the written terms of employment for any employee (other than in connection with a new hire, a promotion or a demotion) or any involuntary termination of any employees (other than for cause), or disclosed (iii) acceleration of the vesting or payment of any compensation or benefit for any employee, member, manager, consultant or independent contractor, other than as provided for in any written agreements, programs or policies or Company Benefit Plan or as required by applicable Law; (q) adoption, modification or termination of any: (i) written Company policies concerning employment, severance or retention of employees, (ii) written Contracts or other written agreements concerning the officers of the Company with respect to such officers’ employment with the Company, (iii) Company Benefit Plan or (iv) collective bargaining or other agreements with a Union other than as provided for in any written agreements or required by applicable Law, in each case, the effect of which would have a material proprietary confidential information effect on the Company’s business; (r) loan to (or forgiveness of any Personloan to) any of its stockholders, directors, officers or employees; (s) entry into a new line of business or abandonment or discontinuance of existing lines of business; (t) 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 filing of any bankruptcy petition against it under any similar Law; (u) except as set forth in Schedule 3.08(t), purchase, lease or other acquisition of the right to own, use or lease any property or assets for an amount in excess of $200,000.00 (in the case of a lease, per annum), except in the ordinary course of business consistent with past custom and practice, or granted any license or sublicense of any rights under or with respect to any Proprietary Rights; (iii) conducted its cash management customs and practices (including, without limitation, the collection of receivables, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practice; (iv) made any loans or advances to, or guarantees for the benefit of, or entered into any transaction with PDK or any of its other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer of any assets of placing a Lien on any assets) except on an arms-length basis in the ordinary course of business consistent with past custom and practice; (v) suffered acquisition by merger or consolidation with, or by purchase of a substantial portion of the assets or stock of, any extraordinary loss, damage, destruction or casualty loss or waived any rights of material value, whether or not covered by insurance and whether or not in the ordinary course of business or consistent with past custom and practiceany Person or any division thereof; (viw) received notificationaction by the Company or any of its Subsidiaries to make, change or become aware rescind any Tax election, amend any Tax Return or take any other similar action that would have the effect of facts which would lead causing a reasonable person to believe, that any material customer or supplier will stop or decrease change in any material Tax liability or Tax asset of the Buyer, the Company or any of its Subsidiaries in respect the rate of business done with the Business; (vii) become subject to any material liabilities, except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into in the ordinary course of business consistent with past custom and practice; (viii) settled or compromised any litigation involving equitable relief or involving any money damages in excess of $50,000Post-Closing Tax Period; or (ixx) entered into taking of any other material transaction, other than action or omitting to take any action that would result in any of the ordinary course of business consistent with past custom and practiceforegoing. (b) No party has accelerated, terminated, modified or canceled any Assigned Contract.

Absence of Certain Developments. (a1) Except as expressly contemplated by this Agreement or as set forth in on the attached "Developments ScheduleDEVELOPMENTS SCHEDULE," since August 31the date of the Latest Balance Sheet, 1998, Seller has conducted the Business only in the ordinary course of business consistent with past custom and practice (including, without limitation, with respect to the offering of special sales or incentive programs or the filling of its distribution channels), has incurred no liabilities other than in the ordinary course of business consistent with past custom and practice, and Seller Company has not: a) issued any notes, bonds or other debt securities (iother than the AWE Note) soldor any equity securities or any securities convertible, assigned exchangeable or transferred exercisable into any of its assets, except for sales of inventory in the ordinary course of business consistent with past custom and practice, or mortgaged, pledged or subjected them to any material Lien, except for Liens for current property Taxes not yet due and payable, or canceled without fair consideration any material debts or claims owing to or held by itequity securities; (iib) sold, assigned, transferred, abandoned borrowed any amount or permitted to lapse any Government Licenses which, individually incurred or in the aggregate, are material to the Business or any portion thereof, or any of the Proprietary Rights or other intangible assets, or disclosed any material proprietary confidential information to any Person, except in the ordinary course of business consistent with past custom and practice, or granted any license or sublicense of any rights under or with respect to any Proprietary Rights; (iii) conducted its cash management customs and practices (including, without limitation, the collection of receivables, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practice; (iv) made any loans or advances to, or guarantees for the benefit of, or entered into any transaction with PDK or any of its other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer of any assets of placing a Lien on any assets) except on an arms-length basis in the ordinary course of business consistent with past custom and practice; (v) suffered any extraordinary loss, damage, destruction or casualty loss or waived any rights of material value, whether or not covered by insurance and whether or not in the ordinary course of business or consistent with past custom and practice; (vi) received notification, or become aware of facts which would lead a reasonable person to believe, that any material customer or supplier will stop or decrease in any material respect the rate of business done with the Business; (vii) become subject to any material liabilities, except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into in the ordinary course of business; c) discharged or satisfied any lien or encumbrance or paid any obligation or liability, other than current liabilities paid in the ordinary course of business; d) declared or made any payment or distribution of cash or other property to its Shareholders with respect to its stock or purchased or redeemed any shares of its stock or any warrants, options or other rights to acquire its stock; e) mortgaged or pledged any of its properties or assets or subjected them to any lien, security interest, charge or other encumbrance, except liens for current property taxes not yet due and payable; f) sold, assigned or transferred any of its tangible assets, except in the ordinary course of business, or canceled any debts or claims; g) sold, assigned or transferred any patents or patent applications, trademarks, service marks, trade names, corporate names, copyrights or copyright registrations, trade secrets or other intangible assets, or disclosed any proprietary confidential information to any Person; h) suffered any extraordinary losses or waived any rights of material value, whether or not in the ordinary course of business or consistent with past custom and practice; (viiii) settled made capital expenditures or compromised any litigation involving equitable relief or involving any money damages commitments therefor that aggregate in excess of $50,000; or25,000 (excluding any amounts of product development expenditures which are capitalized in conformity with generally accepted accounting principles, consistently applied); (ixj) entered into any other material transaction, transaction other than in the ordinary course of business consistent with past custom and practiceor entered into any other material transaction, whether or not in the ordinary course of business; k) made any loans or advances to, guarantees for the benefit of, or any Investments in, any Persons; l) suffered any damage, destruction or casualty loss exceeding in the aggregate $25,000, whether or not covered by insurance; or m) made any Investment in or taken steps to incorporate any Subsidiary. (b2) No party The Company has acceleratednot at any time made any payments for political contributions or made any bribes, terminated, modified kickback payments or canceled any Assigned Contractother illegal payments.

Absence of Certain Developments. (a) Except as set forth on Schedule 3.07, (i) since the date of the Latest Balance Sheet until the date of this Agreement, the Company and its Subsidiaries have conducted their businesses, in the attached "Developments Schedule," since August 31all material respects, 1998, Seller has conducted the Business only in the ordinary course of business consistent with past custom practice and practice (includingii) since the date of the Latest Balance Sheet, without limitationthere has not occurred any event, occurrence or development that has had, or would reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect. Without limiting the generality of the foregoing, except as set forth on Schedule 3.07 or as expressly contemplated by this Agreement, from the date of the Latest Balance Sheet until the date of this Agreement neither the Company nor any of its Subsidiaries has: (a) amended or modified its certificate of incorporation or bylaws (or equivalent organizational or governance documents); (b) issued, delivered or sold, disposed or pledged any of its shares of, or authorized the same in respect of, capital stock, any voting securities or any other equity interests or any options, warrants, convertible or exchangeable securities, subscriptions, stock appreciation rights, calls or commitments with respect to such securities of any kind, or granted phantom stock or other similar rights with respect to any of the offering foregoing; (c) created, incurred, assumed, guaranteed, cancelled or compromised any Indebtedness for borrowed money other than (x) incurred in the ordinary course of special sales business pursuant to the Company's existing revolving credit facilities, including the ADC Loan Facility, or incentive programs (y) incurred or cancelled pursuant to arrangements solely among or between the filling Company and one or more of its distribution channelsdirector or indirect wholly owned Subsidiaries or solely among or between its direct or indirect wholly owned Subsidiaries; (d) announced, implemented or effected any reduction-in-force, lay-off, furlough or other program resulting in the termination of employment of employees (other than terminations of individual employees in the ordinary course of business); (e) (i) except as required pursuant to the agreements listed on Schedule 3.11 or Schedule 3.15(a), has incurred increased or granted any increase in the cash compensation of any former or current officer or employee (including new hires) by an amount greater than three percent (3%) of such Person's total compensation, and, notwithstanding the foregoing, in no event was any increase or grant of increase to such Person's cash compensation in excess of $75,000, (ii) decreased the base salary or base wages of any officer, employee or individual independent contractor, (iii) materially increased or decreased the benefits under any material Plan, (iv) adopted, amended or terminated any material Plan (including any plan, policy or other arrangement that would be a Plan if it were in existence as of the date of this Agreement), (v) granted any additional rights to severance or termination pay to any current or former, officer or employee of the Company or any of its Subsidiaries (in each case, except for increases in benefits under existing Plans in the ordinary course of business or as otherwise required by Law) or (vi) taken any other action in respect of any officer, employee or independent contractor's service, compensation or benefits, in each case, in response to the COVID-19 pandemic; (f) approved or adopted a plan of liquidation, dissolution, merger, consolidation or other reorganization; (g) took any action that would be prohibited by Sections 5.01(b)(iii), 5.01(b)(viii)(I), 5.01(b)(xii), 5.01(b)(xiv), 5.01(b)(xv), 5.01(b)(xvi), 5.01(b)(xix), 5.01(b)(xx) or 5.01(b)(xxi); (h) mortgaged, pledged, subjected, or permitted to be subjected, any material portion of its assets to any Lien, except for Permitted Liens, or sold, assigned, transferred, conveyed, leased or otherwise disposed of any portion of its assets that is material to the Company and its Subsidiaries taken as a whole; (i) made any acquisition of any other business or assets or liabilities other than of another Person that would reasonably be expected to be, individually or in the aggregate, material to the Company and its Subsidiaries, taken as a whole (whether by merger, stock or asset purchase or otherwise); (j) made any loans or advances to any Persons, except to employees and extensions of credit to payors, in each case, in the ordinary course of business consistent with past custom and practice, and Seller has not:; (ik) soldcancelled, assigned waived or transferred released any material debts, rights or claims in favor of the Company or any of its assets, except for sales of inventory in the ordinary course of business consistent with past custom and practice, or mortgaged, pledged or subjected them to any material Lien, except for Liens for current property Taxes not yet due and payable, or canceled without fair consideration any material debts or claims owing to or held by it; (ii) sold, assigned, transferred, abandoned or permitted to lapse any Government Licenses which, individually or in the aggregate, are material to the Business or any portion thereof, or any of the Proprietary Rights or other intangible assets, or disclosed any material proprietary confidential information to any Person, Subsidiaries except in the ordinary course of business consistent with past custom and practice, or granted any license or sublicense of any rights under or with respect to any Proprietary Rights;business; or (iiil) conducted its cash management customs and practices (includingagreed, without limitation, the collection of receivables, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practice; (iv) made any loans or advances to, or guarantees for the benefit of, committed or entered into any transaction with PDK or binding understanding to do any of its other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer of any assets of placing a Lien on any assets) except on an arms-length basis in the ordinary course of business consistent with past custom and practice; (v) suffered any extraordinary loss, damage, destruction or casualty loss or waived any rights of material value, whether or not covered by insurance and whether or not in the ordinary course of business or consistent with past custom and practice; (vi) received notification, or become aware of facts which would lead a reasonable person to believe, that any material customer or supplier will stop or decrease in any material respect the rate of business done with the Business; (vii) become subject to any material liabilities, except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into in the ordinary course of business consistent with past custom and practice; (viii) settled or compromised any litigation involving equitable relief or involving any money damages in excess of $50,000; or (ix) entered into any other material transaction, other than in the ordinary course of business consistent with past custom and practiceforegoing. (b) No party has accelerated, terminated, modified or canceled any Assigned Contract.

Absence of Certain Developments. (a) Except as expressly contemplated by this Agreement or as set forth in on the attached "Developments Schedule," DEVELOPMENTS SCHEDULE, since August December 31, 19981999, Seller has conducted the Business only in the ordinary course of business consistent with past custom and practice (including, without limitation, with respect to the offering of special sales or incentive programs or the filling of its distribution channels), has incurred no liabilities other than in the ordinary course of business consistent with past custom and practice, and Seller Company has not: (i) soldissued any notes, assigned bonds or transferred other debt securities or any of its assetscapital stock or other equity securities or any securities or rights convertible, except for sales of inventory in the ordinary course of business consistent with past custom and practice, exchangeable or mortgaged, pledged exercisable into any capital stock or subjected them to any material Lien, except for Liens for current property Taxes not yet due and payable, or canceled without fair consideration any material debts or claims owing to or held by itother equity securities; (ii) sold, assigned, transferred, abandoned borrowed any amount or permitted to lapse any Government Licenses which, individually incurred or in the aggregate, are material to the Business or any portion thereof, or any of the Proprietary Rights or other intangible assets, or disclosed any material proprietary confidential information to any Person, except in the ordinary course of business consistent with past custom and practice, or granted any license or sublicense of any rights under or with respect to any Proprietary Rights; (iii) conducted its cash management customs and practices (including, without limitation, the collection of receivables, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practice; (iv) made any loans or advances to, or guarantees for the benefit of, or entered into any transaction with PDK or any of its other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer of any assets of placing a Lien on any assets) except on an arms-length basis in the ordinary course of business consistent with past custom and practice; (v) suffered any extraordinary loss, damage, destruction or casualty loss or waived any rights of material value, whether or not covered by insurance and whether or not in the ordinary course of business or consistent with past custom and practice; (vi) received notification, or become aware of facts which would lead a reasonable person to believe, that any material customer or supplier will stop or decrease in any material respect the rate of business done with the Business; (vii) become subject to any material liabilities, except current liabilities incurred in the ordinary course of business and consistent with past practice; (iii) discharged or satisfied any material Lien or paid any material obligation or liability, other than current liabilities under contracts entered into paid in the ordinary course of business; (iv) declared, set aside or made any payment or distribution of cash or other property to any of the Company's shareholders with respect to such shareholder's capital stock or other equity securities or purchased, redeemed or otherwise acquired any shares of its capital stock or other equity securities (including any warrants, options or other rights to acquire its capital stock or other equity securities); (v) mortgaged or pledged any of its properties or assets or subjected them to any Lien; (vi) sold, assigned, transferred, leased, licensed or otherwise encumbered any of its tangible assets, except in the ordinary course of business consistent with past custom and practice, or canceled any material debts or claims; (viiivii) settled sold, assigned, transferred, leased, licensed or compromised otherwise encumbered any litigation involving equitable relief Intellectual Property Rights or involving other intangible assets, disclosed any money damages in excess of $50,000; or material proprietary confidential information to any Person (ix) entered into any other material transaction, than to the Purchasers and other than in the ordinary course of business consistent with past custom and practice.practice in circumstances in which it has imposed reasonable confidentiality restrictions), or abandoned or permitted to lapse any Intellectual Property Rights; (bviii) No made or granted any bonus or any wage or salary increase to any employee or group of employees (except as required by pre-existing contracts described on the attached CONTRACTS SCHEDULE), or made or granted any increase in any employee benefit plan or arrangement, or amended or terminated any existing employee benefit plan or arrangement or adopted any new employee benefit plan or arrangement; (ix) suffered any extraordinary losses or waived any rights of material value (whether or not in the ordinary course of business or consistent with past practice) in excess of $50,000 in the aggregate; (x) made capital expenditures or commitments therefor that aggregate in excess of $50,000; (xi) delayed or postponed the payment of any accounts payable or any other liability or obligation or agreed or negotiated with any party has acceleratedto extend the payment date of any accounts payable or accelerated the collection of any accounts or notes receivable; (xii) made any loans or advances to, terminatedguarantees for the benefit of, modified or canceled any Assigned ContractInvestments in, any Persons (other than advances to the Company's employees in the ordinary course of business consistent with past practice); (xiii) made any charitable contributions or pledges exceeding in the aggregate $50,000; (xiv) suffered any damage, destruction or casualty loss exceeding in the aggregate $50,000, whether or not covered by insurance; (xv) made any change in any method of accounting or accounting policies, other than those required by GAAP which have been disclosed in writing to the Purchasers, or made any write-down in the value of its inventory that is material or that is other than in the usual, regular and ordinary course of business consistent with past practice; (xvi) made any Investment in or taken any steps to incorporate any Subsidiary; (xvii) amended its articles of incorporation, by-laws or other organizational documents; (xviii) entered into any agreement or arrangement prohibiting or restricting it from freely engaging in any business or otherwise restricting the conduct of its business; (xix) entered into any contract other than in the ordinary course of business consistent with past practice, entered into any other material transaction, whether or not in the ordinary course of business or consistent with past practice, or materially changed any business practice; or (xx) agreed, whether orally or in writing, to do any of the foregoing. Neither the Seller nor any of its stockholders have at any time made any payments for political contributions or any bribes, kickback payments or other illegal payments.

Absence of Certain Developments. (a) Except as set forth in the attached "“Developments Schedule," ” attached hereto as Schedule 3.7, since August 31, 1998the date of the Latest Balance Sheet, Seller has conducted not, as it relates to the Business only or the Purchased Assets: (a) mortgaged, pledged or subjected to any lien, charge or any other encumbrance, any portion of the Purchased Assets, except liens for current property taxes not yet due and payable; (b) sold, assigned or transferred, or agreed to do so, any of the Purchased Assets, except in the ordinary course of business consistent with past custom and practice (including, without limitation, with respect to the offering of special sales or incentive programs or the filling of its distribution channels), has incurred no liabilities other than in the ordinary course of business consistent with past custom and practice, and Seller has not: (i) sold, assigned or transferred any of its assets, except for sales of inventory in the ordinary course of business consistent with past custom and practice, or mortgaged, pledged or subjected them to any material Lien, except for Liens for current property Taxes not yet due and payable, or canceled without fair consideration any material debts or claims owing to or held by it; (iic) sold, assigned, transferred, abandoned or permitted to lapse any Government Licenses whichpatents, individually or in the aggregatetrademarks, are material to the Business or any portion thereoftrade names, or any of the Proprietary Rights copyrights, trade secrets or other intangible assets, or disclosed any material proprietary confidential information to any Person, except in the ordinary course of business consistent with past custom and practice, or granted any license or sublicense of any rights under or with respect to any Proprietary Rightsperson; (iiid) conducted its cash management customs and practices (includingmade, without limitationor agreed to make, the collection any capital expenditures or commitments therefore that aggregate in excess of receivables, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practice$50,000; (iv) made any loans or advances to, or guarantees for the benefit of, or entered into any transaction with PDK or any of its other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer of any assets of placing a Lien on any assets) except on an arms-length basis in the ordinary course of business consistent with past custom and practice; (ve) suffered any extraordinary loss, damage, destruction or casualty loss losses or waived any rights of material value, whether or not covered by insurance and whether or not in the ordinary course of business or consistent with past custom and practice; (vif) received notificationentered into, or become aware of facts which would lead a reasonable person agreed to believeenter into, that any material customer or supplier will stop or decrease in any material respect the rate of business done with the Business; (vii) become subject to any material liabilities, except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into in the ordinary course of business consistent with past custom and practice; (viii) settled or compromised any litigation involving equitable relief or involving any money damages in excess of $50,000; or (ix) entered into any other material transaction, transaction other than in the ordinary course of business business; (g) failed to replenish the Seller’s supplies in a normal and customary manner consistent with past custom its prior practice and practice.prudent business practices prevailing in the industry, or made any purchase commitment of services or goods in excess of the normal, ordinary and usual requirements of its business or at any price in excess of the then current market price or upon terms and conditions more onerous than those usual and customary in the industry, or made any change in its selling, pricing, advertising or personnel practice inconsistent with its prior practice and prudent business practices prevailing in the industry; or (bh) No party has acceleratedsuffered any material damage, terminateddestruction or casualty loss to the Purchased Assets, modified whether or canceled any Assigned Contractnot covered by insurance.

Absence of Certain Developments. (a) Since the Orthofix Balance Sheet Date, there has not been any Orthofix Material Adverse Effect. (b) Except as set forth expressly contemplated by this Agreement, since the Orthofix Balance Sheet Date, each of Orthofix and its Subsidiaries has carried on and operated its business in the attached "Developments Schedule," since August 31, 1998, Seller has conducted the Business only all material respects in the ordinary course of business consistent with past custom and practice (including, without limitation, with respect to the offering of special sales or incentive programs or the filling of its distribution channels), has incurred no liabilities other than in the ordinary course of business consistent with past custom and practice, and Seller has notnone of them has: (i) sold, assigned amended or transferred any of modified its assets, except for sales of inventory in the ordinary course of business consistent with past custom and practice, or mortgaged, pledged or subjected them to any material Lien, except for Liens for current property Taxes not yet due and payable, or canceled without fair consideration any material debts or claims owing to or held by itOrganizational Documents; (ii) sold, leased, assigned, transferred, abandoned transferred or permitted to lapse purchased any Government Licenses which, individually or in the aggregate, are material to the Business or any portion thereof, or any of the Proprietary Rights or other intangible tangible assets, in each case in a single or disclosed any material proprietary confidential information to any Personrelated series of transactions, except in the ordinary course of business consistent with past custom and practice, or granted any license or sublicense of any rights under or with respect to any Proprietary Rights; (iii) conducted issued, sold, redeemed or transferred any of its cash management customs and practices (includingcapital stock or other equity securities, without limitationsecurities convertible into its capital stock or other equity securities or warrants, the collection of receivablesoptions or other rights to acquire its capital stock or other equity securities, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practiceany bonds or debt securities; (iv) declared or paid any dividend or other distribution of the assets of Orthofix; (v) made or approved any material changes in its Plans or made any loans material changes in wages, salary or advances toother compensation, including severance, with respect to its current or guarantees for the benefit offormer officers, directors or entered into any transaction with PDK or any of its executive employees other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement than increases in base salaries and for advances wages that are consistent with past custom practices or as required by applicable Law or any Orthofix Plan; (vi) paid, loaned or advanced (other than the payment of compensation and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer of any assets of placing a Lien on any assets) except on an arms-length basis benefits in the ordinary course of business consistent with past custom and practice; (v) suffered any extraordinary losspractice or the payment, damage, destruction advance or casualty loss or waived any rights of material value, whether or not covered by insurance and whether or not in the ordinary course reimbursement of business or consistent with past custom and practice; (vi) received notification, or become aware of facts which would lead a reasonable person to believe, that any material customer or supplier will stop or decrease in any material respect the rate of business done with the Business; (vii) become subject to any material liabilities, except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into expenses in the ordinary course of business consistent with past custom and practicepractice or 401(k) plan loans) any amounts to, or sold, transferred or leased any of its assets to, or entered into any other transactions with, any of its Affiliates, or made any loan to, or entered into any other transaction with, any of its directors or officers outside the ordinary course of business or other than at arm’s length; (vii) except as required by applicable Law, adopted or materially amended any Orthofix Plans; (viii) settled hired or compromised terminated any litigation involving equitable relief of its officers or involving any money damages employees with fixed annual compensation in excess of $50,000; or (ix) entered into any other material transaction350,000, with respect to non-officer employees, other than in the ordinary course of business consistent with past custom and practice.; (bix) No party has acceleratedcommenced or settled any Action in which the amount in dispute is in excess of $1,000,000; (x) made any material change in accounting principles, terminatedmethods, modified procedures or canceled policies, except as required by GAAP; (xi) made, changed or revoked any Assigned Contractmaterial Tax election, or settled or compromised any material Tax claim or liabilities, or filed any substantially amended material Tax Return; (i) authorized, proposed, entered into or agreed to enter into any plan of liquidation, dissolution or other reorganization or (ii) authorized, proposed, entered into or agreed to enter into any merger, consolidation or business combination with any Person; (xiii) except in the ordinary course of business consistent with past practice, incurred or discharged any Indebtedness; (xiv) other than spinal or orthopedic implant set and instrument purchases, made capital expenditures individually in excess of $500,000; (xv) suffered any material damage, destruction or loss, whether or not covered by insurance; (xvi) sold, assigned, transferred, abandoned or allowed to lapse or expire any material Intellectual Property rights or other intangible assets owned, used or licensed by Orthofix or any of its Subsidiaries in connection with any product of Orthofix or any of its Subsidiaries or the operation of any of their businesses; (xvii) been subject to any written claim or written threat of infringement, misappropriation or other violation by or against Orthofix or any of its Subsidiaries of Intellectual Property rights of Orthofix or any of its Subsidiaries or a third party; (xviii) materially reduced the amount of any insurance coverage provided by existing insurance policies; or (xix) committed to do or take any of the actions described in the foregoing clauses (i) through (xviii).

Absence of Certain Developments. (a) Except as set forth in Section 4.10 of the attached "Developments Seller Disclosure Schedule," , since August 31June 30, 19982008, neither Seller, AFT nor any Acquired Company has: (a) suffered any change or suffered any theft, damage, destruction or casualty loss to its assets, whether or not covered by insurance that has had a Material Adverse Effect; (b) except for the transfer of assets contemplated by the Seller has conducted Business Transfer and the AFT Business only in the ordinary course of business consistent with past custom and practice (includingTransfer, without limitation, with respect to the offering of special sales or incentive programs or the filling of its distribution channels), has incurred no liabilities other than in the ordinary course of business consistent with past custom and practice, and Seller has not: (i) sold, assigned assigned, leased or transferred any of its assets, except for sales of inventory in the ordinary course of business consistent with past custom and practice, or mortgaged, pledged or subjected them to any material Lien, except for Liens for current property Taxes not yet due and payable, or canceled without fair consideration any material debts or claims owing to or held by it; (ii) sold, assigned, transferred, abandoned or permitted to lapse any Government Licenses which, individually or in the aggregate, are material to the Business or any portion thereof, or any of the Proprietary Rights or other intangible assets, or disclosed any material proprietary confidential information to any Person, except in the ordinary course of business consistent with past custom practices; (c) except in connection with the transfer of assets contemplated by the Seller Business Transfer and practicethe AFT Business Transfer, permitted any of its shares or the Membership Interests to be sold, redeemed or transferred; (d) permitted any of its assets, shares or the Membership Interests to become subject to any lien, security interest or other encumbrance of any kind or nature; (e) except in connection with the transfer of assets contemplated by the Seller Business Transfer and the AFT Business Transfer, issued additional shares or participated in any merger or plan of share exchange; (f) entered into, amended, waived any material right under or terminated any contract, lease, instrument, license or permit relating to its Business, customers or creditors, or granted taken any license or sublicense of any rights under or with respect to any Proprietary Rights; (iii) conducted its cash management customs and practices (including, without limitation, the collection of receivables, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practice; (iv) made any loans or advances to, or guarantees for the benefit of, action or entered into any other transaction with PDK or any of its other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer of any assets of placing a Lien on any assets) except on an arms-length basis in the ordinary course of business consistent with past custom and practice; practices; (vg) suffered hired or terminated any extraordinary lossof its employees, damage, destruction except for cause or casualty loss or waived any rights of material value, whether or not covered by insurance and whether or not in the ordinary course of business business; (h) paid, declared or consistent with past custom and practice; (vi) received notificationaccrued any bonuses, increases in salaries or become aware of facts which would lead a reasonable person to believe, that any material customer or supplier will stop or decrease in any material respect the rate of business done with the Business; (vii) become subject to any material liabilitiescompensation for services, except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into in the ordinary course of business consistent with past custom practices; (i) incurred any Indebtedness or otherwise made any loans or advances to, or guarantee for the benefit of, or extended any credit or granted any discounts to, any person or entity; (j) except for the transfer of assets contemplated by the Seller Business Transfer and practice; (viii) settled the AFT Business Transfer and matters pertaining thereto, engaged in any transaction with any related party, Insider or compromised any litigation involving equitable relief or involving any money damages in excess of $50,000; or (ix) entered into any other material transactionAffiliate, other than except in the ordinary course of business consistent business; (k) except for the transfer of assets contemplated by the Seller Business Transfer and the AFT Business Transfer and matters pertaining thereto, made any distributions or paid any dividends with past custom and practicerespect to the membership interests of any Acquired Company or made any other distributions; (l) made or committed to any capital expenditure which for any individual item represents an amount greater than $25,000; or (m) committed to do any of the foregoing. (b) No party has accelerated, terminated, modified or canceled any Assigned Contract.

Absence of Certain Developments. (a) Except Since August 1, 2003, there has occurred no fact, event or circumstance which has had or could have a Material Adverse Effect, except as expressly contemplated by this Agreement or as set forth herein, on the transaction described in the attached "Developments Schedule," since this Agreement. Since August 311, 19982003, Seller has caused the Practice has conducted the Business its business only in the ordinary course of business consistent with past custom and practice (including, without limitation, with respect to the offering of special sales or incentive programs or the filling of its distribution channels), has incurred no liabilities other than in the ordinary course of business consistent with past custom and practice, and Seller to the Seller’s knowledge the Practice has not: (ia) sold, assigned or transferred issued any of its assetsnotes, except for sales a note to Xxxx Xxxxxxx to cover a cash flow issue arising out of inventory in the ordinary course change of business consistent with past custom TPA and practicefinancing persons, bonds or mortgagedother debt securities or any capital stock or units of membership interest or other equity securities or any securities or rights convertible, pledged exchangeable or subjected them to exercisable into any material Lien, except for Liens for current property Taxes not yet due and payable, capital stock or canceled without fair consideration any material debts or claims owing to or held by itother equity securities; (iib) soldincurred any Indebtedness, assigned, transferred, abandoned or permitted to lapse any Government Licenses which, individually or other than the capitalized leases listed in the aggregate, are material to the Business or any portion thereof, or any of the Proprietary Rights or other intangible assets, or disclosed any material proprietary confidential information to any Person, except in the ordinary course of business consistent with past custom and practice, or granted any license or sublicense of any rights under or with respect to any Proprietary RightsFinancial Statements; (iiic) conducted its cash management customs and practices (includingdischarged or satisfied any Lien or paid any obligation or liability, without limitation, the collection of receivables, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practice; (iv) made any loans or advances to, or guarantees for the benefit of, or entered into any transaction with PDK or any of its other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer of any assets of placing a Lien on any assets) except on an arms-length basis current liabilities paid in the ordinary course of business consistent with past custom and practice; (vd) suffered declared, set aside or made any extraordinary losspayment or distribution of cash or other property with respect to its capital stock or other equity securities or purchased, damageredeemed or otherwise acquired any shares of its capital stock or other equity securities (including any warrants, destruction options or casualty loss other rights to acquire its capital stock or waived any rights of material value, whether or not covered by insurance and whether or not in the ordinary course of business or consistent with past custom and practiceother equity securities); (vie) received notificationmortgaged or pledged any of its properties or assets or subjected them to any Lien, or become aware of facts which would lead a reasonable person to believe, that any material customer or supplier will stop or decrease in any material respect the rate of business done with the Businessexcept Permitted Liens; (viif) become subject to sold, assigned, transferred, leased, licensed or abandoned any material liabilitiesof its assets, tangible or intangible, except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into in the ordinary course of business consistent with past custom and practice; (viiig) settled made or compromised granted any litigation involving equitable relief bonus or involving any money damages wage or salary increase to any employee or group of employees made or granted any increase in excess of $50,000; orany employee benefit plan or arrangement, or amended or terminated any existing employee benefit plan or arrangement or adopted any new employee benefit plan or arrangement, or entered into, modified or terminated any collective bargaining agreement or relationship, except Christmas bonuses and routine employee reviews; (ixh) entered into delayed, postponed or canceled the payment of any accounts payable, except attorney retainer, or any other material transactionliability or obligation or agreed or negotiated with any party to extend the payment date of any accounts payable or accelerated the collection of any accounts or notes receivable; (i) delayed or postponed the purchase of any inventory, the making of any capital expenditure or the repair or maintenance of any assets; (j) made any loans or advances to, guarantees for the benefit of, or any Investments in, any Persons (other than advances to employees in the ordinary course of business consistent with past custom and practice.) or formed any Subsidiary; (bk) No suffered any damage, destruction or casualty loss exceeding $5,000 in the aggregate, whether or not covered by insurance, or experienced any material changes in the amount and scope of insurance coverage; (l) made any change in its cash management practices, except 3rd party has acceleratedbilling clearing-house, terminatedor in any method of accounting or accounting policies, modified or canceled made any Assigned Contractwrite-down in the value of its inventory that is material or out of the ordinary course of business consistent with past custom and practice; (m) directly or indirectly engaged in any transaction or entered into any arrangement with any officer, director, shareholder, member or other Affiliate of the Practice; (n) amended its charter, bylaws, operating agreement or other organizational documents; (o) taken any action or omit to take any action which act or omission could reasonably be expected to have a Material Adverse Effect; or (p) waived any material benefits of, or agreed to modify in any material respect, any confidentiality, standstill, non-solicitation or similar agreement to which the Sellers are a party; (q) been involved in any labor dispute, other than routine non-material grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Practice, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees; (r) entered into any new line of business, or incurrence or commitment to incur any capital expenditures, obligations or liabilities in connection therewith; (s) entered into any acquisition or agreement to acquire by merger, consolidation or otherwise, or agreement to acquire a substantial portion of the assets of, or in any other manner, any business of any other Person; (t) cancelled or waived (i) any right material to the operation of the business of the Practice; (u) agreed, whether orally or in writing, to do any of the foregoing.

Absence of Certain Developments. (a) Except as set forth in the attached "Developments Schedule," since August Since December 31, 1998, Seller has conducted the Business only in the ordinary course of business consistent with past custom and practice (including, without limitation, with respect to the offering of special sales or incentive programs or the filling of its distribution channels), has incurred no liabilities other than in the ordinary course of business consistent with past custom and practice, and Seller has not: (i) sold, assigned or transferred any of its assets, except for sales of inventory in the ordinary course of business consistent with past custom and practice, or mortgaged, pledged or subjected them to any material Lien, except for Liens for current property Taxes not yet due and payable, or canceled without fair consideration any material debts or claims owing to or held by it; (ii) sold, assigned, transferred, abandoned or permitted to lapse any Government Licenses which, individually or in the aggregate, are material to the Business or any portion thereof, or any of the Proprietary Rights or other intangible assets, or disclosed any material proprietary confidential information to any Person, except in the ordinary course of business consistent with past custom and practice, or granted any license or sublicense of any rights under or with respect to any Proprietary Rights; (iii) conducted its cash management customs and practices (including, without limitation, the collection of receivables, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practice; (iv) made any loans or advances to, or guarantees for the benefit of, or entered into any transaction with PDK or any of its other stockholders or any employee, officer or director of Seller or PDK2020, except for the transactions contemplated by this Agreement and the Related Agreements, and except as otherwise set forth on Section 5.06 of the Disclosure Schedule, there has not been with respect to the Business or the Acquired Companies any: (a) Material Adverse Effect, either individually or in the aggregate; (b) damage, destruction, or Loss, whether covered by insurance or not, having a cost in excess of $250,000; (i) change not in the Ordinary Course of Business of any accounting or Tax policies, principles, or methodologies or in the manner the Acquired Companies keep their respective books and records or any change by the Acquired Companies of their current practices with regard to accounting for advances sales, receivables, payables, or expenses (including any change in depreciation or amortization policies or rates), or (ii) filings of any material amended Tax Return, enter into any closing agreement or voluntary disclosure agreement with any Taxing Authority, failure to pay any Tax that becomes due and payable, preparation or filings of any material Tax Return in a manner inconsistent with past practice, extension of the statute of limitations period for the assessment or collection of any Tax, or settlement or compromise any material Tax liability; (d) other than with respect to this Agreement or sales of inventory in the Ordinary Course of Business or and dispositions of obsolete assets or assets with no book value, the sale, assignment, transfer, lease, license, or other disposition of, or entry into a Contract to sell, assign, transfer, lease, license, or otherwise dispose of, any asset or property with a value of more than $50,000; (e) changes in the ownership or Equity Securities of the Acquired Companies, including the issuance, repurchase, redemption, assignment, or transfer of any Equity Securities of the Acquired Companies; (f) increase in the compensation payable or to become payable to any employee, except for increases made in the Ordinary Course of Business; (g) imposition of any Lien (except for Permitted Liens) on any material asset of the Acquired Companies; (h) (i) waiver or release of any claim or right, (ii) cancellation of any debt held by the Acquired Companies other than those that are not material to any Acquired Company and were made in the Ordinary Course of Business, (iii) creation, incurrence, assumption, or guarantee of any Funded Debt either involving more than $250,000 or outside the Ordinary Course of Business, except for borrowings from banks (or similar financial institutions) necessary to fund capital expenditures in a manner consistent with past custom the Acquired Companies’ existing budget for capital expenditures and practice made ordinary working capital requirements, in each case under a credit facility that is included as Permitted Debt, or (iv) issuance or sale of any debt securities or warrants or rights to Seller's employeesacquire any debt securities; (i) payments to any Affiliate of the Acquired Companies, officers other than wages, lease payments, and directors for travel expenses incurred reimbursements in the ordinary Ordinary Course of Business pursuant to the express terms of written Contracts made available to Buyer; (j) material capital expenditures or commitments therefor, other than in a manner consistent with the Acquired Companies’ existing budget for capital expenditures as made available to Buyer; (k) declaration, setting aside, or making any dividend or other distribution or payment in respect of any Acquired Company’s Equity Securities, other than dividends or distributions paid by any wholly-owned Subsidiary to the Company or another Acquired Company; (l) entry into or amendment or modification of any Contract with any employee or other service provider (including, for the avoidance of doubt, any Contracts with any Key Employee), other than non-disclosure agreements or similar form agreements entered into in the Ordinary Course of Business; (m) termination, establishment, institution, or material amendment of any Plan; (n) entry into any new lease, sublease, or other occupancy agreement in respect of real property; (o) entry into any Contract or the making of any commitment that would restrict the ability of the Company or any of its Affiliates to compete with, or conduct, any business or line of business in any geographic area; (p) (1) termination, cancellation, modification, or amendment in any material respect or the receipt notice or a request for termination, cancellation, modification or amendment of any Material Contract, (2) taking or failure to take any action that would entitle any party to a Material Contract to terminate, modify, cancel, or amend any Material Contract, or (3) otherwise a waiver, release, or assignment of any material rights, claims, or benefits with respect to any Material Contract, other than in the Ordinary Course of Business; (q) institution, commencement, compromise, or settlement of any Proceeding (other than ordinary-course collection matters or matters solely involving the payment of money with respect to such matter of $250,000 or less by the Acquired Companies); (r) (i) adoption of a plan of complete or partial liquidation, dissolution, restructuring, recapitalization, or other reorganization or (ii) discontinuance of any line of business or entered into made any transactionmaterial change in the conduct of its business, arrangement except for changes in the Ordinary Course of Business; (s) loans, advances, or contract (includingcapital contributions to, without limitationor investments in, any transfer Person other than a Subsidiary of the Company; (t) amendment or other modification or supplement to its Organizational Documents; (u) lapse in coverage of any assets of placing a Lien on any assets) except on an arms-length basis in the ordinary course of business consistent with past custom and practiceInsurance Policies (or insurance policies having substantially similar coverage); (v) suffered acquisition by merging or consolidating with, or by purchasing all or substantially all of the Equity Securities or assets of, any extraordinary loss, damage, destruction Person or casualty loss or waived any rights of material value, whether or not covered by insurance and whether or not in the ordinary course of business or consistent with past custom and practicedivision thereof (other than inventory); (vii) received notificationdelay or postponement of the payment of accounts payable, other than those being disputed in good faith, or become aware (ii) acceleration of facts which would lead a reasonable person to believethe collection or receipt of any accounts receivable, that any material customer or supplier will stop or decrease in any material respect the rate of business done with the Business; (vii) become subject to any material liabilities, except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into in the ordinary course of business consistent with past custom and practice; (viii) settled or compromised any litigation involving equitable relief or involving any money damages in excess of $50,000; or (ix) entered into any other material transactioneach case, other than in the ordinary course Ordinary Course of business consistent with past custom and practice.Business; or (bx) No party has accelerated, terminated, modified entry into any Contract to consummate or canceled otherwise resolve to consummate any Assigned Contractof the foregoing.

Absence of Certain Developments. (a) Except as expressly contemplated by this Agreement or as set forth in on the attached "Developments Schedule," Schedule 6M, since August December 31, 19981999, Seller each of the Company and its Subsidiaries has conducted the Business its business only in the ordinary course of business consistent with past custom and practice (including, without limitation, with respect to the offering of special sales or incentive programs or the filling of its distribution channels), has incurred no liabilities other than in the ordinary course of business consistent with past custom and practice, and Seller has notnone of the Company and its Subsidiaries has: (i) soldissued any notes, assigned bonds or transferred other debt securities or any capital stock or other equity securities or any securities or rights convertible, exchangeable or exercisable into any capital stock or other equity securities, other than (x) equity transfers in the ordinary course of its assetsbusiness by shareholders of the Company pursuant to applicable laws of descent and distribution or among such shareholder's Family Group or (y) pursuant to the Stock Option Plan or the Phantom Plan; (ii) incurred any Indebtedness, except for sales of inventory other than any Indebtedness incurred in the ordinary course of business consistent with past custom and practice, or mortgaged, pledged or subjected them to any material Lien, except for Liens for current property Taxes not yet due and payable, or canceled without fair consideration any material debts or claims owing to or held by it; (ii) sold, assigned, transferred, abandoned or permitted to lapse any Government Licenses which, individually or in the aggregate, are material to the Business or any portion thereof, or any of the Proprietary Rights or other intangible assets, or disclosed any material proprietary confidential information to any Person, except in the ordinary course of business consistent with past custom and practice, or granted any license or sublicense of any rights under or with respect to any Proprietary Rights; (iii) conducted its cash management customs and practices (includingdischarged or satisfied any material Lien or paid any material obligation or liability, without limitation, the collection of receivables, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than current liabilities paid in the usual and ordinary course of business consistent with past custom and practice; (iv) declared, set aside or made any payment or distribution of cash or other property to the Sellers with respect to their capital stock or other equity securities or purchased, redeemed or otherwise acquired any shares of its capital stock or other equity securities (including any warrants, options or other rights to acquire its capital stock or other equity securities); (v) mortgaged or pledged or imposed any security interest upon any of its properties or assets, tangible or intangible, or subjected them to any Lien, except Permitted Liens; (vi) sold, assigned, transferred, leased, licensed or abandoned any of its assets, tangible or intangible (including the Intellectual Property Rights), or other than in the ordinary course of business consistent with past custom and practice for a fair consideration; (vii) made or granted any bonus or any wage or salary increase (other than wage increases made in the ordinary course of business consistent with past custom and practice) or made any other change in employment to any director, officer, employee or group of employees (except as required by pre-existing contracts described on the attached Contracts Schedule 6P), or made or granted any increase in any bonus, profit sharing, incentive, severance, or other employee benefit plan, contract or arrangement, or amended or modified or terminated any existing employee benefit plan or arrangement or adopted any new employee benefit plan or arrangement; (viii) entered into any employment contract or collective bargaining agreement, written or oral, or modified the terms of any existing such contracts or agreements; (ix) made capital expenditures or commitments therefor that aggregate in excess of $50,000 other than in connection with the reconstruction of the Washington Facility as set forth on the Construction Schedule 2Q attached hereto; (x) delayed, postponed or canceled the payment of any accounts payable or any other liability or obligation or agreed or negotiated with any party to extend the payment date of any accounts payable or accelerated the collection of any accounts or notes receivable; (xi) made any loans or advances to, or guarantees Guarantees for the benefit of, or entered into any transaction with PDK Investments in, any Persons or formed any Subsidiary; (xii) suffered any damage, destruction or casualty loss exceeding in the aggregate $50,000 (other than the damage caused by the Washington Facility Fire), whether or not covered by insurance, or experienced any material changes in the amount and scope of insurance coverage; (xiii) made any change in any method of accounting or accounting policies or its cash management processes, other than those required by GAAP which have been disclosed in writing to the Purchaser, or made any write-down in the value of its inventory that is other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer of any assets of placing a Lien on any assets) except on an arms-length basis than in the ordinary course of business consistent with past custom and practice; (vxiv) suffered directly or indirectly engaged in any extraordinary losstransaction, damagemade any loan to or entered into any arrangement with any officer, destruction director, partner, shareholder, employee or casualty loss or waived any rights other Affiliate of material value, whether or not covered by insurance and whether or not in the ordinary course of business or consistent with past custom and practiceCompany; (vixv) received notificationexcept as contemplated hereby, amended its articles of incorporation, bylaws or become aware of facts which would lead a reasonable person to believe, that any material customer or supplier will stop or decrease in any material respect the rate of business done with the Businessother organizational documents; (viixvi) become subject granted any license or sublicense of any rights under or with respect to any material liabilities, except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into in the ordinary course of business consistent with past custom and practiceIntellectual Property Rights; (viiixvii) settled canceled, compromised, waived, or compromised released any litigation right or claim (or series of related rights and claims) involving equitable relief more than $25,000; (xviii) entered into any agreement, contract, lease, or license (or series of related agreements, contracts, leases, and licenses) involving more than $25,000; (xix) accelerated, terminated, modified, or canceled any money damages in excess agreement, contract or license (or series of related agreements, contracts, or licenses) involving more than $50,00025,000 to which any of the Company and its Subsidiaries is a party or by which any of them is bound; (xx) experienced any other occurrence, event, incident, or taken any action or omitted to take any action which would have a Material Adverse Effect; or (ixxxi) entered into agreed, whether orally or in writing, to do any other material transaction, other than in of the ordinary course of business consistent with past custom and practiceforegoing. (b) No party has accelerated, terminated, modified or canceled any Assigned Contract.

Absence of Certain Developments. (a) Except as set forth in Schedule 4.4, since the attached "Developments Schedule," since August 31date of the Unaudited Financials, 1998no Seller, Seller has conducted as it relates to the Business only Target Business, or Newly-Formed LLC has: (a) issued any equity securities, any profits interests, or any securities exchangeable for or convertible into any equity securities or profits interests, other than pursuant to the Contribution Agreements; (b) borrowed any amounts, or entered into any other liabilities which are not in the ordinary course of business business, consistent with past custom and practice practice; (includingc) sold, without limitationassigned or transferred any of its assets other than in the ordinary course of business, consistent with respect past practices, other than pursuant to the offering of special sales Contribution Agreements; (i) compromised any debt or incentive programs or the filling of its distribution channels), has incurred no liabilities Claim other than in the ordinary course of business consistent with past custom and practice, and Seller has not: (i) sold, assigned or transferred any of its assets, except for sales of inventory in the ordinary course of business consistent with past custom and practice, or mortgaged, pledged or subjected them to any material Lien, except for Liens for current property Taxes not yet due and payable, or canceled without fair consideration any material debts or claims owing to or held by it; practices; (ii) sold, assigned, transferred, abandoned or permitted to lapse any Government Licenses which, individually or in the aggregate, are material to the Business or any portion thereof, or any of the Proprietary Rights or other intangible assets, or disclosed any material proprietary confidential information to any Person, except in the ordinary course of business consistent with past custom and practice, or granted any license or sublicense of any rights under or with respect to any Proprietary Rights; (iii) conducted its cash management customs and practices (including, without limitation, the collection of receivables, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practice; (iv) made any loans or advances to, or guarantees for the benefit of, or entered into any transaction with PDK or any of its other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer of any assets of placing a Lien on any assets) except on an arms-length basis in the ordinary course of business consistent with past custom and practice; (v) suffered any extraordinary loss, damage, destruction or casualty loss or intentionally waived any rights of material value, whether or not covered by insurance and whether or not in the ordinary course of business or consistent with past custom and practice; (vi) received notification, or become aware of facts which would lead a reasonable person to believe, that any material customer or supplier will stop or decrease in any material respect the rate of business done with the Business; (vii) become subject to any material liabilities, except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into in the ordinary course of business consistent with past custom and practice; (viii) settled or compromised any litigation involving equitable relief or involving any money damages in excess of $50,000; or (ix) entered into any other material transaction, other than in the ordinary course of business consistent with past custom practices; (iii) suffered any material theft, destruction, damage or casualty loss; (iv) intentionally waived, canceled or released any right, Claim or Accounts Receivable other than in the ordinary course of business consistent with past practices; and practice.(v) suffered any extraordinary losses; (be) No party authorized any material increase in the compensation of such Seller’s or Newly-Formed LLC’s employees (including any such increase pursuant to any bonus, pension, profit sharing or other plan or commitment), other than in the ordinary course of business, consistent with past practice (such as pursuant to such Seller’s or Newly-Formed LLC’s customary annual salary and bonus reviews); (f) made any change in any method of accounting or accounting practice that has acceleratedhad a Material Adverse Effect; (g) accepted any purchase order or quotation, terminatedarrangement, modified or canceled understanding for future sale of the products or services of such Seller or Newly-Formed LLC, other than in the ordinary course of business, consistent with past practice; (h) incurred any Assigned Contractliabilities or obligations (absolute, accrued, contingent or otherwise) except in the ordinary course of business and consistent with past practice, or experienced any change in any assumptions underlying or methods of calculating, any bad debt, contingency or other reserves that had a Material Adverse Effect; (i) written down or written up the value of any inventory, increased inventory levels in excess of historical levels for comparable periods or written off as uncollectible any notes or accounts receivable, except, in each case, in the ordinary course of business consistent with past practice; (j) made any single capital expenditure or commitment in excess of $75,000 for additions to property, plant, equipment or intangible capital assets or made capital expenditures or commitments in excess of $75,000 in the aggregate for additions to property, plant, equipment or intangible capital assets; (k) made any material change in the manner in which products or services have been performed or marketed or any other material change to the Target Business conducted by such Seller or Newly-Formed LLC; (l) had any material labor dispute or received notice of any material grievance; (m) suffered any Material Adverse Change in its financial condition, assets, liabilities (absolute, accrued, contingent or otherwise), reserves, business or operations; (n) granted any license or sublicense of any rights under, or with respect to, any Intellectual Property Right; (o) received any resignation of any management level key employee of such Seller who would otherwise have been employed by one of the Newly-Formed LLC’s after the Closing; or (p) agreed, whether in writing or otherwise, to take any action described in this Section 4.4.

Absence of Certain Developments. Since the Balance Sheet Date, there has not occurred any Material Adverse Effect. Prior to the Closing, AHC Holdco shall have conducted no operations and its sole assets shall be (ai) prior to the Conversion, the Shares (which will be cancelled pursuant to the Conversion), and (ii) following the Conversion, all of the Units. Except as set forth in Section 4.06 of the attached "Developments Schedule," Disclosure Schedule and except as expressly contemplated by this Agreement, since August 31the Balance Sheet Date, 1998, Seller each Acquired Company has conducted its business in the Business only ordinary course, consistent with past practice, and neither Acquired Company has: (a) mortgaged, pledged or subjected to any Lien any of its material assets, except Permitted Liens; (b) sold, assigned or transferred any material portion of its tangible assets, except in the ordinary course of business consistent with past custom and practice; (c) issued, sold, redeemed or transferred any of its capital stock or other equity securities, securities convertible into its capital stock or other equity securities or warrants, options or other rights to acquire its capital stock or other equity securities, or any bonds or debt securities; (d) amended its charter or by-laws or other applicable organizational documents; (e) acquired by merger, equity purchase or consolidation with, or by purchase of a substantial portion of the assets or stock of, or by any other manner, any business or any division thereof; (f) made any material capital investment in, or any material loan to, any other Person; (g) made any material capital expenditures or commitments therefor, except in the ordinary course of business consistent with past practice or pursuant to its existing capital expenditure budget; (includingh) deferred an capital expenditures, without limitationexcept in the ordinary course of business consistent with past practice; (i) made any changes in wages, salary or other compensation with respect to its officers, directors or employees, in each case other than changes made in the offering ordinary course of special sales business consistent with past practice or incentive programs pursuant to existing agreements or arrangements listed on Section 4.10 of the filling Disclosure Schedule; (j) paid, loaned or advanced (other than the payment of salary and benefits, the payment, advancement or reimbursement of expenses in the ordinary course of business consistent with past practice or intercompany payments between the Acquired Companies, in any event in the ordinary course of business consistent with past practice) any amounts to, or sold, transferred or leased any of its distribution channels)assets to, has incurred no liabilities or entered into any other transactions with, any of its Affiliates other than in the ordinary course of business consistent with past custom and practice, and Seller has not:; (ik) soldcommenced or settled any litigation involving an amount in excess of $50,000 for any one case; (l) cancelled or waived any claims with a potential value in excess of $50,000, assigned or transferred any of its assets, except for sales of inventory other than in the ordinary course of business consistent with past custom and practice, or mortgaged, pledged or subjected them to any material Lien, except for Liens for current property Taxes not yet due and payable, or canceled without fair consideration any material debts or claims owing to or held by itbusiness; (iim) soldterminated, assigned, transferredamended, abandoned or permitted to lapse any Government Licenses which, individually or in the aggregate, are material to the Business or any portion thereof, or any of the Proprietary Rights or other intangible assets, or disclosed any material proprietary confidential information to any Person, except in the ordinary course of business consistent with past custom and practice, or granted any license or sublicense of any rights under or with respect to any Proprietary Rights; (iii) conducted its cash management customs and practices (including, without limitation, the collection of receivables, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practice; (iv) made any loans or advances to, or guarantees for the benefit of, or entered into any transaction with PDK or any of its other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer of any assets of placing a Lien on any assets) except on an arms-length basis in the ordinary course of business consistent with past custom and practice; (v) suffered any extraordinary loss, damage, destruction or casualty loss canceled or waived any rights of material value, whether or not covered by insurance and whether or not in the ordinary course of business or consistent with past custom and practice; (vi) received notification, or become aware of facts which would lead a reasonable person to believe, that right under any material customer or supplier will stop or decrease in any material respect the rate of business done with the Business; (vii) become subject to any material liabilities, except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into in the ordinary course of business consistent with past custom and practice; (viii) settled or compromised any litigation involving equitable relief or involving any money damages in excess of $50,000; or (ix) entered into any other material transactionMaterial Contract, other than in the ordinary course of business consistent with past custom and practice.; (bn) No party has acceleratedchanged its accounting methods or principles theretofore adopted, terminatedexcept as required by GAAP and reflected in the Financial Statements; (o) experienced any damage, modified destruction or canceled casualty loss (other than those covered by insurance) with respect to any Assigned Contractof the assets or properties of such Acquired Company that, individually or in the aggregate with respect to both Acquired Companies, exceeds $50,000; (p) made any material change to its Benefit Plans or the benefits payable thereunder; (q) experienced any labor grievances or similar claims filed; (r) incurred any Indebtedness (other than (1) borrowings under the Company’s revolving line of credit in the ordinary course of business consistent with past practice, or (2) other ordinary course borrowings in an aggregate amount of no more than $100,000), guaranteed another Person’s Indebtedness, or prepaid any Indebtedness; (s) made any material change in the terms of payment by its patients/payors for any services it performs the effect of which is to enable it to receive payment or recognize revenues in its statement of operations for any period ending on or before the Closing Date which, but for that change, it would not so receive or recognize before a period beginning after the Closing Date; (t) made any material change in its practices with respect to timely payment of accounts payable or other obligations payable to vendors, suppliers or other third parties; or (u) committed to do any of the foregoing.

Absence of Certain Developments. (a) Except as set forth in Section 4.8 of the attached "Developments Schedule," Stockholders’ Disclosure Schedule or except as contemplated in and consistent with the terms of this Agreement, since August 31the Balance Sheet Date, 1998the Company has not: A. changed its accounting methods or practices (including any change in depreciation or amortization policies or rates) or revalued any of its assets; B. declared or paid any dividend or distributions; C. borrowed any amount under existing lines of credit, Seller has conducted or otherwise incurred or become subject to any indebtedness, except in the Business only ordinary course of business and in a manner and in amounts that are in keeping with past practices; D. discharged or satisfied any material Lien (other than Liens arising as a matter of law for property taxes and assessments and business and personal property taxes, mechanic’s liens and similar items discharged in the ordinary course of business consistent with past custom practices); E. except as is reasonably necessary for the ordinary operation of the Business and practice in a manner and in amounts that are in keeping with past practices, mortgaged, pledged, or subjected to any Lien any of its assets with a fair market value in excess of $25,000, except Liens for current property taxes not yet delinquent; F. sold, assigned or transferred (including, without limitation, transfers to any employees, shareholders, or affiliates) any material assets or canceled any material debts or claims, except, in each case, in the ordinary course of business consistent with respect past practices; G. sold, assigned, or transferred any patents, trademarks, trade names, copyrights, trade secrets, or other intangible assets or disclosed any proprietary or confidential information to any person other than Buyer; H. suffered any extraordinary loss or waived any material right or claim, including any write-off or compromise of any contract or account receivable, except to the offering of special sales extent reserved in the Preliminary Closing Balance Sheet; I. except as previously disclosed to Buyer, taken any other action or incentive programs entered into any material land transaction or the filling of its distribution channels), has incurred no liabilities other transaction other than in the ordinary course of business consistent with past custom and practicepractices, and Seller has not:or entered into any transaction with an employee, shareholder, partner, member or officer of the Company, or its affiliates; (i) soldJ. suffered any theft, assigned damage, destruction or transferred loss of or to any of its assetsproperty or properties owned or used by it, whether or not covered by insurance, except for sales of inventory in the ordinary course of business consistent with past custom and practiceany such theft, damage, destruction or mortgaged, pledged or subjected them to any material Lien, except for Liens for current property Taxes loss that is not yet due and payable, or canceled without fair consideration any material debts or claims owing to or held by it; (ii) sold, assigned, transferred, abandoned or permitted to lapse any Government Licenses whichreasonably likely, individually or in the aggregate, are to have a material adverse effect on the Business; K. except as previously disclosed to Buyer, increased the Business or any portion thereof, or any annualized level of the Proprietary Rights or other intangible assets, or disclosed any material proprietary confidential information to any Person, except in the ordinary course compensation of business consistent with past custom and practice, or granted any license extraordinary bonuses, benefits, or sublicense other forms of any rights under direct or with respect indirect compensation to any Proprietary Rightsemployee, officer, director or consultant that aggregate in excess of $25,000, or adopted, amended or modified any employee benefit plans; (iii) conducted its cash management customs L. except as is reasonably necessary for the ordinary operation of the Business and practices (including, without limitation, the collection of receivables, payment of payables in a manner and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than in the usual and ordinary course of business consistent amounts that are in keeping with past custom practices, made any capital expenditures or commitments for property, plant and practiceequipment that aggregate in excess of $25,000; (iv) M. engaged or agreed to engage in any extraordinary transactions or distributions, or, except as is reasonably necessary for the ordinary operation of the Business and in keeping with past practices, entered into any contract, written or oral, that involves consideration or performance by it of a value exceeding $25,000 or a term exceeding one year; N. made any loans or advances to, or guarantees for the benefit of, or entered into any transaction with PDK or any of its other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer of any assets of placing a Lien on any assets) except on an arms-length basis in the ordinary course of business consistent with past custom and practice; (v) suffered any extraordinary loss, damage, destruction or casualty loss or waived any rights of material value, whether or not covered by insurance and whether or not in the ordinary course of business or consistent with past custom and practice; (vi) received notification, or become aware of facts which would lead a reasonable person to believe, that any material customer or supplier will stop or decrease in any material respect the rate of business done with the Business; (vii) become subject to any material liabilities, except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into in the ordinary course of business consistent with past custom and practice; (viii) settled or compromised any litigation involving equitable relief or involving any money damages in excess of $50,000persons; or (ix) entered into any other material transaction, other than O. made charitable contributions or pledges which in the ordinary course of business consistent with past custom and practiceaggregate exceed $10,000. (b) No party has accelerated, terminated, modified or canceled any Assigned Contract.

Absence of Certain Developments. During the period beginning on the date of the Latest Balance Sheet and ending on the date of this Agreement, (ai) Except as set forth in there has not been any Material Adverse Effect (ii) the attached "Developments Schedule," since August 31, 1998, Seller Company has conducted the its Business only in all material respects in the ordinary course of business substantially consistent with past custom practices, and practice (includingiii) the Company has not: (a) amended or modified its Governing Documents; (b) split, without limitationcombined or reclassified any shares of its capital stock; (c) (1) issued, sold, granted or otherwise disposed of any of the Company’s capital stock or any other equity security, (2) issued, sold, granted or otherwise disposed of any options, warrants, calls, subscription or other right of any kind, fixed or contingent, that directly or indirectly calls for the issuance, sale, pledge or other disposition of any shares of the Company’s capital stock or any other equity security, (3) entered into of any contract calling for any transaction referred to in preceding clauses (1) or (2), or (4) made any other change in the Company’s capital structure; (d) declared, set aside or paid any dividends or other distributions (whether in cash, stock, property or any combination thereof) on or in respect of any of its capital stock or any other equity security, or redeemed, purchased or acquired for value any shares of its capital stock or any other equity security; (e) subjected any of its properties or assets or any leased real property to any Lien, except for, if any, (1) Permitted Liens and (2) Liens incurred in connection with any financing obtained by Purchaser; (f) changed or modified in any material respect any method of accounting or accounting practice, including for Tax purposes, or Tax calculating or Tax reporting methods or practice, except as required by applicable law, GAAP or as disclosed in the notes to the Latest Balance Sheet; (g) consented to any extensions or waived any statute of limitations in respect of Taxes or executed or filed with any Governmental Authority any agreement extending the period of assessment or collection of any Taxes; (h) made or amended any elections for Tax purposes; (i) adopted a taxable year other than the fiscal year ending December 31; (j) settled or compromised any material claim or assessment relating to Taxes; (k) made any payments, become obligated to make any payments, or become a party to any plan, program or agreement that could obligate it to make any payments, separately or in the aggregate, that would not be fully deductible under Code Section 280G; (l) made any change or modification to the Company’s cash management practices and its policies, practices and procedures with respect to the offering (1) billing and collection of special sales accounts receivable or incentive programs unbilled charges, (2) establishment of reserves for uncollectible accounts, (3) 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, or the filling of its distribution channels)(4) discounts, has incurred no liabilities rebates or allowances; (m) acquired assets, other than in the ordinary course of business substantially consistent with past custom and practice, and Seller has not:practices; (in) sold, assigned or transferred any of its assets, except for sales of inventory in the ordinary course of business consistent with past custom and practicetransferred, or mortgagedgranted any license or sublicense to, pledged any patents, trademarks, trade names, copyrights, trade secrets or subjected them to any other material Lien, except for Liens for current property Taxes not yet due and payable, or canceled without fair consideration any material debts or claims owing to or held by itintangible assets; (iio) sold, assigned, transferred, abandoned made or permitted to lapse granted any Government Licenses which, individually or in the aggregate, are material to the Business bonus or any portion thereofcompensation or salary increase or entered into any employment Contract to any current (or former) employee of the Company, or any other individual who performs services for the Company whose annual base salary is (or was at the time of the Proprietary Rights his or other intangible assets, or disclosed any material proprietary confidential information to any Person, her termination) in excess of $100,000 (except in the ordinary course of business substantially consistent with past custom and practicepractices or as required under the terms of an applicable contract, or granted any license or sublicense which contract has been disclosed on Schedule 3.8 to the extent in effect as of any rights under or with respect to any Proprietary Rightsthe date of this Agreement); (iiip) conducted its cash terminated, hired or transferred any senior management customs and practices (including, without limitation, employee of the collection of receivables, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practiceCompany; (ivq) made any capital expenditures or appropriations or commitments therefore, except any capital expenditure or appropriations or commitment not in excess of $50,000 individually or $100,000 in the aggregate; (r) made any loans or advances to, or guarantees for the benefit of, or entered into any transaction with PDK or any of its other stockholders or any employee, officer or director of Seller or PDK, Persons (except advances to employees for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel business expenses incurred in the ordinary course of business substantially consistent with past practices); (s) established, adopted, entered into, materially amended or entered into materially increased benefits under, or terminated any transactionmaterial benefit or compensation plan, arrangement or contract agreement (including, without limitation, bonuses, profit sharing, stock option, restricted stock, pensions, retirement benefits, deferred compensation, severance or termination benefits) for any transfer employees of the Company or other individuals who perform services for or on behalf of the Company; (t) incurred any damage, destruction or loss (whether or not covered by insurance), ordinary wear and tear excepted, in an amount exceeding $50,000 individually or $100,000 in the aggregate affecting the property or assets of placing a Lien on the Company; (u) made any assetscapital investment in any other Person except (1) except on an arms-length basis in the ordinary course of business substantially consistent with past custom and practicepractices or (2) for such capital investments that are reflected in the Company’s budget for the fiscal year ending December 31, 2018; (v) suffered sold, transferred, leased or otherwise disposed of any extraordinary lossmaterial assets of the Company, damageexcept for sales, destruction or casualty loss or waived any rights transfers, leases and other dispositions of material value, whether or not covered by insurance and whether or not inventory in the ordinary course of business or substantially consistent with past custom and practicepractices; (viw) received notificationentered into or agreed to enter into any merger, consolidation, reorganization, or become aware of facts which would lead a reasonable person similar agreement to believeacquire or sell any business or any Person, that any material customer or supplier will stop or decrease engaged in any new material respect line of business, invested in, made a capital contribution to, or otherwise acquired the rate securities of, any other Person, or acquired all or substantially all of business done with the Businessassets of any other Person; (viix) become subject to any material liabilities, except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into in any agreements with any Affiliates of the ordinary course Company or Seller or any of business consistent with past custom and practice; (viii) settled their respective directors, officers, employees, or compromised any litigation involving equitable relief or involving any money damages in excess of $50,000stakeholders; or (ixy) entered into authorized, approved, agreed or committed to do any other material transaction, other than in of the ordinary course of business consistent with past custom and practiceforegoing. (b) No party has accelerated, terminated, modified or canceled any Assigned Contract.

Absence of Certain Developments. (a) Except as set forth in on the attached "Developments Schedule," Schedule or as otherwise expressly contemplated herein, since August December 31, 19981999, Seller has conducted operated the Business only in the usual and ordinary course of business consistent with past practices, and has used its reasonable efforts to preserve the goodwill of its business and relationships with its customers, suppliers, franchisees, employees and other Persons having business relations with Seller including by investing and otherwise engaging in marketing, advertising and other promotional activities at times, in amounts and otherwise consistent with prior practices. Without limiting the generality of the foregoing since December 31, 1999, Seller has not, except as described on the Developments Schedule: (a) redeemed or purchased, directly or indirectly, any shares of its capital stock or declared or paid any dividends or distributions with respect to any shares of its capital stock or permitted any other withdrawal or made any payment or distribution of funds or other assets to any of its Affiliates; (b) pledged or subjected to any Lien any of the Purchased Assets, except for Permitted Liens; (c) with respect to the Business, sold, assigned or transferred any of its tangible assets, except in the ordinary course of business consistent with past custom and practice (including, without limitation, with respect to the offering of special sales or incentive programs or the filling of its distribution channels), has incurred no liabilities other than in the ordinary course of business consistent with past custom and practice, and Seller has not: (i) sold, assigned or transferred any of its assets, except for sales of inventory in the ordinary course of business consistent with past custom and practice, or mortgaged, pledged or subjected them to any material Lien, except for Liens for current property Taxes not yet due and payable, or canceled without fair consideration any material debts or claims owing to or held by it; (iid) sold, assigned, transferredlicensed, abandoned transferred or permitted to lapse encumbered any Government Licenses which, individually or in the aggregate, are material to the Business or any portion thereof, or any of the Proprietary Rights or other intangible assets, or disclosed any material proprietary confidential information to any PersonPerson other than Buyer and Buyer's agents or to Seller's agents through the course of due diligence or abandoned or knowingly permitted to lapse any Proprietary Rights; (e) with respect to the Business, made or granted any bonus or any wage or salary increase to any employee or group of employees (except as required by existing contracts or consistent with past practice), or made or granted any increase in any employee benefit plan or arrangement, or amended or terminated any existing employee benefit plan or arrangement or adopted any new employee benefit plan or arrangement; (f) with respect to the Business, suffered any extraordinary losses or waived any right of material value (whether or not in the ordinary course of business or consistent with past custom and practice, or granted any license or sublicense of any rights under or ); (g) with respect to any Proprietary Rights; (iii) conducted its cash management customs and practices (includingthe Business, without limitation, the collection of receivables, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practice; (iv) made any loans or advances to, or guarantees for the benefit of, or any Person; (h) with respect to the Business, entered into any other transaction with PDK or any of its other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer of any assets of placing a Lien on any assets) except on an arms-length basis in the ordinary course of business consistent with past custom and practice; (v) suffered any extraordinary loss, damage, destruction or casualty loss or waived any rights of material value, whether or not covered by insurance and whether or not in the ordinary course of business or and consistent with past custom and practice; (vi) received notification, or become aware of facts which would lead a reasonable person to believe, that any material customer or supplier will stop or decrease in any material respect the rate of business done with the Business; (vii) become subject to any material liabilities, except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into in the ordinary course of business consistent with past custom and practice; (viii) settled or compromised any litigation involving equitable relief or involving any money damages in excess of $50,000; or (ixi) entered into with respect to the Business, agreed, whether orally or in writing, to do any other material transaction, other than in of the ordinary course of business consistent with past custom and practiceforegoing. (b) No party has accelerated, terminated, modified or canceled any Assigned Contract.

Absence of Certain Developments. (a) Except Since December 31, 2010, there has been no Material Adverse Effect. Without limiting the generality of the foregoing, except as set forth on Schedule 5.8 or as taken after the date hereof in accordance with Section 4.1 and subject to the attached "Developments Schedule," restrictions set forth in Section 4.2, since August December 31, 19982010, Seller has conducted the Business only in the ordinary course of business consistent with past custom and practice (including, without limitation, with respect to the offering of special sales or incentive programs or the filling of its distribution channels), has incurred no liabilities other than in the ordinary course of business consistent with past custom and practice, and Seller Company has not: (ia) soldredeemed or purchased, assigned directly or indirectly, any of its capital stock or other equity interests or declared or paid any dividends or distributions with respect thereto or permitted any other withdrawal or distribution of funds or other assets from the Company to any of its Affiliates other than normal and reasonable salaries of employees and the payments of the Company's normal expenses in the Ordinary Course of Business consistent with past practices; (b) issued, sold or transferred any of its capital stock or other equity securities, securities convertible into its capital stock or other equity securities or warrants, options or other rights to acquire its capital stock or other equity securities, or any bonds or debt securities, other than with respect to the exercise of options in the Ordinary Course of Business; (c) sold, leased, transferred, or assigned any of its tangible assets, except other than for sales of inventory fair consideration in the ordinary course Ordinary Course of business consistent with past custom and practiceBusiness; (d) entered into any agreement, contract, lease or license (or series of related agreements, contracts, leases or licenses) either involving a Company obligation of more than $[**] or outside the Ordinary Course of Business; (e) accelerated, terminated, modified, or cancelled any agreement, contract, lease or license (or series of related agreements, contracts, leases or licenses) to which the Company is a party or by which it is bound involving more than $[**] or that is otherwise material to the Company's businesses or outside the Ordinary Course of Business; (f) mortgaged, pledged or subjected them to any material LienLien any of its assets or capital stock, except for Liens for current property Taxes not yet due and payable, or canceled without fair consideration any material debts or claims owing to or held by itPermitted Liens; (g) made any capital investment in, any loan to, or any acquisition of the securities or assets of, any other Person (or series of related capital investments, loans or acquisitions), other than the acquisition of inventory in the Ordinary Course of Business; (h) issued any note, bond or other debt security or created, incurred, assumed, or guaranteed any indebtedness for borrowed money or capitalized lease obligation; (i) delayed or postponed the payment of accounts payable and other liabilities outside the Ordinary Course of Business; (j) cancelled, compromised, waived, or released any right or claim (or series of related rights or claims) either (i) involving more than $[**], (ii) without having received fair consideration or (iii) outside the Ordinary Course of Business; (k) sold, assigned, transferredlicensed, transferred or encumbered, or abandoned or permitted failed to lapse maintain or protect, or taken (or failed to take) any Government Licenses whichother action that impairs or is reasonably likely to impair the value of, any of the Company Intellectual Property or other intangible assets of the Company; (l) experienced any material damage, destruction, or loss (whether or not covered by insurance) to its tangible assets; (m) made any capital expenditures or commitments therefor greater than $[**] individually or in the aggregate, are aggregate or that is otherwise material to the Business or any portion thereofCompany's business that were not contemplated in the 2011 Budget, or any of the Proprietary Rights or other intangible assets, or disclosed failed to make any material proprietary confidential information to any Person, except capital expenditures contemplated in the ordinary course of business consistent with past custom and practice, or granted any license or sublicense of any rights under or with respect to any Proprietary Rights2011 Budget; (iii) conducted its cash management customs and practices (including, without limitation, the collection of receivables, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practice; (ivn) made any loans or advances loan to, or guarantees for the benefit of, or entered into any other transaction with PDK or with, any of its other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employeesdirectors, officers and directors for travel expenses incurred in or employees outside the ordinary course Ordinary Course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer of any assets of placing a Lien on any assets) except on an arms-length basis in the ordinary course of business consistent with past custom and practice; (v) suffered any extraordinary loss, damage, destruction or casualty loss or waived any rights of material value, whether or not covered by insurance and whether or not in the ordinary course of business or consistent with past custom and practice; (vi) received notification, or become aware of facts which would lead a reasonable person to believe, that any material customer or supplier will stop or decrease in any material respect the rate of business done with the Business; (viio) become subject to any material liabilities, except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into in any employment contract or collective bargaining agreement, written or oral, or modified the ordinary course terms of business consistent with past custom and practiceany such existing contract or agreement; (viiip) granted any increase in the base salary compensation of, or made any other change in employment terms for, any of its directors, officers or employees outside the Ordinary Course of Business; (q) adopted, amended, modified, or terminated any bonus, profit-sharing, incentive, severance, or other plan, contract or commitment for the benefit of any of its directors, officers, or employees (or taken any such action with respect to any other Employee Benefit Plan), other than as required by applicable law; (r) made or changed any Tax election, changed an annual accounting period, adopted or changed any accounting method, filed any amended Tax Return, entered into any closing agreement, settled any Tax claim or compromised assessment relating to the Company, surrendered any litigation involving equitable relief right to claim a refund of Taxes, consented to any extension or involving waiver of the limitation period applicable to any money damages in excess Tax claim or assessment relating to the Company, took any other similar action relating to the filing of $50,000any Tax return or the payment of any Tax, or failed to pay any Taxes as they became due and payable; or (ixs) entered into committed or agreed to do any other material transaction, other than in of the ordinary course of business consistent with past custom and practiceforegoing. (b) No party has accelerated, terminated, modified or canceled any Assigned Contract.

Absence of Certain Developments. Except as: (i) set forth on Schedule 4.7; (ii) expressly contemplated by this Agreement and (iii) heretofore disclosed to Buyer in writing, since October 31, 2001, Seller, its Subsidiaries and the Business have not: (a) Except as set forth suffered a material adverse change in the attached "Developments Schedule," since August 31business, 1998financial condition, operating results, earnings, assets, customer, supplier or employee relations or business condition of Seller has conducted or the Business only Business; (b) redeemed or purchased, directly or indirectly, any shares of its capital stock; (c) borrowed any amount or issued or exchanged any notes or other evidences of any Indebtedness for Borrowed Money or incurred or become subject to any obligations or liabilities (whether absolute or contingent), except current liabilities incurred in the ordinary course of business consistent with past custom practice and practice (including, without limitation, with respect to the offering of special sales or incentive programs or the filling of its distribution channels), has incurred no liabilities other than under contracts entered into in the ordinary course of business consistent with past custom and practice, and Seller has not:; (id) solddischarged or satisfied any Lien or encumbrance, assigned or transferred paid any of its assetsobligation or liability, except for sales of inventory other than liabilities paid in the ordinary course of business consistent with past custom and practicebusiness, or prepaid any amount of Indebtedness for Borrowed Money, except as set forth on Schedule 4.7(d); (e) mortgaged, pledged or subjected them to any material Lien, charge or any other encumbrance, any portion of its properties or assets, except for Liens for current property Taxes taxes and assessments not yet due and payable, or canceled without fair consideration any material debts or claims owing to or held by it; (iif) sold, assignedleased, transferredassigned or transferred (including, abandoned or permitted without limitation, transfers to lapse any Government Licenses which, individually or in the aggregate, are material to the Business stockholders or any portion thereof, employees or Affiliates of any of the Stockholder) any tangible assets or Proprietary Rights or other intangible assets, or disclosed any material proprietary confidential information to any Person, except in the ordinary course of business consistent with past practice, or canceled without fair consideration any debts or claims owing to or held by it, or disclosed any proprietary confidential information to any Person; (g) suffered any theft, damage, destruction, casualty loss or other extraordinary loss to its tangible assets exceeding $5,000, whether or not covered by insurance; (h) entered into, amended or terminated any material lease, contract, agreement or commitment, or taken any other action or entered into any other transaction other than in the ordinary course of business and in accordance with past custom and practice, or granted entered into any license transaction with any Insider (as defined in Section 4.20 below) other than in the ordinary course of business and in accordance with past custom and practice, or sublicense entered into any other transaction, other than in the ordinary course of any rights under or business and in accordance with respect to any Proprietary Rightspast custom and practice, except as set forth on Schedule 4.7(h); (iiii) entered into or renegotiated any employment contract or collective bargaining agreement, written or oral, or made or granted any increase in any employee benefit plan or arrangement, or amended or terminated any existing employee benefit plan or arrangement or adopted any new employee benefit plan or arrangement, confidentiality/nondisclosure and non-competition agreement with Seller prior to the Closing Date; (j) changed the employment terms for any employee or agent or made or granted any bonus or any wage, salary or compensation increase to any director, officer, employee or sales representative, group of employees or consultant, other than in the ordinary course of business and in accordance with past custom and practice, except as set forth on Schedule 4.7(j); (k) conducted its cash management customs and practices the Business (including, without limitation, the collection pricing, incurrence of receivablescapital expenditures, payment of payables credit practices and maintenance and repair of inventory control and pricing and credit practices (including, without limitation, extension of credit terms or sales discount programs)assets) other than in the usual and ordinary course of business consistent in accordance with past custom and practice; (ivl) made any capital expenditures (or commitments therefore) in excess of $5,000, either individually or in the aggregate; (m) made any loans or advances to, or guarantees for the benefit of, or entered into any transaction with PDK or any of its other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer of any assets of placing a Lien on any assets) except on an arms-length basis in the ordinary course of business consistent with past custom and practice; (v) suffered any extraordinary loss, damage, destruction or casualty loss or waived any rights of material value, whether or not covered by insurance and whether or not in the ordinary course of business or consistent with past custom and practice; (vi) received notification, or become aware of facts which would lead a reasonable person to believe, that any material customer or supplier will stop or decrease in any material respect the rate of business done with the Business; (vii) become subject to any material liabilities, except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into in the ordinary course of business consistent with past custom and practice; (viii) settled or compromised any litigation involving equitable relief or involving any money damages Persons in excess of $50,0005,000; or (ixn) entered into any other material transaction, other than lease of capital equipment or real estate involving rental in the ordinary course excess of business consistent with past custom and practice$2,500 per annum. (b) No party has accelerated, terminated, modified or canceled any Assigned Contract.

Absence of Certain Developments. (a) Except as contemplated by this Agreement or as set forth in on Schedule 3.20, since January 1, 2019 (i) there has not been any Material Adverse Effect, and (ii) the attached "Developments Schedule," since August 31, 1998, Seller Company has conducted the Business its businesses only in, and has not engaged in the ordinary course of business consistent with past custom and practice (including, without limitation, with respect to the offering of special sales or incentive programs or the filling of its distribution channels), has incurred no liabilities any transaction other than in in, the ordinary course Ordinary Course of business consistent with past custom and practiceBusiness. Without limiting the foregoing, and Seller except as set forth on Schedule 3.20, since January 1, 2019, the Company has not: (a) increased the amount of any bonus, salary, fringe benefit or other compensation payable to any, director, officer, employee, consultant, or independent contractor of the Company, or entered into, amended or terminated any employment or severance Contract with any such person; (b) entered into or deferred any commitment for capital expenditures of the Company, or failed to make any capital expenditures of the Company to be made prior to the Closing, other than in accordance with the maintenance budget of the Company for the applicable fiscal year; (c) changed its accounting methods or principles in any material respect; (d) (i) soldmade or changed any Tax election, assigned (ii) settled or transferred compromised any Tax claim or Liability, (iii) changed any method of accounting or annual accounting period for Tax purposes, (iv) surrendered any claim for a refund of Taxes or (v) waived or extended the statute of limitations in respect of any Tax or entered into any Contract with a Taxing Authority; (e) entered into or agreed to enter into any merger or consolidation with any corporation or other entity, or acquired the securities of any other Person; (f) paid, cancelled, incurred, waived, settled or discharged or satisfied any Indebtedness, Claim, or Liability (whether absolute, accrued, contingent or otherwise), except in the Ordinary Course of Business; (g) encumbered any of its properties or assets, except for sales of inventory in the ordinary course of business consistent with past custom and practice, tangible or mortgaged, pledged or subjected them to any material Lienintangible, except for Liens for current property Taxes not yet due and payableincurred in the Ordinary Course of Business, or canceled without fair consideration any material debts or claims owing to or held by it; (ii) sold, assignedtransferred or otherwise disposed of any assets, transferred, abandoned properties or permitted to lapse any Government Licenses which, individually or in the aggregate, are material to the Business or any portion thereof, or any rights of the Proprietary Rights or other intangible assets, or disclosed any material proprietary confidential information to any Personbusiness of the Company, except in the ordinary course Ordinary Course of business consistent with past custom and practiceBusiness; (h) disposed of or has failed to keep in effect any rights in, to or granted any license or sublicense for the use of any rights under Company Intellectual Property Rights, franchise, license, Permit or certificate material to the business of the Company; (i) changed or modified in any manner its existing credit, collection and payment policies, procedures and practices with respect to any Proprietary Rightsaccounts receivable and accounts payable, respectively; (iiij) conducted its cash management customs and practices (includingincurred any material damage, without limitationdestruction, the collection of receivablestheft, payment of payables and maintenance of inventory control and pricing and credit practices (including, without limitation, extension of credit terms loss or sales discount programs)) other than in the usual and ordinary course of business consistent with past custom and practiceinterruption; (ivk) made waived or released any loans material right or advances toclaim of the Company or incurred any modifications, amendments or guarantees for terminations of any Contracts which are in the benefit aggregate material to the Company or its business; (l) materially modified the terms of, extended, renewed or terminated any Lease; or (m) agreed to do, or entered into any transaction with PDK or Contract requiring, any of its other stockholders or any employee, officer or director of Seller or PDK, except for the transactions contemplated by this Agreement and for advances consistent with past custom and practice made to Seller's employees, officers and directors for travel expenses incurred in the ordinary course of business or entered into any transaction, arrangement or contract (including, without limitation, any transfer of any assets of placing a Lien on any assets) except on an arms-length basis in the ordinary course of business consistent with past custom and practice; (v) suffered any extraordinary loss, damage, destruction or casualty loss or waived any rights of material value, whether or not covered by insurance and whether or not in the ordinary course of business or consistent with past custom and practice; (vi) received notification, or become aware of facts which would lead a reasonable person to believe, that any material customer or supplier will stop or decrease in any material respect the rate of business done with the Business; (vii) become subject to any material liabilities, except current liabilities incurred in the ordinary course of business and liabilities under contracts entered into in the ordinary course of business consistent with past custom and practice; (viii) settled or compromised any litigation involving equitable relief or involving any money damages in excess of $50,000; or (ix) entered into any other material transaction, other than in the ordinary course of business consistent with past custom and practiceforegoing. (b) No party has accelerated, terminated, modified or canceled any Assigned Contract.