Common use of Change in Condition Clause in Contracts

Change in Condition. 3.11.1. From and after the Balance Sheet Date to and including the date hereof, the Company has conducted the Business only in the Ordinary Course of Business. Without limiting the generality of the foregoing, since the Balance Sheet Date to and including the date hereof, no Target Company has: 3.11.1.1. entered into any transaction with any Affiliate (other than another Target Company), or made any Distribution/Payment; 3.11.1.2. incurred, assumed, guaranteed or discharged any Debt, claim, commitment, obligation or liability, absolute, accrued, contingent or otherwise, whether due or to become due, except for Debt incurred in the Ordinary Course of Business that does not exceed $250,000 in the aggregate; 3.11.1.3. created or suffered the imposition of any Lien upon the assets or Intangible of the Target Companies, except for Permitted Liens; 3.11.1.4. terminated, cancelled, materially modified or received any notice of termination of any Contract (except any termination in accordance with the terms of such Contract); 3.11.1.5. (a) sold, leased to others, licensed, assigned, allowed to lapse or expire or otherwise disposed of any of its Assets or Intangibles other than in the Ordinary Course of Business, (b) entered into any Contractual Obligation relating to (i) the purchase of material assets or Intangibles or (ii) any merger, consolidation or other business combination, (c) cancelled or compromised any Debt payable to the Company or claim of the Company (other than compromises of accounts receivable in the Ordinary Course of Business), (d) waived or released any right of material value or (e) instituted, settled or agreed to settle any Action or related Action in excess of $100,000; 3.11.1.6. (a) made any increase in the rate of Compensation or level of employee benefits of any director, officer or employee of a Target Company, except for changes in the Ordinary Course of Business, or (b) paid or agreed to pay any Compensation in connection with the Contemplated Transactions; 3.11.1.7. made any change in its methods of accounting or accounting practices other than as required by GAAP; 3.11.1.8. made capital expenditure or entered into any commitments therefore except in the Ordinary Course of Business or set forth on Schedule 3.11.1.8; 3.11.1.9. entered into or adopted a plan or agreement of complete or partial liquidation, dissolution, consolidation, reorganization, restructuring or recapitalization or entered into any new, or discontinued any existing, line of business; 3.11.1.10. entered into any Contractual Obligation with any sales representative except in the Ordinary Course of Business; 3.11.1.11. entered into any Contractual Obligation to do any of the things referred to in clauses 3.11.1 through 3.11.10 above; or 3.11.1.12. suffered any material damage, destruction or loss (whether or not covered by insurance) to any of its assets, whether tangible or intangible. 3.11.2. Since August 31, 2012 to and including the date hereof, there has not occurred any Material Adverse Effect.

Change in Condition. 3.11.1. From Except for the matters set forth on Schedule 4.2.4, which matters, in the aggregate, have not had and after could not reasonably be expected to have a Material Adverse Effect, since the Balance Sheet Date to and including the date hereof, the Company Date: (a) The Business has been conducted the Business only in the Ordinary Course of Business. Without limiting the generality of the foregoing, since the Balance Sheet Date to and including the date hereof, no Target Company has: 3.11.1.1. entered into any transaction with any Affiliate (other than another Target Company), or made any Distribution/Payment; 3.11.1.2. incurred, assumed, guaranteed (b) No Company has incurred or discharged otherwise become liable in respect of any Debt, claim, commitment, obligation or liability, absolute, accrued, contingent or otherwise, whether due or to become due, Debt except for Debt incurred in the Ordinary Course of Business that does not exceed $250,000 in the aggregate; 3.11.1.3. created or suffered the imposition of any Lien upon the assets or Intangible of the Target Companies, except for Permitted Liens; 3.11.1.4. terminated, cancelled, materially modified or received any notice of termination of any Contract (except any termination in accordance with the terms of such Contract); 3.11.1.5. (a) sold, leased to others, licensed, assigned, allowed to lapse or expire or otherwise disposed of any of its Assets or Intangibles other than borrowings in the Ordinary Course of Business, or become liable in respect of any Guarantee (bother than Guarantees by the Companies of obligations of the Companies) except such Debt as is permitted pursuant to subsection 7.1.4(d) hereof; (c) No Company has declared or made any Distribution or entered into or performed any other transaction which has resulted or will result in any (d) No Company has (i) sold, leased to others or otherwise disposed of any material portion of its assets (except for sales of inventory and equipment in the Ordinary Course of Business), (ii) entered into any Contractual Obligation relating to (iA) the purchase of material any Debt or equity interest in any Person, (B) the purchase of assets or Intangibles constituting a business or (iiC) any merger, consolidation or other business combinationcombination (other than among the Companies), (ciii) cancelled canceled or compromised any material Debt payable to the Company or claim of the Company (other than compromises of accounts receivable and other Debts or claims in the Ordinary Course of Business), (div) Knowingly waived or released any right of material value (other than in the Ordinary Course of Business), or (ev) instituted, settled or agreed to settle any Action material Action, inquiry or related Action in excess of $100,000; 3.11.1.6. investigation (a) made any increase in the rate of Compensation or level of employee benefits of any director, officer or employee of a Target Company, except for changes other than in the Ordinary Course of Business, ); (e) No Company has (i) made any changes in the rate of Compensation in effect for any of the Subscribers or (bii) paid or agreed or orally promised to pay pay, conditionally or otherwise, any extra Compensation to any Subscriber, or (iii) made any changes in connection with the Contemplated Transactionsrate of Compensation of any other officer, employee, consultant or agent of any Company (other than in the case of clause (iii) of this subsection (e) in the Ordinary Course of Business); 3.11.1.7. (f) No Company has made any material change in its customary methods of accounting or accounting practices (including without limitation with respect to reserves), pricing policies or payment or credit practices or failed to pay any creditor any amount owed to such creditor when due or granted any extensions of credit other than as required by GAAP; 3.11.1.8. made capital expenditure or entered into any commitments therefore except in the Ordinary Course of Business or set forth on Schedule 3.11.1.8; 3.11.1.9. entered into or adopted a plan or agreement of complete or partial liquidation, dissolution, consolidation, reorganization, restructuring or recapitalization or entered into any new, or discontinued any existing, line of business; 3.11.1.10. entered into any Contractual Obligation with any sales representative except in the Ordinary Course of Business; 3.11.1.11. (g) No Subscriber or Company has entered into any Contractual Obligation to do any of the things referred to in clauses 3.11.1 (a) through 3.11.10 (f) above; orand 3.11.1.12. suffered (h) No Material Adverse Effect has occurred, nor, to the Subscribers' Knowledge, have any material damageevent or events occurred which could reasonably be expected to have, destruction or loss (whether or not covered by insurance) to any of its assets, whether tangible or intangible. 3.11.2. Since August 31, 2012 to and including the date hereof, there has not occurred any a Material Adverse Effect.

Change in Condition. 3.11.1. From and after the Balance Sheet Date to and ------------------- including the date hereof, the Company has conducted the its Business only in the Ordinary Course of BusinessBusiness and has maintained the value of its Business as a going concern and, except as set forth on Schedule 4.12, its relationships with customers, distributors, suppliers, vendors, employees, agents and others. Without limiting the generality of the foregoing, except as set forth on Schedule 4.12, which matters have not had and will not have in the aggregate a Material Adverse Effect, since the Balance Sheet Date to and including the date hereof, no Target Company hashas not: 3.11.1.1. entered (a) Entered into any transaction otherwise than on an arms' length basis or any transaction with any Existing Stockholder or any Affiliate (other than another Target Company), or made any Distribution/Paymentthereof; 3.11.1.2. incurred, assumed, guaranteed (b) Made any capital expenditure in excess of $100,000 individually or discharged $500,000 in the aggregate; (c) Incurred or otherwise become liable in respect of any Debt, claim, commitment, obligation or liability, absolute, accrued, contingent or otherwise, whether due or to become due, except for Debt incurred borrowings in the Ordinary Course of Business that does not exceed $250,000 under the Loan Agreement, or become liable in the aggregaterespect of any Guarantee; 3.11.1.3. created (d) Created or suffered the imposition of any Lien (other than capital leases, which will not have in the aggregate a Material Adverse Effect) upon the assets any assets, whether tangible or Intangible intangible, of the Target Companies, except for Permitted LiensCompany; 3.11.1.4. terminated, cancelled, materially modified or received any notice of termination of any Contract (except any termination in accordance with the terms of such Contract); 3.11.1.5. (ai) soldSold, leased to others, licensed, assigned, allowed to lapse or expire others or otherwise disposed of any of its Assets or Intangibles other than in the Ordinary Course of Businessassets, (bii) entered into any Contractual Obligation relating to (iA) the purchase of material any capital stock of or interest in any Person, (B) the purchase of assets or Intangibles constituting a business or (iiC) any merger, consolidation or other business combination, (ciii) cancelled canceled or compromised any Debt payable to the Company or claim of the Company (other than compromises of accounts receivable in the Ordinary Course of Business), (div) waived or released any right of material substantial value or (ev) instituted, settled or agreed to settle any Action or related Action in excess of $100,000material Action; 3.11.1.6. (ai) made Made any increase changes in the rate of Compensation or level of employee benefits of any director, officer officer, employee, or employee consultant to, or agent of a Target the Company, except for changes in the Ordinary Course of BusinessBusiness to the compensation of Persons other than directors and officers of the Company, or (bii) paid or agreed to pay any extra Compensation to any such Person (including, without limitation, any such payments to be made in connection with and/or from the Contemplated Transactionsproceeds of the transactions contemplated hereby); 3.11.1.7. made any change in its methods of accounting or accounting practices other than as required by GAAP; 3.11.1.8. made capital expenditure or entered into any commitments therefore except in the Ordinary Course of Business or set forth on Schedule 3.11.1.8; 3.11.1.9. entered into or adopted a plan or agreement of complete or partial liquidation, dissolution, consolidation, reorganization, restructuring or recapitalization or entered into any new, or discontinued any existing, line of business; 3.11.1.10. entered into any Contractual Obligation with any sales representative except in the Ordinary Course of Business; 3.11.1.11. entered into any Contractual Obligation to do any of the things referred to in clauses 3.11.1 through 3.11.10 above; or 3.11.1.12. suffered (g) Suffered any material damage, destruction or loss (whether or not covered by insurance) to any of its assets, whether tangible or intangible.; 3.11.2. Since August 31(h) Made any change in its customary methods of accounting or accounting practices, 2012 pricing policies or payment or credit practices, or failed to and including pay any creditor any amount owed to such creditor when due, or granted any extensions of credit other than in the date hereof, there has not occurred Ordinary Course of Business; (i) Made any Distributions; (j) Entered into any Contractual Obligation to do any of the things referred to in clauses (a) through (h) above; and (k) Suffered or incurred any Material Adverse Effect, nor any event or events which in the aggregate will have a Material Adverse Effect.

Change in Condition. 3.11.1. From and after the Balance Sheet Date to and including the date hereof, the Company has Acquired Companies have conducted the Business only in the Ordinary Course of BusinessBusiness and, except as set forth on Schedule 5.11, have maintained their relationships with customers, distributors, suppliers, vendors, employees, agents and others. Without limiting the generality of the foregoing, except as set forth on Schedule 5.11, since the Balance Sheet Date to and including the date hereof, no Target Acquired Company has: 3.11.1.15.11.1. (i) entered into any transaction otherwise than on an arms’ length basis and in the Ordinary Course of Business or (ii) entered into any transaction with or made any Distributions or any other payments or transfers of assets to any shareholder or Affiliate of the Acquired Companies other than Compensation paid in the Ordinary Course of Business; 5.11.2. incurred or otherwise become liable in respect of any Debt (other than another Target CompanyBank Debt), or made any Distribution/Payment; 3.11.1.2. incurred, assumed, guaranteed or discharged any Debt, claim, commitment, obligation or liability, absolute, accrued, contingent or otherwise, whether due or to become due, except for Debt incurred borrowings and deferred purchase payments in the Ordinary Course of Business that does do not exceed $250,000 in the aggregate; 3.11.1.35.11.3. created or suffered the imposition of any Lien upon the assets any assets, whether tangible or Intangible intangible, of the Target Acquired Companies, except for Permitted Liens; 3.11.1.4. terminated, cancelled, materially modified or received any notice of termination of any Contract (except any termination in accordance with the terms of such Contract); 3.11.1.55.11.4. (ai) sold, leased to others, licensed, assigned, allowed to lapse or expire others or otherwise disposed of any of its Assets or Intangibles assets other than in the Ordinary Course of Business, (bii) entered into any Contractual Obligation relating to to (iA) the purchase of material any Capital Stock of or interest in any Person, (B) the purchase of assets or Intangibles constituting a business or (iiC) any merger, consolidation or other business combination, (ciii) cancelled canceled or compromised any Debt payable to the Company or claim of the Company (other than compromises of accounts receivable in the Ordinary Course of Business), (div) waived or released any right of material value or (ev) instituted, settled or agreed to settle any Action or related Action in excess of $100,000material Action; 3.11.1.65.11.5. (ai) made any increase changes in the rate of Compensation or level of employee benefits of any director, officer officer, employee, or employee consultant to, or agent of a Target Companythe Acquired Companies, except for changes in the Ordinary Course of Business, or (bii) paid or agreed to pay any Compensation in connection with the Contemplated Transactionstransactions contemplated hereby; 3.11.1.7. made any change in its methods of accounting or accounting practices other than as required by GAAP; 3.11.1.8. made capital expenditure or entered into any commitments therefore except in the Ordinary Course of Business or set forth on Schedule 3.11.1.8; 3.11.1.9. entered into or adopted a plan or agreement of complete or partial liquidation, dissolution, consolidation, reorganization, restructuring or recapitalization or entered into any new, or discontinued any existing, line of business; 3.11.1.10. entered into any Contractual Obligation with any sales representative except in the Ordinary Course of Business; 3.11.1.11. entered into any Contractual Obligation to do any of the things referred to in clauses 3.11.1 through 3.11.10 above; or 3.11.1.125.11.6. suffered any material damage, destruction or loss (whether or not covered by insurance) to any of its assets, whether tangible or intangible.; 3.11.25.11.7. Since August 31made any change in its customary methods of accounting or accounting practices, 2012 or payment or credit practices, or granted any extensions of credit other than in the Ordinary Course of Business; 5.11.8. made any change in the Acquired Companies’ cash management, including with respect to and including payment of Debt, collection of receivables, payment of payables or maintenance of working capital levels; 5.11.9. instituted or settled any material legal proceeding; 5.11.10. made any change in accounting or Tax reporting principles, methods or policies; 5.11.11. made, changed or rescinded any election relating to Taxes or settled or compromised any claim relating to Taxes; 5.11.12. entered into or agreed to enter into any Contractual Obligation to do any of the date hereof, there has not occurred things referred to in clauses 5.11.1 through 5.11.11 above; or 5.11.13. suffered or incurred any Material Adverse Effect, nor any event or events which would reasonably be expected to have a Material Adverse Effect.

Change in Condition. 3.11.1. From and after the Balance Sheet Date to and including the date hereofDate, the Company has conducted the its Business only in the Ordinary Course of BusinessBusiness and, except as set forth on Schedule 5.15, has maintained its relationships with wholesale customers, distributors, suppliers, vendors, employees, agents and others consistent with past practice. Without limiting the generality of the foregoing, except as set forth on Schedule 5.15, since the Balance Sheet Date to and including the date hereof, no Target Company hashas not: 3.11.1.15.15.1. (i) entered into any transaction otherwise than on an arms' length basis, (ii) entered into any transaction with any Affiliate, any of its stockholders or any Affiliate thereof, or (iii) made or committed to make any Distributions or any other payments or transfers of assets to any stockholder or Affiliate of the Company other than Compensation paid in the Ordinary Course of Business; 5.15.2. incurred or otherwise become liable in respect of any Debt (other than another Target Bank Debt and Guarantees issued in connection with new leases of the Company), or made any Distribution/Payment; 3.11.1.2. incurred, assumed, guaranteed or discharged any Debt, claim, commitment, obligation or liability, absolute, accrued, contingent or otherwise, whether due or to become due, except for Debt incurred borrowings and deferred purchase payments in the Ordinary Course of Business that does do not exceed $250,000 4,000,000 in the aggregate; 3.11.1.35.15.3. created or suffered the imposition of any Lien (other than Permitted Liens) upon the assets any assets, whether tangible or Intangible intangible, of the Target Companies, except for Permitted LiensCompany; 3.11.1.4. terminated, cancelled, materially modified or received any notice of termination of any Contract (except any termination in accordance with the terms of such Contract); 3.11.1.55.15.4. (ai) sold, leased to others, licensed, assigned, allowed to lapse or expire others or otherwise disposed of any of its Assets or Intangibles assets other than in the Ordinary Course of Business, (bii) entered into any Contractual Obligation relating to (iA) the purchase of material any capital stock of or interest in any Person (other than in connection with the formation of any wholly-owned Subsidiaries of the Company), (B) the purchase of assets or Intangibles constituting a business or (iiC) any merger, consolidation or other business combination, (ciii) cancelled canceled or compromised any Debt payable to the Company or claim of the Company (other than compromises of accounts receivable in the Ordinary Course of Business), (div) waived or released any right of material value or (ev) instituted, settled or agreed to settle any Action or related Action in excess of $100,000material Action; 3.11.1.6. (ai) made any increase changes in the rate of Compensation or level of employee benefits of any director, officer officer, employee, or employee consultant to, or agent of a Target the Company, except for changes in the Ordinary Course of BusinessBusiness to the Compensation of Persons other than directors, officers and Affiliates of the Company, or (bii) paid or agreed to pay any Compensation in connection with the Contemplated Transactionstransactions contemplated hereby; 3.11.1.7. made any change in its methods of accounting or accounting practices other than as required by GAAP; 3.11.1.8. made capital expenditure or entered into any commitments therefore except in the Ordinary Course of Business or set forth on Schedule 3.11.1.8; 3.11.1.9. entered into or adopted a plan or agreement of complete or partial liquidation, dissolution, consolidation, reorganization, restructuring or recapitalization or entered into any new, or discontinued any existing, line of business; 3.11.1.10. entered into any Contractual Obligation with any sales representative except in the Ordinary Course of Business; 3.11.1.11. entered into any Contractual Obligation to do any of the things referred to in clauses 3.11.1 through 3.11.10 above; or 3.11.1.125.15.6. suffered any material damage, destruction or loss (whether or not covered by insurance) to any of its assets, whether tangible or intangible.; 3.11.25.15.7. Since August 31made any change in its customary methods of accounting or accounting practices, 2012 pricing policies or payment or credit practices, or granted any extensions of credit other than in the Ordinary Course of Business; 5.15.8. made any change in the Company's cash management, including with respect to and including payment of Debt, collection of receivables, payment of payables or maintenance of working capital levels; 5.15.9. adopted, amended or terminated any Company Employee Plan; 5.15.10. except in the Ordinary Course of Business, sold any material amount of product of the Company or its Subsidiaries (i) with payment terms longer than terms customarily offered by the Company or its Subsidiaries for such product, (ii) at a discount from the listed price materially differing from any discounts customarily offered by the Company or its Subsidiaries for such product, or (iii) with shipment terms materially differing from the shipment terms customarily offered by the Company or its Subsidiaries for such product; 5.15.11. entered into any Contractual Obligation to do any of the things referred to in clauses 5.15.1 through 5.15.10 above; 5.15.12. otherwise taken any action of the type described in Section 7.2 which, if such action were to occur after the date hereof, there has not occurred would be in violation of such Section; or 5.15.13. suffered or incurred any Material Adverse Effect, nor any event or events which in the aggregate would reasonably be expected to have a Material Adverse Effect.

Change in Condition. 3.11.1. From and after the Balance Sheet Date to and ------------------- including the date hereof, the Company has conducted the its Business only in the Ordinary Course of BusinessBusiness and has maintained the value of its Business as a going concern and, except as set forth on Schedule 4.12, its relationships with customers, distributors, suppliers, vendors, employees, agents and others. Without limiting the generality of the foregoing, except as set forth on Schedule 4.12, which matters have not had and will not have in the aggregate a Material Adverse Effect, since the Balance Sheet Date to and including the date hereof, no Target Company hashas not: 3.11.1.1. entered (a) Entered into any transaction otherwise than on an arms' length basis or any transaction with any Existing Stockholder or any Affiliate thereof (other than another Target Companythe Xxxxxxx Redemption Agreement and the Xxxxxxxx Redemption Agreement), or made any Distribution/Payment; 3.11.1.2. incurred, assumed, guaranteed (b) Made any capital expenditure in excess of $100,000 individually or discharged $500,000 in the aggregate; (c) Incurred or otherwise become liable in respect of any Debt, claim, commitment, obligation or liability, absolute, accrued, contingent or otherwise, whether due or to become due, except for Debt incurred borrowings in the Ordinary Course of Business that does not exceed $250,000 under the Company's Loan and Security Agreement with Xxxxxx Financial, Inc., or become liable in the aggregaterespect of any Guarantee; 3.11.1.3. created (d) Created or suffered the imposition of any Lien upon the assets any assets, whether tangible or Intangible intangible, of the Target Companies, except for Permitted LiensCompany; 3.11.1.4. terminated, cancelled, materially modified or received any notice of termination of any Contract (except any termination in accordance with the terms of such Contract); 3.11.1.5. (ai) soldSold, leased to others, licensed, assigned, allowed to lapse or expire others or otherwise disposed of any of its Assets or Intangibles other than in the Ordinary Course of Businessassets, (bii) entered into any Contractual Obligation relating to (iA) the purchase of material any capital stock of or interest in any Person, (B) the purchase of assets or Intangibles constituting a business or (iiC) any merger, consolidation or other business combination, (ciii) cancelled canceled or compromised any Debt payable to the Company or claim of the Company (other than compromises of accounts receivable in the Ordinary Course of Business), (div) waived or released any right of material substantial value or (ev) instituted, settled or agreed to settle any Action or related Action in excess of $100,000material Action; 3.11.1.6. (ai) made Made any increase changes in the rate of Compensation or level of employee benefits of any director, officer officer, employee, or employee consultant to, or agent of a Target the Company, except for changes in the Ordinary Course of BusinessBusiness to the compensation of Persons other than directors and officers of the Company, or (bii) paid or agreed to pay any extra Compensation to any such Person (including, without limitation, any such payments to be made in connection with and/or from the Contemplated Transactionsproceeds of the transactions contemplated hereby); 3.11.1.7. made (g) Submitted any change in its methods of accounting material bids or accounting practices other than as required by GAAP; 3.11.1.8. made capital expenditure proposals to any third party with respect to the Business, or entered into any material contracts, commitments therefore except in the Ordinary Course of Business or set forth on Schedule 3.11.1.8agreements; 3.11.1.9. entered into or adopted a plan or agreement of complete or partial liquidation, dissolution, consolidation, reorganization, restructuring or recapitalization or entered into any new, or discontinued any existing, line of business; 3.11.1.10. entered into any Contractual Obligation with any sales representative except in the Ordinary Course of Business; 3.11.1.11. entered into any Contractual Obligation to do any of the things referred to in clauses 3.11.1 through 3.11.10 above; or 3.11.1.12. suffered (h) Suffered any material damage, destruction or loss (whether or not covered by insurance) to any of its assets, whether tangible or intangible.; 3.11.2. Since August 31(i) Made any change in its customary methods of accounting or accounting practices, 2012 pricing policies or payment or credit practices, or failed to and including pay any creditor any amount owed to such creditor when due, or granted any extensions of credit other than in the date hereof, there has not occurred Ordinary Course of Business (it being understood that the consummation of the Reorganization required the Company to change from a cash method to an accrual method of accounting for income tax purposes); (j) Made any Distributions; (k) Entered into any Contractual Obligation to do any of the things referred to in clauses (a) through (i) above; and (l) Suffered or incurred any Material Adverse Effect, nor any event or events which in the aggregate will have a Material Adverse Effect.

Change in Condition. 3.11.1. From and after the Balance Sheet Date to and including the date hereof, the Company has conducted the its Business only in the Ordinary Course of BusinessBusiness and has maintained the value of its Business as a going concern and, except as set forth on Schedule 4.12, its relationships with customers, distributors, suppliers, vendors, employees, agents and others. Without limiting the generality of the foregoing, except as set forth on Schedule 4.12, which matters have not had and will not have in the aggregate a Material Adverse Effect, since the Balance Sheet Date to and including the date hereof, no Target Company hashas not: 3.11.1.1. entered (a) Entered into any transaction otherwise than on an arms’ length basis or any transaction with any Existing Stockholder or any Affiliate (other than another Target Company), or made any Distribution/Paymentthereof; 3.11.1.2. incurred, assumed, guaranteed (b) Made any capital expenditure in excess of $100,000 individually or discharged $500,000 in the aggregate; (c) Incurred or otherwise become liable in respect of any Debt, claim, commitment, obligation or liability, absolute, accrued, contingent or otherwise, whether due or to become due, except for Debt incurred borrowings in the Ordinary Course of Business that does not exceed $250,000 under the Loan and Security Agreement dated as of December 13, 2000, between Kenexa Financial, Inc. and Citicorp USA, or become liable in the aggregaterespect of any Guarantee; 3.11.1.3. created (d) Created or suffered the imposition of any Lien (other than capital leases not in excess of $100,000) upon the assets any assets, whether tangible or Intangible intangible, of the Target Companies, except for Permitted LiensCompany; 3.11.1.4. terminated, cancelled, materially modified or received any notice of termination of any Contract (except any termination in accordance with the terms of such Contract); 3.11.1.5. (ai) soldSold, leased to others, licensed, assigned, allowed to lapse or expire others or otherwise disposed of any of its Assets or Intangibles other than in the Ordinary Course of BusinessAssets, (bii) entered into any Contractual Obligation relating to (iA) the purchase by the Company of any capital stock of or interest in any Person (other than purchases by the Company from terminated employees), (B) the purchase of material assets or Intangibles constituting a business or (iiC) any merger, consolidation or other business combination, (ciii) cancelled canceled or compromised any Debt payable to the Company or claim of the Company (other than compromises of accounts receivable in the Ordinary Course of Business), (div) waived or released any right of material substantial value or (ev) instituted, settled or agreed to settle any Action or related Action in excess of $100,000material Action; 3.11.1.6. (ai) made Made any increase changes in the rate of Compensation or level of employee benefits of any director, officer officer, employee, or employee consultant to, or agent of a Target the Company, except for changes in the Ordinary Course of BusinessBusiness to the compensation of Persons other than directors and officers of the Company, or (bii) paid or agreed to pay any extra Compensation to any such Person (including, without limitation, any such payments to be made in connection with and/or from the Contemplated Transactionsproceeds of the transactions contemplated hereby or by the other Transaction Documents); 3.11.1.7. made any change in its methods of accounting or accounting practices other than as required by GAAP; 3.11.1.8. made capital expenditure or entered into any commitments therefore except in the Ordinary Course of Business or set forth on Schedule 3.11.1.8; 3.11.1.9. entered into or adopted a plan or agreement of complete or partial liquidation, dissolution, consolidation, reorganization, restructuring or recapitalization or entered into any new, or discontinued any existing, line of business; 3.11.1.10. entered into any Contractual Obligation with any sales representative except in the Ordinary Course of Business; 3.11.1.11. entered into any Contractual Obligation to do any of the things referred to in clauses 3.11.1 through 3.11.10 above; or 3.11.1.12. suffered (g) Suffered any material damage, destruction or loss (whether or not covered by insurance) to any of its assetsAssets; (h) Made any change in its customary methods of accounting or accounting practices, whether tangible pricing policies or intangible.payment or credit practices, or failed to pay any creditor any amount owed to such creditor when due, or granted any extensions of credit other than in the Ordinary Course of Business; 3.11.2. Since August 31, 2012 (i) Made any Distributions; (j) Entered into any Contractual Obligation to and including do any of the date hereof, there has not occurred things referred to in clauses (a) through (i) above; and (k) Suffered or incurred any Material Adverse Effect, nor any event or events which in the aggregate will have a Material Adverse Effect.

Change in Condition. 3.11.1. From and after the Balance Sheet Date to and including the date hereof, the Company has conducted its Business in the Ordinary Course of Business only and, except as set forth on Schedule 5.11, since the Balance Sheet Date the Company has not: 5.11.1. (i) entered into any transaction otherwise than on an arms' length basis, (ii) entered into any transaction with any Affiliate, any of its shareholders or any Affiliate thereof, or (iii) made any Distributions or any other payments or transfers of assets to any shareholder or Affiliate of the Company other than Compensation paid in the Ordinary Course of Business. Without limiting the generality of the foregoing, since the Balance Sheet Date to and including the date hereof, no Target Company has: 3.11.1.1. entered into any transaction with any Affiliate (other than another Target Company), or made any Distribution/Payment; 3.11.1.25.11.2. incurred, assumed, guaranteed incurred or discharged otherwise become liable in respect of any Debt, claim, commitment, obligation or liability, absolute, accrued, contingent or otherwise, whether due or to become due, except for Debt incurred borrowings and deferred purchase payments in the Ordinary Course of Business that does do not exceed $250,000 2,000,000 in the aggregate; 3.11.1.35.11.3. created or suffered the imposition of any Lien upon the assets any assets, whether tangible or Intangible intangible, of the Target Companies, except for Permitted LiensCompany; 3.11.1.45.11.4. terminated, cancelled, materially modified amended the Charter or received any notice By-laws of termination of any Contract (except any termination in accordance with the terms of such Contract)Company; 3.11.1.55.11.5. (ai) sold, leased to others, licensed, assigned, allowed to lapse or expire others or otherwise disposed of any of its Assets or Intangibles assets other than in the Ordinary Course of Business, ; (bii) entered into or accelerated, terminated, modified or cancelled any Contractual Obligation relating to (iA) the purchase of material any capital stock of or interest in any Person, (B) the purchase of assets or Intangibles constituting a business or (iiC) any merger, consolidation or other business combination, ; (ciii) cancelled canceled or compromised any Debt payable to the Company or claim of the Company (other than compromises of accounts receivable in the Ordinary Course of Business)) which individually have a value in excess of $100,000 or $1,000,000 in the aggregate, (div) waived or released any right of material value value; or (ev) instituted, settled or agreed to settle any Action or related Action in excess of $100,000material Action; 3.11.1.6. (ai) made any increase changes in the rate of Compensation or level of employee benefits of any director, officer officer, employee, or employee consultant to, or agent of a Target the Company, except for changes in the Ordinary Course of Business, or (bii) paid or agreed to pay any Compensation in connection with the Contemplated Transactionstransactions contemplated hereby; 3.11.1.7. made any change in its methods of accounting or accounting practices other than as required by GAAP; 3.11.1.8. made capital expenditure or entered into any commitments therefore except in the Ordinary Course of Business or set forth on Schedule 3.11.1.8; 3.11.1.9. entered into or adopted a plan or agreement of complete or partial liquidation, dissolution, consolidation, reorganization, restructuring or recapitalization or entered into any new, or discontinued any existing, line of business; 3.11.1.10. entered into any Contractual Obligation with any sales representative except in the Ordinary Course of Business; 3.11.1.11. entered into any Contractual Obligation to do any of the things referred to in clauses 3.11.1 through 3.11.10 above; or 3.11.1.125.11.7. suffered any material damage, destruction or loss (whether or not covered by insurance) to any of its assets, whether tangible or intangible.; 3.11.25.11.8. Since August 31written off or written down, 2012 or determined to and write off or write down, any of the assets or properties of the Company which individually have a value in excess of $100,000 or $1,000,000 in the aggregate; 5.11.9. made any change in its customary methods of accounting or accounting practices, other than as required by GAAP, or made any changes it its pricing policies or payment or credit practices, or granted any extensions of credit, other than in the Ordinary Course of Business; 5.11.10. made any change in the Company's cash management, including with respect to payment of Debt, collection of receivables, payment of payables or maintenance of working capital levels; 5.11.11. entered into any Contractual Obligation to do any of the date hereof, there has not occurred things referred to in clauses 5.11.1 through 5.11.10 above; or 5.11.12. suffered or incurred any Material Adverse Effect, nor any event or events which, individually or in the aggregate, would reasonably be expected to have a Material Adverse Effect.