Common use of Absence of Certain Changes Clause in Contracts

Absence of Certain Changes. Except as set forth in Section 4.06 of the Disclosure Letter, since May 31, 2000, (a) the Company and its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) the Company and its Subsidiaries have conducted their respective businesses only in the ordinary course consistent with past practice, except for the negotiation and execution and delivery of this Agreement and (c) there has not been (i) any declaration, setting aside or payment of any dividend or other distribution in respect of the Shares or any repurchase, redemption or other acquisition by the Company or any of its Subsidiaries of any outstanding shares of capital stock (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities in, or other ownership interests in, the Company or any of its Subsidiaries or any amendment (or agreement to amend) the terms of any such shares, securities or ownership interests), (ii) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation payable or to become payable by the Company or any of its Subsidiaries to, any of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable other than in the ordinary course of business consistent with past practice, (viii) any entry into any agreement, commitment or transaction by the Company which is material to the Company and its Subsidiaries taken as a whole or (ix) any commitment to do any of the foregoing.

Absence of Certain Changes. Except as set forth in Section 4.06 4.15 of the Company Disclosure LetterSchedule or as disclosed in the Company’s Form 10-Q for the quarter ended March 27, 2006, since May 31December 26, 20002005, (a) the Company and its Subsidiaries have there has not suffered any Material Adverse Effect or any change, condition, been an event or development that which could reasonably be expected to have a Material Adverse EffectEffect on the Company, (b) the business of the Company and its Subsidiaries have conducted their respective businesses subsidiaries has been conducted, in all material respects, only in the ordinary course a manner consistent with past practice, except for the negotiation and execution and delivery of this Agreement and (c) none of the Company or any of its subsidiaries has incurred any liabilities (direct, contingent, or otherwise) or engaged in any transactions or entered into any agreement or commitment outside the ordinary course of business involving more than $100,000 individually or $500,000 in the aggregate. In addition, other than as previously disclosed in the SEC Reports or as set forth in Section 4.15 of the Company Disclosure Schedule, since December 26, 2005, there has not been (i) any declaration, setting aside or payment of any dividend or other distribution in respect of the Shares or any repurchase, redemption or other acquisition change by the Company relating to Taxes or any of in its Subsidiaries of any outstanding shares of capital stock (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Optionsaccounting methods, including in satisfaction of withholding tax obligations) or other securities inprinciples, or other ownership interests in, the Company or any of its Subsidiaries or any amendment (or agreement to amend) the terms of any such shares, securities or ownership interests)and practices, (ii) except as previously disclosed in writing to representatives of Parent, any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation payable or to become payable reevaluation by the Company or of any of its Subsidiaries toasset (including, without limitation, any of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs down of inventory or write-off of accounts receivable receivable) other than in the ordinary course of business consistent with past practice, (iii) any damage, destruction, or loss (whether or not covered by insurance) with respect to any material property or asset of the Company or any of its subsidiaries involving more than $100,000 individually or $500,000 in the aggregate, (iv) any failure by the Company to revalue any asset in accordance with GAAP applied consistent with past practice, (v) except in the ordinary course of business, any entry by the Company or any of its subsidiaries into any commitment or transaction involving more than $100,000 individually or $500,000 in the aggregate, (vi) any declaration, setting aside, or payment of any dividend or distribution in respect of any capital stock of the Company or any redemption, purchase, or other acquisition of any of its securities, (vii) any increase in or establishment of any bonus, change in control payments, insurance, severance, deferred compensation, pension, retirement, profit sharing, stock option, stock purchase, or other employee benefit plan, or any other increase in the compensation payable or to become payable to any director or officer of the Company; provided, however, that nothing in this Section 4.15 shall require the listing in Section 4.15 of the Company Disclosure Schedule of Options or restricted stock units otherwise disclosed in Section 4.03(a) of the Company Disclosure Schedule or of any item disclosed in Section 4.11 of the Company Disclosure Schedule, (viii) any entry into incurrence, payment, discharge, or satisfaction of any agreementindebtedness, commitment claim, liability, or transaction by obligation other than in the Company which is material to the Company and its Subsidiaries taken as a whole or ordinary course of business consistent with past practice, (ix) any commitment imposition of any Lien on any asset or property of the Company or any of its subsidiaries other than in the ordinary course of business consistent with past practice, (x) any sale, transfer, or other disposition of any properties or assets of the Company or any subsidiaries involving more than $100,000 individually or $500,000 in the aggregate except in the ordinary course of business consistent with past practice, (xi) any entry into, or change or modification to, any Affiliate Transaction, or (xii) any authorization or agreement to do take any of the foregoingactions described in this Section 4.15.

Absence of Certain Changes. Except as set forth disclosed in Section 4.06 of the Disclosure LetterCompany Financial Statements, since May 31, 2000, (a) the Company and its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) Audit Date the Company and its Subsidiaries have conducted their respective businesses only in, and have not engaged in any material transaction other than according to, the ordinary and usual course consistent with past practice, except for the negotiation of such businesses and execution and delivery of this Agreement and (c) there has not been (i) any change in the matters set forth in clause (a), or in the last sentence, of the definition of Company Material Adverse Effect set forth in Section 5.1(a) of this Agreement, (ii) any other development or combination of developments, which, to the best knowledge of the Company, individually or in the aggregate, has had or is reasonably expected to have, a Company Material Adverse Effect or reasonably expected to prevent, materially delay or materially impair the ability of the Company to consummate the Merger or any other transactions contemplated by this Agreement; (iii) any material damage, destruction or other casualty loss with respect to any material asset or property owned, leased or otherwise used by the Company or any of its Subsidiaries, whether or not covered by insurance; (iv) any declaration, setting aside or payment of any dividend or other distribution in cash, stock or property in respect of the Shares or any repurchasecapital stock of the Company, redemption except for dividends or other acquisition distributions on its capital stock publicly announced prior to the date hereof and except as expressly permitted hereby; or (v) any change by the Company in accounting principles, practices or any of its Subsidiaries of any outstanding shares of capital stock (methods that is not required by GAAP. Since the Audit Date, except any obligation of as provided for herein or as disclosed in the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock OptionsFinancial Statements, including in satisfaction of withholding tax obligations) or other securities in, or other ownership interests in, the Company or any of its Subsidiaries or any amendment (or agreement to amend) the terms of any such shares, securities or ownership interests), (ii) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or there has not been any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation payable or to that could become payable by the Company or any of its Subsidiaries to, to officers or key employees or any amendment of or other modification to any of their respective directors, officers the Benefit Plans other than increases or employees, except base salary, guaranteed draw amendments in the ordinary and usual course consistent with past practice and all such increases in compensation and all such present and future costs associated with all such amendments or hourly wage increases to employees who modifications (A) have been fully reserved against in the Company Financial Statements or (B) are not members of in accordance with the executive committee consolidated 2005 Operating Budget of the Company or directors (the “Operating Budget”) attached to Section 5.1(i) of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable other than in the ordinary course of business consistent with past practice, (viii) any entry into any agreement, commitment or transaction by the Company which is material to the Company and its Subsidiaries taken as a whole or (ix) any commitment to do any of the foregoingDisclosure Letter.

Absence of Certain Changes. Except as set forth disclosed in Section 4.06 the SEC Documents or in Schedule 4.4 or as contemplated by this Agreement, since June 30, 1997 until the commencement of the Disclosure LetterOffer, since May 31no event has occurred or will occur and no circumstances exist or will exist, 2000, (a) and as of the date hereof the Company and its Subsidiaries have is not suffered aware of any Material Adverse Effect or any change, condition, event or development that could circumstances which may reasonably be expected likely to have occur or exist, that would be reasonably likely to result in a Material Adverse Effect, (b) except for general economic changes, changes that affect the industry of the Company or any Subsidiary generally, and its Subsidiaries have conducted their respective businesses only changes in the ordinary course consistent with past practiceCompany's business after the date hereof attributable solely to actions taken by Parent or Acquisition Sub. Except as disclosed in the SEC Documents or in Schedule 4.4, except for the negotiation and execution and delivery of this Agreement and (c) since June 30, 1997, there has not been (ia) any declaration, setting aside or payment of any dividend or other distribution in respect of the Shares capital stock of the Company or any repurchase, redemption or other acquisition by the Company or any of its Subsidiaries of any outstanding shares of capital stock Shares; (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities in, or other ownership interests in, the Company or any of its Subsidiaries or any amendment (or agreement to amend) the terms of any such shares, securities or ownership interests), (ii) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation payable or to become payable by the Company or any of its Subsidiaries to, any of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable other than in the ordinary course of business consistent with past practice, (viiib) any entry into any agreement, commitment or transaction by the Company or any Subsidiary which is material to the Company and its the Subsidiaries taken as a whole whole, except agreements, commitments or transactions in the ordinary course of business, (ixc) any commitment to do split, combination or reclassification of the Company's capital stock or any issuance or the authorization of any issuance of any other securities in respect of, in lieu of or in substitution for shares of its capital stock, (d)(i) any granting by the Company or any of the foregoingSubsidiaries to any officer or key employee of the Company or any of the Subsidiaries of any increase in compensation, except in the ordinary course of business or as was required under employment agreements in effect as of the date of the most recent financial statements included in the SEC Documents or (ii) any entry by the Company or any Subsidiary into any employment, severance or termination agreement with any such officer or key employee or granting by the Company or any Subsidiary to any such officer or key employee of any increase in severance or termination pay, except (A) as was required under employment, severance or termination agreements in effect as of the date of the most recent financial statements included in the SEC Documents or (B) as disclosed on Schedule 5.6(d) of the Disclosure Schedule, or (e) any damage, destruction or loss, whether or not covered by insurance, that has or would be reasonably likely to have a Material Adverse Effect or (f) any change in accounting methods, principles or practices by the Company or any Subsidiary materially affecting its assets, liabilities or business, except insofar as may have been required by a change in generally accepted accounting principles.

Absence of Certain Changes. Except as set forth in Section 4.06 of the Disclosure Letter, since May December 31, 20001996, (a) the Company and its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) the Company and its Significant Subsidiaries have conducted their respective businesses business only in the ordinary course of such business consistent with past practicepractices, except for the negotiation and execution and delivery of this Agreement and (c) there has not been (i) any Material Adverse Effect suffered by the Company or any of its Subsidiaries; (ii) any declaration, setting aside or payment of any dividend (other than regular quarterly cash dividends at a rate not in excess of $.46 per share of Common Stock) or other distribution in with respect to the capital stock of the Shares Company or its Subsidiaries (other than wholly-owned Subsidiaries) or any repurchase, redemption or any other acquisition by the Company or any of its Subsidiaries of any outstanding shares of capital stock (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities inof, or other ownership interests in, the Company or its Subsidiaries; (iii) any of its Subsidiaries material change in accounting principles, practices or any amendment methods; (or agreement to amend) the terms of any such shares, securities or ownership interests), (iiiv) any entry into or amendment of any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit ofemployment agreement with, or any increase in the rate or modification in the terms (including including, without limitation, any acceleration of the right to receive or the timing of payment) of any compensation payable or to become payable by the Company or any of its Subsidiaries to, any of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary the past practices, practice of the Company; (iiiv) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including including, without limitation, any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Planbonus, in any such caseinsurance, for pension or with other employee benefit plan or arrangement covering any such directors, officers or employees, (iv) any action by except increases in the Company which, if taken after ordinary course of business in accordance with the date hereof, would constitute a breach of any past practice of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles Company; or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any material revaluation by the Company or any of its Subsidiaries of any of their respective assets, including including, without limitation, write-downs of inventory or write-offs of accounts receivable other than in the ordinary course of business consistent with past practice, (viii) any entry into any agreement, commitment or transaction by the Company which is material to the Company and its Subsidiaries taken as a whole or (ix) any commitment to do any of the foregoingreceivable.

Absence of Certain Changes. Except as set forth in Section 4.06 6.8 of the -------------------------- ----------- Disclosure LetterLetter or as disclosed in the Company Reports, since May during the period from December 31, 20001999 to and including the date of this Agreement, (a) the Company and its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) the Company and its Subsidiaries have conducted their respective businesses only in the ordinary course of such business consistent with past practicepractices, except for the negotiation and execution and delivery of this Agreement and (c) there has have not been (ia) any event, change, occurrence or development of a state of fact that has or could reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect; (b) any declaration, setting aside or payment of any dividend or other distribution in with respect of the Shares or to its capital stock; (c) any repurchase, redemption or any other acquisition by the Company or any of its Subsidiaries of any outstanding shares of capital stock (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities inof, or other ownership interests in, the Company or its Subsidiaries; (d) any of its Subsidiaries material change in accounting principles, practices or any amendment methods; (or agreement to amend) the terms of any such shares, securities or ownership interests), (iie) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit ofemployment agreement with, or any increase in the rate or modification in the terms (including including, without limitation, any acceleration of the right to receive or the timing of payment) of any compensation payable or to become payable by the Company or any of its Subsidiaries to, or forgiveness of any of indebtedness owed to the Company by, their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted for regularly scheduled employee raises in the ordinary course of business consistent with the Company's past practices or raises or forgiveness of indebtedness that, in accordance the case of executive officers, have been approved by the compensation committee of the Board of Directors prior to the date hereof in the ordinary course of business consistent with its customary the committee's past practices, ; (iiif) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including including, without limitation, any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Planbonus, in any such caseinsurance, for pension or with other employee benefit plan or arrangement covering any such directors, officers or employees, (iv) any action by except, in the Company which, if taken after the date hereof, would constitute a breach case of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, increases occurring in the ordinary course of business consistent with the Company's past practices; (viig) any revaluation by the Company or any of its Subsidiaries of any material amount of their respective assets, including taken as a whole, including, without limitation, write-downs of inventory or write-offs of accounts receivable other than in the ordinary course of business consistent with past practice, practices; (viiih) any entry into material adverse change in the business relationship with any agreementmaterial customer, commitment distributor or transaction by supplier of the Company which is material to the Company and or its Subsidiaries taken as a whole Subsidiaries; or (ixi) any commitment to do any action of the foregoingtype described in Sections 8.1 ------------ that had such action been taken after the date of this Agreement would be in violation of any such Section.

Absence of Certain Changes. Except as set forth disclosed in Section 4.06 of the Disclosure LetterCompany -------------------------- Reports filed prior to the date hereof, and except for the NSC Distribution and the Share Repurchase and the transactions incident thereto, since May 31September 30, 2000, (a) the Company and its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) 1997 the Company and its Subsidiaries have conducted their respective businesses only in, and have not engaged in any material transaction other than according to, the ordinary and usual course consistent with past practice, except for the negotiation of such businesses and execution and delivery of this Agreement and (c) there has not been (i) any change in the financial condition, properties, business or results of operations of the Company and its Subsidiaries or any development or combination of developments of which the executive officers of the Company have knowledge that, individually or in the aggregate, has had or is reasonably likely to have a Company Material Adverse Effect; (ii) any material damage, destruction or other casualty loss with respect to any material asset or property owned, leased or otherwise used by the Company or any of its Subsidiaries, whether or not covered by insurance; (iii) any declaration, setting aside or payment of any dividend or other distribution in respect of the Shares or any repurchasecapital stock of the Company, redemption except for dividends or other acquisition distributions on its capital stock publicly announced prior to the date hereof; or (iv) any change by the Company in accounting principles, practices or any of its Subsidiaries of any outstanding shares of capital stock (methods. Since September 30, 1997, except any obligation of as provided for herein or as disclosed in the Company under Reports filed prior to the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Optionsdate hereof, including in satisfaction of withholding tax obligations) or other securities in, or other ownership interests in, the Company or any of its Subsidiaries or any amendment (or agreement to amend) the terms of any such shares, securities or ownership interests), (ii) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or there has not been any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation payable or to that could become payable by the Company or any of its Subsidiaries to, to any of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members any amendment of any of the executive committee of the Company Compensation and Benefit Plans other than increases or directors of the Company that have been granted amendments in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable other than in the ordinary course of business consistent with past practice, (viii) any entry into any agreement, commitment or transaction by the Company which is material to the Company and its Subsidiaries taken as a whole or (ix) any commitment to do any of the foregoingbusiness.

Absence of Certain Changes. Except as set forth disclosed in the SEC Reports (as defined in Section 4.06 4.05) filed with the SEC prior to the date hereof or in Section 4.04 of the Disclosure Letter, since May July 31, 20001997, (ai) the Company and its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (bii) the Company and its Subsidiaries have conducted their respective businesses only in the ordinary course consistent with past practice, except for in connection with the negotiation and execution and delivery of this Agreement Agreement, and (ciii) there has not been (ia) any declaration, setting aside or payment of any dividend or other distribution in respect of the Shares or any repurchase, redemption or other acquisition by the Company or any of its Subsidiaries of any outstanding shares of capital stock (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities in, or other ownership interests in, the Company or any of its Subsidiaries or any amendment Subsidiaries; (or agreement to amend) the terms of any such shares, securities or ownership interests), (iib) any entry into any employment, change in control, retention, incentive or deferred compensation employment agreement or severance agreement, plan or arrangement with or for the benefit ofcompensation agreement with, or any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing payment), of payment) of any compensation payable or to become payable by the Company or any of its Subsidiaries to, any of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company officers or directors of the Company that have been granted occurring in the ordinary course of business in accordance with its customary past practices, ; (iiic) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, of any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reportshereinafter defined) or any adoption other bonus, severance, insurance, pension or implementation of any new Planother employee benefit plan, in any such casepayment or arrangement made to, for or with any such directors, officers or employees, ; (ivd) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, ; (ve) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, United States generally accepted accounting principles; (vif) any labor dispute or other employment related problemdispute, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, agreement or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, ; (viig) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable other than in the ordinary course of business consistent with past practice, ; or (viiih) any entry into any agreement, commitment or transaction by the Company which is material to the Company and its Subsidiaries taken as a whole or (ix) any commitment to do any other than in the ordinary course of the foregoingbusiness consistent with past practice.

Absence of Certain Changes. Except as set forth in Section 4.06 Since the Company Balance Sheet Date, each of the Disclosure Letter, since May 31, 2000, (a) the Company and each Subsidiary has conducted its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) the Company and its Subsidiaries have conducted their respective businesses only business in the ordinary course consistent with past practice, except for the negotiation and execution and delivery of this Agreement practice and (ca) there has not been occurred a Material Adverse Effect with respect to the Company and its Subsidiaries, taken as a whole, (ib) neither the Company nor any Subsidiary has made or entered into any Contract or letter of intent with respect to any acquisition, sale or transfer of any asset of the Company or any Subsidiary (other than the sale or nonexclusive license of Company Products to its customers in the ordinary course of its business consistent with its past practice), (c) except as required by GAAP, there has not occurred any change in accounting methods or practices (including any change in depreciation or amortization policies or rates or revenue recognition policies) by the Company or any Subsidiary or any revaluation by the Company of any of its or any Subsidiary’s assets, (d) there has not occurred any declaration, setting aside aside, or payment of any a dividend or other distribution in with respect to any securities of the Shares Company, or any repurchasedirect or indirect redemption, redemption purchase or other acquisition by the Company of any of its securities, or any change in any rights, preferences, privileges or restrictions of any of its outstanding securities, (e) there has not occurred any material default under any Material Contract to which the Company or any Subsidiary is a party or by which it is, or any of its Subsidiaries of any outstanding shares of capital stock assets and properties are, bound, (except any obligation f) other than as set forth in Schedule 2.6(f) of the Company under Disclosure Letter, there has not occurred any amendment or change to the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) articles or bylaws or other securities in, equivalent organizational or other ownership interests in, governing documents of the Company or any of its Subsidiaries or any amendment (or agreement to amend) the terms of any such shares, securities or ownership interests)Subsidiary, (iig) any entry into any employmentother than as set out in Schedule 2.6(g) of the Company Disclosure Letter, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or there has not occurred any increase in the rate or modification in the terms (including any acceleration of the right to receive compensation or the timing of payment) of any compensation benefits payable or to become payable by the Company or any Subsidiary to any of its Subsidiaries to, any of their respective directors, officers officers, employees or employees, except consultants (other than increases in the base salary, guaranteed draw or hourly wage increases to salaries of employees who are not members officers in an amount that does not exceed 10% of such base salaries), any material modification of any “nonqualified deferred compensation plan” within the meaning of Section 409A of the executive committee Code and Treasury Regulation promulgated thereunder, or any new loans or extension of existing loans to any such directors, officers, employees or consultants (other than routine expense advances to employees of the Company or directors any Subsidiary consistent with past practice), and neither the Company nor any Subsidiary has entered into any Contract to grant or provide (nor has granted any) severance, acceleration of vesting or other similar benefits to any such Persons, (h) other than as set forth in Schedule 2.6(h) of the Company that have been granted Disclosure Letter, there has not occurred the execution of any employment agreements or service Contracts or the extension of the term of any existing employment agreement or service Contract with any Person in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation employ or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees service of the Company or any Subsidiary, which employees were (i) other than as set forth in Schedule 2.6(i) of the Company Disclosure Letter, there has not then subject to a collective bargaining agreementoccurred any change in title, office or position, or any lockoutsmaterial reduction in the responsibilities of, strikes, slowdowns, work stoppages or threats thereof by or change in identity with respect to such employeesthe management, (vii) any revaluation by supervisory or other key personnel of the Company or any Subsidiary, any termination of employment of any such employees, or any labor dispute or claim of unfair labor practices involving the Company or any Subsidiary, (j) neither the Company nor any Subsidiary has incurred, created or assumed any Encumbrance (other than a Permitted Encumbrance) on any of its Subsidiaries assets or properties, any Liability for borrowed money or any Liability as guaranty or surety with respect to the obligations of any of their respective assetsother Person, including write-downs of inventory (k) neither the Company nor any Subsidiary has paid or of accounts receivable other than discharged any Encumbrance or Liability which was not shown on the Company Balance Sheet or incurred in the ordinary course of business consistent with past practice since the Company Balance Sheet Date, (l) neither the Company nor any Subsidiary has incurred any Liability to its directors, officers or shareholders (other than Liabilities to pay compensation or benefits in connection with services rendered in the ordinary course of business, consistent with past practice), (m) other than as set out in Schedule 2.6(m) of the Company Disclosure Letter, neither the Company nor any Subsidiary has made any deferral of the payment of any accounts payable other than in the ordinary course of business, consistent with past practice, or in an amount in excess of $100,000, or given any discount, accommodation or other concession other than in the ordinary course of business, consistent with past practice, in order to accelerate or induce the collection of any receivable, (viiin) neither the Company nor any Subsidiary has made any material change in the manner in which it extends discounts, credits or warranties to customers or otherwise deals with its customers, (o) there has been no material damage, destruction or loss, whether or not covered by insurance, affecting the assets, properties or business of the Company or any Subsidiary, and (p) there has not occurred any announcement of, any negotiation by or any entry into any agreement, commitment or transaction Contract by the Company which is material to the Company and its Subsidiaries taken as a whole or (ix) any commitment Subsidiary to do any of the foregoingthings described in the preceding clauses (a) through (o) (other than negotiations and agreements with Acquiror and its representatives regarding the transactions contemplated by this Agreement).

Absence of Certain Changes. Except Since December 31, 1996, except -------------------------- as disclosed in the Company SEC Documents filed with the Commission prior to the date of this Agreement or as specifically contemplated by this Agreement or as set forth in Section 4.06 3.9 of the Company Disclosure Letter, since May 31, 2000Schedule, (a) the Company and its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) the Company and its Subsidiaries have conducted their respective businesses only in the ordinary course and in a manner consistent with past practice, except for the negotiation and execution and delivery of this Agreement practice and (cb) there has not been (i) any change, event, occurrence or circumstance in the business, operations, properties, financial condition or results of operations of the Company or any of its subsidiaries which, individually or in the aggregate, has had or is reasonably likely to have a Company Material Adverse Effect (except for changes, events, occurrences or circumstances (A) with respect to general economic or industry conditions or (B) arising as a result of the transactions contemplated hereby), (ii) any material change by the Company in its accounting methods, principles or practices, (iii) any declaration, setting aside or payment of any dividend or other distribution or capital return in respect of the Shares or any repurchase, redemption or other acquisition by the Company or any of its Subsidiaries of any outstanding shares of capital stock (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities inof, or other ownership interests equity interest in, the Company or any of its Subsidiaries or any amendment (or agreement to amend) the terms of any such shares, securities or ownership interests)subsidiaries, (iiiv) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or material revaluation for the benefit of, or any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation payable or to become payable financial statement purposes by the Company or any of its Subsidiaries tosubsidiaries of any asset (including, without limitation, any of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members writing down of the executive committee value of any property, investment or asset or writing off of notes or accounts receivable), (v) other than payment of compensation for services rendered to the Company or directors any of the Company that have been granted its subsidiaries in the ordinary course of business consistent with past practice or the grant of Company Options as described in accordance with its customary past practices, (iiiand in amounts consistent with) Section 3.2 or any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined transactions described in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees 3.12 of the Company or Disclosure Schedule, any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by material transactions between the Company or any of its Subsidiaries subsidiaries, on the one hand, and any (A) officer or director of the Company or any of its subsidiaries, (B) record or beneficial owner of five percent (5%) or more of the voting securities of the Company, or (C) affiliate of any of their respective assetssuch officer, including write-downs of inventory director or of accounts receivable beneficial owner, on the other hand, or (vi) other than pursuant to the terms of the plans, programs or arrangements specifically referred to in Section 3.12 or in the ordinary course of business consistent with past practice, any increase in or establishment of any bonus, insurance, welfare, severance, deferred compensation, pension, retirement, profit sharing, stock option (viii) including, without limitation, the granting of stock options, stock appreciation rights, performance awards or restricted stock awards), stock purchase or other employee benefit plan, or any entry into other increase in the compensation payable or to become payable to any agreementemployees, commitment officers, directors or transaction by consultants of the Company which is material to the Company and its Subsidiaries taken as a whole or (ix) any commitment to do any of its subsidiaries, which increase or establishment, individually or in the foregoingaggregate, will result in a material liability.

Absence of Certain Changes. Except as set forth in Section 4.06 of the Disclosure Letter, since May From December 31, 20001997 until the date hereof, (a) there has not occurred any event, change or development which has had or would be reasonably likely to have a Company Material Adverse Effect and (b) except as disclosed in the Company SEC Documents or Section 2.8 of the Company Disclosure Schedule, and except for the performance of this Agreement and the transactions contemplated hereby, the Company and its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, have: (bi) the Company conducted its business and its Subsidiaries have conducted their respective businesses operations only in the ordinary course of business consistent with past practicepractices; (ii) used reasonable efforts to preserve intact the business organizations, except for the negotiation rights, licenses, permits and execution and delivery of this Agreement and (c) there has not been (i) any declaration, setting aside or payment of any dividend or other distribution in respect franchises of the Shares Company and its Subsidiaries, maintain their existing relationships with customers, suppliers and other Persons having business dealings with them and keep available the services of its officers and employees; (iii) used reasonable efforts to keep in full force and effect adequate insurance coverages and maintain and keep its properties and assets in good repair, working order and condition, normal wear and tear excepted; (iv) not amended or modified its articles of association, certificate of incorporation, by-laws or comparable governing documents; (v) not authorized for issuance, issued, sold, granted, delivered, pledged or encumbered or agreed or committed to issue, sell, grant, deliver, pledge or encumber (to or with any repurchase, redemption or party other acquisition by than the Company or and 7 any of its Subsidiaries wholly-owned Subsidiaries) any shares of any outstanding shares class or series of capital stock (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities in, or other ownership interests in, the Company or any of its Subsidiaries or any amendment (other equity or agreement to amend) voting security or equity or voting interest of the terms Company or any of its Subsidiaries, any securities convertible into or exercisable or exchangeable for any such shares, securities or ownership interests, or any options, warrants, calls, commitments, subscriptions or rights to purchase or acquire any such shares, securities or interests (other than issuances of Company Shares (i) upon exercise of outstanding Stock Options granted to directors, officers, employees and consultants of the Company in accordance with the Option Plans as currently in effect and (ii) pursuant to conversion of the TOPrS); (vi) except for conversion of the TOPrS in accordance with their terms, (i) split, combined or reclassified any shares of its capital stock or issued or authorized or proposed the issuance of any other securities in respect of, in lieu of, or in substitution for, shares of its capital stock, (ii) in the case of the Company or any entry into Subsidiary of the Company that is not wholly-owned by the Company, declared, set aside or paid any employmentdividends on, change or made other distributions in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit respect of, any capital stock or (iii) repurchased, redeemed or otherwise acquired, or agreed or committed to repurchase, redeem or otherwise acquire, any increase in the rate shares of capital stock or modification in the terms (including any acceleration other equity or debt securities or equity interests of the right to receive or the timing of payment) of any compensation payable or to become payable by the Company or any of its Subsidiaries to(other than to fulfill its obligations under the Option Plans as currently in effect); (vii) not amended or otherwise modified the terms of any Stock Options or any Option Plan the effect of which was to make such terms more favorable to the holders thereof or Persons eligible for participation therein, or reserved any additional Company Shares for issuance under any such Plan; (viii) except as required by law or existing written agreements, entered into, adopted or materially amended any incentive, compensation, option or severance plan or arrangement (including, without limitation, any Benefit Plan) for the benefit or welfare of their respective directorsany current or former director, officers officer or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee employee of the Company or directors any of the Company that have been granted its Subsidiaries, or (except for normal increases in the ordinary course of business in accordance that are consistent with its customary past practices, (iii) any increase in increased the rate of compensation or benefits payable of any persons or accruing underpay any benefit not required by any existing plan and arrangement; (ix) not acquired or agreed to acquire (by merger, orconsolidation, modification acquisition of stock or assets or otherwise) from any Person, any corporation, partnership, joint venture, association or other business organization or division thereof or otherwise acquired or agreed to acquire any assets of another Person other than the terms purchase of assets in the ordinary course of business consistent with past practice or in an aggregate amount of less than $5,000,000; (including any acceleration of the right x) not sold, leased, licensed, encumbered or otherwise disposed of, or agreed to receive payment) sell, lease, license, encumber or otherwise dispose of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) material properties or any adoption or implementation assets of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries of Subsidiaries, except as intercompany transactions between the Company and any of their respective assetsits wholly-owned Subsidiaries or in transactions with any other Person in the ordinary course of business, including write-downs consistent with past practice and in an aggregate amount of inventory less than $5,000,000. (xi) not made any material change in any of its accounting or financial reporting methods, principles or practices, except as may be required by GAAP; (xii) except in the ordinary course of accounts receivable business consistent with past practices, not amended, modified or terminated any Material Contract required to be listed in Section 2.16 of the Company Disclosure Schedule (other than in response to Section 2.16(a)(iii) thereof) or waived, released or assigned any material rights or claims thereunder; (xiii) not adopted a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other reorganization of the Company or any of its Subsidiaries; (xiv) not made any loans, advances or capital contributions to any Person other than as required by existing agreements or in the ordinary course of business consistent with past practice, (viii) any entry into any agreement, commitment ; or transaction by the Company which is material to the Company and its Subsidiaries taken as a whole or (ix) any commitment to do any of the foregoing.8

Absence of Certain Changes. Except as set forth in Section 4.06 Since September 30, 2000 (the "Company Balance Sheet Date"), through the date of this Agreement, Company and each of the Disclosure Letter, since May 31, 2000, (a) the Company and its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) the Company and its Subsidiaries have conducted their respective businesses only in the ordinary course consistent with past practice, except for the negotiation practice and execution and delivery of this Agreement and (c) there has not been occurred: (i) any change, event or condition (whether or not covered by insurance) that has resulted in, or might reasonably be expected to result in, a Material Adverse Effect on Company; (ii) any acquisition, sale or transfer of any material asset of Company or any Company Subsidiary; (iii) any change in accounting methods or practices (including any change in depreciation or amortization policies or rates) by Company or any revaluation by Company of any of its assets; (iv) any declaration, setting aside or payment of any a dividend or other distribution in with respect to the shares of the Shares Company, or any repurchasedirect or indirect redemption, redemption purchase or other acquisition by the Company or any Company Subsidiary of any of its Subsidiaries of any outstanding shares of capital stock stock, respectively; (except v) any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities in, or other ownership interests in, the material contract entered into by Company or any of its Subsidiaries Company Subsidiary, other than as provided to Parent, or any material amendment (or agreement to amend) the terms of any such shares, securities or ownership interests), (ii) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit termination of, or default under, any material contract to which Company or any Company Subsidiary is a party or by which any of them are bound; (vi) any amendment or change to the certificate of incorporation or bylaws of Company or any Company Subsidiary; (vii) any increase in the rate or modification in the terms (including any acceleration of the right to receive compensation or the timing of payment) of any compensation benefits payable or to become payable by the Company or any of its Subsidiaries to, Company Subsidiary to any of their respective directors, officers employees or employeesconsultants other than, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employeesnon-officer employees and consultants only, (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable other than increases in the ordinary course of business consistent with past practice, ; or (viii) any entry into agreement by Company or any agreement, commitment or transaction by the Company which is material to the Company and its Subsidiaries taken as a whole or (ix) any commitment Subsidiary to do any of the foregoingthings described in the preceding clauses (i) through (vii).

Absence of Certain Changes. Except Since November 30, 1998, except as set forth disclosed in Section 4.06 7.8 of the Disclosure LetterSchedule there has not been any: (i) change in the assets, since May 31liabilities, 2000sales, (a) income, or business of the Company and or in its Subsidiaries have not suffered any Material Adverse Effect relationships with suppliers, customers, or any changelessors, condition, event or development other than changes that could reasonably be expected to have a Material Adverse Effect, (b) the Company and its Subsidiaries have conducted their respective businesses only were both in the ordinary course consistent with past practiceof business and have not caused, except for either in any case or in the negotiation aggregate, a Material Adverse Effect on the Company; (ii) acquisition or disposition by the Company of any material asset or property; (iii) damage, destruction or loss, whether or not covered by insurance, materially and execution and delivery adversely affecting, either in any case or in the aggregate, the business or any material property of this Agreement and the Company; (civ) there has not been (i) any declaration, setting aside or payment of any dividend or any other distribution distributions in respect of any shares of capital stock of the Shares Company; (v) issuance of any shares of the capital stock of the Company or any repurchasedirect or indirect redemption, redemption purchase, or other acquisition by the Company or any of its Subsidiaries of any outstanding shares of capital stock (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities in, or other ownership interests in, the Company or any of its Subsidiaries or any amendment (or agreement to amend) the terms of any such shares, securities capital stock; (vi) loss of the services of any officer or ownership interests), (ii) any entry into any employment, change in control, retention, incentive key employee or deferred compensation or severance agreement, plan or arrangement with or for the benefit ofconsultant, or any increase in the rate compensation, pension, or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation other benefits payable or to become payable by the Company or to any of its Subsidiaries toofficers or key employees or consultants, or any bonus payments or arrangements made to or with any of their respective directors, officers them; (vii) forgiveness or employees, except base salary, guaranteed draw cancellation of any debts or hourly wage increases to employees who are not members of the executive committee of claims by the Company or directors any waivers of any rights; (viii) entry by the Company that have been granted into any transaction with any of its Affiliates; (ix) incurrence by the Company of any obligations or liabilities, whether absolute, accrued, contingent or otherwise (including without limitation liabilities as guarantor or otherwise with respect to obligations of others), other than obligations and liabilities incurred in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification persons other than Affiliates of the terms Company; (including x) incurrence or imposition of any acceleration Lien on any of the right to receive paymentassets, tangible or intangible, of the Company; or (xi) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) discharge or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action satisfaction by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change Lien or payment by the Company of any obligation or liability (fixed or contingent) other than (A) current liabilities included in accounting methodsthe November 30, principles or practices except as required by changes in GAAP1998 Balance Sheet, (viB) any labor dispute or other employment related problem, current liabilities to persons other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees Affiliates of the Company or any Subsidiaryincurred since November 30, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable other than 1998 in the ordinary course of business consistent business, and (C) current liabilities incurred in connection with past practice, (viii) any entry into any agreement, commitment or transaction by the Company which is material to the Company transactions contemplated hereby and its Subsidiaries taken as a whole or (ix) any commitment to do any disclosed in Section 7.8 of the foregoingDisclosure Schedule.

Absence of Certain Changes. Except as disclosed in the Company credit reports required to be submitted by the Company, including, without limitation, those prepared by Dun and Bradstreet and reports delivered by the Company to the Company's lenders under any Debt Contracts (the "Reports"), filed prior to the date hereof and as set forth in Section 4.06 3.6 of the Seller Disclosure Letter, since May October 31, 20001998 (the "Financial Statement Date"), (a) the Company and its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) the Company and each of its Subsidiaries have conducted their respective businesses only in, and have not entered into or engaged in any material transaction other than in, the ordinary and usual course consistent with past practice, except for the negotiation of such businesses and execution and delivery of this Agreement and (c) there has not been (ia) any change in the financial condition, properties, business or results of operations of the Company or any of its Subsidiaries or any development or combination of developments that, individually or in the aggregate, has had or is reasonably likely to have a Material Adverse Effect; (b) any damage, destruction or other casualty loss with respect to any asset or property owned, leased or otherwise used by the Company or any of its Subsidiaries, whether or not covered by insurance, except as is not reasonably likely to have, individually or in the aggregate, a Material Adverse Effect; (c) any declaration, setting aside or payment of any dividend or other distribution in respect of the Shares or any repurchasecapital stock of the Company, redemption except for dividends or other acquisition distributions on its capital stock publicly announced prior to the date hereof; (d) any material change by the Company in accounting principles, practices or methods; or (e) any entry by the Company or any of its Subsidiaries of any outstanding shares of capital stock (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities in, or other ownership interests in, the Company or any of its Subsidiaries or any amendment (or agreement to amend) the terms of any such shares, securities or ownership interests), (ii) any entry into any employment, change in controlconsulting, retentionseverance, incentive termination or deferred compensation or severance agreement, plan indemnification agreement or arrangement with any employee or director. Since the Financial Statement Date, except as provided for herein or as disclosed in the benefit ofCompany Reports filed prior to the date hereof, or there has not been any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation payable or to that could become payable by the Company or any of its Subsidiaries to, any of their respective to directors, officers or employees, except base salary, guaranteed draw key employees or hourly wage increases to employees who are not members any amendment of any of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan Compensation and Benefit Plans (as defined in Section 4.093.8 below) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, increases or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable other than amendments in the ordinary course of business consistent with past practice, (viii) any entry into any agreement, commitment or transaction by the Company which is material to the Company and its Subsidiaries taken as a whole or (ix) any commitment to do any of the foregoingcourse.

Absence of Certain Changes. Except as disclosed in the SEC Documents or as contemplated by this Agreement or as set forth in Section 4.06 of the Disclosure LetterSchedule 2.6, since May March 31, 20001998, (a) the Company no event has occurred, and its Subsidiaries have not suffered any Material Adverse Effect or any changeno circumstances exist, condition, event or development that could reasonably be expected to have result in a Material Adverse Effect, (b) the Company and its Subsidiaries have conducted their respective businesses only . Except as disclosed in the ordinary course consistent with past practiceSEC Documents or as set forth in Schedule 2.6, except for the negotiation and execution and delivery of this Agreement and (c) since March 31, 1998, there has not been (ia) any declaration, setting aside or payment of any dividend or other distribution in respect of the Shares capital stock of the Company or any repurchase, redemption or other acquisition by the Company or any of its Subsidiaries of any outstanding shares of capital stock (except any obligation Common Stock or other equity securities of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities in, or other ownership interests in, the Company or any of its Subsidiaries or any amendment Company; (or agreement to amend) the terms of any such shares, securities or ownership interests), (ii) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation payable or to become payable by the Company or any of its Subsidiaries to, any of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable other than in the ordinary course of business consistent with past practice, (viiib) any entry into any agreement, commitment or transaction by the Company or any of its subsidiaries which is material to the Company and its Subsidiaries subsidiaries taken as a whole whole, except agreements, commitments or transactions in the ordinary course of business, consistent with prior practice; (c) any split, combination or reclassification of the Company's capital stock or any issuance or the authorization of any issuance of any other securities in respect of, in lieu of or in substitution for shares of its capital stock; (d)(i) any granting by the Company or any of its subsidiaries to any officer or key employee of the Company or any of its subsidiaries of any increase in compensation, except in the ordinary course of business consistent with prior practice or as was required under employment agreements in effect as of the date of the most recent audited financial statements included in the SEC Documents, (ii) any granting by the Company or any of its subsidiaries to any such officer or key employee of any increase in severance or termination pay, except as was required under employment, severance or termination agreements in effect as of the date of the most recent audited financial statements included in the SEC Documents, or (ixiii) any commitment to do entry by the Company or any of its subsidiaries into any employment, severance or termination agreement with any such officer or key employee; (e) any damage, destruction or loss, whether or not covered by insurance, that could reasonably be expected to have a Material Adverse Effect; or (f) any change in accounting methods, principles or practices by the foregoingCompany materially affecting its assets, liabilities or business, except insofar as may have been required by a change in generally accepted accounting principles.

Absence of Certain Changes. (a) Except as set forth in Section 4.06 4.07 of the Company Disclosure LetterSchedule, since May 31September 30, 20002010, (a) the business of the Company and its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) the Company and its Subsidiaries have has been conducted their respective businesses only in the ordinary course consistent with past practice, except for the negotiation practices and execution and delivery of this Agreement and (c) there has not been (ia) any event, occurrence, development or state of circumstances or facts that has had or would reasonably be expected to have, individually or in the aggregate, a Company Material Adverse Effect; (b) any amendment to the certificate of incorporation or bylaws of the Company; (c) any split, combination or reclassification of any shares of the Company’s capital stock or declaration, setting aside or payment of any dividend or other distribution (whether in cash, stock or property or any combination thereof) in respect of the Shares Company’s capital stock, or any repurchaseredemption, redemption repurchase or other acquisition by the or offer to redeem, repurchase or otherwise acquire any Company or Securities; (d) any of its Subsidiaries of any outstanding shares of capital stock (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Optionssale, including in satisfaction of withholding tax obligations) or other securities inassignment, license, or other ownership interests in, the transfer of any Company Registered Intellectual Property (or any of its Subsidiaries rights therein) or any amendment (or agreement to amend) the terms acquisition of any such shares, securities or ownership interests), (ii) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation payable or to become payable by the material Company or any of its Subsidiaries to, any of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable Registered Intellectual Property other than in the ordinary course of business consistent with past practicepractices; (e) except as required by the terms of an applicable plan or agreement then in effect or as required or deemed advisable pursuant to applicable Law and except as would not result in an expense greater than $25,000 in the aggregate, (viiii) any entry into increase in compensation, bonuses or other benefits payable to any director or executive officer or, except in the ordinary course of business consistent with past practices, other employee of the Company or any of its Subsidiaries or (ii) any entering into, adoption or amendment in any material respect of any employment, change of control, severance, compensation, bonus, profit-sharing, stock option or other stock related rights or other forms of incentive or deferred compensation, retirement benefits or other benefit agreement, plan, arrangement or policy applicable to any director or executive officer or, except in the ordinary course of business consistent with past practices, any other employee of the Company or any of its Subsidiaries; or (e) any resolution, commitment or transaction by the Company which is material agreement to the Company and its Subsidiaries taken as a whole or (ix) any commitment to do take any of the foregoingactions described in clauses (b) through (d) of this Section 4.07.

Absence of Certain Changes. Except for liabilities incurred in connection with this Agreement and except as set forth in Section 4.06 of the Disclosure Letterexpressly permitted or contemplated by this Agreement, since May December 31, 2000, (a) the Company and its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) 2009 the Company and its Subsidiaries have conducted their respective businesses only in the ordinary course consistent with past practice, except for and the negotiation Company has not suffered a Company Material Adverse Effect, and execution and delivery of this Agreement and (c) since December 31, 2009 there has not been (i) any declaration, setting aside or payment of any dividend or other distribution (whether in cash, stock or property) with respect to any capital stock of the Shares Company or any repurchaseof its Subsidiaries, other than any declaration setting aside or payment from a wholly owned Subsidiary of the Company to the Company, (ii) any purchase, redemption or other acquisition by the Company or any of its Subsidiaries of any outstanding shares of capital stock (except or any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities in, or other ownership interests in, of the Company or any of its Subsidiaries or any amendment options, warrants, calls or rights to acquire such shares or other securities (other than acquisitions of Shares in connection with the surrender of Shares by holders of Options, RSUs or agreement Warrants in order to amend) pay the terms of any such shares, securities exercise price thereof or ownership intereststhe taxes thereon), (iiiii) any entry into any employmentsplit, change in control, retention, incentive combination or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) reclassification of any compensation payable or to become payable by capital stock of the Company or any of its Subsidiaries toor any issuance or the authorization of any issuance of any other securities in respect of, any in lieu of or in substitution for shares of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employeescapital stock, (iv) any action by damage, destruction or loss to any asset of the Company which, if taken after the date hereof, would constitute a breach of or any of the clauses of Section 6.01 hereofits Subsidiaries, whether or not covered by insurance, that would have a Company Material Adverse Effect, (v) any change by the Company in accounting methods, principles or practices by the Company materially affecting its assets, liabilities or businesses, except insofar as may have been required by changes a change in GAAP, GAAP or (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or except with respect to such employees, (vii) any revaluation by depreciation and amortization of the assets of the Company or any of its Subsidiaries Subsidiaries, any material Tax election or change in such election, any change in material method of accounting for Tax purposes or any settlement or compromise of any of their respective assets, including write-downs of inventory or of accounts receivable other than in the ordinary course of business consistent with past practice, (viii) any entry into any agreement, commitment or transaction by the Company which is material to the Company and its Subsidiaries taken as a whole or (ix) any commitment to do any of the foregoingincome Tax liability.

Absence of Certain Changes. Except as set forth disclosed in Section 4.06 of its Reports filed prior to the Disclosure Letterdate hereof or as expressly contemplated or permitted by this Agreement, since May 31, 2000, (a) the Company and its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) the Company Audit Date it and its Subsidiaries have conducted their respective businesses only in, and have not engaged in any material transaction other than according to, the ordinary and usual course consistent with past practice, except for the negotiation of such businesses and execution and delivery of this Agreement and (c) there has not been (ii)any change in the financial condition, properties, prospects, business or results of operations of it and its Subsidiaries, except those changes that are not, individually or in the aggregate, reasonably likely to have a Material Adverse Effect on it; (ii) any damage, destruction or other casualty loss with respect to any asset or property owned, leased or otherwise used by it or any of its Subsidiaries, whether or not covered by insurance, which damage, destruction or loss is reasonably likely, individually or in the aggregate, to have a Material Adverse Effect on it; (iii) any declaration, setting aside or payment of any dividend or other distribution in respect of its capital stock, except publicly announced regular quarterly cash dividends on its common stock and, in the Shares case of SBC, any dividends in capital stock of SBC which are simultaneously taken into account in an adjustment to the Exchange Ratio pursuant to Section 4.4; or (iv) any repurchasechange by it in accounting principles, redemption practices or other acquisition methods, except as required by GAAP. Since the Audit Date, except as provided for herein, in the Company Disclosure Letter, as disclosed in the Reports filed by the Company prior to the date hereof or any of its Subsidiaries of any outstanding shares of capital stock (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Optionspermitted hereby, including in satisfaction of withholding tax obligations) or other securities in, or other ownership interests in, the Company or any of its Subsidiaries or any amendment (or agreement to amend) the terms of any such shares, securities or ownership interests), (ii) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or there has not been any increase in the rate salary, wage, bonus or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any other compensation payable or to that could become payable by the Company or any of its Subsidiaries to, any of their respective to directors, officers or employees, except base salary, guaranteed draw key employees or hourly wage increases to employees who are not members any amendment of the executive committee any of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan Compensation and Benefit Plans (as defined in Section 4.095.1(h)(i)) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, increases or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable other than amendments in the ordinary course of business consistent with past practice, (viii) any entry into any agreement, commitment or transaction by the Company which is material to the Company and its Subsidiaries taken as a whole or (ix) any commitment to do any of the foregoingcourse.

Absence of Certain Changes. Except as set forth in the Company Reports or in Section 4.06 4.9 of the Company Disclosure Letter, since May March 31, 20001999, (a) the Company and its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) the Company and its Subsidiaries have conducted their respective businesses only business in the ordinary course of such business consistent with past practicepractices, except for the negotiation and execution and delivery of this Agreement and (c) there has not been (i) any event or state of fact that, individually or in the aggregate, would have a Material Adverse Effect; (ii) any declaration, setting aside or payment of any dividend or other distribution in with respect of the Shares to its capital stock or any repurchase, redemption or any other acquisition by the Company or any of its Subsidiaries of any outstanding shares of capital stock (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities inof, or other ownership interests in, the Company or any of its Subsidiaries Subsidiaries; (iii) any change in accounting principles, practices or any amendment methods; (or agreement to amend) the terms of any such shares, securities or ownership interests), (iiiv) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit ofemployment agreement with, or any increase in the rate or modification in the terms (including including, without limitation, any acceleration of the right to receive or the timing of payment) of any compensation payable or to become payable by the Company or any of its Subsidiaries to, any of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to for employees who are not members officers or directors occurring in the ordinary course of business in accordance with their customary practices; (v) any increase in the rate or terms (including, without limitation, any acceleration of the executive committee right to receive payment) of the Company any bonus, insurance, pension or other employee benefit plan or arrangement covering any such directors, officers or employees, except increases for employees who are not officers or directors of the Company that have been granted occurring in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, ; (vi) any labor dispute entry into any Contracts or other employment related problem, other than routine individual grievances, or any activity or proceeding transaction by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, Subsidiary which employees were is material to the Company and its Subsidiaries taken as a whole whether or not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, in the ordinary course of business; (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including including, without limitation, write-downs of inventory or write-offs of accounts receivable other than in the ordinary course of business consistent with past practice, practices; or (viii) any entry into any agreement, commitment or transaction action by the Company which is material to if taken after the Company date hereof would constitute a breach of Section 6.2(b) hereof (other than Sections 6.2(b)(ii) and its Subsidiaries taken as a whole or (ix) any commitment to do any of the foregoing6.2(b)(xiii)).

Absence of Certain Changes. Except as contemplated by this Agreement or as set forth in on Section 4.06 3.8 of the Seller Disclosure Letter, since May March 31, 20002018 to the date of this Agreement, (a) the Company and its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) the Company and its Subsidiaries have Business has been conducted their respective businesses only in all material respects in the ordinary course and consistent with past practicepractice and (b) no “Event of Default” under the Debt Facilities has occurred and is continuing, except for the negotiation and execution and delivery of this Agreement and (c) there has not been (i) any declarationevent, setting aside development or payment state of any dividend or other distribution in respect circumstances which would require the consent of the Shares or any repurchase, redemption or other acquisition by the Company or any of its Subsidiaries of any outstanding shares of capital stock (except any obligation of the Company under the Stock Option Plans Purchaser pursuant to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities in, or other ownership interests in, the Company or any of its Subsidiaries or any amendment (or agreement to amend) the terms of any such shares, securities or ownership interestsSection 5.2(a)(ii), (ii) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation payable or to become payable by the Company or any of its Subsidiaries to, any of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP), (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees), (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets(but replacing $250,000 in Section 5.2(a)(vii), including write-downs of inventory or of accounts receivable other than in the ordinary course of business consistent with past practice$1,000,000), (viii) any entry into any agreement(but replacing $100,000 in Section 5.2(a)(viii), commitment with $1,000,000 and $1,000,000 in Section 5.2(a)(viii), with $10,000,000), (ix), (x), (xv) or transaction by (xvi) were it to be taken between the Company which is material date hereof and the Closing Date. No Litigation. Except as set forth on Section 3.9 of the Seller Disclosure Letter, (a) there is, and since June 30, 2015 there has been, no Action or Order outstanding, pending or, to the Company Knowledge of Seller, threatened in writing against any of Seller, any Selling Subsidiary or any Transferred Subsidiary relating to the Purchased Assets or the Assumed Liabilities or the Business or the Business Employees or against the Miraclon Entities or the Transferred Subsidiaries by or before any Governmental Authority or arbitrator and its Subsidiaries taken as a whole (b) there is, and since June 30, 2015 there has been, no material Action, outstanding, or (ix) to the Knowledge of Seller, threatened in writing against Seller, any commitment Selling Subsidiary or any Transferred Subsidiary, in each case, relating to do the Purchased Assets or the Assumed Liabilities or the Business or the Business Employees or against the Miraclon Entities or the Transferred Subsidiaries. None of Seller, any Selling Subsidiary or any Transferred Subsidiary is subject to any Order of any Governmental Authority relating to the Business or by which any of the foregoingPurchased Assets is bound. To the Knowledge of Seller, no Business Employee is subject to any Order that prohibits such Business Employee from engaging in or continuing any conduct, activity or practice relating to the Business.

Absence of Certain Changes. Except as set forth in Section 4.06 With respect to the First Closing, since the date of the Disclosure Lettermost recent financial statements of the Company included in the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2021, filed with the Commission on August 6, 2021, and with respect to the Second Closing, since May 31, 2000, (a) the date of the most recent financial statements of the Company and its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) the Company and its Subsidiaries have conducted their respective businesses only included in the ordinary course consistent with past practiceCompany’s most recent Quarterly Report on Form 10-Q or Annual Report on Form 10-K, except as applicable, for the negotiation and execution and delivery of this Agreement and quarter or year, as applicable, immediately preceding the Second Tranche Exercise Notice: (ci) there has not been any change in the capital stock (i) any declarationother than the issuance of shares of Common Stock or Class B common stock upon exercise of stock options and warrants or the settlement of restricted stock units described as outstanding in, setting aside and the grant of options and awards under existing equity incentive plans described in, the Company SEC Filings, the short-term debt or payment long-term debt of any dividend or other distribution in respect of the Shares or any repurchase, redemption or other acquisition by the Company or any of its Subsidiaries subsidiaries, or any dividend or distribution of any outstanding shares kind declared, set aside for payment, paid or made by the Company on any class of capital stock (except stock, or any obligation material adverse change, or any development involving a prospective material adverse change, in or affecting the business, properties, management, financial position, stockholders’ equity or results of operations of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligationsand its Subsidiaries taken as a whole; (ii) or other securities in, or other ownership interests in, neither the Company or nor any of its Subsidiaries or subsidiaries has entered into any amendment (transaction or agreement to amend) the terms of any such shares, securities (whether or ownership interests), (ii) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation payable or to become payable by the Company or any of its Subsidiaries to, any of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, (iiibusiness) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable other than in the ordinary course of business consistent with past practice, (viii) any entry into any agreement, commitment or transaction by the Company which that is material to the Company and its Subsidiaries taken as a whole or incurred any liability or obligation, direct or contingent, that is material to the Company and its Subsidiaries taken as a whole; and (ixiii) any commitment to do neither the Company nor any of its subsidiaries has sustained any loss or interference with its business that is material to the foregoingCompany and its Subsidiaries taken as a whole and that is either from fire, explosion, flood or other calamity, whether or not covered by insurance, or from any labor disturbance or dispute or any action, order or decree of any court or arbitrator or governmental or regulatory authority, except in each case as otherwise disclosed in the Company SEC Filings.

Absence of Certain Changes. Except as set forth in Section 4.06 of Since the Disclosure LetterAudit Date, since May 31, 2000, (a) the Company and its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have taken as a Material Adverse Effect, (b) the Company and its Subsidiaries whole have conducted their respective businesses business only in the ordinary and usual course consistent with past practice, except for the negotiation of such business and execution and delivery of this Agreement and (c) there has not been (i) any change in the financial condition, business, assets, liabilities, or results of operations of the Company and its Subsidiaries that has had or would be reasonably likely to have a Company Material Adverse Effect; (ii) any material damage, destruction or other casualty loss with respect to any material asset or material property owned, leased or otherwise used by the Company or any of its Subsidiaries, not covered by insurance; (iii) any declaration, setting aside or payment of any dividend or other distribution in respect of the Shares capital stock of the Company or any repurchase, redemption or other acquisition by the Company or any of its Subsidiaries Subsidiary of any outstanding shares of capital stock (except any obligation securities of the Company under the Stock Option Plans to accept other than (A) regular quarterly dividends on Shares in connection the ordinary course (including any periodic increase thereon consistent with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligationspast practice) not to exceed $.225 per Share and (B) as expressly contemplated by this Agreement; or other securities in, or other ownership interests in, (iv) any change by the Company in accounting principles, practices or any of its Subsidiaries or any amendment (or agreement to amend) the terms of any such shares, securities or ownership interests), (ii) any entry into any employment, methods which is not required by a change in controlGAAP. Since the Audit Date and through the date hereof, retentionexcept as provided for herein or as disclosed in the Company Reports, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or there has not been any material increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation payable or to that could become payable by the Company or any of its Subsidiaries to, to officers or key employees or any material amendment of any of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan Compensation and Benefit Plans (as defined in Section 4.095.1(h)(i)) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, increases or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable other than amendments in the ordinary course of business consistent with past practice, (viii) any entry into any agreement, commitment or transaction by the Company which is material to the Company and its Subsidiaries taken as a whole or (ix) any commitment to do any of the foregoing.

Absence of Certain Changes. Except Since December 31, 2002 (the "Measurement Date"), except as set forth on Schedule 3.6, Seller has conducted its business in Section 4.06 of the Disclosure Letter, since May 31, 2000, ordinary course and there has not occurred: (ai) the Company and its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development condition (whether or not covered by insurance) that could has resulted in, or might reasonably be expected to result in, a Material Adverse Effect to Seller; (ii) any acquisition, sale or transfer of any asset of Seller that would have a Material Adverse Effect, (b) the Company and its Subsidiaries have conducted their respective businesses only in the ordinary course consistent with past practice, except for the negotiation and execution and delivery of this Agreement and (c) there has not been (i) any declaration, setting aside or payment of any dividend or other distribution in respect of the Shares or any repurchase, redemption or other acquisition by the Company or any of its Subsidiaries of any outstanding shares of capital stock (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities in, or other ownership interests in, the Company or any of its Subsidiaries or any amendment (or agreement to amend) the terms of any such shares, securities or ownership interests), (ii) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation payable or to become payable by the Company or any of its Subsidiaries to, any of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable Effect other than in the ordinary course of business and consistent with past practice; (iii) any change in accounting methods or practices (including any change in depreciation or amortization policies or rates) by Seller or any revaluation by Seller of any of its assets; (iv) any declaration, setting aside, or payment of a dividend or other distribution with respect to the shares of Seller or any direct or indirect redemption, purchase or other acquisition by Seller of any of its shares of capital stock; (v) any Material Contract (as such term is defined in Section 3.11) entered into by Seller, other than in the ordinary course of business and as provided to Kintera or Purchaser, or any amendment that would have a Material Adverse Effect or termination of, or default under, any Material Contract to which Seller is a party or by which it is bound; (vi) any amendment or change to the charter documents of Seller; (vii) any increase in or modification of the compensation or benefits paid, payable or to become payable by Seller to any of its directors, officers or employees; (viii) any entry into reduction in the sales of Seller to or significant detrimental change in terms with any agreementcustomer year-to-date through June 30, commitment or transaction by the Company which is material 2003 as compared to the Company and its Subsidiaries taken as a whole same time period last year or (ix) any commitment negotiation or agreement by Seller to do any of the foregoingthings described in the preceding clauses (i) through (viii) (other than negotiations with Purchaser, Kintera and their representatives regarding the transactions contemplated by this Agreement). As of Closing, there will be no accrued but unpaid dividends on member interests of Seller's capital stock.

Absence of Certain Changes. Except as set forth disclosed in Section 4.06 3.9 of the Disclosure Letter, since May March 31, 20002001, neither the Company nor any Subsidiary has (a) experienced any change, event or condition which, individually or in the aggregate, has had or reasonably would be expected to have a Company Material Adverse Effect; provided, however, that none of the following shall be deemed to constitute and none of the following shall be taken into account in determining whether there has been or will be a Company Material Adverse Effect: (A) any adverse change or effect (including any loss of employees, cancellation of, modification of, or delay in customer orders, or disruption, modification or termination of business relationships) including, without limitation, that relationship with Motorola, Inc.) arising from or relating to (1) changes that generally affect the industries and markets in which the Company and its Subsidiaries have not suffered operate, or result from general political, economic or market conditions or general conditions in the economy or financial markets, or (2) the announcement or pendency of the Merger or the other transactions contemplated by this Agreement; (B) any Material Adverse Effect litigation or threat of litigation filed or made after the date hereof challenging any of the transactions contemplated herein or any change, condition, event shareholder litigation filed or development that could reasonably be expected to have a Material Adverse Effect, made after the date hereof resulting from this Agreement or the transactions contemplated herein; or (C) the increase or decrease in the Company's stock price or trading volume as quoted on NASDAQ; (b) the Company and conducted its Subsidiaries have conducted their respective businesses only in the ordinary course consistent with past practice, except for the negotiation and execution and delivery of this Agreement and (c) there has not been (i) any declaration, setting aside or payment of any dividend or other distribution in respect of the Shares or any repurchase, redemption or other acquisition by the Company or any of its Subsidiaries of any outstanding shares of capital stock (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities in, or other ownership interests in, the Company or any of its Subsidiaries or any amendment (or agreement to amend) the terms of any such shares, securities or ownership interests), (ii) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation payable or to become payable by the Company or any of its Subsidiaries to, any of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable other than in the ordinary course of business consistent with past practicepractices, (viiic) incurred any indebtedness for borrowed money (excluding trade credit incurred in the ordinary course of business consistent with past practices) or issued any debt securities or assumed, guaranteed or endorsed the obligations of any other Person, (d) other than sales or dispositions of inventory in the ordinary course of business sold, transferred or otherwise disposed of any of its property or assets, (e) mortgaged or encumbered any of its property or assets, (f) suffered any material casualty losses not covered by insurance, (g) repurchased, redeemed or otherwise acquired any of its capital stock or any capital stock of any of the Subsidiaries, (h) declared, set aside or paid any dividend or other distribution in respect of its capital stock, (i) amended its Certificate of Incorporation or Bylaws (or similar organizational documents) or merged with or into or consolidated with any other Person, (j) split, combined or reclassified its capital stock, (k) issued or sold (or agreed to issue or sell) any entry of its equity securities or any options, warrants, conversion or other rights to purchase any such securities or any securities convertible into or exchangeable for such securities, or granted, or agreed to grant any such rights, other than grants, sales or issuances pursuant to Company Stock Options consistent with past practices (including as to amounts and extents) outstanding on the date of this Agreement, (l) increased the rates of compensation (including bonuses) payable or to become payable to any of its officers, directors, employees, agents, independent contractors or consultants other than customary merit raises made in the ordinary course of business consistent with past practices (including as to amounts and extent), (m) entered into any new, or amended any existing, employment contracts, severance agreements or consulting contracts or instituted or agreed to institute any increase in benefits or altered its employment practices or the terms and conditions of employment, (n) except as otherwise required by law and as disclosed on the Company Financial Statements, changed, in any material respect its underwriting, actuarial or Tax accounting methods, principles or practices, (o) entered into any joint ventures or partnerships of any kind, or (p) entered into any material contract, agreement, commitment understanding or transaction by the Company which is material to the Company and its Subsidiaries taken as a whole or (ix) any commitment arrangement to do any of the foregoing.

Absence of Certain Changes. Except as set forth in Section 4.06 Since the date of the Disclosure LetterUnaudited Interim Balance Sheet, since May 31there has been (i) no material adverse change to, 2000and no material adverse development in, the assets, liabilities, business, properties, operations, condition (financial or otherwise), results of operations or prospects of the Company or its Subsidiaries, (aii) the Company and its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a no Material Adverse Effect, (biii) the Company and its Subsidiaries have conducted their respective businesses only in the ordinary course consistent with past practiceno satisfaction or discharge of any material lien, except for the negotiation and execution and delivery of this Agreement and (c) there has not been (i) any declaration, setting aside claim or encumbrance or payment of any dividend or other distribution in respect of the Shares or any repurchase, redemption or other acquisition obligation by the Company or any of its Subsidiaries of any outstanding shares of capital stock (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities in, or other ownership interests in, the Company or any of its Subsidiaries or any amendment (or agreement to amend) the terms of any such shares, securities or ownership interests), (ii) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation payable or to become payable by the Company or any of its Subsidiaries to, any of their respective directors, officers or employeesCompany, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business in accordance and with its customary past practices, respect to payments under the Company’s outstanding contingent value rights (iii“CVRs”) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, and (iv) any action by no waiver, not in the Company whichordinary course of business, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any Subsidiary of a material right or of a material debt owed to it. Since the date of the Unaudited Interim Balance Sheet, neither the Company nor any of its Subsidiaries has (i) purchased any of its outstanding Common Stock (other than from its employees or other service providers in connection with the termination of their service pursuant to the terms of its equity compensation plans or agreements) or declared or paid any dividends or distributions, other than payments under the CVRs, (ii) sold any material assets, individually or in the aggregate, outside of the ordinary course of business, (iii) made any material change or material amendment to, or waiver of any material right, or termination of, any Material Contract, (iv) entered into any material transaction or made any material capital expenditures, individually or in the aggregate, outside of their respective assets, including write-downs of inventory or of accounts receivable other than in the ordinary course of business consistent with past practiceor (v) experienced any loss of services of any executive officer (as defined in Rule 405 under the Securities Act), (viii) any entry into any agreement, commitment or transaction by other than as disclosed in the SEC Reports prior to the date hereof. Neither the Company which is material to the Company and nor any of its Subsidiaries has taken as a whole or (ix) any commitment steps to do seek protection pursuant to any of the foregoing.bankruptcy law, nor does

Absence of Certain Changes. Except as set forth disclosed in Section 4.06 of the Disclosure LetterVeeco SEC Documents, since May 31September 30, 20001999 (the "VEECO BALANCE SHEET DATE"), (a) the Company and its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) the Company Veeco and its Subsidiaries have conducted their respective businesses only business in the ordinary course consistent with past practice, except for the negotiation practice and execution and delivery of this Agreement and (c) there has not been occurred: (i) any declarationchange, setting aside event or payment condition (whether or not covered by insurance) that has resulted in, or might reasonably be expected to result in, a Material Adverse Effect to Veeco; (ii) any acquisition, sale or transfer of any dividend or other distribution in respect material asset of the Shares or any repurchase, redemption or other acquisition by the Company Veeco or any of its Subsidiaries of any outstanding shares of capital stock (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities in, or other ownership interests in, the Company or any of its Subsidiaries or any amendment (or agreement to amend) the terms of any such shares, securities or ownership interests), (ii) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation payable or to become payable by the Company or any of its Subsidiaries to, any of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable subsidiaries other than in the ordinary course of business and consistent with past practice, ; (viiiiii) any entry change in accounting methods or practices (including any change in depreciation or amortization policies or rates) by Veeco or any revaluation by Veeco of any of its assets; (iv) any declaration, setting aside, or payment of a dividend or other distribution with respect to the shares of Veeco, or any direct or indirect redemption, purchase or other acquisition by Veeco of any of its shares of capital stock; (v) any material contract entered into by Veeco or any agreementof its subsidiaries, commitment other than in the ordinary course of business, or transaction any material amendment or termination of, or default under, any material contract to which Veeco or any of its subsidiaries is a party or by which it or any of them is bound; (vi) any action or failure to act that could reasonably be expected to cause the Merger to fail to qualify as a reorganization as described in Section 368(a) of the Code with respect to which no gain or loss will be recognized by a stockholder of the Company which is material on the conversion of Company Common Stock into Veeco Shares pursuant to the Company and its Subsidiaries taken as Merger (except with respect to any cash received in lieu of a whole fractional share); or (ixvii) any commitment agreement by Veeco or any of its subsidiaries to do any of the foregoingthings described in the preceding clauses (i) through (vi) (other than negotiations with the Company and its representatives regarding the transactions contemplated by this Merger Agreement).

Absence of Certain Changes. Except as set forth in Section 4.06 Since the Balance Sheet Date through the date hereof, except for actions expressly contemplated by this Agreement, the business of the Disclosure Letter, since May 31, 2000, (a) the Company and its Subsidiaries have has been conducted, in all material respects, in the ordinary course of business, and with respect to the Company and its Subsidiaries there has not suffered been (a) any Material Adverse Effect change or any change, condition, event that has had or development that could would reasonably be expected to have a Company Material Adverse Effect, (b) the Company and its Subsidiaries have conducted their respective businesses only in the ordinary course consistent with past practice, except for the negotiation and execution and delivery of this Agreement and (c) there has not been (i) any declaration, setting aside or payment of any dividend or other distribution in with respect of the Shares to its capital stock or other equity interest or any repurchaseredemption, redemption purchase or other acquisition by the Company or of any of its Subsidiaries of any outstanding shares of capital stock (except any obligation of the Company under the Stock Option Plans to accept Shares or other equity interest, other than in connection with the exercise of Existing Stock Options(i) Company Stock-Based Awards, including in satisfaction of withholding tax obligations(ii) or other securities in, or other ownership interests in, an intra-company transaction between the Company or any and one of its Subsidiaries or any amendment (or agreement to amend) between two Subsidiaries of the terms of any such shares, securities or ownership interests), (ii) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit ofCompany, or any increase in the rate or modification in the terms (including any acceleration iii) dissolution of a wholly owned Subsidiary of the right to receive or the timing of payment) of any compensation payable or to become payable by the Company or any of its Subsidiaries toCompany, any of their respective directorsin each case, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business business, (c) any split, combination or reclassification of any of its capital stock or other equity interest or any issuance or the authorization of any issuance of any other securities in accordance respect of, in lieu of or in substitution for shares of its capital stock or other equity interest, other than in connection with (i) Company Stock-Based Awards, (ii) an intra-company transaction between the Company and one of its customary past practicesSubsidiaries, or (iii) any increase dissolution of a wholly owned Subsidiary of the Company, in each case, in the rate ordinary course of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employeesbusiness, (ivd) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any material change by the Company in accounting methods, principles or practices used by the Company affecting its assets, liabilities or business, except insofar as may have been required by changes a change in GAAP, (vie) any labor dispute amendments or changes in the charter documents or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees organizational documents of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries Subsidiaries, (f) any change in any material method of Tax accounting or material Tax compliance practices, (g) any change or rescission of any material Tax election, (h) any closing agreement, settlement or compromise of their respective assetsany claim or assessment, including write-downs in each case in respect of inventory material Taxes, or consent to any extension or waiver of accounts receivable any limitation period with respect to any claim or assessment for material Taxes, (i) any material acquisitions or dispositions (of assets or equity) other than in the ordinary course of business consistent with past practicebusiness, (viiij) any material capital expenditures outside of the ordinary course of business, (k) entry into any agreement, commitment or transaction by arrangements regarding material Indebtedness of the Company which is or any of its Subsidiaries, (l) the settlement, waiver or compromise of any material to Legal Proceeding that was not fully reserved against on the Company Balance Sheet, and its Subsidiaries taken as a whole (m) the entry into any agreement or contract (ixwhether oral or written) any commitment to do any of the foregoing.

Absence of Certain Changes. Except as set forth in Section 4.06 of Since June 30, 2005 (the Disclosure Letter“Company Balance Sheet Date”) through the Effective Time, since May 31, 2000, there has not occurred: (ai) the Company and its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development condition (whether or not covered by insurance or similar indemnification agreement) that could has resulted in, or would reasonably be expected to have result in, a Company Material Adverse Effect, (bii) the any acquisition, sale or transfer of any material asset of Company and or any of its Subsidiaries have conducted their respective businesses only subsidiaries, (iii) any change in the ordinary course consistent with past practiceaccounting methods or practices (including any change in depreciation or amortization policies or rates) by Company or any revaluation by Company of any of its or any of its subsidiaries’ assets, except for the negotiation and execution and delivery of this Agreement and (c) there has not been (iiv) any declaration, setting aside aside, or payment of any a dividend or other distribution in with respect to the shares of the Shares Company, or any repurchasedirect or indirect redemption, redemption purchase or other acquisition by the Company of any of its shares of capital stock, (v) any material contract entered into by Company or any of its Subsidiaries of subsidiaries, or any outstanding shares of capital stock material amendment or (except any obligation by way of lapse of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligationsterm thereof) or other securities intermination of, or other ownership interests indefault under, the any material contract to which Company or any of its Subsidiaries subsidiaries is a party or any amendment (or agreement to amend) the terms of any such shares, securities or ownership interests)by which it is bound, (iivi) any entry into action to amend or change the Certificate of Incorporation or Bylaws of Company, (vii) any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or any material increase in the rate compensation or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation benefits payable or to become payable by the Company or to any of its Subsidiaries to, any of their respective directors, officers directors or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable other than in the ordinary course of business consistent and as contemplated by this Agreement or increases associated with past practicemerit or annual pay increases or promotions in the ordinary course of business, (viii) any entry into transaction with any agreement, commitment or transaction by the affiliate of Company which is material to the Company and its Subsidiaries taken as not a whole Subsidiary of Company, or (ix) any commitment negotiation or agreement by Company or any of its subsidiaries to do any of the foregoingthings described in the preceding clauses (i) through (viii) (other than negotiations with Parent and its representatives regarding the transactions contemplated by this Agreement and the agreements disclosed herein).

Absence of Certain Changes. Except as set forth on -------------------------- Schedule 4.11 or disclosed in Section 4.06 of any SEC Filings or the Disclosure LetterJune 10-Q, since May December ------------- 31, 20001996: (i) there has not been any event or occurrences, or series of events or occurrences, which have had, or may have, a Material Adverse Effect on the Company, (aii) neither the Company nor any of its Subsidiaries has incurred any liability or engaged in any transaction that is material to the Company and its Subsidiaries have not suffered taken as a whole, or entered into any Material Adverse Effect or any changeAgreement, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) the Company and its Subsidiaries have conducted their respective businesses only except in the ordinary course of business consistent with past practice, except for or as contemplated by this Agreement, (iii) neither the negotiation Company nor any of its Subsidiaries is in default under (and execution and delivery no event has occurred which with the lapse of this Agreement and time or action by a third party could result in a default under) any Material Agreement, (civ) there has not been (i) any declaration, setting aside or payment of any dividend or other distribution in with respect of to the Shares Preferred Stock or the Existing Preferred Stock, (v) there has not been any repurchasecommitment, redemption contractual obligation, borrowing, capital expenditure or other acquisition transaction (each, a "Commitment") ---------- entered into by the Company or any of its Subsidiaries of any outstanding shares of capital stock (except any obligation of Subsidiaries, other than Commitments which would not, individually or in the Company under aggregate, reasonably be expected to result in a Material Adverse Effect on the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities inCompany, or other ownership interests in, the Company or any of its Subsidiaries or any amendment (or agreement to amend) the terms of any such shares, securities or ownership interests), (ii) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation payable or to become payable by the Company or any of its Subsidiaries to, any of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) there has not been any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable other than change in the ordinary course of business consistent with past practiceCompany's accounting principles, (viii) any entry into any agreementpractices or methods which would, commitment individually or transaction by in the Company which is material aggregate, reasonably be expected to result in a Material Adverse Effect on the Company and its Subsidiaries taken as a whole or (ix) any commitment to do any of the foregoingCompany.

Absence of Certain Changes. Except as set forth in Section 4.06 of the Disclosure Letter, since May Since December 31, 20001998 (the "Omega Balance Sheet Date"), (a) the Company and Omega has conducted its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) the Company and its Subsidiaries have conducted their respective businesses only business in the ordinary course consistent with past practice, except for the negotiation practice and execution and delivery of this Agreement and (c) there has not been occurred except as otherwise disclosed in the Omega SEC Documents: (i) any change, event or condition (whether or not covered by insurance) that has resulted in, or would reasonably be expected to result in, a Material Adverse Effect on Omega; (ii) any acquisition, sale or transfer of any material asset of Omega or any of its subsidiaries other than in the ordinary course of business and consistent with past practice; (iii) any change in accounting methods or practices (including any change in depreciation or amortization policies or rates) by Omega or any revaluation by Omega of any of its or any of its subsidiaries' assets; (iv) any declaration, setting aside aside, or payment of any a dividend or other distribution in with respect to the shares of the Shares Omega, or any repurchasedirect or indirect redemption, redemption purchase or other acquisition by the Company Omega of any of its shares of capital stock; (v) any material contract entered into by Omega or any of its Subsidiaries subsidiaries, other than in the ordinary course of any outstanding shares of capital stock (except any obligation of the Company under the Stock Option Plans business and as provided to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities inOnline, or other ownership interests inany material amendment or termination of, the Company or material default under, any material contract to which Omega or any of its Subsidiaries subsidiaries is a party or by which it is bound; (vi) any amendment or change to the Articles of Incorporation or Bylaws of Omega; (or agreement to amend) the terms of any such shares, securities or ownership interests), (iivii) any entry into any employment, change material increase in control, retention, incentive or deferred material modification of the compensation or severance agreement, plan or arrangement with or for the benefit of, or any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation benefits payable or to become payable by the Company or Omega to any of its Subsidiaries to, any of their respective directors, officers or employees, employees (except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course case of business in accordance with its customary past practices, employees (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (viiofficers) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable other than increases in the ordinary course of business consistent with past practice, practices; (viii) any entry into material change in the interest rate risk management and hedging policies, procedures or practices of Omega or any agreementof its subsidiaries, commitment or transaction by the Company which is material any failure to the Company comply with such policies, procedures and its Subsidiaries taken as a whole practices; or (ix) any commitment negotiation or agreement by Omega or any of its subsidiaries to do any of the foregoingthings described in the preceding clauses (i) through (viii) (other than negotiations with Online and its representatives regarding the transactions contemplated by this Agreement).

Absence of Certain Changes. Except as set forth disclosed in Section 4.06 Schedule 3.8 of the Disclosure LetterSchedule, since May 31January 1, 20002013, the Seller has conducted the Business in the usual ordinary course, and, without limiting the generality of the foregoing, since such date, there has not been: (a) any change or condition of any character in the Company and its Subsidiaries have not suffered any Material Adverse Effect or any changeAssets including, without limitation, the financial condition, event results of operations or development that prospects of the Business which, individually or in the aggregate, had or could reasonably be expected to have a material adverse effect on the revenues, financial condition, results of operations, properties, assets or prospects of the Seller (a "Material Adverse Effect, "); (b) the Company and its Subsidiaries have conducted their respective businesses only any capital expenditure or commitment thereof in excess of $25,000 individually or $50,000 in the ordinary course consistent with past practiceaggregate, except for or the negotiation and execution and delivery of this Agreement and making or any loans or advances; (c) there has not been (i) any declarationsale, setting aside lease, license, Encumbrance or payment other transfer or disposition of any dividend assets or other distribution in respect properties of the Shares or any repurchase, redemption or other acquisition by the Company or any of its Subsidiaries of any outstanding shares of capital stock (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities in, or other ownership interests in, the Company or any of its Subsidiaries or any amendment (or agreement to amend) the terms of any such shares, securities or ownership interests), (ii) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation payable or to become payable by the Company or any of its Subsidiaries to, any of their respective directors, officers or employeesSeller, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, the Business; (iiid) any increase in forgiveness or cancellation of any debts or claims; (e) any entry into or commitment to enter into any material contract by the rate of compensation Seller or benefits payable any change or accruing underamendment to any material contract, or, modification or any entry into any or commitment to enter into any contract with an affiliate of the terms Seller; (including f) any acceleration damage, destruction or loss to the properties or assets owned, leased or used by the Seller, whether or not covered by insurance, which adversely affected the operations of the right to receive payment) of, any existing Plan Business; (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (vg) any change by the Company Seller in its financial or tax accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievancesmethods, or any activity or proceeding by a labor union or representative thereof failure to organize any employees maintain the books, accounts and records of the Company Seller in the usual, regular and ordinary manner on a basis consistent with prior practice and in accordance with GAAP; (h) any acquisition (by merger, consolidation or acquisition of stock or assets) by the Seller of any Subsidiarybusiness entity or division or significant assets thereof; (i) any change made or authorized in the Seller's certificate of incorporation or by-laws; or (j) any failure by the Seller to use its customary best efforts to preserve the Seller's goodwill with suppliers, customers and others with which employees were not then subject it has business relationships and to a collective bargaining agreementmaintain its business, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable other than in the ordinary course of business licenses and operations consistent with past practice, (viii) any entry into any agreement, commitment or transaction by the Company which is material to the Company and its Subsidiaries taken as a whole or (ix) any commitment to do any of the foregoingpractices.

Absence of Certain Changes. Except as set forth (a) disclosed on the Reference Balance Sheet; (b) disclosed in Section 4.06 4.16 of the Disclosure LetterSchedule; or (c) expressly contemplated by this Agreement, since May 31the date of the Reference Balance Sheet, 2000, neither the Companies nor their Subsidiaries have: (ai) the Company and its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have change constituting a Seller Material Adverse Effect; (ii) split, combined or reclassified their capital stock; (biii) materially changed their accounting principles, practices or methods, except as required by GAAP or applicable Law; (iv) declared or paid any dividend or other distribution of cash or other assets or made any payments to Seller or its affiliates (in each case, on a net basis), or released any claims against Seller or its affiliates, except for (A) participation in Seller's cash management program pursuant to which cash collected by the Company Companies and its their Subsidiaries have conducted their respective businesses only in is swept by Seller to reduce amounts outstanding under the ordinary course Intercompany Notes and expenditures made by the Companies and the Subsidiaries are paid with funds provided by Seller increasing the balances of the Intercompany Notes, consistent with past practice, except for the negotiation and execution and delivery of this Agreement and (cB) there has not been (i) any declaration, setting aside or the payment of any dividend accounts payable to Seller or other distribution in respect of its affiliates arising from the Shares or any repurchase, redemption or other acquisition by the Company or any of its Subsidiaries of any outstanding shares of capital stock (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities in, or other ownership interests in, the Company or any of its Subsidiaries or any amendment (or agreement to amend) the terms of any such shares, securities or ownership interests), (ii) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation payable or to become payable by the Company or any of its Subsidiaries to, any of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted sale in the ordinary course of business in accordance of food or other products or services to the Companies and the Subsidiaries by Seller or such affiliates consistent with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, practice; (v) materially increased any change by the Company in accounting methods, principles compensation or practices except as required by changes in GAAP, expanded any perquisites of employees; (vi) paid any labor dispute liabilities or other employment related problem, other than routine individual grievances, or collected any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable receivables other than in the ordinary course of business based on the normal terms thereof and consistent with past practice, ; (vii) sold or otherwise transferred any material asset of the Companies or the Subsidiaries; or (viii) any entry into any agreement, commitment or transaction by otherwise operated the Company which is material to business other than in the Company and its Subsidiaries taken as a whole or (ix) any commitment to do any of the foregoingordinary course consistent with past practices.

Absence of Certain Changes. Except as set forth in Section 4.06 of Since June 30, 1999 (the Disclosure Letter"Company Balance Sheet Date"), since May 31, 2000, (a) the Company and has conducted its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) the Company and its Subsidiaries have conducted their respective businesses only business in the ordinary course consistent with past practice, except for the negotiation practice and execution and delivery of this Agreement and (c) there has not been occurred: (i) any declarationchange, setting aside event or payment condition (whether or not covered by insurance) that has resulted in, or might reasonably be expected to result in, a Material Adverse Effect to Company; (ii) any acquisition, sale or transfer of any dividend or other distribution in respect material asset of the Shares or any repurchase, redemption or other acquisition by the Company or any of its Subsidiaries of any outstanding shares of capital stock (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities in, or other ownership interests in, the Company or any of its Subsidiaries or any amendment (or agreement to amend) the terms of any such shares, securities or ownership interests), (ii) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation payable or to become payable by the Company or any of its Subsidiaries to, any of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable subsidiaries other than in the ordinary course of business and consistent with past practice, ; (viiiiii) any entry into change in accounting methods or practices (including any agreementchange in depreciation or amortization policies or rates) by Company or any revaluation by Company of any of its or any of its subsidiaries' assets; (iv) any declaration, commitment setting aside, or transaction by the Company which is material payment of a dividend or other distribution with respect to the shares of Company, or any direct or indirect redemption, purchase or other acquisition by Company of any of its shares of capital stock; (v) any material contract entered into by Company or any of its subsidiaries, other than in the ordinary course of business and as provided to Parent, or any material amendment or termination of, or default under, any material contract to which Company or any of its Subsidiaries taken subsidiaries is a party or by which it is bound; (vi) any amendment or change to the Certificate of Incorporation or Bylaws or, except as a whole contemplated by Section 2.32 hereof, Rights Agreement of Company; or (ixvii) any commitment increase in or modification of the compensation or benefits payable, or to become payable, by Company to any of its directors or employees, other than pursuant to scheduled annual performance reviews, provided that any resulting modifications are in the ordinary course of business and consistent with Company's past practices. Company has not agreed since June 30, 1999 to do any of the foregoingthings described in the preceding clauses (i) through (vii) and is not currently involved in any negotiations to do any of the things described in the preceding clauses (i) through (vii) (other than negotiations with Parent and its representatives regarding the transactions contemplated by this Agreement).

Absence of Certain Changes. Except as set forth in Section 4.06 of Since November 30, 2006 (the Disclosure Letter"Target Balance Sheet Date"), since May 31, 2000, (a) the Company and Target has conducted its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) the Company and its Subsidiaries have conducted their respective businesses only business in the ordinary course consistent with past practice, except for the negotiation practice and execution and delivery of this Agreement and (c) there has not been occurred (ia) any declarationchange, setting aside event or payment of any dividend condition (whether or other distribution in respect of the Shares or any repurchase, redemption or other acquisition not covered by the Company or any of its Subsidiaries of any outstanding shares of capital stock (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligationsinsurance) or other securities that has resulted in, or other ownership interests would reasonably be expected to result in, the Company a Material Adverse Effect on Target; (b) any acquisition, sale or any of its Subsidiaries or any amendment (or agreement to amend) the terms transfer of any such shares, securities or ownership interests), (ii) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or any increase in the rate or modification in the terms (including any acceleration material asset of the right to receive or the timing of payment) of any compensation payable or to become payable by the Company or any of its Subsidiaries to, any of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable Target other than in the ordinary course of business and consistent with past practice, ; (viiic) any entry into change in accounting methods or practices (including any agreementchange in depreciation or amortization policies or rates) by Target or any revaluation by Target of any of its assets; (d) any declaration, commitment setting aside, or transaction by the Company which is material payment of a dividend or other distribution with respect to the Company shares of Target or any direct or indirect redemption, purchase or other acquisition by Target of any of its shares of capital stock; (e) any Material Contract entered into by Target, other than in the ordinary course of business and as provided to Acquiror, or any material amendment or termination of, or default under, any Material Contract (as defined in Section 3.13) to which Target is a party or by which it is bound; (f) any amendment or change to the Certificate of Incorporation or Bylaws of Target; (g) any increase in or modification of the compensation or benefits payable or to become payable by Target to any of its Subsidiaries taken as a whole directors, executive officers, or, other than in the ordinary course of business, employees; or (ixh) any commitment negotiation or agreement by Target to do any of the foregoingthings described in the preceding clauses (a) through (g) (other than negotiations with Acquiror and its representatives regarding the transactions contemplated by this Agreement). At the Effective Time, there will be no accrued but unpaid dividends on shares of Target's capital stock.

Absence of Certain Changes. Except Since the date of the Balance Sheet, the Business has been conducted only in the ordinary course, consistent with past practice. Without limiting the foregoing, since the date of the Balance Sheet, except as set forth in Section 4.06 of the Disclosure LetterSchedule 3.6, since May 31, 2000, (a) the Company and its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) the Company and its Subsidiaries have conducted their respective businesses only in the ordinary course consistent with past practice, except for the negotiation and execution and delivery of this Agreement and (c) there has not been (ia) any actual or to the best knowledge of Sellers, threatened change in the condition (financial or otherwise), properties, assets or results of operations of the Business or any Seller which, individually or in the aggregate, could have a material adverse effect, (b) any material damage, destruction or other casualty loss to, or actual or, to Sellers' knowledge, threatened forfeiture or taking of, any Assets or any property used in the Business (whether or not covered by insurance), (c) any waiver or modification by any Seller of any right or rights of substantial value, or any payment (direct or indirect) in satisfaction of any liability, which individually or in the aggregate, could have a material adverse effect on the Business, (d) any change in the accounting principles, methods, practices or procedures followed by any Seller in connection with the Business or any change in the depreciation or amortization policies or rates theretofore adopted by any Seller in connection with the Business, (e) any sale, transfer, conveyance of any Asset, or grant to any party of any license, sublicense, franchise or option or other right of any nature to sell or distribute the Assets, other than inventory in the ordinary course of the Business, (f) any material change to any business policy of the Business, including, without limitation, advertising, marketing, pricing, purchasing, personnel, return or product acquisition policies; (g) any increase in the rate of compensation or in the benefits payable or to become payable by Balfour to any employee or officer of the Business inconsistent with their past practices or, except as set forth on Schedule 3.6(g) hereto, any institution of a bonus or incentive plan for employees for fiscal 1997 or subsequent years, (h) any declaration, setting aside or payment of any dividend dividends, or other distribution distributions in respect of the Shares or any repurchase, redemption or other acquisition by the Company or any of its Subsidiaries of any outstanding shares of capital stock of Balfour, (except i) any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Optionsstrikes, including in satisfaction of withholding tax obligations) work stoppages, slowdowns, lockouts, arbitrations or any grievances or other securities inlabor disputes pending or, to Sellers' best knowledge, threatened against or other ownership interests ininvolving Balfour, the Company (j) any unfair labor practice charges, grievances or complaints pending or, to any of its Subsidiaries Seller's best knowledge, threatened by or any amendment (or agreement to amend) the terms on behalf of any such shares, securities employee or ownership interests), (ii) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or any increase in the rate or modification in the terms (including any acceleration group of the right to receive or the timing of payment) of any compensation payable or to become payable by the Company or any of its Subsidiaries to, any of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company Business, (k) any organizing activity involving any Seller or, to any Seller's best knowledge, threatened by any labor organization or group of employees of the Business, (l) any payment or commitment to pay severance or termination pay to any of Sellers' officers, directors, employees, consultants, agents or other representatives of the Business or (m) any pending or, to any Seller's best knowledge, threatened or anticipated dispute with any customer or supplier or any Subsidiary, which employees were not then subject to a collective bargaining agreement, occurrence or any lockouts, strikes, slowdowns, work stoppages situation or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable other than in the ordinary course of business consistent with past practice, (viii) any entry into any agreement, commitment or transaction by the Company event which is reasonably likely to result in any material to the Company and its Subsidiaries taken as a whole reduction in amount of products purchased or (ix) sold or material change in terms or conditions of doing business with any commitment to do any substantial customer or supplier of the foregoingBusiness.

Absence of Certain Changes. Except as set forth in Section 4.06 of the Disclosure Letteron Schedule 5.6, since May 31November 30, 20002006 (the "Acquiror Balance Sheet Date"), (a) the Company and Acquiror has conducted its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) the Company and its Subsidiaries have conducted their respective businesses only business in the ordinary course consistent with past practice, except for the negotiation practice and execution and delivery of this Agreement and (c) there has not been occurred (ia) any declarationchange, setting aside event or payment of any dividend condition (whether or other distribution in respect of the Shares or any repurchase, redemption or other acquisition not covered by the Company or any of its Subsidiaries of any outstanding shares of capital stock (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligationsinsurance) or other securities that has resulted in, or other ownership interests would reasonably be expected to result in, the Company a Material Adverse Effect on Acquiror; (b) any acquisition, sale or any of its Subsidiaries or any amendment (or agreement to amend) the terms transfer of any such shares, securities or ownership interests), (ii) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or any increase in the rate or modification in the terms (including any acceleration material asset of the right to receive or the timing of payment) of any compensation payable or to become payable by the Company or any of its Subsidiaries to, any of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable Acquiror other than in the ordinary course of business and consistent with past practice, ; (viiic) any entry into change in accounting methods or practices (including any agreementchange in depreciation or amortization policies or rates) by Acquiror or any revaluation by Acquiror of any of its assets; (d) any declaration, commitment setting aside, or transaction by the Company which is material payment of a dividend or other distribution with respect to the Company shares of Acquiror or any direct or indirect redemption, purchase or other acquisition by Acquiror of any of its shares of capital stock; (e) any Material Contract entered into by Acquiror, other than in the ordinary course of business and as provided to Acquiror, or any material amendment or termination of, or default under, any Material Contract (as defined in Section 5.14) to which Acquiror is a party or by which it is bound; (f) any amendment or change to the Certificate of Incorporation or Bylaws of Acquiror; (g) any increase in or modification of the compensation or benefits payable or to become payable by Acquiror to any of its Subsidiaries taken as a whole directors, executive officers, or, other than in the ordinary course of business, employees; or (ixh) any commitment negotiation or agreement by Acquiror to do any of the foregoingthings described in the preceding clauses (a) through (g) (other than negotiations with Acquiror and its representatives regarding the transactions contemplated by this Agreement). At the Effective Time, there will be no accrued but unpaid dividends on shares of Acquiror's capital stock.

Absence of Certain Changes. Except as set forth in Section 4.06 of the Disclosure Letter, since May Since March 31, 2000, (a) except as contemplated by the Company and Disclosure Schedule, Acquiror has conducted its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) the Company and its Subsidiaries have conducted their respective businesses only business in the ordinary course consistent with past practice, except for the negotiation practice and execution and delivery of this Agreement and (c) there has not been occurred: (i) any declarationchange, setting aside event or payment condition in the business or condition of any dividend Acquiror (whether or other distribution in respect of the Shares or any repurchase, redemption or other acquisition not covered by the Company or any of its Subsidiaries of any outstanding shares of capital stock (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligationsinsurance) or other securities that has resulted in, or other ownership interests might reasonably be expected to result in, the Company or any of its Subsidiaries or any amendment (or agreement a Material Adverse Effect to amend) the terms of any such shares, securities or ownership interests), Acquiror; (ii) any entry into any employmentacquisition, change in control, retention, incentive sale or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) transfer of any compensation payable or to become payable by the Company or any material asset of its Subsidiaries to, any of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable Acquiror other than in the ordinary course of business and consistent with past practice; (iii) any change in accounting methods or practices (including any change in depreciation or amortization policies or rates) by Acquiror or any revaluation by Acquiror of any of its assets; (iv) any declaration, setting aside, or payment of a dividend or other distribution with respect to the shares of Acquiror or any direct or indirect redemption, purchase or other acquisition by Acquiror of any of its shares of capital stock; (v) any material contract entered into by Acquiror or any of its subsidiaries, or any material amendment or termination of, or default under, any material contract to which Acquiror or any of its subsidiaries is a party or by which it is bound; (vi) any amendment or change to the Certificate of Incorporation or Bylaws of Acquiror; (vii) any increase in or modification of the compensation or benefits payable or to become payable by Acquiror to any of its directors or employees; or (viii) any entry into negotiation or agreement by Acquiror or any agreement, commitment or transaction by the Company which is material to the Company and of its Subsidiaries taken as a whole or (ix) any commitment subsidiaries to do any of the foregoingthings described in the preceding clauses (i) through (vii) (other than negotiations with Target and its representatives regarding the transactions contemplated by this Agreement). At the Effective Time, there will be no accrued but unpaid dividends on shares of Acquiror's capital stock.

Absence of Certain Changes. Except as set forth in Section 4.06 on Schedule 4.6 of the Company Disclosure LetterLetter or in the Completed Commission Filings or as required or permitted by the Transaction Documents, since May December 31, 20002000 to the date of this Agreement, (ai) the Company and its Subsidiaries have not suffered any there has been no Material Adverse Effect or on the Company or, to the knowledge of the Company, any event, change, conditionoccurrence, event effect, fact, violation or development circumstances that could reasonably be expected to have a Material Adverse EffectEffect on the Company, (bii) the businesses of the Company and each of its Subsidiaries have been conducted their respective businesses only in the ordinary course, (iii) neither the Company nor any of its Subsidiaries has incurred any material liabilities (direct, contingent or otherwise) or engaged in any material transaction or entered into any material agreement outside the ordinary course consistent with past practiceof business, except for (iv) neither the negotiation and execution and delivery Company nor any of this Agreement and its Subsidiaries have increased the compensation of any officer or granted any general salary or benefits increase to their respective employees, other than in the ordinary course of business, (cv) neither the Company nor any of its Subsidiaries has taken any action referred to in Section 6.3 hereof, (vi) there has not been (i) any no declaration, setting aside or payment of any dividend or other distribution in with respect to any class of the Shares or any repurchase, redemption or other acquisition by the Company or any of its Subsidiaries of any outstanding shares of capital stock (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities in, or other ownership interests in, of the Company or any of its Subsidiaries or any amendment and (or agreement to amendvii) the terms of any such shares, securities or ownership interests), (ii) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation payable or to become payable by the Company or any of its Subsidiaries to, any of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have there has been granted in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any no change by the Company in accounting principles, practices or methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable other than in the ordinary course of business consistent with past practice, (viii) any entry into any agreement, commitment or transaction by the Company which is material to the Company and its Subsidiaries taken as a whole or (ix) any commitment to do any of the foregoing.

Absence of Certain Changes. Except as set forth in Section 4.06 of the Disclosure Letter, since May December 31, 20001996, (a) the Company and its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) the Company and its Subsidiaries have conducted their respective businesses business only in the ordinary course of such business consistent with past practicepractices, except for the negotiation and execution and delivery of this Agreement and (c) there has not been (i) any events or states of fact which individually or in the aggregate would have a Material Adverse Effect; (ii) any declaration, setting aside or payment of any dividend or other distribution in with respect of the Shares or to its capital stock; (iii) any repurchase, redemption or any other acquisition by the Company or any of its Subsidiaries of any outstanding shares of capital stock (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities inof, or other ownership interests in, the Company or its Subsidiaries; (iv) any of its Subsidiaries material change in accounting principles, practices or any amendment methods; (or agreement to amend) the terms of any such shares, securities or ownership interests), (iiv) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit ofemployment agreement with, or any increase in the rate or modification in the terms (including including, without limitation, any acceleration of the right to receive or the timing of payment) of any compensation payable or to become payable by the Company or any of its Subsidiaries to, any of their respective directors, officers or employees, except base salaryfor increases occurring in the ordinary course of business in accordance with their customary practices which do not exceed $500,000, guaranteed draw in the aggregate, annually and employment agreements entered into in the ordinary course of business which do not provide for annual compensation which exceeds $100,000, in the aggregate; (vi) any increase in the rate or hourly wage increases to employees who are not members terms (including, without limitation, any acceleration of the executive committee right to receive payment) of the Company any bonus, insurance, pension or directors of the Company that have been granted other employee benefit plan or arrangement covering any such directors, officers or employees, except increases occurring in the ordinary course of business in accordance with its customary past practices, practices which do not exceed $1,000,000 in the aggregate; (iiivii) any increase in the rate of compensation entry into any Contract or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action transaction by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, Subsidiary or modification of any existing Contract which employees were is material to the Company and its Subsidiaries taken as a whole whether or not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, in the ordinary course of business; (viiviii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including including, without limitation, write-downs of inventory or write-offs of accounts receivable other than in the ordinary course of business consistent with past practice, (viii) any entry into any agreement, commitment or transaction by the Company which is material to the Company and its Subsidiaries taken as a whole practices; or (ix) any commitment to do any of the foregoing.action by the

Absence of Certain Changes. Except as set forth in Section 4.06 Schedule 3.7, since the Balance Sheet Date, the business of the Disclosure LetterCompany has been conducted only in the Ordinary Course of Business and there has not been any event, since May 31occurrence, 2000, (a) the Company and its Subsidiaries have not suffered any Material Adverse Effect or any change, conditiondevelopment, event condition or development that state of circumstances which has had or could reasonably be expected to have have, individually or in the aggregate, a Material Adverse Effect. Without limiting the generality of the foregoing, except as set forth in Schedule 3.7, since the Balance Sheet Date, there has not occurred: (bi) any damage, destruction or loss, whether or not adequately covered by insurance, involving any Asset in excess of $50,000; (ii) any adoption or modification of any Benefit Plan made to, for or with any employees of the Company; (iii) any change in compensation payable (including, without limitation, commission, bonus or other direct or other remuneration) or to become payable by the Company to its employees, directors, officers or agents or change in benefits under any Benefit Plan, in each case other than changes made in the Ordinary Course of Business; (iv) any sale or other disposition of any Assets of the Company, other than sales or dispositions made in the Ordinary Course of Business; (v) any creation or other incurrence of a Lien of any kind upon any Assets of the Company except Permitted Liens; (vi) any change in the method of allocation of expenses, liabilities or income between the Company and its Subsidiaries have conducted their respective businesses only any other subsidiaries, divisions or business units of the Company or the Parent or any other change in the ordinary course consistent with past practicemethod of accounting or accounting practices of the Company; (vii) any amendment, termination, waiver, cancellation or release of any rights or claims of material value, including rights or claims under any Material Contract, or any waiver or release of any right or claim relating to the Company's business against any affiliate (as defined in Rule 405 under the Securities Act, "affiliate") of any of the Parent or the Company; (viii) any discharge or payment of any material obligation or liability of the Company other than in the Ordinary Course of Business; (ix) any incurrence of Indebtedness by the Company; (x) any capital expenditures or commitments by the Company for any addition to property, plant or equipment exceeding $20,000 individually or $100,000 in the aggregate; (xi) any material cancellation or waiver of any debts to or any claims of the Company except for in the negotiation and execution and delivery Ordinary Course of this Agreement and Business; (c) there has not been (ixii) any declaration, setting aside or payment of any dividend or other distribution in with respect of to the Shares Stock, or any repurchase, redemption or other acquisition by the Company or any of its Subsidiaries of any outstanding shares of capital stock (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities inof the Company, or other ownership interests in, payments to any of the Company's stockholders in their capacity as such; (xiii) any amendment of any material term of any outstanding security of the Company or any recapitalization or reclassification of its Subsidiaries or any amendment the capital stock of the Company; (or agreement to amendxiv) the terms of any such shares, securities or ownership interests), (iiA) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement employment agreement with or for the benefit of, or any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation payable or to become payable by the Company or any of its Subsidiaries to, any of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses Company's directors, officers, employees or agents; (B) any payment of Section 6.01 hereofany pension, retirement allowance or other employee benefit not required to be paid by any existing Benefit Plan; or (vC) any commitment made by the Company to any of the Company's directors, officers, employees or agents with respect to any additional pension, profit sharing, bonus, incentive, deferred compensation, stock purchase, stock option, stock appreciation, group insurance, severance pay, retirement or other Benefit Plan; (xv) any amendment or termination (other than by completion thereof) of any Material Contract; (xvi) any change by or modification in any material respect to the Company in accounting methodsCompany's credit, principles collection or practices except as required by changes in GAAPpayment policies, procedures or practices, including acceleration of collections or receivables (vi) any labor dispute whether or not past due), acceleration of payment of payables or other employment related problem, other than routine individual grievances, liabilities or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable other than in the ordinary course of business consistent with past practice, (viii) any entry into any agreement, commitment or transaction by the Company which is material to the Company and its Subsidiaries taken as a whole or (ix) any commitment to do any of the foregoing.failure to

Absence of Certain Changes. Except as set forth disclosed in Section 4.06 Schedule 4.9 -------------------------- ------------ attached hereto, since the date of the Disclosure LetterBalance Sheet, since May 31, 2000, there has not been: (a) the Company and its Subsidiaries have not suffered any Material Adverse Effect Change; (b) any material damage, destruction or loss (whether or not covered by insurance) adversely affecting the properties, Assets, liabilities, financial condition or results of operations of the Division; (c) any increase in the compensation, commissions or perquisites payable or to become payable by the Division to any employee of the Division, or any changepayment of any bonus, conditionprofit sharing or other extraordinary compensation to any employee of the Division (other than any such increase or payment paid or to become payable not exceeding 4% over amounts paid during the year ended December 31, event 1998); (d) any cancellation of any material debts owed to or development claims held by the Division or waiver of any material rights held by the Division; (e) any sale, lease, abandonment or other disposition by the Division of any real property, or, other than in the ordinary course of business and not exceeding $50,000 in the aggregate based on the book value thereof, of any machinery, equipment or other operating properties, or of any intangible assets; (f) any change in the amount, aging or collectibility of the Accounts Receivable or other debts due to Seller with respect to the Division or the allowances with respect thereto or accounts payable from that reflected on the Financial Statements which could reasonably be expected to have a Material Adverse Effect; or (g) any action taken by Seller which, (b) if taken subsequent to the Company and its Subsidiaries have conducted their respective businesses only in the ordinary course consistent with past practice, except for the negotiation and execution and delivery of this Agreement and (c) there has not been (i) any declaration, setting aside on or payment of any dividend or other distribution in respect of prior to the Shares or any repurchase, redemption or other acquisition by the Company or any of its Subsidiaries of any outstanding shares of capital stock (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities in, or other ownership interests in, the Company or any of its Subsidiaries or any amendment (or agreement to amend) the terms of any such shares, securities or ownership interests), (ii) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation payable or to become payable by the Company or any of its Subsidiaries to, any of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereofClosing Date, would constitute a breach of any of the clauses of Seller's agreements set forth in Section 6.01 hereof6.1(a), (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAPb), (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employeese), (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable other than in the ordinary course of business consistent with past practicef), (viiig) any entry into any agreement, commitment or transaction by the Company which is material to the Company and its Subsidiaries taken as a whole or (ixh) any commitment to do any of the foregoingthis Agreement.

Absence of Certain Changes. Except Since December 31, 1997 and except as set forth in the Company SEC Reports and Section 4.06 4.18 of the Company Disclosure LetterSchedule, since May 31, 2000, (a) the Company and its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) the Company and its Subsidiaries subsidiaries have conducted their respective businesses only business in the ordinary course consistent with past practice, except for the negotiation practice and execution and delivery of this Agreement and (c) there has not been been: (ia) any event, occurrence or development of a state of circumstances or facts which has had or is reasonably likely to have, individually or in the aggregate, a Material Adverse Effect on the Company; (b) any declaration, setting aside or payment of any dividend or other distribution in with respect to any shares of the Shares Company Common Stock, or any repurchase, redemption or other acquisition by the Company or -19- 24 any of its Subsidiaries subsidiaries of any amount of outstanding shares of capital stock (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities inof, or other ownership interests in, the Company or any of its Subsidiaries subsidiaries; (c) any amendment of any material term of any outstanding security of the Company or any amendment of its subsidiaries; (or agreement to amend) the terms of any such shares, securities or ownership interests), (iid) any entry into any employmentincurrence, change in control, retention, incentive assumption or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation payable or to become payable guarantee by the Company or any of its Subsidiaries to, subsidiaries of any indebtedness from any third party for borrowed money other than guarantees by the Company for the benefit of any of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted its subsidiaries and other than in the ordinary course of business and in accordance amounts and on terms consistent with its customary past practices, ; (iiie) any increase in the rate of compensation creation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation assumption by the Company or any of its Subsidiaries subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable Lien on any material asset other than in the ordinary course of business consistent with past practice, practices; (viiif) any making of any loan, advance or capital contribution to or investment in any person other than loans, advances or capital contributions to or investments in wholly-owned subsidiaries or to employees of the Company made in the ordinary course of business consistent with past practices; (g) any damage, destruction or other casualty loss (whether or not covered by insurance) affecting the business or assets of the Company or any of its subsidiaries which, individually or in the aggregate, has had or is reasonably likely to have a Material Adverse Effect on the Company; (h) any transaction or commitment made, or any contract or agreement entered into, by the Company or any of its subsidiaries relating to its assets or business (including, without limitation, the acquisition or disposition of any assets) (other than transactions and commitments contemplated by this Agreement) inconsistent with the Company's 1998 Strategic and Annual Operating Plan dated February 18, 1998 (the "1998 Plan"), which was disclosed to Parent and Purchaser prior to the date of this Agreement, or any relinquishment by the Company or any of its subsidiaries of any material contract, license or right; (i) any change in any method of accounting or accounting principle or practice by the Company or any of its subsidiaries, except for any such change required by GAAP or Regulation S-X promulgated under the Exchange Act ("Regulation S-X"); or (j) any (i) grant by the Company or any of its subsidiaries of any severance or termination pay to, or entry into any employment, termination or severance arrangement with, any director, officer or employee of the Company or any subsidiaries other than any such grant or arrangement to or with any employee of any subsidiary of the Company in the ordinary course in an amount not exceeding an amount equal to the annual compensation plus expenses relating to "COBRA" and out-placement benefits of such employee; (ii) entering into of any employment, deferred compensation or other similar agreement (or any amendment to any such existing agreement) with any director, commitment officer or transaction employee of the Company or any of its subsidiaries, (iii) increase in benefits payable under any existing severance or termination pay policies or employment agreements or (iv) increase in compensation, bonus or other benefits payable to directors, officers or employees of the Company or any of its subsidiaries, other than in the ordinary course of business. SECTION 4.19. MILLENNIUM (a) The Company is in the process of conducting an inventory and assessment of all software, computers, network equipment, technical infrastructure, production equipment and other equipment and systems that are material to the operation of its business and the businesses of its subsidiaries and that rely on, utilize or perform date or time processing ("Systems"). (b) Any failure of any of the Company's Systems to be Year 2000 Complaint has not had and is not reasonably expected to have a Material Adverse Effect on the Company. (c) "Year 2000 Compliant" means a System will at all times: (i) consistently and accurately handle and process date and time information and data values before, during and after January 1, 2000, including but not limited to accepting date input, providing date output, and performing calculations on or utilizing dates or -20- 25 portions of dates; (ii) function accurately and in accordance with its specifications without interruption, abnormal endings, degradation, change in operation or other impact, or disruption of other Systems, resulting from processing date or time data with values, before, during and after January 1, 2000; (iii) respond to and process two-digit date input in a way that resolves any ambiguity as to century; and (iv) store and provide output of date information in ways that are unambiguous as to century. SECTION 4.20. FULL DISCLOSURE None of the representations or warranties of the Company contained in this Article 4 nor any of the disclosures contained in the Company Disclosure Schedule contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements contained herein or therein, in light of the circumstances under which they are to be made, not misleading, subject to such exceptions which, individually or in the aggregate, have not had and would not reasonably be expected to have a Material Adverse Effect on the Company. The documents furnished by the Company pursuant to this Agreement are in all material respects true and correct copies of such documents. SECTION 4.21. REAL PROPERTY (a) Section 4.21(a) of the Company Disclosure Schedule lists all material real property owned by the Company or any of its subsidiaries (the "Owned Real Property"). The Company has good and marketable title in fee simple to the Owned Real Property and, except as indicated in Section 4.21(a) of the Company Disclosure Schedule, the Owned Real Property and all mineral reserves located thereon are owned free and clear of any charge, claim, community property interest, equitable interest, lien, option, pledge, security interest, mortgage, lease, license, easement, right of first refusal or other encumbrance ("Liens") other than for Permitted Liens. (b) Section 4.21(b) of the Company Disclosure Schedule contains a list of all leases and subleases (the "Leases"), with respect to all material real property leased by the Company or any of its subsidiaries (the "Leased Property"). (c) The Company and its Subsidiaries have the mineral reserves disclosed in pages 1-7 of the 1997 Form 10-K. There are no material zoning or land use restrictions or covenants which would materially inhibit the surface or subsurface mining or quarrying process where such mineral reserves are located. (d) The Liens affecting the Owned Real Property or Leased Property do not and will not, with respect to each Owned Real Property or Leased Property, individually or in the aggregate, materially impair the Company's or its subsidiary's ability to use the Owned Real Property or Leased Property in the operation of the Company's or its subsidiary's business as presently conducted. To the Knowledge of the Company, the Company or its subsidiary has access to public roads, streets or the like or valid easements over private streets, roads or other private property for such ingress to and egress from the Owned Real Property and the Leased Property, except as would not materially impair the Company's or its subsidiary's ability to use any such Owned Real Property or Leased Property in the operation of the Company's or its subsidiary's business as presently conducted or for the purposes for which such Owned Real Property or Leased Property is material held by the Company or its subsidiary. (e) Neither the Company nor any of its subsidiaries has received any notice of any violation of any applicable building, zoning, land use or other similar statutes, laws, ordinances, regulations, permits or other requirements in respect of the Owned Real Property and the Leased Property, and to the Knowledge of the Company, there does not exist any such violations which adversely affect the ability of the Company and its Subsidiaries taken as subsidiaries to use the Owned Real Property or Leased Property in the manner and scope in which it is now being used except for violations which have not had and would not reasonably be expected to have a whole or (ix) any commitment to do Material Adverse Effect on the Company. Neither the Company nor any of its subsidiaries has received any notice that any, and to the foregoingKnowledge of the Company, no operations on or uses of the Owned Real Property and the Leased Property constitute non-conforming uses under any applicable building, zoning, land use or other similar statutes, laws, ordinances, regulations, permits or other requirements other than (i) non-conforming uses that are legal non- conforming uses, (ii) non-conforming uses that have been conducted with sufficient continuity so as to preserve the right to continue the existing operations and uses and any similar operations and uses for such property in the future, and (iii) non-conforming uses which, individually and in the aggregate, have not had and would not -21- 26 reasonably be expected to have, a Material Adverse Effect on the Company. Neither the Company nor any of its subsidiaries has Knowledge of or has received notice of any pending or contemplated condemnation, eminent domain or rezoning proceeding affecting the Owned Real Property or the Leased Property. (f) Neither the Company nor any of its subsidiaries has received any notice from any insurance carrier regarding defects or inadequacies in the Owned Real Property or Leased Property which, if not corrected, would result in termination of the Company's or its subsidiaries' insurance coverage or any material increase in the cost thereof, and the Company has no Knowledge of any such defects or inadequacies. (g) "Permitted Liens" means, with respect to any asset, (i) covenants, conditions, restrictions, encroachments, encumbrances, easements, rights of way, licenses, grants, building or use restrictions, exceptions, reservations, limitations or other imperfections of title (other than a Lien securing any indebtedness) with respect to such asset which, individually or in the aggregate, do not materially detract from the value of, or materially interfere with the present occupancy or use of, such asset and the continuation of the present occupancy or use of such asset or the use or occupancy for which such asset is held by a person; (ii) unfiled mechanic's, materialmen's and similar Liens with respect to amounts not yet due and payable or which are being contested in good faith through appropriate proceedings; (iii) Liens for taxes not yet delinquent or which are being contested in good faith through appropriate proceedings; and (iv) Liens securing rental payments under capital lease arrangements. SECTION 4.22. CONTRACTS Section 4.22 of the Company Disclosure Schedule sets forth a list of all material sales contracts and agreements to which the Company or any subsidiary is a party (the "Material Contracts"). All such contracts and agreements are in full force and effect and are binding on the parties thereto. No default by the Company or any of its subsidiaries has occurred thereunder, and to the Knowledge of the Company, no default by the other contracting parties has occurred thereunder, other than defaults which, individually and in the aggregate, have not had and would not reasonably be expected to have a Material Adverse Effect on the Company. ARTICLE V REPRESENTATIONS AND WARRANTIES OF PARENT Parent represents and warrants to the Company as follows: SECTION 5.1. ORGANIZATION AND QUALIFICATION Parent is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware and has the corporate power to carry on its business as it is now being conducted or currently proposed to be conducted. SECTION 5.2.

Absence of Certain Changes. Except as set forth in Section 4.06 the Company SEC Documents or on Schedule 3.6 of the Company Disclosure LetterSchedule, since May December 31, 20002006 (the “Company Balance Sheet Date”), through the date of this Agreement, (ai) the Company and its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) the Company and each of its Subsidiaries have conducted their respective businesses only in the ordinary course of business consistent with past practice, except for the negotiation and execution and delivery of this Agreement practice and (cii) there has not been occurred: (iA) any change, event or condition (whether or not covered by insurance) that has resulted in, or might reasonably be expected to result in, a Company Material Adverse Effect, (B) any acquisition, sale, or transfer of any material asset of the Company or its Subsidiaries, (C) any material change in accounting methods or practices (including any change in depreciation or amortization policies or rates) by the Company or any revaluation by the Company of any of its assets, (D) any declaration, setting aside or payment of any a dividend or other distribution in with respect to the shares of the Shares Company, or any repurchasedirect or indirect redemption, redemption purchase or other acquisition by the Company or any of its Subsidiaries of any outstanding shares of capital stock (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities in, or other ownership interests in, the Company or any of its Subsidiaries or any amendment (or agreement to amend) the terms of any such shares, securities or ownership interests), (ii) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation payable or to become payable by the Company or any of its Subsidiaries to, any of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries of any of its shares of capital stock, respectively, (E) any Material Contract entered into by the Company or any of its Subsidiaries, other than as provided to Parent, or any material amendment or termination of, or default under, any Material Contract (or contract that, but for such termination, would be a Material Contract), (F) any amendment or change to the Company Articles or the Certificate of Incorporation of any of its Subsidiaries, (G) any increase in or modification of the compensation or benefits payable or to become payable by Company or any of its Subsidiaries to any of their respective assetsdirectors, including writeemployees or consultants other than, with respect to non-downs of inventory or of accounts receivable other than officer employees and consultants only, any increases in the ordinary course of business consistent with past practice, or (viiiH) any entry into any agreement, commitment or transaction agreement by the Company which is material to the Company and or any of its Subsidiaries taken as a whole or (ix) any commitment to do any of the foregoingthings described in the preceding clauses (A) through (G).

Absence of Certain Changes. Except as set forth in Section 4.06 of the Disclosure LetterSchedule 6.6 attached hereto, since May 31January 1, 20001995, (a) the Company has conducted the Business in the ordinary course, and there has not been or occurred with respect to the Company: (i) any change in or amendment to its Subsidiaries Articles of Incorporation or Bylaws or any recapitalization or reclassification of its authorized or outstanding capital stock; (ii) any damage, destruction or loss, whether or not covered by insurance, which has had or may have not suffered any a Material Adverse Effect on the Company or its ability to operate the Business in the ordinary course and consistent with past practices; (iii) any amendment, modification or termination of any Material Contract or the termination, cessation or loss of or any change, condition, event material change in the pricing or development that other material terms of any product supply or other business arrangement or relationship which would or could reasonably be expected to have a Material Adverse Effect, ; (biv) the Company and its Subsidiaries have conducted their respective businesses only other than immaterial increases in regular salaries or wages made in the ordinary course of business and consistent with past practicepractices, except any increase in, or commitment to increase, the direct or indirect compensation or benefits payable or to become payable to any of the Company's officers, directors, employees, agents, or independent contractors, or the payment or awarding, or the making of any commitment to pay, any severance, bonus, incentive or special or deferred compensation to or similar arrangements with any of such officers, directors, employees, agents or independent contractors or the adoption of any new, or any material amendment or modification of any existing, Employee Plan (as hereinafter defined); (v) any sale or issuance of, or grant of options, warrants or other rights to acquire, any shares of capital stock or other securities (whether currently outstanding or authorized or available for the negotiation and execution and delivery of this Agreement and issuance); (c) there has not been (ivi) any declaration, setting aside or payment of any a dividend or other distribution in respect of the Shares its capital stock, or any repurchasedirect or indirect redemption, redemption repurchase or other acquisition by the Company of any shares of its capital stock or other securities, or any of its Subsidiaries issuance or the creation of any outstanding commitment or obligation to issue any shares of capital stock (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities in, or other ownership interests in, the Company or any rights or securities convertible, exchangeable or exercisable into shares of its Subsidiaries or any amendment (or agreement to amend) the terms of any such shares, securities or ownership interests), (ii) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit ofcapital stock, or any increase in the rate transfer, sale, pledge, assignment or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation payable or to become payable by the Company or any of its Subsidiaries toother disposition of, any of their respective directorsthe Shares, officers or employees, except base salary, guaranteed draw any interest in or hourly wage increases right to employees who are not members acquire any of the executive committee Shares; (vii) any waiver or release of any material right or claim of the Company or directors Company; (viii) except for sales of the Company that have been granted inventory made, and Permitted Liens (as defined in Subsection 6.7(d) below) incurred in the ordinary course of business in accordance and consistent with its customary past practices, any sale, transfer, mortgage, pledge or subjection to Lien of or affecting any of its properties or assets other than sales of assets that are not material to and are no longer needed in the Business; (iiiix) the incurrence of any indebtedness for borrowed money or capitalized lease obligations or any guaranty of indebtedness of any other person or entity; (x) any increase capital expenditures or any commitment involving more than [$25,000] individually or [$50,000] in the rate of compensation or benefits payable or accruing under, or, modification of the terms aggregate; (including xi) any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed material alteration in the Company SEC Reports) manner of keeping the books, accounts or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees records of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreementin the manner of preparing financial statements, or any lockoutschange in the accounting principles, strikespractices, slowdowns, work stoppages policies or threats thereof procedures of the Company (except as may have been required by any modification or with respect to such employees, change in GAAP); (viixii) any revaluation material alteration in the operating or employment policies and procedures of the Company; (xiii) any other event or condition of any character that has had or could reasonably be expected to result in a Material Adverse Effect on the Company or the Business; or (xiv) any agreement or commitment by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable other than in the ordinary course of business consistent with past practice, (viii) any entry into any agreement, commitment or transaction by the Company which is material to the Company and its Subsidiaries taken as a whole or (ix) any commitment Shareholder to do any of the foregoingthings described in the preceding clauses (i) through (xiii).

Absence of Certain Changes. Except as set forth disclosed in the 1999 10-KSB, the September 1999 10-QSB, in Section 4.06 3.10 of the Seller Disclosure LetterSchedule, or incurred hereinafter in the ordinary course of business consistent with past practice and with Section 5.01 hereof, since May March 31, 20001999, (ai) the Company business of each of Seller and its Subsidiaries has been conducted only in the ordinary course consistent with past practices, (ii) there has not been any change in the business, assets, financial condition or results of operations of Seller and its Subsidiaries, (iii) there has not been any change in any policy or practice followed by Seller nor its Subsidiaries in the ordinary course of business except for changes which have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected had and are not likely to have a Material Adverse Effect, (b) the Company and its Subsidiaries have conducted their respective businesses only in the ordinary course consistent with past practice, except for the negotiation and execution and delivery of this Agreement and (civ) there has not been any material agreement, contract or commitment entered into, or agreed to be entered into, except for those in the ordinary course of business; (iv) there has not been any declaration, setting aside increase in or payment establishment of any dividend bonus, insurance, severance (including severance after a change in control), deferred compensation, pension, retirement, profit sharing, life insurance or other distribution in respect of the Shares split dollar life insurance, retiree medical or any repurchase, redemption or other acquisition by the Company or any of its Subsidiaries of any outstanding shares of capital stock (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities inlife insurance, or other ownership interests in, the Company or any of its Subsidiaries or any amendment (or agreement to amend) the terms of any such shares, securities or ownership interests), (ii) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the employee benefit ofplan, or any other increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation payable or to become payable by the Company or to any of its Subsidiaries to, any of their respective directors, officers or employeeskey employees of Seller or its Subsidiaries, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employeescash compensation, (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable other than in the ordinary course of business consistent with past practice, ; (vi) there has not been any change in any of the accounting methods or practices of Seller and its Subsidiaries other than changes required by applicable law or applicable accounting policies; and (viii) any entry into any agreement, commitment or transaction by the Company which is material to the Company and neither Seller nor its Subsidiaries taken as a whole has declared, paid or (ix) set aside for payment any commitment to do dividend or other distribution in respect of its capital stock or redeemed, purchased or otherwise acquired, directly or indirectly, any shares of the foregoingcapital stock or other securities of Seller or any Subsidiary.

Absence of Certain Changes. Except as set forth disclosed in Section 4.06 of the Disclosure LetterCompany SEC Reports, since May 31September 30, 2000, (a) the Company and its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) 1994 the Company and its Subsidiaries have conducted their respective businesses only in, have not engaged in any transaction other than according to, the ordinary course consistent with past practiceand usual course, except for the negotiation and execution and delivery of this Agreement and (c) there has not been (ia) any Material Adverse Effect; (b) any declaration, setting aside or payment of any dividend or other distribution (whether in cash, stock or property) with respect to the capital stock of the Shares or any repurchase, redemption or other acquisition by the Company or any of its Subsidiaries Subsidiaries; (c) any change by the Company in accounting principles, practices or methods; (d) any labor dispute or difficulty which is reasonably likely to result in any Material Adverse Effect, and to the Company's knowledge no such dispute or difficulty is now threatened; (e) except as contemplated by the POL Agreement, any material asset sold, disposed of any outstanding shares of capital stock (except inventory sold in the ordinary course of business) mortgaged, pledged or subjected to any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Optionslien, including in satisfaction of withholding tax obligations) charge or other securities in, or other ownership interests in, the Company or any of its Subsidiaries or any amendment encumbrance; (or agreement to amendf) the terms of any such shares, securities or ownership interestsexcept as set forth on Schedule 3.8(f), (ii) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation payable or to which could become payable by the Company or any of its Subsidiaries to, any of to their respective directors, officers or officers, employees, except base salarydistributors, guaranteed draw dealers or hourly wage increases to employees who are not members sales representatives; (g) any amendment of the executive committee of any employee benefit plan; (h) any issuance, transfer, sale or pledge by the Company or directors its Subsidiaries of any shares of stock or other securities or of any commitments, options, rights or privileges under which the Company that or its Subsidiaries is or may become obligated to issue any shares of stock or other securities; (i) any indebtedness incurred by the Company or its Subsidiaries, except such as may have been granted incurred in the ordinary course of business in accordance and consistent with its customary past practices, practice; (iiij) any increase in the rate of compensation loan made or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right agreed to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action be made by the Company whichor its Subsidiaries, if taken after nor has the date hereof, would constitute Company or its Subsidiaries become liable or agreed to become liable as a breach of guarantor with respect to any of the clauses of Section 6.01 hereof, loan; (vk) any change waiver by the Company in accounting methodsor its Subsidiaries of any right or rights of material value or any payment, principles direct or practices indirect, of any material debt, liability or other obligation; or (l) except as required by changes set forth on Schedule 3.8(l), any change in GAAP, or amendment to the articles of incorporation or bylaws (vior similar charter documents) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable other than in the ordinary course of business consistent with past practice, (viii) any entry into any agreement, commitment or transaction by the Company which is material to the Company and its Subsidiaries taken as a whole or (ix) any commitment to do any of the foregoingSubsidiaries.

Absence of Certain Changes. Except for liabilities incurred in connection with this Agreement and except as set forth in Section 4.06 of the Disclosure Letterexpressly permitted or contemplated by this Agreement, since May December 31, 2000, (a) the Company and its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) 2007 the Company and its Subsidiaries have conducted their respective businesses only in the ordinary course consistent with past practice, except for and the negotiation Company has not suffered a Company Material Adverse Effect, and execution and delivery of this Agreement and (c) since December 31, 2007 until the date hereof there has not been (i) any declaration, setting aside or payment of any dividend or other distribution (whether in cash, stock or property) with respect to any capital stock of the Shares Company or any repurchaseof its Subsidiaries, other than any declaration setting aside or payment from a wholly owned Subsidiary of the Company to the Company, (ii) any purchase, redemption or other acquisition by the Company or any of its Subsidiaries of any outstanding shares of capital stock (except or any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities in, or other ownership interests in, of the Company or any of its Subsidiaries or any amendment options, warrants, calls or rights to acquire such shares or other securities (other than acquisitions of Shares in connection with the surrender of Shares by holders of Company Options or agreement Warrants in order to amend) pay the terms of any such shares, securities or ownership interestsexercise price thereof), (iiiii) any entry into split, combination or reclassification of any employment, change capital stock of the Company or any of its Subsidiaries or any issuance or the authorization of any issuance of any other securities in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit respect of, in lieu of or in substitution for shares of their respective capital stock, (iv) (A) any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation payable or to become payable granting by the Company or any of its Subsidiaries to, to any Specified Participant of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate compensation, bonus or fringe or other benefits or any granting of any type of compensation or benefits payable to any Specified Participant not previously receiving or accruing under, or, modification of the terms (including any acceleration of the right entitled to receive payment) ofsuch type of compensation or benefit, any existing Plan (as defined in Section 4.09) (except as disclosed was required under any agreement or Benefit Plan in the Company SEC Reports) or any adoption or implementation effect as of any new PlanDecember 31, in any such case, for or with any such directors, officers or employees2007, (ivB) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation granting by the Company or any of its Subsidiaries to any director, officer, employee or consultant of any right to receive, or any increase in, change of their respective assetscontrol, including write-downs of inventory retention, severance or of accounts receivable other than in the ordinary course of business consistent with past practicetermination compensation or benefits, (viiiC) any entry into any agreement, commitment or transaction by the Company which is material to or any of its Subsidiaries into, or any amendment or termination of (1) any employment, deferred compensation, consulting, severance, change of control, termination, retention, indemnification, loan or similar agreement between the Company or any of its Subsidiaries, on the one hand, and any Specified Participant, on the other hand, or (2) any agreement between the Company or any of its Subsidiaries, on the one hand, and any Specified Participant, on the other hand, the benefits of which are contingent, or the terms of which are materially altered, upon the occurrence of a transaction involving the Company of a nature contemplated by this Agreement (all such agreements under this clause (C), collectively, “Specified Benefit Agreements”), (D) any payment of any compensation or benefit under, or the grant of any award under, any bonus, incentive, performance or other compensation plan or arrangement, Specified Benefit Agreement, Equity Plan or Benefit Plan, except as required to comply with applicable Law or any Specified Benefit Agreement, Equity Plan or Benefit Plan in effect as of December 31, 2007, (E) the taking of any action to fund or in any other way secure the payment of compensation or benefits under any Equity Plan, Benefit Plan or Specified Benefit Agreement (except as required by a Benefit Plan as in effect on December 31, 2007) or (F) the taking of any action to accelerate the vesting or payment of any compensation or benefits under any Equity Plan, Benefit Plan or Specified Benefit Agreement, (v) any damage, destruction or loss to any asset of the Company or any of its Subsidiaries, whether or not covered by insurance, that individually or in the aggregate would have a Company Material Adverse Effect, (vi) any change in accounting methods, principles or practices by the Company materially affecting its assets, liabilities or businesses, except insofar as may have been required by a change in GAAP or (vii) except with respect to depreciation and amortization of the assets of the Company or any of its Subsidiaries, any material Tax election or change in such election, any change in material method of accounting for Tax purposes or any settlement or compromise of any material income Tax liability. Since December 31, 2007, neither the Company nor any of its Subsidiaries taken as a whole or (ix) any commitment to do any of the foregoinghave incurred indebtedness.

Absence of Certain Changes. Except as set forth in Section 4.06 From September 30, 2001 (the "Company Balance Sheet Date") through the date of the Disclosure Letterthis Agreement, since May 31, 2000, (a) the Company and has conducted its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) the Company and its Subsidiaries have conducted their respective businesses only business in the ordinary course consistent with past practice, except for the negotiation practice and execution and delivery of this Agreement and (c) there has not been occurred, except as set forth in Section 3.6 of the Company Disclosure Schedule or as specifically contemplated by this Agreement: (i) any change, event or condition (whether or not covered by insurance) that has resulted in, or could reasonably be expected to result in, a Material Adverse Effect with respect to the Company; (ii) any acquisition, sale or transfer of any material asset of the Company other than in the ordinary course of business and consistent with past practice; (iii) any change in accounting methods or practices (including any change in depreciation or amortization policies or rates) by the Company or any revaluation by the Company of any of its assets, in each case, other than as required by changes in generally accepted accounting principles or other applicable principles of accounting or auditing; (iv) any declaration, setting aside aside, or payment of any a dividend or other distribution in with respect to the shares of the Shares Company or any repurchasedirect or indirect redemption, redemption purchase or other acquisition by the Company or of any of its Subsidiaries of any outstanding shares of capital stock stock; (except v) any obligation Material Contract entered into by the Company, other than in the ordinary course of the Company under the Stock Option Plans business and as provided to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities inNetRatings, or other ownership interests in, the Company any material amendment or any of its Subsidiaries or any amendment (or agreement to amend) the terms of any such shares, securities or ownership interests), (ii) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit termination of, or default under, any Material Contract; (vi) any amendment or change to the certificate of incorporation or bylaws of the Company; (vii) any increase in the rate or modification in the terms (including any acceleration of the right to receive compensation or the timing of payment) of any compensation benefits payable or to become payable by the Company or to any of its Subsidiaries to, any of their respective directors, officers directors or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable other than in the ordinary course of business consistent with past practice, ; or (viii) any entry into any agreement, commitment negotiation or transaction agreement by the Company which is material to the Company and its Subsidiaries taken as a whole or (ix) any commitment to do any of the foregoingthings described in the preceding clauses (i) through (vii) (other than negotiations with NetRatings and its representatives regarding the transactions contemplated by this Agreement). At the Effective Time, there will be no accrued but unpaid dividends on shares of the Company's capital stock.

Absence of Certain Changes. Except as set forth in Section 4.06 of the Disclosure Letteron Schedule 5.6, since May December 31, 20001996 the Seller has carried on the NAC Business only in the ordinary course, and there has not been with relation to the NAC Business, (a) any change in the Company and assets, liabilities, sales, income or business of the Seller or in its Subsidiaries have not suffered any Material Adverse Effect relationships with suppliers, customers or any changelessors, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) the Company and its Subsidiaries have conducted their respective businesses only other than changes which were both in the ordinary course consistent with past practiceof business and have not been, except for either in any case or in the negotiation and execution and delivery aggregate, materially adverse; (b) any acquisition or disposition by the Seller of this Agreement and any asset or property other than in the ordinary course of business; (c) there has any damage, destruction or loss, whether or not been (i) covered by insurance, materially and adversely affecting, either in any declarationcase or in the aggregate, setting aside the property or payment of any dividend or other distribution in respect business of the Shares or any repurchase, redemption or other acquisition by the Company or any of its Subsidiaries of any outstanding shares of capital stock Seller; (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligationsd) or other securities in, or other ownership interests in, the Company or any of its Subsidiaries or any amendment (or agreement to amend) the terms of any such shares, securities or ownership interests), (ii) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or any increase in the rate compensation, pension or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation other benefits payable or to become payable by the Company or Seller to any of its Subsidiaries to, any of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases any bonus payments or arrangements made to employees who are not members or with any of them (other than pursuant to the executive committee terms of any existing written agreement or plan of which the Company Buyer has been supplied complete and correct copies of); (e) any forgiveness or directors cancellation of any debt or claim by the Company that have been granted Seller or any waiver of any right of material value other than compromises of accounts receivable in the ordinary course of business in accordance with its customary past practices, business; (iiif) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action entry by the Company which, if taken after the date hereof, would constitute a breach of Seller into any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable transaction other than in the ordinary course of business consistent with past practice, business; (viiig) any entry into any agreement, commitment or transaction incurrence by the Company which is material Seller of any obligations or liabilities, whether absolute, accrued, contingent or otherwise (including, without limitation, liabilities as guarantor or otherwise with respect to obligations of others), other than obligations and liabilities incurred in the Company and its Subsidiaries taken as a whole ordinary course of business; or (ixh) any commitment to do mortgage, pledge, lien, lease, security interest or other charge or encumbrance on any of the foregoing.assets, tangible or intangible, of the Seller;

Absence of Certain Changes. Except as set forth disclosed in Section 4.06 of its Reports filed prior to the Disclosure Letterdate hereof, since May December 31, 2000, (a) the Company and its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) the Company 2001 it and its Subsidiaries have conducted their respective businesses in all material respects only in, and have not engaged in any material transaction other than according to, the ordinary and usual course consistent with past practice, except for the negotiation of such businesses and execution and delivery of this Agreement and (c) there has not been (i) any change in the condition (financial or otherwise), properties, assets (including intangible assets), business or results of operations of it and its Subsidiaries, except those changes that, individually or in the aggregate, have not had, and are not reasonably likely to have, a Material Adverse Effect on it; (ii) any material damage, destruction or other casualty loss with respect to any material asset or property owned, leased or otherwise used by it or any of its Subsidiaries, whether or not covered by insurance; (iii) any declaration, setting aside or payment of any dividend or other distribution in respect of the Shares or any repurchaseits capital stock, redemption except for dividends or other acquisition by distributions on its capital stock publicly announced prior to the date hereof and, in the case of the Company, the issuance of the Company Rights pursuant to the Company Rights Agreement and in the case of Parent regular quarterly cash dividends payable by Parent in respect of the shares of Parent Common Stock at the rate of $.02 per share; or (iv) any change in its accounting principles, practices or methods. Since December 31, 2001, except as provided for herein, as disclosed in Section 5.1(f) of its respective Disclosure Letter or as disclosed in its Reports filed prior to the date hereof, there has not been any increase in the compensation payable or that could become payable by it or any of its Subsidiaries to (x) its officers or (y) any key employees of any outstanding shares of capital stock (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) it or other securities inits Subsidiaries, or other ownership interests inany officers of its Subsidiaries, the Company whose annual cash compensation is $250,000 or more, or any amendment of any of its Subsidiaries or any amendment (or agreement to amend) the terms of any such shares, securities or ownership interests), (ii) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation payable or to become payable by the Company or any of its Subsidiaries to, any of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable other than in the ordinary course of business consistent with past practice, (viii) any entry into any agreement, commitment or transaction by the Company which is material to the Company Compensation and its Subsidiaries taken as a whole or (ix) any commitment to do any of the foregoingBenefit Plans.

Absence of Certain Changes. Except as set forth in Section 4.06 Since the date of the Disclosure LetterLatest Balance Sheet, since May 31, 2000, (a) neither the Company and its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) the Company and its Subsidiaries have conducted their respective businesses only in the ordinary course consistent with past practice, except for the negotiation and execution and delivery of this Agreement and (c) there has not been (i) any declaration, setting aside or payment of any dividend or other distribution in respect of the Shares or any repurchase, redemption or other acquisition by the Company or nor any of its Subsidiaries has: (a) suffered any adverse change with respect to its business or financial condition results of operations, assets, liabilities (absolute, accrued or contingent), reserves, operations or prospects that, individually or in the aggregate, constitutes a Company Material Adverse Effect; (b) suffered any outstanding shares of capital stock (except any obligation of the Company under the Stock Option Plans material loss, damage or destruction to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities in, or other ownership interests in, the Company or any of its Subsidiaries material assets; (c) incurred any indebtedness for borrowed money or any amendment (or agreement to amend) the terms of guaranteed any such shares, securities or ownership interests), indebtedness; (iid) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation payable or to become payable by the Company or any of its Subsidiaries to, any of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Planchanged, in any such casematerial respect, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in its accounting methods, principles or practices except as required by changes in GAAP; (e) sold or otherwise transferred any material assets, except in the ordinary course of business; (vif) declared, set aside or paid any labor dispute dividend or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or distribution with respect to such employeesits outstanding capital stock or other equity interests, or repurchased or redeemed or otherwise acquired any outstanding capital stock or other equity interests; (viig) made or changed any revaluation by the Company material tax election or settled any of its Subsidiaries of any of their respective assetsmaterial tax claims, including write-downs of inventory or of accounts receivable in each case, other than in the ordinary course of business; (h) granted any increase in the compensation payable or to become payable to any officers, directors, or key employees, or agents or consultants other than in the ordinary course of business; or (i) entered into any agreement to take any of the actions referred to in clauses (c) through (h) of this sentence. Since date of the Latest Balance Sheet the Company and each of its Subsidiaries have conducted its respective business in the ordinary course consistent with past practice, (viii) any entry into any agreement, commitment or transaction by the Company which is material to the Company and its Subsidiaries taken as a whole or (ix) any commitment to do any of the foregoingpractices.

Absence of Certain Changes. Except as set forth in Section 4.06 of the Disclosure LetterSchedule 2.8 hereto, since May 31January 1, 20001997, (a) the Company and its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) the Company and its Subsidiaries subsidiaries have conducted their respective businesses only in the ordinary course consistent with past practicecourse, except for the negotiation and execution and delivery of this Agreement and (c) there has not been (i) any declaration, setting aside or payment of any dividend or other distribution in with respect of the Shares to its capital stock, (ii) any incurrence, assumption or any repurchase, redemption or other acquisition guarantees by the Company or any of its Subsidiaries subsidiaries of any outstanding shares indebtedness for borrowed money other than in the ordinary course of business, (iii) any making of any loan, advance or capital stock (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Optionscontributions to, including in satisfaction of withholding tax obligations) or other securities investments in, any other person, (iv) any split, combination or other ownership interests in, the Company or reclassification of any of its Subsidiaries capital stock or any amendment (issuance or agreement to amend) the terms authorization of any such sharesissuance of any other securities in respect of, securities in lieu of or ownership interests)in substitution for shares of its capital stock, (iiv) (x) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation payable or to become payable granting by the Company or any of its Subsidiaries to, subsidiaries to any of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee officer of the Company or directors any of the Company that have been granted its subsidiaries of any increase in compensation, except in the ordinary course of business (including in accordance connection with its customary promotions) consistent with past practicespractice or as was required under employment agreements in effect as of the date of the most recent audited financial statements included in the SEC Reports filed and publicly available prior to the date of this Agreement, (iiiy) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation granting by the Company or any of its Subsidiaries subsidiaries to any such officer of any increase in severance or termination pay, except as part of their respective assetsa standard employment package to any person promoted or hired, including write-downs or as was required under employment, severance or termination agreements in effect as of inventory the date of the most recent audited financial statements included in the SEC Reports filed or of accounts receivable other than (z) except termination arrangements in the ordinary course of business consistent with past practicepractice with employees other than any executive officer of the Company, (viii) any entry into any agreement, commitment or transaction by the Company which is or any of its subsidiaries into any employment, severance or termination agreement with any such officer, (vi) any damage, destruction or loss, whether or not covered by insurance, that would be expected to have a Company Material Adverse Effect, (vii) any transaction or commitment made, or any contract or agreement entered into, by the Company or any of its subsidiaries relating to any of their assets or business (including the acquisition or disposition of any assets) or any relinquishment by the Company or any of its subsidiaries or any contract or other right, in either case, material to the Company and its Subsidiaries subsidiaries, taken as a whole whole, other than transactions and commitments in the ordinary course of business and those contemplated by this Agreement, (viii) any change in accounting methods, principles or practices by the Company materially affecting its assets, liabilities or business, except insofar as may have been required by a change in generally accepted accounting principles or (ix) any commitment to do any of the foregoingother change which would have a Company Material Adverse Effect.

Absence of Certain Changes. Except as set forth in Section 4.06 of Since September 30, 2006 (the Disclosure Letter“Parent Balance Sheet Date”), since May 31, 2000, (a) the Company and Parent has conducted its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) the Company and its Subsidiaries have conducted their respective businesses only business in the ordinary course consistent with past practice, except for the negotiation practice and execution and delivery of this Agreement and (c) there has not been occurred: (i) any declarationchange, setting aside event or payment condition (whether or not covered by insurance) that has resulted in, or is reasonably likely to result in, or to the best of Parent’s knowledge any event beyond Parent’s control that is reasonably likely to result in, a Material Adverse Effect to Parent; (ii) any acquisition, sale or transfer of any dividend or other distribution in respect material asset of the Shares or any repurchase, redemption or other acquisition by the Company Parent or any of its Subsidiaries of any outstanding shares of capital stock (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities in, or other ownership interests in, the Company or any of its Subsidiaries or any amendment (or agreement to amend) the terms of any such shares, securities or ownership interests), (ii) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation payable or to become payable by the Company or any of its Subsidiaries to, any of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable subsidiaries other than in the ordinary course of business and consistent with past practice, ; (viiiiii) any entry into change in accounting methods or practices (including any agreementchange in depreciation or amortization policies or rates) by Parent or any revaluation by Parent of any of its or any of its subsidiaries’ assets; (iv) any declaration, commitment setting aside, or transaction by the Company which is material payment of a dividend or other distribution with respect to the Company shares of Parent, or any direct or indirect redemption, purchase or other acquisition by Parent of any of its shares of capital stock; (v) any material contract entered into by Parent or any of its subsidiaries, other than in the ordinary course of business and as provided to Company, or any amendment or termination of, or default under, any material contract to which Parent or any of its Subsidiaries taken as subsidiaries is a whole party or by which it is bound; (vi) any amendment or change to Parent’s Certificate of Incorporation or Bylaws; or (ixvii) any commitment increase in or modification of the compensation or benefits payable, or to become payable, by Parent to any of its directors or employees, other than pursuant to scheduled annual performance reviews, provided that any resulting modifications are in the ordinary course of business and consistent with Parent’s past practices. Parent has not agreed since September 30, 2006 to do any of the foregoingthings described in the preceding clauses (i) through (vii) and is not currently involved in any negotiations to take any of the actions described in the preceding clauses (i) through (vii) (other than negotiations with the Company and its representatives regarding the transactions contemplated by this Agreement).

Absence of Certain Changes. Except as set forth in Section 4.06 of the Disclosure Letterexpressly contemplated by this Agreement, since May December 31, 20001999, (a) the Company and its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) the Company and its Subsidiaries have conducted their respective businesses only in, and have not engaged in any material transaction other than in accordance with, the ordinary and usual course consistent with past practiceof these businesses, except for the negotiation and execution and delivery of this Agreement and (c) since December 31, 1999 there has not been (i) any change in the financial condition, properties, business or results of operations of the Company and its Subsidiaries except those changes that, individually or in the aggregate, have not had and would not have a Material Adverse Effect on the Company; (ii) any declaration, setting aside or payment of any dividend or other distribution in cash, stock or property in respect of the Shares Company's capital stock or any repurchasesecurities convertible, redemption exchangeable or exercisable for or into shares of its capital stock, except for (w) regular quarterly cash dividends of no more than U.S. $.025 per Company Common Share, (x) dividends in respect of the Company Money Market Preferred Shares in accordance with their terms, and (y) interest payments in respect of the Company Convertible Notes in accordance with their terms; (iii) any redemption, repurchase or other acquisition by of any shares of the Company Company's capital stock or any securities convertible, exchangeable or exercisable for or into shares of its Subsidiaries of any outstanding shares of capital stock (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities in, or other ownership interests in, the Company or any of its Subsidiaries or any amendment (or agreement to amend) than as required by the terms of any such shares, securities or ownership interestsCompany Stock Plan and other than repurchases of Company Money Market Preferred Shares for not more than the Preferred Consideration per share), or (iiiv) any entry into any employmentchange by it in accounting principles, change practices or methods except as required by changes in controlU.S. GAAP. Between December 31, retention1999 and the date of this Agreement, incentive or deferred compensation or severance agreementexcept as contemplated by this Agreement, plan or arrangement with or for the benefit of, or there has not been any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation payable or to that could become payable by the Company or any of its Subsidiaries to, any of their respective directors, to officers or key employees, except base salary, guaranteed draw or hourly wage other than increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary and usual course of business in accordance with business, and the Company has not entered into or amended any of its customary past practices, (iii) any increase in the rate of compensation or benefits payable benefit plans or accruing underagreements, orincluding severance, modification change of control or similar plans and agreements. Since December 31, 1999, the Company has granted awards under its performance share plan implemented pursuant to the Company's 1997 Incentive Compensation Plan and under similar plans to the categories of persons with the terms (including any acceleration of the right performance targets) applicable to receive payment) of, any existing Plan (as defined these awards set forth in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees 2.1.6 of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by Disclosure Schedule. Section 2.1.6 of the Company or any Disclosure Schedule sets forth the estimated total value of its Subsidiaries the awards payable solely as a result of any a change of their respective assets, including write-downs of inventory or of accounts receivable other than control and the amount reflected in the ordinary course of business consistent with past practice, (viii) any entry into any agreement, commitment or transaction by the Company which is material Company's budget for 2000 previously delivered to the Company and its Subsidiaries taken as a whole or (ix) any commitment to do any of the foregoingParent.

Absence of Certain Changes. Except as set forth in Section 4.06 of the Disclosure Letter, since May Since January 31, 20002002 (the "Measurement Date"), Involve has conducted its business in the ordinary course and there has not occurred: (ai) the Company and its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development condition (whether or not covered by insurance) that could has resulted in, or might reasonably be expected to result in, a Material Adverse Effect to Involve; (ii) any acquisition, sale or transfer of any asset of Involve that would have a Material Adverse Effect, (b) the Company and its Subsidiaries have conducted their respective businesses only in the ordinary course consistent with past practice, except for the negotiation and execution and delivery of this Agreement and (c) there has not been (i) any declaration, setting aside or payment of any dividend or other distribution in respect of the Shares or any repurchase, redemption or other acquisition by the Company or any of its Subsidiaries of any outstanding shares of capital stock (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities in, or other ownership interests in, the Company or any of its Subsidiaries or any amendment (or agreement to amend) the terms of any such shares, securities or ownership interests), (ii) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation payable or to become payable by the Company or any of its Subsidiaries to, any of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable Effect other than in the ordinary course of business and consistent with past practice; (iii) any change in accounting methods or practices (including any change in depreciation or amortization policies or rates) by Involve or any revaluation by Involve of any of its assets; (iv) any declaration, setting aside, or payment of a dividend or other distribution with respect to the shares of Involve or any direct or indirect redemption, purchase or other acquisition by Involve of any of its shares of capital stock; (v) any Material Contract (as such term is defined in Section 3.11) entered into by Involve, other than in the ordinary course of business and as provided to Merger Sub, or any amendment that would have a Material Adverse Effect or termination of, or default under, any Material Contract to which Involve is a party or by which it is bound; (vi) any amendment or change to the charter documents of Involve; (vii) any increase in or modification of the compensation or benefits paid, payable or to become payable by Involve to any of its directors, officers or employees; (viii) any entry into reduction in the sales of Involve to or significant detrimental change in terms with any agreementcustomer year-to-date through October 31, commitment or transaction by the Company which is material 2002 as compared to the Company and its Subsidiaries taken as a whole same time period last year or (ix) any commitment negotiation or agreement by Involve to do any of the foregoingthings described in the preceding clauses (i) through (viii) (other than negotiations with Merger Sub, Kintera and their representatives regarding the transactions contemplated by this Agreement). As of Closing, there will be no accrued but unpaid dividends on shares of Involve's capital stock.

Absence of Certain Changes. (a) Except as set forth in Section 4.06 of the Disclosure LetterCompany SEC Documents, or as otherwise required by this Agreement, since May March 31, 20002008 (the “Company Balance Sheet Date”), through the date of this Agreement, (ai) the Company and its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) the Company and each of its Subsidiaries have conducted their respective businesses only in the ordinary course of business consistent with past practice, except for the negotiation and execution and delivery of this Agreement practice and (cii) there has not been occurred: (iA) any acquisition, sale, or transfer of any material asset of the Company or its Subsidiaries, except for sales of assets and licenses of Company Intellectual Property in the ordinary course of business consistent with past practices, (B) except as required by applicable Laws or GAAP, any material change in accounting methods or practices (including any change in depreciation or amortization policies or rates) by the Company or any revaluation by the Company of any of its material assets, (C) any declaration, setting aside or payment of any a dividend or other distribution in with respect of to the Shares Shares, or any repurchasedirect or indirect redemption, redemption purchase or other acquisition by the Company or any of its Subsidiaries of any outstanding shares of capital stock (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities in, or other ownership interests in, the Company or any of its Subsidiaries or any amendment (or agreement to amend) the terms of any such shares, securities or ownership interests), (ii) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation payable or to become payable by the Company or any of its Subsidiaries to, any of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries of any of its shares of capital stock, respectively (except for any Shares withheld in connection with the vesting of any Restricted Shares), (D) any amendment or change to the Company Certificate or the respective organizational documents of any of its Subsidiaries, (E) any Material Contract entered into by the Company or any of its Subsidiaries, other than as provided to Parent, or any material amendment or termination of, or default under, any Material Contract (or contract that, but for such termination, would be a Material Contract), (F) any increase in or modification of the compensation or benefits payable or to become payable by Company or any of its Subsidiaries to any of their respective assetsdirectors, including write-downs of inventory employees or of accounts receivable consultants other than any increase or modification in the ordinary course of business consistent with past practice, or (viiiG) any entry into any agreement, commitment or transaction agreement by the Company which is material to the Company and or any of its Subsidiaries taken as a whole or (ix) any commitment to do any of the foregoingthings described in the preceding clauses (A) through (F).

Absence of Certain Changes. Except as set forth in Section 4.06 of the Disclosure Letteron SCHEDULE 5.6, since May December 31, 20001995 the Seller, (a) VWS and VSI have carried on the Company and its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) the Company and its Subsidiaries have conducted their respective businesses VECTRA Waste Business only in the ordinary course consistent with past practicecourse, except for the negotiation and execution and delivery of this Agreement and (c) there has not been been, insofar as it relates to the VECTRA Waste Business or the Acquired Waste Business Assets: (ia) any declarationchange in the assets, setting aside liabilities, sales, income or payment business of any dividend or other distribution in respect of the Shares Seller, VWS or any repurchaseVSI or in their relationships with suppliers, redemption customers or lessors, other acquisition by the Company or any of its Subsidiaries of any outstanding shares of capital stock (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities in, or other ownership interests in, the Company or any of its Subsidiaries or any amendment (or agreement to amend) the terms of any such shares, securities or ownership interests), (ii) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation payable or to become payable by the Company or any of its Subsidiaries to, any of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted than changes which were both in the ordinary course of business and have not resulted in, either in accordance with its customary past practicesany case or in the aggregate, a Material Adverse Effect; (iiib) any increase in the rate of compensation acquisition or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action disposition by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereofSeller, (v) any change by the Company in accounting methods, principles VWS or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries VSI of any of their respective assets, including write-downs of inventory asset or of accounts receivable property other than in the ordinary course of business consistent business; (c) any damage, destruction or loss, whether or not covered by insurance, materially and adversely affecting, either in any case or in the aggregate, the Acquired Waste Business Assets or the VECTRA Waste Business; (d) except for any increases or payments reflected in the year to date gross wages reflected on SCHEDULE 5.14, any increase in the compensation, pension or other benefits payable or to become payable by any of the Seller, VWS or VSI to any of the employees listed on SCHEDULE 5.14, or any bonus payments or arrangements made to or with past practice, any of them (viiiother than pursuant to the terms of any existing written agreement or plan of which the Buyer has been supplied complete and correct copies of); (e) any entry into any agreement, commitment or transaction by the Company which is material to the Company and its Subsidiaries taken as a whole or (ix) any commitment to do any of the foregoingSeller, VWS or VSI into any transaction other than in the ordinary course of business; or (f) any incurrence by any of the Seller, VWS or VSI of any obligations or liabilities, whether absolute, accrued, contingent or otherwise (including, without limitation, liabilities as guarantor or otherwise with respect to obligations of others), other than obligations and liabilities incurred in the ordinary course of business.

Absence of Certain Changes. Except as set forth in Section 4.06 of the Disclosure Letteron Schedule 2.5, since May 31March 29, 20001998 (the "Target Balance Sheet Date"), (a) the Company and its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) the Company Target and its Subsidiaries have conducted their respective businesses only in the ordinary course consistent with past practice, except for the negotiation practice and execution and delivery of this Agreement and (c) there has not been occurred: (i) any change, event or condition (whether or not covered by insurance) that, individually or in the aggregate, has resulted in a Material Adverse Effect on Target; (ii) any acquisition, sale or transfer of any material asset by Target or any of its Subsidiaries other than (A) for consideration of less than $250,000 in any one transaction in the ordinary course of business and consistent with past practice or (B) sales of inventory in the ordinary course of business; (iii) any change in accounting methods or practices (including any change in depreciation or amortization policies or rates) by Target or its Subsidiaries or any revaluation by Target of any of its or any of its Subsidiaries' assets; (iv) any declaration, setting aside aside, or payment of any a dividend or other distribution in with respect to the shares of the Shares Target, or any repurchasedirect or indirect redemption, redemption purchase or other acquisition by Target of any of its shares of capital stock; (v) any entrance by Target or its Subsidiaries into any material Contract not made in the Company ordinary course of business, or any material amendment or termination (not made in the ordinary course of business) of, or default under, any material Contract to which Target or any of its Subsidiaries is a party or by which it is bound; (vi) any amendment or change to the Articles of any outstanding shares Incorporation or Bylaws of capital stock (except any obligation Target or organizational documents of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities in, or other ownership interests in, the Company or any of its Subsidiaries Subsidiaries; or any amendment (or agreement to amendvii) the terms of any such shares, securities or ownership interests), (ii) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any base compensation payable or to become payable by the Company Target or any of its Subsidiaries to, to any of their respective directors, directors or officers (or equivalent positions) or employees, except for such increase or modification as would not result in an increase in excess of ten percent (10%) in the base salary, guaranteed draw compensation annualized over the next twelve (12) months payable or hourly wage increases to employees be payable to any employee who are not members had an annual rate of base compensation of over $50,000 as of the executive committee later of the Company date of hire or directors of the Company that have been granted March 29, 1998. Except as set forth in the ordinary course of business in accordance with its customary past practicesSchedule 2.5, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable other than in the ordinary course of business consistent with past practice, (viii) any entry into any agreement, commitment or transaction by the Company which is material to the Company Target and its Subsidiaries taken as a whole or (ix) any commitment have not agreed since March 29, 1998 to do any of the foregoingthings described in the preceding clauses (i) through (vii) and is not currently involved in any negotiations to do any of the things described in the preceding clauses (i) through (vii) (other than negotiations with Acquiror and its representatives regarding the transactions contemplated by this Agreement).

Absence of Certain Changes. Except as set forth in Section 4.06 of the Disclosure Letter, since Since May 31, 20001999 (the "Target Balance Sheet Date"), (a) the Company and Target has conducted its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) the Company and its Subsidiaries have conducted their respective businesses only business in the ordinary course consistent with past practice, except for the negotiation practice and execution and delivery of this Agreement and (c) there has not been occurred: (i) any declarationchange, setting aside event or payment of any dividend condition (whether or other distribution in respect of the Shares or any repurchase, redemption or other acquisition not covered by the Company or any of its Subsidiaries of any outstanding shares of capital stock (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligationsinsurance) or other securities that has resulted in, or other ownership interests might reasonably be expected to result in, the Company or any of its Subsidiaries or any amendment (or agreement a Material Adverse Effect to amend) the terms of any such shares, securities or ownership interests), Target; (ii) any entry into any employmentacquisition, change in control, retention, incentive sale or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) transfer of any compensation payable or to become payable by the Company or any material asset of its Subsidiaries to, any of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable Target other than in the ordinary course of business and consistent with past practice, ; (viiiiii) any entry into change in accounting methods or practices (including any agreementchange in depreciation or amortization policies or rates) by Target or any revaluation by Target of its assets; (iv) any declaration, commitment setting aside, or transaction by the Company which is material payment of a dividend or other distribution with respect to the Company shares of Target, or any direct or indirect redemption, purchase or other acquisition by Target of any of its shares of capital stock; (v) any material contract entered into by Target, other than in the ordinary course of business and its Subsidiaries taken as provided to Acquiror, or any material amendment or termination of, or default under, any material contract to which Target is a whole party or by which it is bound; (vi) any amendment or change to the Articles of Incorporation or Bylaws or, except as contemplated by Section 2.16 hereof, the Target Rights Agreement of Target; or (ixvii) any commitment increase in or modification of the compensation or benefits payable or to become payable by Target to any of its directors or employees. Other than with respect to the stock option and incentive plans described in Target's proxy statement for the annual meeting of its shareholders held on January 18, 1999 or as disclosed on Section 2.15 of the Target Disclosure Schedule, Target has not agreed since the Target Balance Sheet Date to do any of the foregoingthings described in the preceding clauses (i) through (vii) and is not currently involved in any negotiations to do any of the things described in the preceding clauses (i) through (vii) (other than negotiations with Acquiror and its representatives regarding the transactions contemplated by this Agreement).

Absence of Certain Changes. Except as set forth in Section 4.06 3.4 of the Company Disclosure LetterSchedule, since May December 31, 20002002, (a) the Company and its Subsidiaries subsidiaries have conducted their business only in the ordinary course, and during such period there has not suffered been any Material Adverse Effect or any event, change, condition, event effect or development that that, individually or in the aggregate, has had or could reasonably be expected to have a Material Adverse EffectEffect on the Company, (b) and the Company and its Subsidiaries have conducted their respective businesses only subsidiaries are not aware of any event, change, effect or development which may reasonably be expected to occur or exist that, individually or in the ordinary course consistent with past practiceaggregate, except for would have a Material Adverse Effect on the negotiation Company. Except as specifically disclosed in the Company’s filings and execution reports (including proxy statements) under the Exchange Act filed since December 31, 2002 and delivery publicly available prior to the date of this Agreement and (cthe “Filed Company SEC Documents”) or as set forth in Section 3.4 of the Company Disclosure Schedule, since December 31, 2002 there has not been (ia) any declaration, setting aside or payment of any dividend or other distribution in respect of the Shares capital stock of the Company or any repurchase, redemption or other acquisition by the Company or any of its Subsidiaries of any outstanding shares of capital stock (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities in, or other ownership interests in, the Company or any of its Subsidiaries or any amendment Company; (or agreement to amend) the terms of any such shares, securities or ownership interests), (ii) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation payable or to become payable by the Company or any of its Subsidiaries to, any of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable other than in the ordinary course of business consistent with past practice, (viiib) any entry into any agreement, commitment or transaction by the Company or any of its subsidiaries which is material to the Company and its Subsidiaries subsidiaries taken as a whole whole, except agreements, commitments or transactions in the ordinary course of business, consistent with prior practice; (c) any split, combination or reclassification of the Company’s capital stock or of any other equity interests in the Company, or any issuance or the authorization of any issuance of any other securities in respect of, in lieu of or in substitution for shares of its capital stock or of any other equity interests in the Company; (d)(i) any granting by the Company or any of its subsidiaries to any officer, director or key employee of the Company or any of its subsidiaries of any increase in compensation, except in the ordinary course of business consistent with prior practice or as was required under employment agreements in effect as of the date of the most recent audited financial statements included in the Filed Company SEC Documents, (ii) any granting by the Company or any of its subsidiaries to any such officer, director or key employee of any increase in severance or termination pay, except as was required under employment, severance or termination agreements in effect as of the date of the most recent audited financial statements included in the Filed Company SEC Documents or (ixiii) any commitment to do entry by the Company or any of its subsidiaries into any employment, severance or termination agreement with any such officer, director or key employee; (e) any damage, destruction or loss, whether or not covered by insurance, that, individually or in the foregoingaggregate, has had or could reasonably be expected to have a Material Adverse Effect on the Company; (f) any change in accounting methods, principles or practices by the Company or any subsidiary materially affecting the consolidated assets, liabilities, results of operations or business of the Company or its subsidiaries, except insofar as may have been required by a change in generally accepted accounting principles; or (g) any making or revocation of any material Tax election (except in a manner consistent with past practice), any change of a method of accounting for Tax purposes, or any settlement or compromise of any material Tax liability with any Governmental Entity or any agreement to an extension of a statute of limitations.

Absence of Certain Changes. Except as set forth disclosed in Section 4.06 the Company Reports filed with the SEC prior to the date of the Disclosure Letterthis Agreement or as contemplated by this Agreement, since May 31, 2000, (a) the Company and its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, Balance Sheet Date (bas defined below) the Company and its Subsidiaries have conducted their respective businesses only in, and have not engaged in any material transaction other than according to, the ordinary course of such businesses consistent with past practice, except for the negotiation practice and execution and delivery of this Agreement and (c) there has not been (i) any change in the financial condition, properties, business or results of operations of the Company and its Subsidiaries or any development or combination of developments of which management of the Company has Knowledge that, individually or in the aggregate, has had or is reasonably likely to have a Company Material Adverse Effect or prevent or materially impair the ability of the Company to consummate the transactions contemplated by this Agreement; (ii) any material damage, destruction or other casualty loss with respect to any material asset or property owned, leased or otherwise used by the Company or any of its Subsidiaries, whether or not covered by insurance; (iii) any declaration, setting aside or payment of any dividend or other distribution in cash, stock or property in respect of the Shares or any repurchasecapital stock of the Company, redemption except for dividends or other acquisition distributions on its capital stock publicly announced prior to the date of this Agreement and except as expressly permitted hereby; (iv) any change by the Company in accounting principles or any of its Subsidiaries of any outstanding shares of capital stock material accounting practices or methods; (v) except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Optionsas provided for herein, including in satisfaction of withholding tax obligations) or other securities in, or other ownership interests in, the Company or any of its Subsidiaries or any amendment (or agreement to amend) the terms of any such shares, securities or ownership interests), (ii) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation payable or to that could become payable by the Company or any of its Subsidiaries to, any of their respective directors, to officers or employees, except base salary, guaranteed draw key employees or hourly wage increases to employees who are not members any amendment of the executive committee any of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan Compensation and Benefit Plans (as defined in Section 4.095.1(i)) (except as disclosed other than increases or amendments in the Company SEC Reports) ordinary course; or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute action that, if it would have occurred immediately after the date of this Agreement, would have violated or other employment related problembeen inconsistent with, other than routine individual grievancesthe provisions of Section 6.1(a) (provided, that solely for purposes of this Section 5.1(f)(vi), Section 6.1(a)(i)(N)(II) shall only apply to employment, severance or deferred compensation agreements with (A) any activity officer or proceeding by a labor union or representative thereof to organize any employees director of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (viiB) any revaluation by other employee of the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable other than in the ordinary course of business consistent with past practice, (viii) any entry into any agreement, commitment or transaction by the Company which is material to the Company and its Subsidiaries taken as a whole or (ix) any commitment to do any of the foregoing.an annual base salary in

Absence of Certain Changes. Except Since December 31, 1998 (the "Company -------------------------- Balance Sheet Date"), except as set forth in Section 4.06 of any Company SEC Document (but only to the Disclosure Letterextent set forth therein), since May 31, 2000, (a) the Company and has conducted its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) the Company and its Subsidiaries have conducted their respective businesses only business in the ordinary course consistent with past practice, except for the negotiation practice and execution and delivery of this Agreement and (c) there has not been occurred: (i) any declarationchange, setting aside event or payment condition (whether or not covered by insurance) that has resulted in, or might reasonably be expected to result in, a Material Adverse Effect on Company; (ii) any acquisition, sale or transfer of any dividend or other distribution in respect material asset of the Shares or any repurchase, redemption or other acquisition by the Company or any of its Subsidiaries other than in the ordinary course of business and consistent with past practice; (iii) any material change in accounting methods or practices (including any change in depreciation or amortization policies or rates) by Company or any revaluation by Company of any outstanding of its or any of its Subsidiaries' assets, except as set forth in any Company SEC Document (but only to the extent set forth therein); (iv) any declaration, setting aside, or payment of a dividend or other distribution with respect to the shares of Company, or any direct or indirect redemption, purchase or other acquisition by Company of any of its shares of capital stock stock; (except v) any obligation material contract entered into by Company or any of its Subsidiaries, other than in the Company under the Stock Option Plans ordinary course of business and as made available to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities inParent, or other ownership interests inany material amendment or termination of, the or default under, any material contract to which Company or any of its Subsidiaries is a party or by which it is bound; (vi) any amendment or change to the Certificate of Incorporation or Bylaws of Company; (or agreement to amend) the terms of any such shares, securities or ownership interests), (iivii) any entry into any employment, change material increase in control, retention, incentive or deferred modification of the compensation or severance agreement, plan or arrangement with or for the benefit of, or any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation benefits payable or to become payable by the Company or any of its Subsidiaries to, to any of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted other than (in the ordinary course case of business in accordance with its customary past practices, (iiinon-executive officer employees) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable other than in the ordinary course of business consistent with past practice, ; (viii) any entry into material change in the interest rate risk management and hedging policies, procedures or practices of Company or any agreementof its Subsidiaries, commitment or transaction by the Company which is material any failure to the Company comply with such policies, procedures and its Subsidiaries taken as a whole practices; or (ix) any commitment negotiation or agreement by Company or any of its Subsidiaries to do any of the foregoingthings described in the preceding clauses (i) through (vii) (other than negotiations with Parent and its representatives regarding the transactions contemplated by this Agreement).

Absence of Certain Changes. Except as set forth disclosed in Section 4.06 the SEC Documents, since December 31, 2019, (i) there has been no material adverse change in the business, properties, operations, financial condition or results of operations of the Disclosure Letter, since May 31, 2000, (aCompany or its Subsidiaries,(ii) the Company and its Subsidiaries Subsidiaries, considered as one entity, have not suffered incurred any Material Adverse Effect material liability or obligation, indirect, direct or contingent, including without limitation any changelosses or interference with its business from fire, conditionexplosion, event flood, earthquakes, accident or development other calamity, whether or not covered by insurance, or from any strike, labor dispute or court or governmental action, order or decree, that could reasonably be expected are material, individually or in the aggregate, to have a Material Adverse Effect, (b) the Company and its Subsidiaries have conducted their respective businesses only Subsidiaries, considered as one entity, or has entered into any transactions not in the ordinary course consistent with past practice, except for the negotiation and execution and delivery of this Agreement and business; (ciii) there has not been any material disruption, material delay or other material adverse change in (iA) any declaration, setting aside or payment the development of any of the Company’s product candidates, (B) the anticipated timeline of pre-clinical or clinical trials to support the development of any of the Company’s product candidates, or (C) the recruitment of candidates for clinical trials to support the development of any of the Company’s product candidates, in each case as a result of the recent outbreak of COVID-19, or as a result of any measures intended to contain the outbreak of COVID-19 imposed by any federal, state, local or foreign government or government agency in any country or region in which the Company, or any of its agents, consultants, advisors or vendors, has assets or properties or conducts business, including, without limitation, any limitations, curtailments, suspensions or closures of businesses, business offices or establishments, schools, properties and other public areas due to quarantines, curfews, travel restrictions, workplace controls, “stay at home” orders, social distancing requirements or guidelines or other public gathering restrictions or limitations; and (iv) there has not been any material decrease in the capital stock or any material increase in any short-term or long-term indebtedness of the Company or its Subsidiaries and there has been no dividend or distribution of any kind declared, paid or made by the Company or, except for dividends paid to the Company or other distribution in respect Subsidiaries, by any of the Shares Company’s Subsidiaries on any class of capital stock, or any repurchase, repurchase or redemption or other acquisition by the Company or any of its Subsidiaries of any outstanding shares class of capital stock (except stock. The Company has not taken any obligation of the Company under the Stock Option Plans steps, and does not currently expect to accept Shares in connection with the exercise of Existing Stock Optionstake any steps, including in satisfaction of withholding tax obligations) or other securities in, or other ownership interests in, to seek protection pursuant to any Bankruptcy Law nor does the Company or any of its Subsidiaries have any knowledge or any amendment (reason to believe that its creditors intend to initiate involuntary bankruptcy or agreement insolvency proceedings. The Company is financially solvent and is generally able to amend) the terms of any such shares, securities or ownership interests), (ii) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation payable or to pay its debts as they become payable by the Company or any of its Subsidiaries to, any of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable other than in the ordinary course of business consistent with past practice, (viii) any entry into any agreement, commitment or transaction by the Company which is material to the Company and its Subsidiaries taken as a whole or (ix) any commitment to do any of the foregoingdue.

Absence of Certain Changes. Except as set forth in Section 4.06 of the Company Disclosure LetterSchedule, since May 31September 27, 20002009, (a) except as otherwise expressly contemplated by this Agreement, the Company and each Company Subsidiary has conducted its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) the Company and its Subsidiaries have conducted their respective businesses only business in the ordinary course consistent with past practice, except for the negotiation practice and execution and delivery of this Agreement and (c) there has not been been: (ia) any declarationdamage, setting aside destruction or payment loss (whether or not covered by insurance) affecting the business, properties or assets of any dividend or other distribution in respect of the Shares or any repurchase, redemption or other acquisition by the Company or any of its Subsidiaries of any outstanding shares of capital stock (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities inSubsidiary that has had, or other ownership interests inwould be reasonably likely to have, the Company individually or any of its Subsidiaries or any amendment (or agreement to amend) the terms of any such shares, securities or ownership interests), (ii) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or any increase in the rate or modification in the terms aggregate, a Company Material Adverse Effect; (including any acceleration of the right to receive or the timing of payment) of any compensation payable or to become payable by the Company or any of its Subsidiaries to, any of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (vb) any change by the Company in its accounting methods, principles or practices except as practice (other than changes required by changes in GAAP, ); (vic) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable other than in the ordinary course of business consistent with past practice, (viii) any entry into any agreement, commitment or transaction by the Company which is sale of a material to amount of assets of the Company and its Subsidiaries taken as a whole or the Company Subsidiaries; (ixd) any commitment material Tax election, any material change in method of accounting with respect to do Taxes or any compromise or settlement of any proceeding with respect to any material Tax liability; (e) any change in the financial condition, results of operations or business of the Company and any of the foregoingCompany Subsidiaries that has had, or would be reasonably likely to have, individually or in the aggregate, a Company Material Adverse Effect; (f) any revaluation by Company of any of its assets in any material respect; (g) any declaration, setting aside or payment of any dividends or distributions in respect of shares of Company Common Stock or any redemption, purchase or other acquisition of any of its securities or any of the securities of any Company Subsidiary; (h) any increase in the wages, salaries, compensation, pension, or other fringe benefits or perquisites payable to any executive officer, employee, or director from the amount thereof in effect as of January 1, 2009 (which amounts have been previously disclosed to Parent), granted any severance or termination pay, entered into any contract to make or grant any severance or termination pay, or paid any bonus; or (i) any action, event, occurrence, development or state of circumstances or facts that has had, or would be reasonably likely to have, individually or in the aggregate, a Company Material Adverse Effect.

Absence of Certain Changes. Except as set forth in Section 4.06 of Since September 30, 2006 (the Disclosure Letter“Company Balance Sheet Date”), since May 31, 2000, (a) the Company and has conducted its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) the Company and its Subsidiaries have conducted their respective businesses only business in the ordinary course consistent with past practice, except for the negotiation practice and execution and delivery of this Agreement and (c) there has not been occurred: (i) any declarationchange, setting aside event or payment condition (whether or not covered by insurance) that has resulted in, or is reasonably likely to result in, or to the best of Company’s knowledge any event beyond Company’s control that is reasonably likely to result in, a Material Adverse Effect to Company; (ii) any acquisition, sale or transfer of any dividend or other distribution in respect material asset of the Shares or any repurchase, redemption or other acquisition by the Company or any of its Subsidiaries of any outstanding shares of capital stock (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities in, or other ownership interests in, the Company or any of its Subsidiaries or any amendment (or agreement to amend) the terms of any such shares, securities or ownership interests), (ii) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation payable or to become payable by the Company or any of its Subsidiaries to, any of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable subsidiaries other than in the ordinary course of business and consistent with past practice, ; (viiiiii) any entry into change in accounting methods or practices (including any agreementchange in depreciation or amortization policies or rates) by Company or any revaluation by Company of any of its or any of its subsidiaries’ assets; (iv) any declaration, commitment setting aside, or transaction by the Company which is material payment of a dividend or other distribution with respect to the shares of Company, or any direct or indirect redemption, purchase or other acquisition by Company of any of its shares of capital stock; (v) any material contract entered into by Company or any of its subsidiaries, other than in the ordinary course of business and as provided to Parent, or any amendment or termination of, or default under, any material contract to which Company or any of its Subsidiaries taken as subsidiaries is a whole party or by which it is bound; (vi) any amendment or change to the Certificate of Incorporation or Bylaws; or (ixvii) any commitment increase in or modification of the compensation or benefits payable, or to become payable, by Company to any of its directors or employees, other than pursuant to scheduled annual performance reviews, provided that any resulting modifications are in the ordinary course of business and consistent with Company’s past practices. Company has not agreed since September 30, 2006 to take any of the actions described in the preceding clauses (i) through (vii) and is not currently involved in any negotiations to do any of the foregoingthings described in the preceding clauses (i) through (vii) (other than negotiations with Parent and its representatives regarding the transactions contemplated by this Agreement).

Absence of Certain Changes. Except as set forth disclosed in Section 4.06 of the Disclosure LetterSchedule 5.10, since May 31January 1, 20002008, (a) PHMD has conducted the Company and its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) the Company and its Subsidiaries have conducted their respective businesses Division’s business only in the ordinary course consistent with past practice, except for the negotiation practice and execution and delivery of this Agreement and (c) there has not been occurred: (ia) any declarationmaterial adverse change with respect to the Acquired Assets or the Division’s business; (b) any damage to, setting aside destruction or payment loss of any dividend or other distribution in respect of the Shares or any repurchase, redemption or other acquisition Acquired Asset that is not covered by the Company or any of its Subsidiaries of any outstanding shares of capital stock (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities in, or other ownership interests in, the Company or any of its Subsidiaries or any amendment (or agreement to amend) the terms of any such shares, securities or ownership interests), (ii) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation payable or to become payable by the Company or any of its Subsidiaries to, any of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are insurance and is not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business and that would require expenditures in accordance with its customary past practices, (iii) any increase excess of $5,000 in the rate of compensation aggregate to repair or benefits payable or accruing under, or, modification of the terms replace; (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (vc) any change by the Company PHMD in its accounting methods, principles or practices with respect to the Division except as required by changes any change in, or as appropriate to, GAAP; (d) any revaluation by PHMD of any of its Acquired Assets, including any writing down the value of inventory or writing off accounts receivable, except as such revaluation may happen in GAAPthe ordinary course of business and consistent with past accounting practices; (e) any sale or disposition of, or encumbrance or security interest placed on, any Acquired Asset, except (1) sales or uses of inventory in the ordinary course of business and in a manner consistent with past practice and (2) dispositions of obsolete or worthless assets; (f) any execution or implementation of any employment, bonus, deferred compensation, severance or similar arrangement or agreement (or amendment of any such agreement) covering employees of the Division, or any increase in employee welfare or retirement benefits covering such employees of the Division, except as such may happen in the ordinary course of business and consistent with past practice, (vig) any increase in the salary of any employee in the Division not in the ordinary course of business; (h) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or labor representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreementPHMD, or any lockouts, strikes, slowdowns, picketing, work stoppages or or, to the knowledge of PHMD, threats thereof by or with respect to such employees, ; (viii) any revaluation by the Company termination, or any notice of its Subsidiaries termination, of any material written contract or, to the knowledge of their respective assetsPHMD, including write-downs of inventory or of accounts receivable other than material permit, except as happens in the ordinary course of business consistent business; (j) any material failure that is inconsistent with past practice, (viii) any entry into any agreement, commitment practice to pay the Division’s creditors or transaction by the Company which is material to collect debt or obligations owed to the Company and its Subsidiaries taken as a whole Division or any material change in the Division’s selling, pricing or advertising practices; (ixk) any commitment to do a third party for capital expenditures in excess of $5,000 that is not in the ordinary course of business; (l) any resignation, termination, death or material disability involving any of the foregoingDivision’s employees, except as happen in the ordinary course of business; (m) any material adverse change in the amount, aging or collectibility of the Division’s accounts receivable or other debts due it or the allowances with respect thereto or in the Division’s accounts payable from those which are to be reflected on the Financial Statements.

Absence of Certain Changes. Except as set forth disclosed in Section 4.06 of Schedule -------------------------- 5.1(f) or in the Disclosure LetterCompany Reports filed prior to the date hereof, since May 31the Audit Date, 2000, (a) the Company and its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) the Company and its Subsidiaries have conducted their respective businesses in all material respects only in, and have not engaged in any material transaction other than according to, the ordinary and usual course of such businesses consistent with past practicepractices, except for the negotiation and execution and delivery of this Agreement and (c) there has not been any (i) change in the financial condition, properties, business or results of operations of the Company and its Subsidiaries, except for those changes that, individually or in the aggregate, have not had and are not reasonably likely to have a Company Material Adverse Effect; (ii) material damage, destruction or other casualty loss with respect to any material asset or property owned, leased or otherwise used by the Company or any of its Subsidiaries, not covered by insurance; (iii) declaration, setting aside or payment of any dividend or other distribution in respect of the Shares Capital Stock of the Company or any of its Subsidiaries (other than wholly-owned Subsidiaries) or any repurchase, redemption or other acquisition by the Company or any of its Subsidiaries of any outstanding shares of capital stock (except any obligation of the Company under the Capital Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities inof, or other ownership interests in, the Company or any of its Subsidiaries Subsidiaries; (iv) amendment of any material term of any outstanding security of the Company or any amendment of its Subsidiaries; (v) incurrence, assumption or agreement to amend) guarantee by the terms Company or any of its Subsidiaries of any such shares, securities indebtedness for borrowed money other than in the ordinary course of business and in amounts and on terms consistent with past practices; (vi) creation or ownership interests), (ii) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for assumption by the benefit of, Company or any increase of its Subsidiaries of any Lien (other than Permitted Liens) on any material asset other than in the rate or modification in the terms ordinary course of business consistent with past practices; (including any acceleration of the right to receive or the timing of paymentvii) making of any compensation payable loan, advance or to become payable capital contributions by the Company or any of its Subsidiaries to, or investment in, any of their respective directors, officers Person other than (x) loans or employees, except base salary, guaranteed draw or hourly wage increases advances to employees who in connection with business-related travel, (y) loans made to employees consistent with past practices which are not members in the aggregate in excess of the executive committee of the Company $250,000, and (z) loans, advances or directors of the Company that have been granted capital contributions to or investments in wholly-owned Subsidiaries, and in each case made in the ordinary course of business in accordance consistent with its customary past practices; (viii) transaction or commitment made, (iii) or any increase in contract or agreement entered into, by the rate Company or any of compensation its Subsidiaries relating to its assets or benefits payable or accruing under, or, modification of the terms business (including the acquisition or disposition of any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reportsassets) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action relinquishment by the Company which, if taken after the date hereof, would constitute a breach or any of its Subsidiaries of any of the clauses of Section 6.01 hereofContract or other right, (v) any change by in either case, material to the Company and its Subsidiaries, taken as a whole, other than transactions and commitments in accounting methods, principles or the ordinary course of business consistent with past practices except as required and those contemplated by changes in GAAP, this Agreement; (viix) any labor dispute or other employment related problemdispute, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreementof its Subsidiaries, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, ; or (viix) any revaluation change by the Company or any of its Subsidiaries of any of their respective assetsin accounting principles, including write-downs of inventory practices or of accounts receivable other than methods. Since the Audit Date, except as disclosed in the Company Reports filed prior to the date hereof or increases in the ordinary course of business consistent with past practicepractices, (viii) there has not been any entry into any agreement, commitment increase in the compensation payable or transaction that could become payable by the Company which is material or any of its Subsidiaries to (a) officers of the Company and or any of its Subsidiaries taken as a whole or (ixb) any commitment to do employee of the Company or any of its Subsidiaries whose annual cash compensation is $150,000 or more, or any amendment of any of the foregoingCompensation and Benefit Plans (as defined in Section 5.1(h)).

Absence of Certain Changes. Except as set forth disclosed in Section 4.06 of the Disclosure LetterCompany Reports filed prior to the date hereof, since May October 31, 2000, (a) 1999 the Company and its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) the Company and each of its Subsidiaries have conducted their respective businesses only in, and have not engaged in any material transaction other than according to, the ordinary and usual course consistent with past practiceof such businesses, except for the negotiation and execution and delivery of this Agreement and (c) there has not been (i) any change in the financial condition, properties, business or results of operations of the Company and its Subsidiaries, or any development or combination of developments of which the executive officers of the Company have knowledge, that, individually or in the aggregate, has had or is reasonably likely to have a Company Material Adverse Effect; (ii) any material damage, destruction or other casualty loss with respect to any material asset or property owned, leased or otherwise used by the Company or any of its Subsidiaries, whether or not covered by insurance; (iii) any declaration, setting aside or payment of any dividend or other distribution in respect of the Shares capital stock of the Company; (iv) any change by the Company in accounting policies, practices, procedures, methods, assumptions or any repurchase, redemption or other acquisition by principles of the Company or any of its Subsidiaries of any outstanding shares of capital stock Subsidiaries; or (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligationsv) or other securities in, or other ownership interests in, the Company or any of its Subsidiaries or any amendment (or agreement to amend) the terms of any such shares, securities or ownership interests), (ii) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation payable or to that could become payable by the Company or any of its Subsidiaries toto executive officers, any of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage other than increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing undercourse, or, modification other than as required by Law, any amendment of any of the terms (including any acceleration of the right to receive payment) of, any existing Plan Compensation and Benefit Plans (as defined in Section 4.09) (except as disclosed in the Company SEC Reports5.1(h)) or any the adoption or implementation of any new Compensation and Benefit Plan. For purposes of this Agreement, "KNOWLEDGE OF THE EXECUTIVE OFFICERS" or any variation thereof means, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any case of the clauses Company, knowledge of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees executive officers of the Company (or any Subsidiaryits Subsidiaries) and, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable other than in the ordinary course case of business consistent with past practiceParent, (viii) any entry into any agreement, commitment or transaction by the Company which is material to the Company and its Subsidiaries taken as a whole or (ix) any commitment to do any knowledge of the foregoingexecutive officers of Parent (or its Subsidiaries), in each case after due inquiry.

Absence of Certain Changes. Except as set forth disclosed in Section 4.06 the Company Reports -------------------------- filed with the SEC prior to the date of this Agreement or as disclosed in Schedule 4.8 of the Pacific Disclosure Letter, since May December 31, 20001998, (a) the ------------ Company and each Subsidiary has conducted its Subsidiaries have business only in the ordinary course of such business consistent with past practice and there has not suffered been (i) any Material Adverse Effect or any change, condition, event or development that could events which, individually or in the aggregate, would reasonably be expected to have a Material Adverse EffectEffect on the Company, (b) the Company and its Subsidiaries have conducted their respective businesses only in the ordinary course consistent with past practice, except for the negotiation and execution and delivery of this Agreement and (c) there has not been (iii) any declaration, setting aside or payment of any dividend or other distribution in with respect to the Capital Stock of the Shares or any repurchase, redemption or other acquisition by the Company or any of its Subsidiaries of any outstanding shares of capital stock (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities in, or other ownership interests in, the Company or any of its Subsidiaries or any amendment (redemption or agreement to amend) the terms repurchase of any shares of such shares, securities or ownership interests)Capital Stock, (iiiii) any entry into any employment, material change in controlthe accounting principles, retentionpractices or methods of the Company or any of its Subsidiaries, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or (iv) any increase in the rate salaries or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any other compensation payable to any officer, director or to become payable by employee of the Company or any of its Subsidiaries to, any of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable other than normal increases in the ordinary course of business consistent with past practice) or any increase in, or addition to, other benefits to which such officer, director or employee may be entitled (except as required by the terms of plans as in effect on the date of this Agreement and which are listed on Schedule 4.8 of the Pacific Disclosure Letter or as required by law), (viiiv) any entry into any agreement, commitment or transaction ------------ incurrence by the Company which is or any of its Subsidiaries of indebtedness for borrowed money (except in the ordinary course of business consistent with past practice), (vi) any material adverse change or threat of a material adverse change in the Company's or any of its Subsidiaries' relations with, or any loss or threat of loss of, any of the Company's or its Subsidiaries' important suppliers or customers, (vii) any termination, cancellation or waiver of any contract or other right material to the operation of the business of the Company and its Subsidiaries taken as a whole or (ixviii) any commitment to do any material damage, destruction or loss, whether or not covered by insurance, adversely affecting the properties, assets, business or prospects of the foregoingCompany and its Subsidiaries taken as a whole, or any deterioration in the operating condition of the assets of the Company and its Subsidiaries which would, individually or in the aggregate, be material to the Company or its Subsidiaries taken as a whole.

Absence of Certain Changes. Except as set forth in Section 4.06 of the Disclosure Letter, since Since May 31, 20002005 (the “Parent Balance Sheet Date”) through the Effective Time, there has not occurred: (ai) the Company and its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development condition (whether or not covered by insurance or similar indemnification agreement) that could has resulted in, or would reasonably be expected to have result in, a Parent Material Adverse Effect, (bii) the Company and any acquisition, sale or transfer of any material asset of Parent or any of its Subsidiaries have conducted their respective businesses only subsidiaries, (iii) any change in the ordinary course consistent with past practiceaccounting methods or practices (including any change in depreciation or amortization policies or rates) by Parent or any revaluation by Parent of any of its or any of its subsidiaries’ assets, except for the negotiation and execution and delivery of this Agreement and (c) there has not been (iiv) any declaration, setting aside aside, or payment of any a dividend or other distribution in with respect to the shares of the Shares Parent, or any repurchasedirect or indirect redemption, redemption purchase or other acquisition by the Company Parent of any of its shares of capital stock, (v) any material contract entered into by Parent or any of its Subsidiaries of subsidiaries, or any outstanding shares of capital stock material amendment or (except any obligation by way of lapse of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligationsterm thereof) or other securities intermination of, or other ownership interests indefault under, the Company any material contract to which Parent or any of its Subsidiaries subsidiaries is a party or any amendment (or agreement to amend) the terms of any such shares, securities or ownership interests)by which it is bound, (iivi) any entry into action to amend or change the Certificate of Incorporation or Bylaws or equivalent organizational documents of Parent, Merger Sub 1 or Merger Sub 2, (vii) any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or any material increase in the rate compensation or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation benefits payable or to become payable by the Company or Parent to any of its Subsidiaries to, any of their respective directors, officers directors or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable other than in the ordinary course of business consistent or increases associated with past practicemerit or annual pay increases or promotions in the ordinary course of business, (viii) any entry into transaction with any agreement, commitment or transaction by the Company affiliate of Parent which is material to the Company and its Subsidiaries taken as not a whole Subsidiary of Parent, or (ix) any commitment negotiation or agreement by Parent or any of its subsidiaries to do any of the foregoingthings described in the preceding clauses (i) through (viii) (other than negotiations with Company and its representatives regarding the transactions contemplated by this Agreement and the agreements disclosed herein).

Absence of Certain Changes. Except as set forth in Section 4.06 of the Disclosure LetterCompany SEC Reports or as set forth in SECTION 3.9 OF THE COMPANY DISCLOSURE LETTER, since May December 31, 20002002, (a) the Company and its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) the Company and its Subsidiaries have conducted their respective businesses business only in the ordinary course of such business consistent with past practicepractices, except for the negotiation and execution and delivery of this Agreement and (c) there has not been been: (i) any event or state of fact that, individually or in the aggregate, would reasonably be expected to have a Company Material Adverse Effect; (ii) any declaration, setting aside or payment of any dividend or other distribution in with respect to the capital stock of the Shares Company or any of its Subsidiaries or any repurchase, redemption or any other acquisition by the Company or any of its Subsidiaries of any outstanding shares of capital stock (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities inof, or other ownership interests in, the Company or any of its Subsidiaries or any amendment (or agreement to amend) the terms of any such shares, securities or ownership interests), (ii) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation payable or to become payable by the Company or any of its Subsidiaries to, any of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, Subsidiaries; (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any material change by the Company in its accounting methods, principles or practices except as required by changes in GAAP, practices; (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (viiiv) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs including, without limitation, writing down the value of inventory or of writing off notes or accounts receivable other than in the ordinary course of business consistent with past practicebusiness; (v) any damage, destruction or loss (whether or not covered by insurance) of any of the material properties or assets of the Company and its Subsidiaries; (vi) any increase in indebtedness for borrowed money other than an increase as a result of borrowings incurred in the ordinary course of business; (vii) any split, combination or reclassification of any capital stock of the Company or any issuance or the authorization of any issuance of any other securities in -10- respect of, in lieu of or in substitution for shares of the capital stock of the Company; or (viii) any entry into any agreement, agreement or commitment (contingent or transaction by the Company which is material otherwise) to the Company and its Subsidiaries taken as a whole or (ix) any commitment to do take any of the foregoingactions set forth in clauses (i) through (vii) above.

Absence of Certain Changes. Except as disclosed in the Company Reports filed prior to the date hereof or in Company press releases or other public announcements prior to the date hereof (the "Public Announcements") or as set forth in Section 4.06 4.7 or Section 4.8 of the Company Disclosure LetterSchedule and except as otherwise provided in or contemplated by this Agreement, since May December 31, 20001998 (the "Company Audit Date"), (a) the Company and its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) the Company and its Subsidiaries have conducted their respective businesses only in, and have not engaged in any material transaction other than according to, the ordinary and usual course of such businesses and there has not been: (a) any change in the ordinary course consistent financial condition, properties, business or results of operations of the Company and its Subsidiaries, or any transaction, commitment, dispute or other event, or any other development or combination of developments that, individually or in the aggregate, has had or is reasonably likely to result in a Company Material Adverse Effect; (b) any material damage, destruction or other casualty loss with past practicerespect to any material asset or property owned, except for leased or otherwise used by the negotiation and execution and delivery Company or any of this Agreement and its Subsidiaries, whether or not covered by insurance; (c) there has not been (i) any authorization, declaration, setting aside or payment of any dividend or other distribution in respect of the Shares or capital stock of the Company, except as permitted by Section 6.1 hereof; (d) any repurchase, redemption or other acquisition change by the Company in accounting principles, practices or methods other than as required by changes in applicable GAAP or statutory accounting principles; (e) any material addition to the Company's consolidated reserves for unpaid losses and loss adjustment expenses prior to the date of its Subsidiaries this Agreement; (f) any material change in the accounting, actuarial, investment, reserving, underwriting or claims administration policies, practices, procedures, methods, assumptions or principles of any outstanding shares Company Insurance Subsidiary; or (g) any repurchase or redemption of capital stock (any Shares. Since the Company Audit Date, except any obligation as provided for herein or as disclosed in the Company Reports or Public Announcements filed or made prior to the date hereof or as set forth in Section 4.7 of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock OptionsDisclosure Schedule, including in satisfaction of withholding tax obligations) or other securities in, or other ownership interests in, the Company or any of its Subsidiaries or any amendment (or agreement to amend) the terms of any such shares, securities or ownership interests), (ii) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or there has not been any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation payable or to that could become payable by the Company or any of its Subsidiaries to, to officers at the senior vice president level or above or key employees or any amendment of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee any of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan Compensation and Benefit Plans (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable other than in the ordinary course of business consistent with past practice, (viii) any entry into any agreement, commitment or transaction by the Company which is material to the Company and its Subsidiaries taken as a whole or (ix) any commitment to do any of the foregoing4.9(a)).

Absence of Certain Changes. Except as set forth disclosed in Section 4.06 of the Disclosure Letter, since May 31, 2000Kroger SEC Reports filed prior to this date, (a) since the Company end of Kroger's fiscal year last ended, Kroger and each of its Subsidiaries has conducted its business in all material respects in the ordinary and usual course of its business consistent with past practice and there has not been any change in the financial condition, business, prospects or results of operations of Kroger and its Subsidiaries have not suffered any Material Adverse Effect or any changedevelopment or combination of developments that, conditionindividually or in the aggregate, event has had or development that could would reasonably be expected to have a Kroger Material Adverse Effect, Effect and (b) since the Company and its Subsidiaries have conducted their respective businesses only in the ordinary course consistent with past practiceend of Kroger's fiscal year last ended until this date, except for the negotiation and execution and delivery of this Agreement and (c) there has not been (i) any declaration, setting aside or payment of any dividend or other distribution in respect of the Shares or any repurchase, redemption or other acquisition by the Company or any of its Subsidiaries of any outstanding shares of capital stock (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities in, or other ownership interests in, the Company or any of its Subsidiaries or any amendment (or agreement to amend) the terms of any such shares, securities or ownership interests), Kroger; (ii) any entry into any employmentchange by Kroger to its accounting policies, change in control, retention, incentive practices or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation payable or to become payable by the Company or any of its Subsidiaries to, any of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, methods; (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable other than in the ordinary course of business consistent with past practice, any material tax election made or changed, any audit settled or any amended Tax Returns filed; (viiiiv) any entry into amendment or change to the terms of any agreement, commitment or transaction by the Company which is of its indebtedness material to the Company Kroger and its Subsidiaries taken as a whole whole; (v) any incurrence of any material indebtedness outside of the ordinary course of business; (vi) outside the ordinary course of business, any transfer, lease, license, sale, mortgage, pledge, encumbrance or other disposition of assets or properties material to Kroger and its Subsidiaries taken as a whole; (vii) any material damage, destruction or other casualty loss with respect to any asset or property owned, leased or otherwise used by Kroger or its Subsidiaries material to Kroger and its Subsidiaries taken as a whole, whether or not covered by insurance; (viii) except in the ordinary course of business consistent with past practice for employees other than executive officers or directors, or except as required by applicable law or pursuant to a contractual obligation in effect as of the date of this Agreement, (A) any execution, adoption or amendment of any agreement or arrangement relating to severance or any employment or consulting agreement with any officer, director or other key employee, or any amendment to any Kroger Benefit Plan or adoption or execution of any new employee benefit plan for the benefit of any officer, director or other key employee (including, without limitation, the Kroger Benefit Plans referred to in Section 4.10) or (B) any grant of any stock options or other equity related award; or (ix) any agreement or commitment entered into with respect to do any of the foregoing.

Absence of Certain Changes. Except as disclosed in the Company Reports filed prior to the date hereof or otherwise set forth in Section 4.06 5.1(f) of the Company Disclosure Letter, since May 31, 2000, (a) the Company Audit Date and its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected prior to have a Material Adverse Effect, (b) the date hereof the Company and its Subsidiaries have conducted their respective businesses only in the ordinary and usual course consistent with past practice, except for the negotiation of such businesses and execution and delivery of this Agreement and (c) there has not been (i) any change, event or circumstance which, individually or in the aggregate, has had or would reasonably be expected to have a Company Material Adverse Effect; (ii) any material damage, destruction or other casualty loss with respect to any material tangible asset or property owned, leased or otherwise used by the Company or any of its Subsidiaries, whether or not covered by insurance; (iii) any declaration, setting aside or payment of any dividend or other distribution in respect of the stock of the Company, except for regular quarterly cash dividends on its Common Shares or publicly announced prior to the date hereof; (iv) any repurchase, redemption or other acquisition material change by the Company in accounting principles, practices or methods other than those required by GAAP or SAP; (v) any material addition, or any of its Subsidiaries development involving a prospective material addition, to the Company's aggregate reserves for future policy benefits or other policy claims and benefits; or (vi) any change in the accounting, actuarial, investment, reserving, underwriting or claims administration policies, practices, procedures, methods, assumptions or principles of any outstanding shares of capital stock (Company Insurance Subsidiary that is material to the Company and its Subsidiaries, taken as a whole. Since the Audit Date, except any obligation as provided for herein, or as set forth in Section 5.1(f) of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities inDisclosure Letter, or other ownership interests in, as disclosed in the Company or any of its Subsidiaries or any amendment (or agreement Reports filed prior to amend) the terms of any such sharesdate hereof, securities or ownership interests), (ii) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or there has not been any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation payable or to that could become payable by the Company or any of its Subsidiaries to, to any of their respective directors, officers the top 12 most highly compensated employees or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members any amendment of any of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan Compensation and Benefit Plans (as defined in Section 4.095.1(h)(i)) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, increases or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable other than amendments in the ordinary course of business consistent with past practice, (viii) any entry into any agreement, commitment and increases or transaction amendments approved by the Company which is material to the Company and its Subsidiaries taken as a whole or (ix) any commitment to do any of the foregoingParent.

Absence of Certain Changes. Except as set forth in Section 4.06 Since the Company Balance Sheet Date, the business of the Disclosure Letter, since May 31, 2000, (a) the Company and its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) the Company and its Subsidiaries have has been conducted their respective businesses only in the ordinary course consistent with past practice, except for the negotiation practices and execution and delivery of this Agreement and (c) there has not been any event, occurrence, development or state of circumstances or facts that has had or would reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect on the Company. Without limiting the generality of the foregoing, since the Company Balance Sheet Date, there has not been: (i) any declaration, setting aside or payment of any dividend or other distribution (whether in cash, stock or property) with respect to any capital stock of the Shares Company or any repurchaseof its Subsidiaries, (ii) any purchase, redemption or other acquisition by the Company or any of its Subsidiaries of any outstanding shares of capital stock (except or any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities in, or other ownership interests in, of the Company or any of its Subsidiaries or any amendment options, warrants, calls or rights to acquire such shares or other securities, (iii) any split, combination or agreement to amend) the terms reclassification of any such sharescapital stock of the Company or any of its Subsidiaries or any issuance or the authorization of any issuance of any other securities in respect of, securities in lieu of or ownership interests)in substitution for shares of their respective capital stock, (iiiv) (A) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation payable or to become payable granting by the Company or any of its Subsidiaries to, to any of their respective directors, officers current or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee former (1) director of the Company or directors (2) employee of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries who is a party to a change of control or severance arrangement (all individuals described in the foregoing clauses (1) and (2), collectively, the “Key Personnel”) of any of their respective assetsincrease in compensation, including write-downs of inventory bonus or of accounts receivable fringe or other than benefits, except in the ordinary course of business consistent with past practicepractice or as was required under any Benefit Agreement or Benefit Plan, (viiiB) any granting by the Company or any of its Subsidiaries to any Key Personnel of (1) any increase in severance or termination pay or (2) any right to receive any severance or termination pay except for severance or termination pay received in the ordinary course of business consistent with past practice or as was required under any Benefit Agreement or Benefit Plan, (C) any entry into any agreement, commitment or transaction by the Company or any of its Subsidiaries into, or any amendments of, (1) any employment, deferred compensation, consulting, severance, change of control, termination or indemnification contract with any Key Personnel or any other director, officer or employee of the Company or any of its Subsidiaries or (2) any Contract with any Key Personnel or any other director, officer or employee of the Company or any of its Subsidiaries the benefits of which are contingent, or the terms of which are materially altered, upon the occurrence of the Merger (all such Contracts under this clause (C), collectively, “Benefit Agreements”), (D) the removal or modification of any restrictions in any Benefit Agreement or Benefit Plan or awards made thereunder, except as required to comply with Applicable Law or the terms or provisions of any Benefit Agreement or Benefit Plan in effect as of the date hereof and except as may be effected in the ordinary course of business consistent with past practice or (E) the adoption, amendment or termination of any Benefit Plan, other than, in the case of sections 4.10(iv)(A)-(D), such increases, amendments, new agreements, removals, modifications or terminations that (1) do not provide for any increase in compensation or benefits for any individual Key Personnel that is material in relation to such person’s compensation or benefits prior to such increase and (2) in the aggregate do not result in any material increase in compensation, benefits or other similar expenses of the Company and its Subsidiaries taken as a whole or Subsidiaries, and (ixv) any commitment to do any of change in financial accounting methods, principles or practices by the foregoingCompany materially affecting its assets, liabilities or businesses, except insofar as may have been required by a change in GAAP.

Absence of Certain Changes. Except as set forth in Section 4.06 of Since September 30, 2003 (the Disclosure Letter“Company Balance Sheet Date”) through the Effective Time, since May 31, 2000, there has not occurred: (ai) the Company and its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development condition (whether or not covered by insurance or similar indemnification agreement) that could has resulted in, or would reasonably be expected to have result in, a Company Material Adverse Effect, (bii) the any acquisition, sale or transfer of any material asset of Company and or any of its Subsidiaries have conducted their respective businesses only subsidiaries, (iii) any change in the ordinary course consistent with past practiceaccounting methods or practices (including any change in depreciation or amortization policies or rates) by Company or any revaluation by Company of any of its or any of its subsidiaries’ assets, except for the negotiation and execution and delivery of this Agreement and (c) there has not been (iiv) any declaration, setting aside aside, or payment of any a dividend or other distribution in with respect to the shares of the Shares Company, or any repurchasedirect or indirect redemption, redemption purchase or other acquisition by the Company of any of its shares of capital stock, (v) any material contract entered into by Company or any of its Subsidiaries of subsidiaries, or any outstanding shares of capital stock material amendment or (except any obligation by way of lapse of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligationsterm thereof) or other securities intermination of, or other ownership interests indefault under, the any material contract to which Company or any of its Subsidiaries subsidiaries is a party or any amendment (or agreement to amend) the terms of any such shares, securities or ownership interests)by which it is bound, (iivi) any entry into action to amend or change the Certificate of Incorporation or Bylaws of Company, (vii) any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or any material increase in the rate compensation or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation benefits payable or to become payable by the Company or to any of its Subsidiaries to, any of their respective directors, officers directors or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable other than in the ordinary course of business consistent and as contemplated by this Agreement or increases associated with past practicemerit or annual pay increases or promotions in the ordinary course of business, (viii) any entry into transaction with any agreement, commitment or transaction by the affiliate of Company which is material to the Company and its Subsidiaries taken as not a whole Subsidiary of Company, or (ix) any commitment negotiation or agreement by Company or any of its subsidiaries to do any of the foregoingthings described in the preceding clauses (i) through (viii) (other than negotiations with Parent and its representatives regarding the transactions contemplated by this Agreement and the agreements disclosed herein).

Absence of Certain Changes. Except as set forth in Section 4.06 of the Disclosure Letter, since May From December 31, 20002002 to the date of this Agreement, (a) the Company and Xxxxxx has conducted its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) the Company and its Subsidiaries have conducted their respective businesses business only in the ordinary course consistent with past practice, except for the negotiation and execution and delivery of this Agreement and (c) there has not been (i) any event or occurrence that has had or is reasonably likely to have a Xxxxxx Material Adverse Effect; (ii) any material change by Xxxxxx or any of its Subsidiaries, when taken as a whole, in any of its accounting methods, principles or practices or any of its tax methods, practices or elections; (iii) any declaration, setting aside or payment of any dividend or other distribution in respect of the Shares any capital stock of Xxxxxx or any repurchaseredemption, redemption purchase or other acquisition by the Company or of any of its Subsidiaries securities; (iv) any split, combination or reclassification of any outstanding shares of capital stock (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities in, or other ownership interests in, the Company Xxxxxx or any of its Subsidiaries or any amendment (issuance or agreement to amend) the terms authorization of any such sharesissuance of any other securities in respect of, securities in lieu of or ownership interests), in substitution for shares of that capital stock; (iiv) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit ofgranting, or any increase in the rate commitment or modification in the terms (including any acceleration of the right promise to receive or the timing of payment) of any compensation payable or to become payable grant, by the Company Xxxxxx or any of its Subsidiaries to, to any officer of Xxxxxx or any of their respective directors, officers or employeesits Subsidiaries of (A) any increase in compensation, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business business, including in accordance connection with promotions, consistent with prior practice or as required by employment agreements in effect as of the date of the consolidated balance sheet of Xxxxxx and its customary past practices, Subsidiaries included in the Xxxxxx Reports required or (iiiB) any increase in severance or termination pay, except as part of a standard employment package to any person promoted or hired, but not including the rate five most highly compensated executive officers of compensation Xxxxxx, or as employment, severance or termination agreements in effect as of date of the consolidated balance sheet of Xxxxxx and its Subsidiaries included in the Xxxxxx Reports required; (vi) any entry by Xxxxxx or any of its Subsidiaries into any employment, severance or termination agreement with any officer of Xxxxxx or any of its Subsidiaries; (vii) any increase in, or any commitment or promise to increase, benefits payable or accruing under, or, modification of the terms (including available under any acceleration of the right to receive payment) of, any pre-existing Xxxxxx Benefit Plan (as defined in Section 4.09) (5.11), except as disclosed in accordance with the Company SEC Reports) or any adoption or implementation pre-existing terms of any new that Xxxxxx Benefit Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievancesestablishment of, or any activity commitment or proceeding by a labor union promise to establish, any new Xxxxxx Benefit Plan, any amendment of any existing stock options, stock appreciation rights, performance awards or representative thereof to organize restricted stock awards or, except in accordance with and under pre-existing compensation policies, any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreementgrant, or any lockoutscommitment or promise to grant, strikesany stock options, slowdownsstock appreciation rights, work stoppages performance awards, or threats thereof by or with respect to such employees, restricted stock awards; (vii) any revaluation damage to or any destruction or loss of physical properties Xxxxxx or any of its Subsidiaries owns or uses, whether or not covered by insurance, that in the Company aggregate have had or reasonably could be expected to have a Xxxxxx Material Adverse Effect; or (viii) any reevaluations by Xxxxxx or any of its Subsidiaries of any of their respective assets (other than any ceiling test writedown related to adjusting the fair value of assets as a result of the consideration to be paid pursuant to this Agreement) which, in accordance with generally accepted accounting principles, Xxxxxx will reflect in its consolidated financial statements, including any impairment of assets, including write-downs of inventory or of accounts receivable other than and which in the ordinary course of business consistent with past practice, (viii) any entry into any agreement, commitment or transaction by the Company which is aggregate are material to the Company and its Subsidiaries taken as a whole or (ix) any commitment to do any them. Schedule 5.9 of the foregoingXxxxxx Disclosure Letter sets forth all severance and termination payments which will be payable upon the consummation of the Merger and the termination of any employees of Xxxxxx.

Absence of Certain Changes. Except as set forth Since June 30, 2014 (the “Target Balance Sheet Date”), other than any actions taken with Acquiror’s prior written consent in relation to the Spin-Off Transaction and accurately described in Section 4.06 3.6 of the Target Disclosure LetterSchedule, since May 31, 2000, (a) the Company and its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) the Company Target and its Subsidiaries have conducted their respective businesses only the Target Business in the ordinary course consistent with past practice and there has not occurred (a) any change, event or condition (whether or not covered by insurance) that has resulted in, or would reasonably be expected to result in, a Target Material Adverse Effect; (b) any acquisition, sale or transfer of any material asset of Target other than in the ordinary course of business and consistent with past practice, except for the negotiation and execution and delivery of this Agreement and ; (c) there has not been any change in accounting methods or practices (iincluding any change in depreciation or amortization policies or rates) by Target or any revaluation by Target of any of its assets; (d) any declaration, setting aside aside, or payment of any a dividend or other distribution in with respect to the shares of Target (other than a distribution of shares of Target that occurs due to the Shares exercise of a Target Option) or any repurchasedirect or indirect redemption, redemption purchase or other acquisition by the Company or Target of any of its Subsidiaries of any outstanding shares of capital stock stock; (except e) any obligation Material Contract entered into by Target, other than in the ordinary course of business and as provided to Acquiror, or any material amendment (other than in the Company under the Stock Option Plans ordinary course of business and as provided to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligationsAcquiror) or other securities in, or other ownership interests in, the Company or any of its Subsidiaries or any amendment (or agreement to amend) the terms of any such shares, securities or ownership interests), (ii) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit termination of, or default under, any Material Contract to which Target is a party or by which it is bound; (f) any amendment or change to the Restated Certificate or Bylaws of Target; (g) any increase in the rate or modification in the terms (including any acceleration of the right to receive compensation or the timing of payment) of any compensation benefits payable or to become payable by the Company or Target to any of its Subsidiaries to, any of their respective directors, officers directors or employees, except base salary, guaranteed draw or hourly wage other than increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any non-officer employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable other than made in the ordinary course of business consistent with past practice, ; or (viiih) any entry into any agreement, commitment or transaction agreement by the Company which is material to the Company and its Subsidiaries taken as a whole or (ix) any commitment Target to do any of the foregoingthings described in the preceding clauses (a) through (g). At the Effective Time, there will be no accrued or unpaid dividends on shares of Target’s Capital Stock.

Absence of Certain Changes. Except as set forth disclosed in Section 4.06 3.13 of the Company Disclosure LetterSchedule, since May 31, 2000, (a) the Balance Sheet Date the business of the Company and its Subsidiaries Subsidiary has been conducted only in the Ordinary Course of Business, and there have not suffered been (a) any Material Adverse Effect events or any change, condition, event changes that have resulted in or development that could would reasonably be expected to have result in, individually or in the aggregate, a Company Material Adverse Effect, Effect (as defined below); (b) the Company and its Subsidiaries have conducted their respective businesses only in the ordinary course consistent with past practice, except for the negotiation and execution and delivery of this Agreement and (c) there has not been (i) any declaration, setting aside or payment of any dividend or other distribution (whether in cash, stock or property) with respect to the equity interests of the Shares Company; or (c) any repurchase, redemption or other acquisition change by the Company or its Subsidiary in accounting principles, practices, policies or methods (including with respect to reserves), (d) any of its Subsidiaries of any outstanding shares of capital stock (except any obligation amendment to the Organizational Documents of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities in, or other ownership interests in, the Company or any of its Subsidiaries or any amendment Subsidiary; (or agreement to amend) the terms of any such shares, securities or ownership interests), (iie) any entry into any employmenttransaction with, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, any Shareholder, Member of the Immediate Family of any Shareholder (if applicable) or any increase Affiliate of any of the foregoing Persons (other than payments of wages and salaries made to officers, directors and employees in the rate Ordinary Course of Business); (f) any material loss, destruction or modification damage (in the terms (including any acceleration of the right to receive each case, whether or the timing of paymentnot insured) of any compensation payable or to become payable by affecting the Company or any of its Subsidiaries to, any of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee material asset of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, Subsidiary; (iiig) any increase in the rate of compensation or benefits payable or accruing underpaid, orwhether conditionally or otherwise, modification to any employee, consultant or agent other than in the Ordinary Course of the terms (including any acceleration of the right to receive payment) ofBusiness, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) director or officer or any adoption Shareholder or implementation any Affiliate of any new Plan, in any such case, for or with any such directors, officers or employees, Shareholder; (ivh) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation agreement by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable other than in the ordinary course of business consistent with past practice, (viii) any entry into any agreement, commitment or transaction by the Company which is material to the Company and its Subsidiaries taken as a whole or (ix) any commitment Subsidiary to do any of the foregoingthings referred to elsewhere in this Section 3.13, (i) neither the Company nor its Subsidiary has become liable in respect of any guarantee or has incurred, assumed or otherwise become liable in respect of any Debt, except for borrowings in the Ordinary Course of Business under credit facilities in existence as of the Balance Sheet Date; or (j) neither the Company nor its Subsidiary has permitted any of its assets to become subject to a Lien other than a Permitted Lien.

Absence of Certain Changes. Except to the extent arising out of or relating to the Transactions, since December 31, 2016, (a) the business of the SALIC Group has been operated in all material respects in the Ordinary Course of Business, (b) there has not occurred any event or events that, individually or in the aggregate, have had, or would reasonably be expected to have, a SALIC Material Adverse Effect, (c) other than as set forth in Section 4.06 3.8(c) of the SALIC Disclosure LetterSchedule, since May 31, 2000, (a) the Company and its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) the Company and its Subsidiaries have conducted their respective businesses only in the ordinary course consistent with past practice, except for the negotiation and execution and delivery of this Agreement and (c) there has not been (i) occurred any declaration, setting aside or payment of any dividend or other distribution (whether in cash, stock or property) with respect to any of SALIC’s outstanding capital stock or the outstanding capital stock of the Shares or any repurchase, redemption or SALIC Group Companies other acquisition by the Company or any of its Subsidiaries of any outstanding shares of capital stock than regular dividend payments and (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligationsd) or other securities in, or other ownership interests in, the Company or any of its Subsidiaries or any amendment (or agreement to amend) the terms of any such shares, securities or ownership interests), (ii) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation payable or to become payable by the Company or any of its Subsidiaries to, any of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are there has not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) occurred any change by the Company in accounting methods, principles or practices by any SALIC Group Company materially affecting its assets or liabilities, except insofar as may have been required by changes Applicable Law or required or permitted by a change in GAAP, applicable GAAP or SAP. Except with regard to Material Contracts (viwhich are addressed in Section 3.16) any labor dispute or other employment related problemand Reinsurance Contracts and Reserve Financing Contracts (which are addressed in Section 3.21), other than routine individual grievancesas set forth in Section 3.8(e) of the SALIC Disclosure Schedule, since December 31, 2016 to the date hereof, no SALIC Group Company has taken any action or omitted to take any action, which action or omission, if occurring after the date hereof without the consent of Purchaser, had Section 5.2 been in effect from December 31, 2016 to the date hereof, would constitute (x) a breach of clause (i) through (iv), (vii), (viii), (ix), (x), (xi), (xiii), (xv), (xvi), (xviii), (xix), (xx) or (xxi) (or clause (xxii) with respect to the foregoing clauses) of Section 5.2; or (y) a breach in any material respect of clause (v), (xii), (xiv), or any activity (xvii) (or proceeding by a labor union or representative clause (xxii) thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (viiother clauses) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable other than in the ordinary course of business consistent with past practice, (viii) any entry into any agreement, commitment or transaction by the Company which is material to the Company and its Subsidiaries taken as a whole or (ix) any commitment to do any of the foregoingSection 5.2.

Absence of Certain Changes. Except as set forth in Section 4.06 3.12 of the Parent Disclosure LetterSchedule, since May December 31, 20002004 (the “Parent Balance Sheet Date”), (a) the Company and Parent has conducted its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) the Company and its Subsidiaries have conducted their respective businesses only business in the ordinary course consistent with past practice, except for the negotiation practice and execution and delivery of this Agreement and (c) there has not been occurred: (ia) any declarationchange, setting aside event or payment condition (whether or not covered by insurance) that has resulted in, or could reasonably be expected to result in, a Parent Material Adverse Effect; (b) any acquisition, sale or transfer of any dividend or other distribution in respect material asset of the Shares or any repurchase, redemption or other acquisition by the Company Parent or any of its Subsidiaries of any outstanding shares of capital stock (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities in, or other ownership interests in, the Company or any of its Subsidiaries or any amendment (or agreement to amend) the terms of any such shares, securities or ownership interests), (ii) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation payable or to become payable by the Company or any of its Subsidiaries to, any of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable other than in the ordinary course of business and consistent with past practice, ; (viiic) any entry change in accounting methods or practices (including any change in depreciation or amortization policies or rates) by Parent or any revaluation by Parent of any of its or any of its Subsidiaries’ assets; (d) any declaration, setting aside, or payment of a dividend or other distribution with respect to the shares of Parent, or any direct or indirect redemption, purchase or other acquisition by Parent of any of its shares of capital stock other than the purchase of unvested shares upon employment or service termination; (e) any entering into by Parent or any of its Subsidiaries of any material contract or agreement, commitment or transaction any material amendment or termination of, other than in the ordinary course of business, or default by the Company Parent or any of its Subsidiaries under, any material contract or agreement to which Parent or any of its Subsidiaries is material a party or by which it is bound (or, to the Company and its Subsidiaries taken as a whole Knowledge of Parent, by any other party thereto); (f) any amendment or change to the Certificate of Incorporation or Bylaws; or (ixg) any commitment increase in or modification of the compensation or benefits payable, or to become payable, by Parent to any of its directors, consultants or employees, other than pursuant to scheduled annual performance reviews, provided that any resulting modifications are in the ordinary course of business and consistent with Parent’s past practices. Except as set forth in Section 3.12 of the Parent Disclosure Schedule, Parent has not agreed since December 31, 2004 to effect any changes, events, or conditions or take any of the actions described in the preceding clauses (a) through (g) and is not currently involved in any negotiations to do any of the foregoingthings described in the preceding clauses (a) through (g) (other than negotiations with the Company and its representatives regarding the Contemplated Transactions).

Absence of Certain Changes. Except as set forth in Section 4.06 of From June 30, 2003 through the Disclosure Letterdate hereof, since May 31, 2000, (a) the Company and its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) the Company and its Subsidiaries have conducted their respective businesses only business in the ordinary course of such business consistent with past practices, except as contemplated by this Agreement in connection with the Merger and the transactions contemplated thereby. From June 30, 2003 through the date hereof, neither the Company nor any of its Subsidiaries has engaged in any transaction or series of transactions material to the Company and its Subsidiaries in the aggregate, other than in the ordinary course of business consistent with past practice, except for the negotiation and execution and delivery of this Agreement and (c) there has have not been (ia) any events, changes, effects, developments or states of fact that would reasonably be expected to have or constitute a Company Material Adverse Effect; (b) any declaration, setting aside or payment of any dividend or other distribution in respect of the Shares capital stock of the Company; (c) any issuance by the Company, or agreement or commitment of the Company to issue, any shares of Common Stock or securities convertible into or exchangeable for shares of Common Stock; (d) any repurchase, redemption or any other acquisition by the Company or any of its Subsidiaries of any outstanding shares of capital stock (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities inof, or other ownership interests in, the Company or its Subsidiaries; (e) any of its Subsidiaries material change in accounting principles, practices or any amendment methods; (or agreement to amend) the terms of any such shares, securities or ownership interests), (iif) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit ofemployment agreement with, or any material increase in the rate or modification in the terms (including including, without limitation, any acceleration of the right to receive or the timing of payment) of any compensation payable or to become payable by the Company or any of its Subsidiaries to, any of their respective directors, officers directors or employeesofficers, except base salary, guaranteed draw or hourly wage for increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted occurring in the ordinary course of business in accordance with its their customary past practices, practices and employment agreements entered into in the ordinary course of business; (iiig) any material increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including including, without limitation, any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Planbonus, in any such caseinsurance, for pension or with other employee benefit plan or arrangement covering any such directors, officers or employees, except increases occurring in the ordinary course of business in accordance with the Company’s customary practices; (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (viih) any revaluation by the Company or any of its Subsidiaries of any material amount of their respective assets, including taken as a whole, including, without limitation, write-downs of inventory or write-offs of accounts receivable other than in the ordinary course of business consistent with past practice, practices; and (viiii) any entry into any agreement, commitment or transaction by the Company which is material to the Company and its Subsidiaries taken as a whole or (ix) any commitment to do any action of the foregoingtype described in Section 7.1(a) or Section 7.1(b) that had such action been taken after the date of this Agreement would be in violation of such Section.

Absence of Certain Changes. Except as set forth in Section 4.06 of the Disclosure Letter, since May Since January 31, 20001999 (the "Online Balance Sheet Date"), (a) the Company and Online has conducted its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) the Company and its Subsidiaries have conducted their respective businesses only business in the ordinary course consistent with past practice, except for the negotiation practice and execution and delivery of this Agreement and (c) there has not been occurred except as otherwise disclosed in the Online SEC Documents: (i) any change, event or condition (whether or not covered by insurance) that has resulted in, or would reasonably be expected to result in, a Material Adverse Effect on Online; (ii) any acquisition, sale or transfer of any material asset of Online or any of its subsidiaries other than in the ordinary course of business and consistent with past practice; (iii) any change in accounting methods or practices (including any change in depreciation or amortization policies or rates) by Online or any revaluation by Online of any of its or any of its subsidiaries' assets; (iv) any declaration, setting aside aside, or payment of any a dividend or other distribution in with respect to the shares of the Shares Online, or any repurchasedirect or indirect redemption, redemption purchase or other acquisition by the Company Online of any of its shares of capital stock; (v) any material contract entered into by Online or any of its Subsidiaries subsidiaries, other than in the ordinary course of any outstanding shares of capital stock (except any obligation of the Company under the Stock Option Plans business and as provided to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities inOmega, or other ownership interests inany material amendment or termination of, the Company or material default under, any material contract to which Online or any of its Subsidiaries subsidiaries is a party or by which it is bound; (vi) any amendment or change to the Articles of Incorporation or Bylaws of Online; (or agreement to amend) the terms of any such shares, securities or ownership interests), (iivii) any entry into any employment, change material increase in control, retention, incentive or deferred material modification of the compensation or severance agreement, plan or arrangement with or for the benefit of, or any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation benefits payable or to become payable by the Company or Online to any of its Subsidiaries to, any of their respective directors, officers or employees, employees except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course case of business in accordance with its customary past practices, employees (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (viiofficers) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable other than increases in the ordinary course of business consistent with past practice, practices; (viii) any entry into material change in the interest rate risk management and hedging policies, procedures or practices of Online or any agreementof its subsidiaries, commitment or transaction by the Company which is material any failure to the Company comply with such policies, procedures and its Subsidiaries taken as a whole practices; or (ix) any commitment negotiation or agreement by Online or any of its subsidiaries to do any of the foregoingthings described in the preceding clauses (i) through (viii) (other than negotiations with Omega and its representatives regarding the transactions contemplated by this Agreement).

Absence of Certain Changes. Except as specifically set forth in Section 4.06 on Schedule 4.14 of the Disclosure LetterSchedule, since May December 31, 2000, 2010 (the “Interim Date”) none of the Group Companies have: (a) the Company and its Subsidiaries have not suffered incurred any Material Adverse Effect liability or obligation of any changenature (whether accrued, conditionabsolute, event contingent or development that could reasonably be expected to have a Material Adverse Effect, (b) the Company and its Subsidiaries have conducted their respective businesses only in the ordinary course consistent with past practiceotherwise), except for the negotiation and execution and delivery of this Agreement and (c) there has not been (i) any declaration, setting aside or payment of any dividend or other distribution in respect of the Shares or any repurchase, redemption or other acquisition by the Company or any of its Subsidiaries of any outstanding shares of capital stock (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities in, or other ownership interests in, the Company or any of its Subsidiaries or any amendment (or agreement to amend) the terms of any such shares, securities or ownership interests), (ii) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation payable or to become payable by the Company or any of its Subsidiaries to, any of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business business; (b) permitted any of their assets to be subjected to any Lien; (c) acquired, sold, transferred or otherwise disposed of any assets except in accordance with its customary past practicesthe ordinary course of business; (d) made any capital expenditure or commitment therefor which, individually or in the aggregate, exceeded $25,000; (iiie) declared or paid any dividends or made any distributions on any of their Equity Interests, or redeemed, purchased or otherwise acquired any of their Equity Interests or any Option, or other right to purchase or acquire any of their Equity Interests; (f) made any bonus or profit sharing distribution; (g) increased or prepaid their Indebtedness, except current borrowings under bank credit lines listed on Schedule 4.14 of the Disclosure Schedule in the ordinary course of business, or made any loan to any Person; (h) written down the value of any work-in-process, or written off as uncollectible any notes or accounts receivable, except write-downs and write-offs in the ordinary course of business, none of which, individually or in the aggregate, is material to the Group Companies; (i) granted any increase in the rate of wages, salaries, bonuses or other remuneration of (A) any employee who, whether as a result of such increase or prior thereto, receives aggregate compensation from the Group Companies at an annual rate of $25,000 or benefits payable more, or accruing under(B) except in the ordinary course of business, of any other employee; (j) canceled or waived any claims or rights of material value; (k) made any change in any method of accounting procedures; (l) otherwise conducted the Business or entered into any transaction, except in the usual and ordinary manner and in the ordinary course of their business; (m) entered into, amended or terminated any Material Agreements; (n) entered into, renewed, extended or modified any lease for real property, or, modification except in the ordinary course of the terms (including any acceleration of the right to receive payment) ofbusiness, any existing Plan lease of personal property; (as defined o) agreed, whether or not in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Planwriting, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of to do any of the clauses foregoing (except for transactions contemplated by this Agreement); (p) experienced or incurred any material and adverse effect on their assets, liabilities, prospects, results of Section 6.01 hereofoperation, business or condition (financial or otherwise); (q) failed to preserve intact the present business organization and reputation of the Business, including any failure to: (1) keep the Business and the properties of the Group Companies substantially intact, including their present operations, physical facilities, assets, and working conditions, (v2) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, keep available (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreementdismissals, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable other than resignations and retirements in the ordinary course of business consistent with past practicepractice or otherwise not within the Group Companies’ control) the services of the employees of the Group Companies, (viii3) use commercially reasonable efforts to maintain the goodwill of patients, suppliers, lenders, and other individuals or entities to whom the Group Companies provide services or with whom the Group Companies otherwise have significant business relationships in connection with the Business, and (4) continue all current sales, marketing and promotional activities of the Group Companies relating to the Business, except to the extent required by applicable Law or for changes that are not material; or (r) failure to cause the books and records of the Group Companies to be maintained in the usual, regular and ordinary manner, such that the books and records accurately reflect the Company’s income, expenses, assets and liabilities, and (not permit; (s) caused or permitted any entry material change in any pricing, investment, accounting, financial reporting, inventory, credit, allowance or Tax practice or policy of any Group Company that would materially adversely affect the Business or the assets, or (t) 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, commitment settled any Tax claim or transaction by assessment, surrendered any right to claim a refund of Taxes, consented to any extension or waiver of the Company which is material limitation period applicable to any Tax claim or assessment, or taken any other similar action, or omitted to take any action relating to the Company and its Subsidiaries taken as a whole filing of any Tax Return or (ix) the payment of any commitment to do Tax, if such election, adoption, change, amendment, agreement, settlement, surrender, consent or other action or omission would have the effect of increasing the Tax liability of the any of the foregoingGroup Companies for any period ending after the Closing Date or decreasing any Tax attribute of any of the Group Companies existing on the Closing Date.

Absence of Certain Changes. Except as set forth in Section 4.06 on Schedule 2.6 of the Disclosure LetterSchedule, since May 31the Target Balance Sheet Date, 2000, Target and Predecessor have each conducted its business in the ordinary course and there has not occurred: (ai) the Company and its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development condition (whether or not covered by insurance) that could has resulted in, or might reasonably be expected to have result in, a Material Adverse Effect, (b) the Company and its Subsidiaries have conducted their respective businesses only in the ordinary course consistent with past practice, except for the negotiation and execution and delivery of this Agreement and (c) there has not been (i) any declaration, setting aside Effect to Target or payment of any dividend or other distribution in respect of the Shares or any repurchase, redemption or other acquisition by the Company or any of its Subsidiaries of any outstanding shares of capital stock (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities in, or other ownership interests in, the Company or any of its Subsidiaries or any amendment (or agreement to amend) the terms of any such shares, securities or ownership interests), Predecessor; (ii) any entry into any employmentacquisition, change in control, retention, incentive sale or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) transfer of any compensation payable asset of Target or to become payable by the Company or any of its Subsidiaries to, any of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable Predecessor other than in the ordinary course of business and consistent with past practicepractice or that would have a Material Adverse Effect; (iii) any change in accounting methods or practices (including any change in depreciation or amortization policies or rates) by Target or Predecessor or any revaluation by Target or Predecessor of any of Target’s or Predecessor’s assets; (iv) any declaration, setting aside, or payment of a dividend or other distribution with respect to the shares of Target or membership interests of Predecessor or any direct or indirect redemption, purchase or other acquisition by Target of any of its Target Shares or by Predecessor of its membership interests; (v) any Material Contract entered into by Target or Predecessor, other than in the ordinary course of business and as provided to Acquiror, or any amendment or termination of, or default under, any Material Contract to which Target or Predecessor is a party or by which either of them is bound; (vi) any amendment or change to the charter documents of Target or the charter documents of Predecessor; (vii) any increase in or modification of the compensation or benefits paid, payable or to become payable by Target or Predecessor to any of its managers, officers or employees; (viii) any entry into reduction in the sales of Target or Predecessor to, or significant detrimental change in terms with, any agreement, commitment or transaction by customer for the Company which is material twelve month period beginning on the Closing and ending on the one-year anniversary of the Closing as compared to the Company and its Subsidiaries taken as a whole same time period during the previous year or (ix) any commitment negotiation or agreement by Target or Predecessor to do any of the foregoingthings described in the preceding clauses (i) through (viii) (other than in connection with (A) the Reorganization, and (B) negotiations with Merger Sub, Acquiror and their representatives regarding the transactions contemplated by this Agreement). As of Closing, there will be no accrued but unpaid dividends on the Target Shares.

Absence of Certain Changes. Except as set forth in Section 4.06 4.10 of the Company Disclosure LetterSchedule, since May 31the Company Balance Sheet Date, 2000, (a) the business of the Company and its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) the Company and its Subsidiaries have has been conducted their respective businesses only in the ordinary course consistent with past practice, except for the negotiation practices and execution and delivery of this Agreement and (c) there has not been (ia) any event, occurrence, development or state of circumstances or facts that has had or would reasonably be expected to have, individually or in the aggregate, a Company Material Adverse Effect; (b) any amendment to the articles of incorporation or bylaws of the Company; (c) any split, combination or reclassification of any shares of the Company’s capital stock or declaration, setting aside or payment of any dividend or other distribution (whether in cash, stock or property or any combination thereof) in respect of the Shares Company’s capital stock, or any repurchaseredemption, redemption repurchase or other acquisition by the or offer to redeem, repurchase or otherwise acquire any Company Securities; (d) any sale, assignment, license or other transfer of any Necessary Intellectual Property or Company Intellectual Property (or any of its Subsidiaries rights therein) or acquisition of any outstanding shares of capital stock (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities in, or other ownership interests in, the Company or any of its Subsidiaries or any amendment (or agreement to amend) the terms of any such shares, securities or ownership interests), (ii) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation payable or to become payable by the Company or any of its Subsidiaries to, any of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required by changes in GAAP, (vi) any labor dispute or other employment related problem, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, (vii) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable material Intellectual Property other than in the ordinary course of business consistent with past practicepractices; (e) except as required by the terms of an applicable plan or agreement then in effect or as required or deemed advisable pursuant to applicable Law and except as would not result in an expense greater than $25,000 in the aggregate, (viiii) any entry into increase in compensation, bonuses or other benefits payable to any director or executive officer or, except in the ordinary course of business consistent with past practices, other employee of the Company or any of its Subsidiaries or (ii) any entering into, adoption or amendment in any material respect of any employment, change of control, severance, compensation, bonus, profit-sharing, stock option or other stock related rights or other forms of incentive or deferred compensation, retirement benefits or other benefit agreement, plan, arrangement or policy applicable to any director or executive officer or, except in the ordinary course of business consistent with past practices, any other employee of the Company or any of its Subsidiaries; or (f) any resolution, commitment or transaction by the Company which is material agreement to the Company and its Subsidiaries taken as a whole or (ix) any commitment to do take any of the foregoingactions described in clauses (b) through (e) of this Section 4.10.

Absence of Certain Changes. Except as set forth in Section 4.06 To the best of the Disclosure LetterPVAXX's knowledge, since May the year end period of March 31, 2000, (a) the Company and its Subsidiaries have not suffered any Material Adverse Effect or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect, (b) the Company and its Subsidiaries have conducted their respective businesses only in the ordinary course consistent with past practice, except for the negotiation and execution and delivery of this Agreement and (c) there has not been been: (i) any declarationmaterial adverse change in the financial condition, setting aside assets, liabilities (contingent or otherwise), income or business of PVAXX; (ii) any damage, destruction or loss (whether or not covered by insurance) materially and adversely affecting the properties or business of PVAXX; (iii) any declaration or payment of any dividend or other distribution in respect of the Shares capital stock or any repurchasedirect or indirect redemption, redemption purchase or other acquisition by the Company or of any of its Subsidiaries of any outstanding shares of the capital stock of PVAXX; (except any obligation of the Company under the Stock Option Plans to accept Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligationsiv) or other securities in, or other ownership interests in, the Company or any of its Subsidiaries or any amendment (or agreement to amend) the terms of any such shares, securities or ownership interests), (ii) any entry into any employment, change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, or any increase in the rate compensation, bonus, sales commissions or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation fee arrangement payable or to become payable by the Company or PVAXX to any of its Subsidiaries toofficers, directors, employees, consultants or agents other than raises or increases in compensation consistent with prior policy that are not in excess of five percent of the individual's annual compensation or hourly rate; (v) the creation of any material Encumbrance on any of their respective directorsthe assets of PVAXX, officers or employeesthe amendment, except base salarymodification or extension of any existing material Encumbrance on any such asset other than any such creation, guaranteed draw amendment, modification or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted extension effected (A) in the ordinary course of business in accordance with its customary past practicesbusiness, (iiiB) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company in accounting methods, principles or practices except as required in connection with the PVAXX Share Exchange, or (C) for current taxes or assessments which are not yet due, or being contemplated in good faith by changes in GAAP, appropriate proceedings; (vi) any labor dispute sale, assignment, transfer, conveyance, lease, hypothecation, abandonment or other employment related problemdisposition of or agreement to sell, assign, transfer, convey, lease, hypothecate, abandon or otherwise dispose of, any of the material assets of PVAXX, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not then subject to a collective bargaining agreement, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, that (viiA) any revaluation by the Company or any of its Subsidiaries of any of their respective assets, including write-downs of inventory or of accounts receivable other than assets sold in the ordinary course of business consistent with past practicebusiness, or; (viiiB) any entry into any agreement, commitment or transaction by the Company assets which is material to the Company and its Subsidiaries taken are scrapped as a whole or (ix) any commitment to do any of the foregoingobsolete in conformance with customary procedure.

Absence of Certain Changes. Except Since the Balance Sheet Date (as set forth in Section 4.06 of the Disclosure Letterhereinafter defined), since May 31, 2000, (a) the Company and its Subsidiaries have not suffered any Material Adverse Effect no event has occurred that has had or any change, condition, event or development that could reasonably be expected to have a Material Adverse Effect. Since the Balance Sheet Date, (b) the Company and its Subsidiaries have conducted their respective businesses only in the ordinary course consistent with past practice, except for the negotiation and execution and delivery of this Agreement and (c) there has not been been, directly or indirectly, (i) any declaration, setting aside or payment of any dividend or other distribution in respect of the Shares Target Common Shares, any return of any capital or other distribution of assets to shareholders, or any repurchase, redemption or other acquisition by the Company or any Target of its Subsidiaries of any outstanding shares of capital stock (except any obligation of the Company under the Stock Option Plans to accept Target Common Shares in connection with the exercise of Existing Stock Options, including in satisfaction of withholding tax obligations) or other securities in, or other ownership interests in, the Company or any obligations of its Subsidiaries or any amendment (or agreement to amend) the terms of any such shares, securities or ownership interests), Target; (ii) any entry into any employment, significant change in control, retention, incentive or deferred compensation or severance agreement, plan or arrangement with or for the benefit of, by Target or any increase in the rate or modification in the terms (including any acceleration of the right to receive or the timing of payment) of any compensation payable or to become payable by the Company or any of its Subsidiaries to, any of their respective directors, officers or employees, except base salary, guaranteed draw or hourly wage increases to employees who are not members of the executive committee of the Company or directors of the Company that have been granted in the ordinary course of business in accordance with its customary past practices, (iii) any increase in the rate of compensation or benefits payable or accruing under, or, modification of the terms (including any acceleration of the right to receive payment) of, any existing Plan (as defined in Section 4.09) (except as disclosed in the Company SEC Reports) or any adoption or implementation of any new Plan, in any such case, for or with any such directors, officers or employees, (iv) any action by the Company which, if taken after the date hereof, would constitute a breach of any of the clauses of Section 6.01 hereof, (v) any change by the Company Subsidiary in accounting methods, principles or practices except as required by changes a change in GAAPgenerally accepted accounting principles, (viiii) any labor dispute direct or indirect material purchase or other employment related problemacquisition of stock of any individual or entity of any kind or nature (collectively, other than routine individual grievances“person” or “Person”), or any activity direct or proceeding by indirect loan, advance (other than advances to employees for travel or entertainment expenses in the ordinary course of business) or capital contribution to any person, (iv) a labor union grant of any general increase in the compensation of its officers or representative thereof employees (including any such increase pursuant to organize any employees of the Company bonus, pension, profit-sharing or other plan or commitment) or any Subsidiary, which employees were not then subject increase in the compensation payable or to a collective bargaining agreement, become payable to any such officer or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees, employee; and (viiv) any revaluation by agreement to take, whether in writing or otherwise, any action which would make or have made any representation or warranty in this Article 4 untrue or incorrect. Since the Company or Balance Sheet Date, Target and its Subsidiaries have conducted their respective businesses only in the ordinary and usual course consistent with past practice. Since the Balance Sheet Date, neither Target nor any of its Subsidiaries of have (A) sold, assigned or transferred any of their respective assetsits tangible assets except in the ordinary course of business, including or canceled any debt or claim, except for write-downs of inventory or of accounts receivable other than offs in the ordinary course of business consistent with past practicepractices, (viiiB) suffered any entry loss of property or waived any right whether or not in the ordinary course of business, except where such loss or waiver would not have a Material Adverse Effect, (C) (i) granted any severance or termination pay to any of its directors, officers, employees or consultants, (ii) increased any benefits payable under any existing severance or termination pay policies or employment agreements, or (iii) increased the compensation, bonus or other benefits payable to any of its directors, officers, consultants or employees, (D) made any material change in the manner of its business or operations, (E) entered into any agreement, commitment transaction except in the ordinary course of business or transaction by the Company which is material to the Company and its Subsidiaries taken as a whole otherwise contemplated hereby or (ixF) entered into any commitment (contingent or otherwise) to do any of the foregoing.