Common use of Interim Operations Clause in Contracts

Interim Operations. The Company covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the earlier of the termination of this Agreement in accordance with its terms and the Effective Time (unless Parent shall otherwise approve in writing, and except as otherwise expressly contemplated by this Agreement): (a) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and its Subsidiaries shall use their respective best efforts to preserve its business organization intact and maintain its existing relations and goodwill with customers, suppliers, distributors, creditors, lessors, employees and business associates; (b) it shall not (i) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (ii) amend its certificate of incorporation or by-laws; (iii) split, combine or reclassify its outstanding shares of capital stock; (iv) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly-owned Subsidiaries; or (v) except for the repurchase of the Class A Warrant contemplated by the Warrantholder Agreement and the repurchase of outstanding Class B Preferred Shares, repurchase, redeem or otherwise acquire, or permit any of its Subsidiaries to purchase or otherwise acquire, any shares of its capital stock or any securities convertible into or exchangeable or exercisable for any shares of its capital stock; (c) except as set forth in Section 6.1(c) of the Company Disclosure Letter, neither it nor any of its Subsidiaries shall (i) issue, sell, pledge, dispose of or encumber any shares of, or securities convertible into or exchangeable or exercisable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class or any other property or assets (other than Shares issuable pursuant to options outstanding on the date hereof under the Stock Plan or upon conversion of the Class A Preferred Shares and Class C Preferred Shares); (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any material property or assets (including capital stock of any of its Subsidiaries) or incur or modify any material indebtedness or other liability; or (iii) except as set forth in Section 6.1(c)(iii) of the Company Disclosure Letter, make or authorize or commit for any capital expenditures other than in amounts less than $25,000 individually and $100,000 in the aggregate or, by any means, make any acquisition of, or investment in, assets or stock of any other Person or entity in excess of $25,000; (d) neither it nor any of its Subsidiaries shall terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Compensation and Benefit Plans or increase the salary, wage, bonus or other compensation of any employees except increases for non-executive employees occurring in the ordinary and usual course of business (which shall include normal periodic performance reviews and related compensation and benefit increases); (e) neither it nor any of its Subsidiaries shall settle or compromise any material claims or litigation or, except in the ordinary and usual course of business, modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claims; (f) neither it nor any of its Subsidiaries shall make any Tax election or permit any insurance policy naming it as a beneficiary or loss-payable payee to be cancelled or terminated except in the ordinary and usual course of business; and (g) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.

Interim Operations. The Company covenants and agrees as to itself and each of its Subsidiaries that, after through the date hereof and prior to the earlier of the termination of this Agreement in accordance with its terms and the Effective Time Second Closing Date (unless Parent Buyer shall otherwise approve in writingapprove, and except as otherwise expressly contemplated by this Agreement): (a) the The business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and its Subsidiaries shall use their respective best all commercially reasonable efforts to preserve its business organization intact and maintain its existing relations and goodwill with customers, suppliers, distributors, creditors, lessors, employees and business associates; (b) Neither it nor any of its Subsidiaries shall not (i) issue, sell, pledge, dispose of or encumber any capital stock owned by it or any of its Subsidiaries in any of its SubsidiariesSubsidiaries or other Affiliates, except pursuant to the exercise of existing Company Options or warrants disclosed to Buyer pursuant to Section 3.2 hereof in accordance with their terms; (ii) amend its certificate articles of incorporation or by-lawslaws (or comparable organizational documents); (iii) split, combine or reclassify its outstanding shares of capital stock; (iv) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly-owned Subsidiaries; or (v) except for the repurchase of the Class A Warrant contemplated by the Warrantholder Agreement and the repurchase of outstanding Class B Preferred Shares, repurchase, redeem or otherwise acquire, except in connection with the payment of the exercise price of any option outstanding on the date hereof under the Stock Plan, or permit any of its Subsidiaries to purchase or otherwise acquire, any shares of its capital stock or any securities convertible into or exchangeable or exercisable for any shares of its capital stock; (c) except as set forth in Section 6.1(c) of the Company Disclosure Letter, neither Neither it nor any of its Subsidiaries shall (i) issue, sell, pledge, dispose of or encumber any shares of, or securities convertible into or exchangeable or exercisable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class or any other property or assets (other than Shares shares issuable pursuant to options outstanding on the date hereof under the Stock Plan or upon conversion warrants outstanding on the date hereof as described in Section 3.2 of the Class A Preferred Shares and Class C Preferred SharesSeller Disclosure Letter); (ii) purchase, transfer, lease, sell, mortgage, pledge, dispose of or encumber any real property, or effect any improvements or expansions thereon; (iii) other than in the ordinary and usual course of business, purchase, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any material other property or assets (including capital stock of any of its Subsidiaries) or incur or modify any material indebtedness or other liability; or (iiiiv) except as set forth in Section 6.1(c)(iii) of the Company Disclosure Letter, make or authorize or commit for any capital expenditures expenditure(s) in excess of $25,000; (v) make draws against the Company's credit facility with Sunrock other than in amounts less than the ordinary course of business, provided however that after such time that the Company's draws against such credit facility equal or exceed five million dollars ($25,000 individually and $100,000 5,000,000) in the aggregate oraggregate, any additional draws against such credit facility, whether in the ordinary course of business or otherwise, may not be made without the prior approval of Buyer, which approval shall not be unreasonably delayed or denied; or (vi) by any means, make any acquisition of, or investment inin any business, whether through the acquisition of assets or stock of any other Person or entity in excess of $25,000Person; (d) Except as may be required by applicable law, and except as provided in Section 5.8, neither it nor any of its Subsidiaries shall terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Compensation and Benefit Plans or increase the salary, wage, bonus bonus, severance, incentive or other compensation of any employees except increases for non-executive employees occurring in the ordinary and usual course of business (which shall include normal periodic performance reviews and related compensation and benefit increases)employees, officers or directors; (e) neither Neither it nor any of its Subsidiaries shall settle or compromise any material claims or litigation or, except in the ordinary and usual course of businessbusiness consistent with past practice, enter into any Debt Contracts or Other Contracts, or modify, amend or terminate prior to the scheduled expiration thereof any of its material Debt Contracts or Other Contracts or waive, release or assign any material rights or claims; (f) neither Neither it nor any of its Subsidiaries shall make any Tax election or permit any insurance policy naming it as a beneficiary or loss-payable payee to be cancelled amended or terminated canceled; (g) Neither it nor any of its Subsidiaries shall take any action, other than reasonable and usual actions in the ordinary and usual course of business consistent with past practice, with respect to accounting policies or procedures; (h) Neither it nor any of its Subsidiaries shall sell, transfer, assign or abandon any patents, trademarks or licenses which are owned or controlled directly or indirectly by the Company or any of its Subsidiaries except in the ordinary and usual course of business consistent with past practice; (i) Neither it nor any of its Subsidiaries shall license or otherwise encumber any patents or trademarks which are owned or controlled directly or indirectly by the Company or any of its Subsidiaries, except in the ordinary and usual course of business; and; (gj) neither Neither it nor any of its Subsidiaries will shall make any modification to employee or customer incentives or trade policies which would reasonably be expected to cause the Company's distributors or end-user customers to increase purchases above those levels normally required to meet their respective needs or cause a material increase or decrease in the Company's inventories or Working Capital; and (k) Neither it nor any of its Subsidiaries shall authorize or announce an intention to do any of the foregoing, or enter into an agreement any contract, agreement, commitment or arrangement to do any of the foregoing.

Interim Operations. The Company covenants and agrees as to itself and its Subsidiaries that, after From the date hereof and prior to of this ------------------ Agreement until the earlier Closing Time, except as set forth in Section 5.1 of the termination of this Agreement in accordance with its terms and the Effective Time (unless Parent shall otherwise approve in writing, and except Company Disclosure Schedule or as otherwise expressly contemplated by any other provision of this Agreement):, unless the Parent has consented in writing thereto, the Company shall, and shall cause each of its subsidiaries to: (a) the conduct its business of it and its Subsidiaries shall be conducted operations only in the ordinary and usual course and, to the extent of business consistent therewith, it and its Subsidiaries shall use their respective best efforts to preserve its business organization intact and maintain its existing relations and goodwill with customers, suppliers, distributors, creditors, lessors, employees and business associatespast practice; (b) it shall use reasonable efforts to preserve intact the business, organization, goodwill, rights, licenses, permits and franchises of the Company and its subsidiaries and maintain their existing relationships with customers, suppliers and other persons having business dealings with them; (c) use reasonable efforts to keep in full force and effect adequate insurance coverage and maintain and keep its properties and assets in good repair, working order and condition, normal wear and tear excepted; (d) not amend or modify its respective charter or certificate of incorporation, by-laws, partnership agreement or other charter or organization documents; (ie) except as required under Section 2.1, not authorize for issuance, issue, sell, pledgegrant, dispose of deliver, pledge or encumber or agree or commit to issue, sell, grant, deliver, pledge or encumber any shares of any class or series of capital stock owned by it in of the Company or any of its Subsidiaries; subsidiaries or any other equity or voting security or equity or voting interest in the Company or any of its subsidiaries, any securities convertible into or exercisable or exchangeable for any such shares, securities or interests, or any options, warrants, calls, commitments, subscriptions or rights to purchase or acquire any such shares, securities or interests (iiother than issuances of Shares upon exercise of Company Stock Options granted prior to the date of this Agreement to directors, officers, employees and consultants of the Company in accordance with the Company Stock Plan as currently in effect); (f) amend its certificate of incorporation or by-laws; not (iiii) split, combine or reclassify its outstanding any shares of capital its stock or issue or authorize or propose the issuance of any other securities in respect of, in lieu of, or in substitution for, shares of its stock; , (ivii) in solely the case of the Company, declare, set aside or pay any dividend payable in cashdividends on, stock or property make other distributions in respect of, any of any capital stock other than dividends from its direct or indirect wholly-owned Subsidiaries; the Company's stock, or (viii) except for the repurchase of the Class A Warrant contemplated by the Warrantholder Agreement and the repurchase of outstanding Class B Preferred Sharesas required under Section 2.1, repurchase, redeem or otherwise acquire, or permit any of its Subsidiaries agree or commit to purchase repurchase, redeem or otherwise acquire, any shares of its capital stock or other equity or debt securities or equity interests of the Company or any securities convertible into or exchangeable or exercisable for any shares of its capital stocksubsidiaries; (cg) except as set forth not amend or otherwise modify the terms of any Company Stock Options or the Company Option Plan, the effect of which shall be to make such terms more favorable to the holders thereof or persons eligible for participation therein; (h) other than regularly scheduled seniority increases in Section 6.1(c) the ordinary course of business consistent with past practice, not increase the compensation payable or to become payable to any directors, officers or employees of the Company Disclosure Letter, neither it nor or any of its Subsidiaries shall subsidiaries, or grant any severance or termination pay to, or enter into any employment or severance agreement with any director or officer of the Company or any of its subsidiaries, or establish, adopt, enter into or amend in any material respect or take action to accelerate any material rights or benefits under any collective bargaining, bonus, profit sharing, thrift, compensation, stock option, restricted stock, pension, retirement, deferred compensation, employment, termination, severance or other plan, agreement, trust, fund, policy or arrangement for the benefit of any director, officer or employee of the Company of any of its subsidiaries; (i) issuenot acquire or agree to acquire (including, sellwithout limitation, pledgeby merger, dispose of or encumber any shares ofconsolidation, or acquisition of stock, equity securities convertible into or exchangeable or exercisable forinterests, or assets) any corporation, partnership, joint venture, association or other business organization or division thereof or otherwise acquire or agree to acquire any assets of any other person outside the ordinary course of business consistent with past practice or any interest in any real properties (whether or not in the ordinary course of business); (j) not incur, assume or guarantee any indebtedness for borrowed money (including draw-downs on letters or lines of credit) or issue or sell any notes, bonds, debentures, debt instruments, evidences of indebtedness or other debt securities of the Company or any of its subsidiaries or any options, warrants, calls, commitments warrants or rights of to purchase or acquire any kind to acquire, any shares of its capital stock of any class or any other property or assets (other than Shares issuable pursuant to options outstanding on the date hereof under the Stock Plan or upon conversion of the Class A Preferred Shares same, except for (i) renewals of existing bonds and Class C Preferred Shares)letters of credit in the ordinary course of business not to exceed $100,000 in the aggregate; and (ii) transferadvances, loans or other indebtedness in the ordinary course of business consistent with past practice in an aggregate amount not to exceed $100,000; (k) not sell, lease, license, guaranteeencumber or otherwise dispose of, or agree to sell, mortgagelease, pledgelicense, encumber or otherwise dispose of or encumber of, any material property properties or assets (including capital stock of the Company or any of its Subsidiariessubsidiaries; (l) or incur or modify any material indebtedness or other liability; or (iii) except as set forth in Section 6.1(c)(iii) of the Company Disclosure Letter, make or not authorize or commit for make any capital expenditures other than (including by lease) in amounts less than $25,000 individually and excess of $100,000 in the aggregate or, by any means, make any acquisition of, or investment in, assets or stock for the Company and all of any other Person or entity in excess of $25,000its subsidiaries; (dm) neither it nor not make any material change in any of its Subsidiaries shall terminateaccounting or financial reporting (including tax accounting and reporting) methods, establishprinciples or practices, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Compensation and Benefit Plans or increase the salary, wage, bonus or other compensation of any employees except increases for non-executive employees occurring in the ordinary and usual course of business (which shall include normal periodic performance reviews and related compensation and benefit increases)as may be required by GAAP; (en) neither it nor not make any of its Subsidiaries shall material tax election or settle or compromise any material claims United States or litigation or, foreign tax liability; (o) except in the ordinary and usual course of businessbusiness consistent with past practice, modifynot amend, amend modify or terminate any Contract required to be listed in Section 3.15 of its material Contracts the Company Disclosure Schedule or waive, release or assign any material rights or claimsclaims thereunder; (fp) neither it nor not adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other reorganization of the Company or any of its Subsidiaries shall make subsidiaries; (q) not take any Tax election action that would, or permit would be reasonably likely to, result in any insurance policy naming it of the representations and warranties set forth in this Agreement not being true and correct in any material respect (as a beneficiary if such representation or loss-payable payee warranty were made and in effect on the date such action would have been taken, notwithstanding any other provisions hereof) or (except as to be cancelled any action permitted under Section 5.4) any of the conditions set forth in Article 7 or terminated except in the ordinary and usual course of business8 not being satisfied; and (gr) neither it nor any except as to subsections (a), (b) and (c) of its Subsidiaries will authorize Section 5.1, not agree or enter into an agreement commit in writing or otherwise to do any of the foregoing.

Interim Operations. The Company covenants and agrees as to itself and its Subsidiaries that, after From the date hereof and prior to the earlier of the termination of this Agreement in accordance with its terms and until ------------------ the Effective Time (unless Parent shall otherwise approve in writingClosing Date, and except as otherwise set forth in Section 5.1 of the Company Disclosure Schedule or as expressly contemplated by any other provision of this Agreement):, unless the Purchaser has consented in writing thereto, the Company shall, and shall cause each of its subsidiaries to: (a) the conduct its business of it and its Subsidiaries shall be conducted operations only in the ordinary and usual course and, to the extent of business consistent therewith, it and its Subsidiaries shall use their respective best efforts to preserve its business organization intact and maintain its existing relations and goodwill with customers, suppliers, distributors, creditors, lessors, employees and business associatespast practice; (b) it shall use all reasonable efforts to preserve intact the business organizations, goodwill, rights, licenses, permits and franchises of the Company and its subsidiaries and maintain their existing relationships with customers, suppliers and other persons having business dealings with them; (c) use its commercially reasonable efforts to keep in full force and effect adequate insurance overages and maintain and keep its properties and assets in good repair, working order and condition, normal wear and tear excepted; (d) not amend or modify its respective articles or certificate of incorporation, by-laws, partnership agreement or other charter or organization documents; (ie) not authorize for issuance, issue, sell, pledgegrant, dispose of deliver, pledge or encumber or agree or commit to issue, sell, grant, deliver, pledge or encumber any shares of any class or series of capital stock owned by it in of the Company or any of its Subsidiaries; subsidiaries or any other equity or voting security or equity or voting interest in the Company or any of its subsidiaries, any securities convertible into or exercisable or exchangeable for any such shares, securities or interests, or any options, warrants, calls, commitments, subscriptions or rights to purchase or acquire any such shares, securities or interests (iiother than issuances of Company Common Stock upon exercise of Company Options granted prior to the date of this Agreement to directors, officers, employees and consultants of the Company in accordance with the Company Stock Plan as currently in effect); (f) amend its certificate of incorporation or by-laws; not (iiiA) split, combine or reclassify its outstanding any shares of its capital stock or issue or authorize or propose the issuance of any other securities in respect of, in lieu of, or in substitution for, shares of its capital stock; , (ivB) in solely the case of the Company, declare, set aside or pay any dividend payable in cashdividends on, stock or property make other distributions in respect of, any of any the Company's capital stock other than dividends from its direct or indirect wholly-owned Subsidiaries; stock, or (vC) except for the repurchase of the Class A Warrant contemplated by the Warrantholder Agreement and the repurchase of outstanding Class B Preferred Shares, repurchase, redeem or otherwise acquire, or permit any of its Subsidiaries agree or commit to purchase repurchase, redeem or otherwise acquire, any shares of its capital stock or other equity or debt securities or equity interests of the Company or any securities convertible into or exchangeable or exercisable for any shares of its capital stocksubsidiaries; (cg) except as set forth not amend or otherwise modify the terms of any Company Options or the Company Stock Plan the effect of which shall be to make such terms more favorable to the holders thereof or persons eligible for participation therein; (h) other than regularly scheduled seniority increases in Section 6.1(c) the ordinary course of business consistent with past practice, not increase the compensation payable or to become payable to any directors, officers or employees of the Company Disclosure Letter, neither it nor or any of its Subsidiaries shall subsidiaries, or grant any severance or termination pay to, or enter into any employment or severance agreement with any director or officer of the Company or any of its subsidiaries, or establish, adopt, enter into or amend in any material respect or take action to accelerate any material rights or benefits under any collective bargaining, bonus, profit sharing, thrift, compensation, stock option, restricted stock, pension, retirement, deferred compensation, employment, termination, severance or other plan, agreement, trust, fund, policy or arrangement for the benefit of any director, officer or employee of the Company of any of its subsidiaries; (i) issuenot acquire or agree to acquire (including, sellwithout limitation, pledgeby merger, dispose of or encumber any shares ofconsolidation, or acquisition of stock, equity securities convertible into or exchangeable or exercisable forinterests, or assets) any corporation, partnership, joint venture, association or other business organization or division thereof or otherwise acquire or agree to acquire any assets of any other person outside the ordinary course of business consistent with past practice or any interest in any real properties (whether or not in the ordinary course of business); (j) not incur, assume or guarantee any indebtedness for borrowed money (including draw-downs on letters or lines of credit) or issue or sell any notes, bonds, debentures, debt instruments, evidences of indebtedness or other debt securities of the Company or any of its subsidiaries or any options, warrants, calls, commitments warrants or rights of to purchase or acquire any kind to acquire, any shares of its capital stock of any class or any other property or assets (other than Shares issuable pursuant to options outstanding on the date hereof under the Stock Plan or upon conversion of the Class A Preferred Shares same, except for (A) renewals of existing bonds and Class C Preferred Shares); letters of credit in the ordinary course of business not to exceed $10,000,000 and (iiB) transferadvances, loans or other indebtedness in the ordinary course of business consistent with past practice in an aggregate amount not to exceed $5,000,000; (k) not sell, lease, license, guaranteeencumber or otherwise dispose of, or agree to sell, mortgagelease, pledgelicense, encumber or otherwise dispose of or encumber of, any material property properties or assets (including capital stock of the Company or any of its Subsidiariessubsidiaries; (l) or incur or modify any material indebtedness or other liability; or (iii) except as set forth in Section 6.1(c)(iii) of the Company Disclosure Letter, make or not authorize or commit for make any capital expenditures other than in amounts less than $25,000 individually and $100,000 in the aggregate or, (including by any means, make any acquisition of, or investment in, assets or stock of any other Person or entity lease) in excess of $25,0005,000,000 in the aggregate for the Company and all of its subsidiaries; (dm) neither it nor not make any material change in any of its Subsidiaries shall terminateaccounting or financial reporting (including Tax accounting and reporting) methods, establishprinciples or practices, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Compensation and Benefit Plans or increase the salary, wage, bonus or other compensation of any employees except increases for non-executive employees occurring in the ordinary and usual course of business (which shall include normal periodic performance reviews and related compensation and benefit increases)as may be required by GAAP; (en) neither it nor not make any of its Subsidiaries shall material tax election or settle or compromise any material claims United States, Dutch or litigation or, foreign tax liability; (o) except in the ordinary and usual course of businessbusiness consistent with past practice, modifynot amend, amend modify or terminate any Contract required to be listed in Section 3.17 of its material Contracts the Company Disclosure Schedule or waive, release or assign any material rights or claimsclaims thereunder; (fp) neither it nor not adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other reorganization of the Company or any of its Subsidiaries shall make subsidiaries; (q) not take any Tax election action that would, or permit would be reasonably likely to, result in any insurance policy naming it as a beneficiary of the representations and warranties set forth in this Agreement not being true and correct in any material respect or loss-payable payee to be cancelled or terminated except any of the conditions set forth in the ordinary and usual course of businessArticle VI not being satisfied; and (gr) neither it nor any of its Subsidiaries will authorize not agree or enter into an agreement commit in writing or otherwise to do (or, in the case of clauses (i) through (iii), to do anything inconsistent with) any of the foregoing.

Interim Operations. The Except as otherwise contemplated by this Agreement or as set forth in Section 6.01 of the Company Disclosure Schedule or as consented to in writing by Parent, the Company covenants and agrees as to itself and its Subsidiaries that, after that during the period from the date hereof and prior of this Agreement to the earlier of the Effective Time (or until termination of this Agreement in accordance with its terms and the Effective Time (unless Parent shall otherwise approve in writing, and except as otherwise expressly contemplated by this AgreementArticle 8 hereof): (a) the business and operations of it the Company and its Subsidiaries shall be conducted only in the ordinary course of business and usual course and, to the extent consistent therewith, it Company and its Subsidiaries shall use their respective reasonable best efforts to preserve its intact their current business organization intact organizations, keep available the services of their current officers and maintain its existing relations employees and goodwill preserve their relationships with their material customers, suppliers, distributorslicensors, creditorslicensees, lessorsadvertisers, employees distributors and other material third parties having business associatesdealings with them and to preserve the goodwill of their respective businesses; (b) it the Company shall not (i) authorize for issuance, issue, selldeliver, pledgesell or agree or commit to issue, dispose sell or deliver (whether through the issuance or granting of options, commitments, subscriptions, rights to purchase or otherwise), pledge or otherwise encumber any shares of its capital stock owned by it in or the capital stock of any of its Subsidiaries; , any other securities or any securities convertible or exercisable into, or any rights, warrants or options to acquire, any such shares, securities or convertible securities or any other securities or equity equivalents (including without limitation stock appreciation rights or phantom interests), except for issuances of Common Shares upon the exercise of Options outstanding as of the date hereof or (ii) amend its certificate of incorporation or by-laws; (iii) split, combine or reclassify its outstanding shares of capital stock; (iv) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly-owned Subsidiaries; or (v) except for the repurchase of the Class A Warrant contemplated by the Warrantholder Agreement and the repurchase of outstanding Class B Preferred Shares, repurchase, redeem or otherwise acquire, or permit any of its Subsidiaries to purchase repurchase, redeem or otherwise acquire, any shares of its capital stock or any securities convertible into or exchangeable or exercisable for any shares of its capital stock; (c) except as set forth in Section 6.1(c) other equity interests of the Company Disclosure Letter, neither it nor or any of its Subsidiaries shall (i) issueincluding, sellwithout limitation, pledge, dispose of or encumber any shares of, or securities convertible into or exchangeable or exercisable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class or any other property or assets (other than Shares issuable pursuant to options outstanding on the date hereof under the Stock Plan or upon conversion equity interests of the Class A Preferred Shares and Class C Preferred Shares); (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of Company or encumber any material property or assets (including capital stock of any of its Subsidiaries) or incur or modify any material indebtedness or other liability; or (iii) except as set forth in Section 6.1(c)(iii) of the Company Disclosure Letter, make or authorize or commit for any capital expenditures other than in amounts less than $25,000 individually and $100,000 in the aggregate or, by any means, make any acquisition of, or investment in, assets or stock of any other Person or entity in excess of $25,000; (d) neither it nor any of its Subsidiaries shall terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Compensation and Benefit Plans or increase the salary, wage, bonus or other compensation of any employees except increases for non-executive employees occurring in the ordinary and usual course of business (which shall include normal periodic performance reviews and related compensation and benefit increases); (e) neither it nor any of its Subsidiaries shall settle or compromise any material claims or litigation or, except in the ordinary and usual course of business, modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claims; (f) neither it nor any of its Subsidiaries shall make any Tax election or permit any insurance policy naming it as a beneficiary or loss-payable payee to be cancelled or terminated except in the ordinary and usual course of business; and (g) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.

Interim Operations. The Company covenants and agrees as to itself and its Subsidiaries that, after From the date hereof and prior to the earlier of the termination of this Agreement in accordance with its terms and until the Effective Time (unless Parent shall otherwise approve in writingTender Offer Purchase Time, and except as otherwise set forth in Section 5.1 of the Company Disclosure Schedule or as expressly contemplated by any other provision of this Agreement):, unless the Parent has consented in writing thereto, the Company shall, and shall cause each of its subsidiaries to: (a) the conduct its business of it and its Subsidiaries shall be conducted operations only in the ordinary and usual course and, to the extent of business consistent therewith, it and its Subsidiaries shall use their respective best efforts to preserve its business organization intact and maintain its existing relations and goodwill with customers, suppliers, distributors, creditors, lessors, employees and business associatespast practice; (b) it use reasonable efforts to preserve intact the business, organization, goodwill, rights, licenses, permits and franchises of the Company and its subsidiaries and maintain their existing relationships with customers, suppliers and other Persons having business dealings with them; (c) use reasonable efforts to keep in full force and effect adequate insurance coverage and maintain and keep its material Company Assets in good repair, working order and condition, normal wear and tear excepted; (d) not amend or modify its respective Articles of Incorporation, Bylaws or other charter or organizational documents, except that the Company shall file Articles Supplementary with respect to the Series B Preferred Stock with the SDAT; (e) not (i) authorize for issuance, issue, sell, pledgegrant, dispose of deliver, pledge or encumber or agree or commit to issue, sell, grant, deliver, pledge or encumber any shares of any class or series of capital stock owned by it in of the Company or any of its Subsidiariessubsidiaries or any other equity or voting security or equity or voting interest in the Company or any of its subsidiaries, any securities convertible into or exercisable or exchangeable for any such shares, securities or interests, or any options, warrants, calls, commitments, subscriptions or rights to purchase or acquire any such shares, securities or interests (other than issuances of Shares or, in the case of clause (iv), shares of Series B Preferred Stock (i) exercise of Company Stock Options granted prior to the date of this Agreement to directors, officers, employees and consultants of the Company in accordance with the Option Plans as currently in effect; (ii) amend its certificate conversion of incorporation or by-laws; the Convertible Preferred Stock, (iii) exercise of the Warrants and (iv) exercise by Acquisition of the Option); (f) not (i) split, combine or reclassify its outstanding any shares of capital stock; its stock or issue or authorize or propose the issuance of any other securities in respect of, in lieu of, or in substitution for, shares of its stock or (ivii) in solely the case of the Company, declare, set aside or pay any dividend payable in cashdividends on, stock or property make other distributions in respect of of, any capital stock other than dividends from its direct or indirect wholly-owned Subsidiaries; or (v) except for the repurchase of the Class A Warrant contemplated by the Warrantholder Agreement and the repurchase of outstanding Class B Preferred SharesCompany's stock, repurchase, redeem or otherwise acquire, or permit any of its Subsidiaries agree or commit to purchase repurchase, redeem or otherwise acquire, any shares of its capital stock or other equity or debt securities or equity interests of the Company or any securities convertible into or exchangeable or exercisable for any shares of its capital stocksubsidiaries, except that the Company may pay an aggregate dividend of $43,533.00 on the Convertible Preferred Stock on November 12, 2000 and as contemplated by Section 2.10 with respect to settlement of Company Stock Options; (cg) except as contemplated by Section 2.10, not amend or otherwise modify the terms of any Company Stock Options or the Option Plans, the effect of which shall be to make such terms more favorable to the holders thereof or Persons eligible for participation therein; (h) not (i) increase the compensation payable or to become payable to any directors, officers or employees of the Company or any of its subsidiaries except arrangements in connection with employee transfers and agreements with new employees having a salary of greater than $85,000, (ii) grant any severance or termination pay to, or enter into any employment or severance agreement with any director or officer or employee (other than in the ordinary course of business of the Company or any of its subsidiaries except that the Company may enter into new employment agreements with each of Messrs. ▇▇▇▇▇▇ ▇. ▇▇▇▇ and ▇▇▇▇ ▇. ▇▇▇▇▇ ("Management Employment Agreements") in the form attached hereto as Exhibits D and E, respectively, with such changes thereto as may be approved by Parent), or (iii) establish, adopt, enter into or amend in any material respect or take action to accelerate, any material rights or material benefits under any collective bargaining, bonus, profit sharing, thrift, compensation, stock option (except as contemplated by Section 2.10), restricted stock (except to the extent described in existing employment agreements), pension, retirement, deferred compensation, employment, termination, severance or other plan, agreement, trust, fund, policy or arrangement for the benefit of any director or officer or employee (other than in the ordinary course of business) of the Company or any of its subsidiaries; (i) not acquire or agree to acquire (including, without limitation, by merger, consolidation, or acquisition of stock, equity securities or interests, or assets) any corporation, partnership, joint venture, association or other business organization or division thereof or otherwise acquire or agree to acquire any assets of any other Person outside the ordinary course of business consistent with past practice or any interest in any real properties (other than in the ordinary course of business); (j) not incur, assume or guarantee any indebtedness for borrowed money (including draw-downs on letters or lines of credit) or issue any notes, bonds, debentures, debt instruments, evidences of indebtedness or other debt securities of the Company or any of its subsidiaries or any options, warrants or rights to purchase or acquire any of the same, except for (i) renewals of existing bonds and letters of credit in the ordinary course of business not to exceed $1,000,000 in the aggregate; (ii) incurring indebtedness for borrowed money in the ordinary course of business consistent with past practice in an aggregate amount not to exceed $1,000,000 or (iii) advances in the ordinary course pursuant to (A) working capital lines of credit in an amount not to exceed $1,000,000 in the aggregate and (B) warehouse lines of credit set forth in Section 6.1(c3.15(a)(v) of the Company Disclosure Letter, neither it nor any of its Subsidiaries shall (i) issue, sell, pledge, dispose of or encumber any shares ofSchedule, or securities convertible into any renewal or exchangeable or exercisable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class or any other property or assets replacement thereof; (other than Shares issuable pursuant to options outstanding on the date hereof under the Stock Plan or upon conversion of the Class A Preferred Shares and Class C Preferred Shares); (iik) transfernot sell, lease, license, guaranteeencumber or otherwise dispose of, or agree to sell, mortgagelease, pledgelicense, encumber or otherwise dispose of or encumber of, any material property properties or assets (including capital stock of the Company or any of its Subsidiariessubsidiaries, other than in the ordinary course of business; (l) or incur or modify any material indebtedness or other liability; or (iii) except as set forth in Section 6.1(c)(iii) of the Company Disclosure Letter, make or not authorize or commit for make any capital expenditures other than (including by lease) in amounts less than $25,000 individually and excess of $100,000 in the aggregate or, by any means, make any acquisition of, or investment in, assets or stock other than the ordinary course of any other Person or entity in excess business for the Company and all of $25,000its subsidiaries; (dm) neither it nor not make any material change in any of its Subsidiaries shall terminateaccounting or financial reporting (including tax accounting and reporting) methods, establishprinciples or practices, adopt, enter into, make any new grants except as may be required by a change in law or awards under, amend or otherwise modify, any Compensation and Benefit Plans or increase the salary, wage, bonus or other compensation of any employees except increases for non-executive employees occurring in the ordinary and usual course of business (which shall include normal periodic performance reviews and related compensation and benefit increases)GAAP; (en) neither it nor not make any of its Subsidiaries shall material tax election or settle or compromise any material claims United States or litigation or, foreign tax liability; (o) except in the ordinary and usual course of businessbusiness consistent with past practice, modifynot amend, amend modify or terminate any of its material Contracts Contract or waive, release or assign any material rights or claimsclaims thereunder; (fp) neither it nor other than in the ordinary course of business, not enter into contracts that reasonably would involve financial obligations by the Company exceeding $100,000; (q) not adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other reorganization of the Company or any of its Subsidiaries shall make subsidiaries; (r) fail to report any Tax election facts, circumstance or permit events that has resulted in any insurance policy naming it as a beneficiary claims that, individually or loss-payable payee to be cancelled or terminated except in the ordinary and usual course of businessaggregate, would have a Material Adverse Effect; and (gs) neither it nor any except as to subsections (a), (b) and (c) of its Subsidiaries will authorize Section 5.1, not agree or enter into an agreement commit in writing or otherwise to do any of the foregoing.

Interim Operations. The Except as otherwise expressly contemplated by this Agreement, as set forth in Section 5.01 of the Company Disclosure Schedule, as required by applicable Law, for Expenses incurred by the Company or as otherwise agreed to in writing by Parent, the Company covenants and agrees as to itself and its Subsidiaries that, after that during the period from the date hereof and prior of this Agreement to the earlier of the Effective Time (or until termination of this Agreement in accordance with its terms and the Effective Time (unless Parent shall otherwise approve in writing, and except as otherwise expressly contemplated by this AgreementArticle 7 hereof): (a) the business and operations of it the Company and its Subsidiaries subsidiaries shall be conducted in the ordinary course of business consistent with past practice and usual course and, to the extent consistent therewith, it Company and its Subsidiaries subsidiaries shall use their respective best commercially reasonable efforts to preserve its intact their current business organization intact organizations, keep available the services of their current officers and maintain its existing relations key employees and goodwill preserve their relationships with their material customers, suppliers, licensors, licensees and distributors, creditors, lessors, employees and business associates; (b) it the Company shall not (i) authorize for issuance, issue, selldeliver, pledgesell or agree or commit to issue, dispose sell or deliver (whether through the issuance or granting of options, commitments, subscriptions, rights to purchase or otherwise), pledge or otherwise encumber any shares of its capital stock owned by it in or the capital stock of any of its Subsidiaries; subsidiaries, any other securities or any securities convertible into, or any rights, warrants or options to acquire, any such shares, securities or convertible securities or any other securities or equity equivalents (including stock appreciation rights or phantom interests), except for issuances of Common Shares upon the exercise of Options or Warrants outstanding as of the date of this Agreement, (ii) amend its certificate of incorporation or by-laws; (iii) split, combine or reclassify its outstanding shares of capital stock; (iv) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly-owned Subsidiaries; or (v) except for the repurchase of the Class A Warrant contemplated by the Warrantholder Agreement and the repurchase of outstanding Class B Preferred Shares, repurchase, redeem or otherwise acquire, or permit any of its Subsidiaries subsidiaries to purchase repurchase, redeem or otherwise acquire, any shares of its capital stock or any securities convertible into or exchangeable or exercisable for any shares of its capital stock; (c) except as set forth in Section 6.1(c) other equity interests of the Company Disclosure Letter, neither it nor or any of its Subsidiaries shall subsidiaries (i) issue, sell, pledge, dispose of or encumber any shares of, or including securities convertible into or exchangeable or exercisable for, or options, warrants, calls, commitments or rights of any kind to acquire, capital stock or other equity interests of the Company or any of its subsidiaries) except for forfeitures of Common Shares issued pursuant to Restricted Stock Awards, (iii) sell, transfer or pledge, or agree to sell, transfer or pledge, any equity interest owned by it in any of its subsidiaries or alter through merger, liquidation, reorganization, restructuring or in any other fashion the corporate structure or ownership of any of its subsidiaries, (iv) amend or otherwise change its certificate of incorporation or bylaws or permit any of its subsidiaries to amend its certificate of incorporation, bylaws or similar organizational documents, (v) split, combine or reclassify any shares of its capital stock, and shall not permit any of its subsidiaries to split, combine or reclassify any shares of its capital stock or (vi) amend or otherwise change the terms of any class Warrants; (c) the Company shall not, and shall not permit any of its subsidiaries to (i) declare, set aside or pay any dividends on (whether in cash, stock or other property), or make any other property distributions in respect of, any of its capital stock (except for dividends paid to the Company by direct or assets (other than Shares issuable pursuant to options outstanding on the date hereof under the Stock Plan or upon conversion indirect wholly-owned subsidiaries of the Class A Preferred Shares and Class C Preferred SharesCompany); , (ii) transferacquire or agree to acquire, leaseincluding by merging or consolidating with, license, guarantee, sell, mortgage, pledge, dispose of or encumber any material property or purchasing the assets (including except raw materials, inventory or supplies in the ordinary course of business consistent with past practice) or capital stock of any of its Subsidiaries) or incur or modify any material indebtedness or other liability; equity interests of, or by any other manner, any business or any corporation, partnership, association or other business organization or division thereof or (iii) except as set forth in Section 6.1(c)(iii) enter into, amend, modify or supplement any Contract, transaction, commitment or arrangement with any current or former officer, director, employee or other affiliate of the Company Disclosure Letter, make or authorize or commit for any capital expenditures other than in amounts less than $25,000 individually and $100,000 in the aggregate or, by any means, make any acquisition of, or investment in, assets or stock of any other Person or entity in excess of $25,000its subsidiaries; (d) neither it the Company nor any of its Subsidiaries subsidiaries shall terminate(i) grant or agree to any increase in any manner the compensation, establishseverance benefits or fringe benefits of, adoptor pay any severance or bonus to, any current or former director, officer or employee except for payments made in accordance with Sections 5.11(b) and 5.11(c) hereof, (ii) except as provided in Section 5.11(d) of this Agreement and Section 5.11(d)(iii) of the Company Disclosure Schedule, enter into, make into any new grants or awards underamend any existing employment, amend consulting, severance, termination, change-of-control or indemnification Contract with any director, officer or employee of the Company, (iii) except as may be required to comply with applicable Law and except as provided or otherwise modifycontemplated in this Agreement (including Section 2.02 hereof), become obligated under any Compensation and Benefit Plans Plan that was not in existence on the date of this Agreement or increase the salaryamend, wage, bonus modify or terminate any Benefit Plan or other compensation employee benefit plan or any Contract, arrangement, plan or policy for the benefit of any employees current or former director, officer or employee in existence on the date of this Agreement or (iv) except increases as may be required to comply with applicable Law and except as provided or otherwise contemplated in this Agreement (including Section 2.02 hereof), pay any benefit not required by any plan or arrangement as in effect as of the date of this Agreement (including the granting of, acceleration of, exercisability of or vesting of stock options, stock appreciation rights or restricted stock, except as otherwise contemplated by this Agreement), except in connection with terminating the Options and the Stock Plans pursuant to Section 2.02 and except for non-executive employees occurring in the ordinary and usual course payment of business (which shall include normal periodic performance reviews and related compensation and benefit increases)the employer match under the Company’s 401(k) plan; (e) the Company shall not, and shall not permit any of its subsidiaries to, sell, lease, license, mortgage or otherwise encumber or subject to any Lien or otherwise dispose of, or agree to sell, lease, license, mortgage or otherwise encumber or subject to any Lien or otherwise dispose of, any of its properties or assets that are material, individually or in the aggregate, to the Company and its subsidiaries, taken as a whole, other than sales of inventory and other assets in the ordinary course of business consistent with past practice; (f) except pursuant to a Material Contract, the Company shall not, and shall not permit any of its subsidiaries to (i) incur, assume, pre-pay, discharge or satisfy any Indebtedness or enter into any Contract to incur, assume, pre-pay, discharge or satisfy any Indebtedness, or guarantee, or agree to guarantee, any such Indebtedness or obligation of another Person, or issue or sell, or agree to issue or sell, any debt securities or options, warrants or calls or rights to acquire any debt securities of the Company or any of its subsidiaries, guarantee any debt securities of others, enter into any “keep well” or other Contract to maintain any financial statement condition of another Person or enter into any Contract or arrangement having the economic effect of any of the foregoing, or (ii) make or forgive any loans, advances or capital contributions to, guarantees for the benefit of, or investments in, any Person, other than (y) loans between or among the Company and any of its wholly-owned subsidiaries and (z) cash advances to the Company’s or its subsidiary’s employees for reimbursable travel and other business expenses incurred in the ordinary course of business; (g) neither it the Company nor any of its Subsidiaries subsidiaries shall settle adopt or compromise put into effect a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other reorganization of the Company or any material claims of its subsidiaries; (h) the Company shall not, and shall not permit any of its subsidiaries to, (i) enter into, or litigation or, except in the ordinary and usual course of businessamend, modify, amend elect not to renew or terminate any of its material Contracts or waive, release or assign any rights under any Material Contract in any material rights respect in a manner which is adverse to the Company or claimsits subsidiaries (other than entering into a new Material Contract to replace a Material Contract which has terminated without a breach thereunder by its terms, which new Material Contract is consistent with the terms of the terminated Material Contract); (fi) neither it nor except for customer Contracts entered into in the ordinary course of business consistent with past practice, the Company shall not, and shall not permit its subsidiaries to, renegotiate or enter into any new material Contract, license, arrangement or other relating to any Proprietary Rights; (j) the Company and its subsidiaries (i) shall comply in all material respects with their obligations under the Material Contracts as such obligations become due, (ii) shall continue in force insurance covering risks of its Subsidiaries such types and in such amounts as are consistent with the Company’s past practices and (iii) shall make any Tax election or not permit any insurance policy naming it as a beneficiary or loss-loss payable payee to be cancelled canceled or terminated terminated; (k) the Company shall not, and shall not permit any of its subsidiaries to, make any capital expenditure or commitments not consistent with the expenditures in the Company’s capital budget for 2008 provided to Parent; (l) the Company shall not, and shall not permit any of its subsidiaries to make any material changes in their respective standardized or other sales terms and conditions, except in the ordinary and usual course of businessbusiness consistent with past practice; (m) the Company shall not, and shall not permit any of its subsidiaries to, enter into any settlement, conciliation or similar Contract with any Governmental Authority or that requires payment of any material consideration after the execution date of this Agreement; (n) the Company shall not, and shall not permit any of its subsidiaries to, (i) settle or compromise any pending or threatened Claim, except with respect to the settlement or compromise of any such Claim where the full amount paid or to be paid is covered by insurance coverage maintained by the Company, (ii) change any of the accounting policies, practices or procedures (including material Tax accounting methods, periods, policies, practices or procedures) or any of its methods of reporting income, deductions or other items for financial accounting purposes, except as may be required as a result of a change in GAAP enacted after the date of this Agreement, or (iii) except in the ordinary course of business and in a manner consistent with past practice, make, change or rescind any material Tax election, enter into any material closing agreement relating to Taxes, settle or compromise any material Tax liability, audit, claim, proceeding or assessment, file any material amended Tax Return, surrender any right to claim a refund of material Taxes, or consent to any extension or waiver of the limitation period applicable to any material Tax liability or assessment; (o) the Company shall not, and shall not permit any of its subsidiaries to, allow any material Company Proprietary Rights to become abandoned or expired for failure to make required filings or pay required fees; and (gp) neither it nor the Company shall not, and shall not permit any of its Subsidiaries will authorize subsidiaries to, agree or enter into an agreement commit to do any of the foregoing.

Interim Operations. The Company covenants and agrees as to itself and its Subsidiaries that, after From the date hereof and prior to the earlier of the termination of this Agreement in accordance with its terms and until the Effective Time (unless Parent shall otherwise approve in writingClosing Time, and except as otherwise set forth in Section 5.1 of the Company Disclosure Schedule or as expressly contemplated by any other provision of this Agreement):, unless the Parent has consented in writing thereto, the Company shall, and shall cause each of its subsidiaries to: (a) the conduct its business of it and its Subsidiaries shall be conducted operations only in the ordinary and usual course and, to the extent of business consistent therewith, it and its Subsidiaries shall use their respective best efforts to preserve its business organization intact and maintain its existing relations and goodwill with customers, suppliers, distributors, creditors, lessors, employees and business associatespast practice; (b) it shall use reasonable efforts to preserve intact the business, organization, goodwill, rights, licenses, permits and franchises of the Company and its subsidiaries and maintain their existing relationships with customers, suppliers and other persons having business dealings with them, the loss of any of which would be reasonably likely to result in a Material Adverse Effect on the Company; (c) use reasonable efforts to keep in full force and effect adequate insurance coverage and maintain and keep its properties and assets in good repair, working order and condition, normal wear and tear excepted; (d) not amend or modify its respective charter or certificate of incorporation, by-laws, or other charter or organization documents; (ie) not authorize for issuance, issue, sell, pledgegrant, dispose of deliver, pledge or encumber or agree or commit to issue, sell, grant, deliver, pledge or encumber any shares of any class or series of capital stock owned by it in of the Company or any of its Subsidiaries; subsidiaries or any other equity or voting security or equity or voting interest in the Company or any of its subsidiaries, any securities convertible into or exercisable or exchangeable for any such shares, securities or interests, or any options, warrants, calls, commitments, subscriptions or rights to purchase or acquire any such shares, securities or interests (iiother than issuances of Shares upon exercise of Company Stock Options granted prior to the date of this Agreement and disclosed pursuant to Section 3.2 to directors, officers, employees and consultants of the Company in accordance with the Company Option Plans as currently in effect); (f) amend its certificate of incorporation or by-laws; not (iiii) split, combine or reclassify its outstanding any shares of capital its stock or issue or authorize or propose the issuance of any other securities in respect of, in lieu of, or in substitution for, shares of its stock; , (ivii) in solely the case of the Company, declare, set aside or pay any dividend payable in cashdividends on, stock or property make other distributions in respect of, any of any capital stock other than dividends from its direct or indirect wholly-owned Subsidiaries; the Company's stock, or (viii) except for the repurchase of the Class A Warrant contemplated by the Warrantholder Agreement and the repurchase of outstanding Class B Preferred Shares, repurchase, redeem or otherwise acquire, or permit any of its Subsidiaries agree or commit to purchase repurchase, redeem or otherwise acquire, any shares of its capital stock or other equity or debt securities or equity interests of the Company or any securities convertible into or exchangeable or exercisable for any shares of its capital stocksubsidiaries; (cg) except as set forth not amend or otherwise modify the terms of any Company Stock Options or the Company Option Plans, the effect of which shall be to make such terms more favorable to the holders thereof or persons eligible for participation therein; (h) other than regularly scheduled seniority increases in Section 6.1(c) the ordinary course of business consistent with past practice, not increase the compensation payable or to become payable to any directors, officers or employees of the Company Disclosure Letter, neither it nor or any of its Subsidiaries shall subsidiaries, or grant any severance or termination pay to, or enter into any employment or severance agreement with any director or officer of the Company or any of its subsidiaries, or establish, adopt, enter into or amend in any material respect or take action to accelerate any material rights or benefits under any collective bargaining, bonus, profit sharing, thrift, compensation, stock option, restricted stock, pension, retirement, deferred compensation, employment, termination, severance or other plan, agreement, trust, fund, policy or arrangement for the benefit of any director, officer or employee of the Company of any of its subsidiaries; (i) issuenot acquire or agree to acquire (including, sellwithout limitation, pledgeby merger, dispose of or encumber any shares ofconsolidation, or acquisition of stock, equity securities convertible into or exchangeable or exercisable forinterests, or assets) any corporation, partnership, joint venture, association or other business organization or division thereof or otherwise acquire or agree to acquire any assets of any other person outside the ordinary course of business consistent with past practice or any interest in any real properties (whether or not in the ordinary course of business); (j) not incur, assume or guarantee any indebtedness for borrowed money (including draw-downs on letters or lines of credit) or issue or sell any notes, bonds, debentures, debt instruments, evidences of indebtedness or other debt securities of the Company or any of its subsidiaries or any options, warrants, calls, commitments warrants or rights of to purchase or acquire any kind to acquire, any shares of its capital stock of any class or any other property or assets (other than Shares issuable pursuant to options outstanding on the date hereof under the Stock Plan or upon conversion of the Class A Preferred Shares same, except for (i) renewals of existing bonds and Class C Preferred Shares)letters of credit in the ordinary course of business not to exceed $1,000,000 in the aggregate; and (ii) transferadvances, loans or other indebtedness in the ordinary course of business consistent with past practice in an aggregate amount not to exceed $1,000,000; (k) not sell, lease, license, guaranteeencumber or otherwise dispose of, or agree to sell, mortgagelease, pledgelicense, encumber or otherwise dispose of or encumber of, any material property properties or assets (including capital stock of any of its Subsidiaries) or incur or modify any material indebtedness or other liability; or (iii) except as set forth in Section 6.1(c)(iii) of the Company Disclosure Letter, make or and its subsidiaries taken as a whole; (l) not authorize or commit for make any capital expenditures other than in amounts less than $25,000 individually and $100,000 in the aggregate or, (including by any means, make any acquisition of, or investment in, assets or stock of any other Person or entity lease) in excess of $25,0001,000,000 in the aggregate for the Company and all of its subsidiaries; (dm) neither it nor not make any material change in any of its Subsidiaries shall terminateaccounting or financial reporting (including tax accounting and reporting) methods, establishprinciples or practices, adopt, enter into, make any new grants except as may be required by GAAP or awards under, amend or otherwise modify, any Compensation and Benefit Plans or increase the salary, wage, bonus or other compensation of any employees except increases for non-executive employees occurring in the ordinary and usual course of business (which shall include normal periodic performance reviews and related compensation and benefit increases)applicable tax laws; (en) neither it nor not make any of its Subsidiaries shall material tax election or settle or compromise any material claims United States or litigation or, foreign tax liability; (o) except in the ordinary and usual course of businessbusiness consistent with past practice, modifynot amend, amend modify or terminate any Contract required to be listed in Section 3.15 of its material Contracts the Company Disclosure Schedule or waive, release or assign any material rights or claimsclaims thereunder; (fp) neither it nor not adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other reorganization of the Company or any of its Subsidiaries shall make any Tax election or permit any insurance policy naming it as a beneficiary or loss-payable payee to be cancelled or terminated except in the ordinary and usual course of businesssubsidiaries; and (gq) neither it nor any except as to subsections (a), (b) and (c) of its Subsidiaries will authorize this Section 5.1, not agree or enter into an agreement commit in writing or otherwise to do any of the foregoing.

Interim Operations. The Except as otherwise expressly contemplated by this Agreement or as set forth on the Company Disclosure Schedule or as agreed to in writing by Parent, which agreement, in the case of clauses (h), (i), (j) or (l) (or, to the extent relating to any of the foregoing clauses, clause (q)), shall not be unreasonably withheld or delayed, the Company covenants and agrees as to itself and its Subsidiaries that, after that during the period from the date hereof and prior of this Agreement to the earlier of the Effective Time (or until termination of this Agreement in accordance with its terms and the Effective Time (unless Parent shall otherwise approve in writing, and except as otherwise expressly contemplated by this AgreementArticle 7 hereof): (a) the business and operations of it the Company and its Subsidiaries subsidiaries shall be conducted only in the ordinary course of business and usual course and, to the extent consistent therewith, it Company and its Subsidiaries subsidiaries shall use their respective reasonable best efforts to preserve its intact their current business organization intact organizations, keep available the services of their current officers and maintain its existing relations employees and goodwill preserve their relationships with their material customers, suppliers, distributorslicensors, creditorslicensees, lessorsadvertisers, employees distributors and other material third parties having business associatesdealings with them and to preserve the goodwill of their respective businesses; (b) it the Company shall not (i) authorize for issuance, issue, selldeliver, pledgesell or agree or commit to issue, dispose sell or deliver (whether through the issuance or granting of options, commitments, subscriptions, rights to purchase or otherwise), pledge or otherwise encumber any shares of its capital stock owned by it in or the capital stock of any of its Subsidiaries; subsidiaries, any other securities or any securities convertible into, or any rights, warrants or options to acquire, any such shares, securities or convertible securities or any other securities or equity equivalents (including without limitation stock appreciation rights or phantom interests), except for issuances of Common Shares upon the exercise of Options outstanding as of the date hereof, (ii) amend its certificate of incorporation or by-laws; (iii) split, combine or reclassify its outstanding shares of capital stock; (iv) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly-owned Subsidiaries; or (v) except for the repurchase of the Class A Warrant contemplated by the Warrantholder Agreement and the repurchase of outstanding Class B Preferred Shares, repurchase, redeem or otherwise acquire, or permit any of its Subsidiaries subsidiaries to purchase repurchase, redeem or otherwise acquire, any shares of its capital stock or any securities convertible into or exchangeable or exercisable for any shares of its capital stock; (c) except as set forth in Section 6.1(c) other equity interests of the Company Disclosure Letter, neither it nor or any of its Subsidiaries shall subsidiaries (i) issueincluding, sellwithout limitation, pledge, dispose of or encumber any shares of, or securities convertible into or exchangeable or exercisable for, or options, warrants, calls, commitments or rights of any kind to acquire, capital stock or other equity interests of the Company or any of its subsidiaries), (iii) sell, transfer or pledge, or agree to sell, transfer or pledge, any equity interest owned by it in any of its subsidiaries or alter through merger, liquidation, reorganization, restructuring or in any other fashion the corporate structure or ownership of any of its subsidiaries, (iv) amend or otherwise change its certificate of incorporation or bylaws or permit any of its subsidiaries to amend its certificate of incorporation, bylaws or equivalent organizational documents or (v) split, combine or reclassify any shares of its capital stock, and shall not permit any of its subsidiaries to split, combine or reclassify any shares of its capital stock; (c) the Company shall not, and shall not permit any of its subsidiaries to (i) declare, set aside or pay any dividends on (whether in cash, stock or other property), or make any other distributions in respect of, any of its capital stock (except for dividends paid by direct or indirect wholly owned subsidiaries to the Company), (ii) acquire or agree to acquire, including, without limitation, by merging or consolidating with, or purchasing the assets or capital stock or other equity interests of, or by any class other manner, any business or any corporation, partnership, association or other property business organization or assets division thereof, (iii) authorize or make any capital expenditures in excess of $100,000 in the aggregate (other than Shares issuable pursuant to options outstanding on commitments prior to the date hereof under the Stock Plan or upon conversion of the Class A Preferred Shares and Class C Preferred Shares); (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any material property or assets (including capital stock of any of its Subsidiaries) or incur or modify any material indebtedness or other liability; or (iii) except as set forth disclosed in Section 6.1(c)(iii5.01(c) of the Company Disclosure LetterSchedule) or (iv) enter into, make amend, modify or authorize supplement any agreement, transaction, commitment or commit for arrangement with any capital expenditures current or former officer, director, employee or other affiliate of the Company or any of its subsidiaries (or any affiliate of the foregoing) other than in amounts less than $25,000 individually and $100,000 in the aggregate or, as contemplated by any means, make any acquisition of, or investment in, assets or stock of any other Person or entity in excess of $25,000this Agreement; (d) neither it the Company nor any of its Subsidiaries subsidiaries shall terminate(i) grant or agree to any increase in any manner the compensation or fringe benefits of, establish, adopt, enter into, make or pay any new grants or awards under, amend or otherwise modifybonus to, any Compensation current or former director, officer or employee except (A) for increases and Benefit Plans bonuses expressly contemplated by or increase required under existing employment agreements or bonus plans listed in Section 5.01(d) of the salaryCompany Disclosure Schedule, wage, bonus or other (B) for increases in compensation of any to employees except increases for non-executive employees occurring in the ordinary and usual course of business consistent with past practice (which shall include normal periodic performance reviews but in no event greater than 5% for any individual employee whose reasonably anticipated annual compensation is greater than $150,000 or 10% for any individual employee whose reasonably anticipated annual compensation is equal to or less than $150,000), (C) in connection with accelerating the vesting schedules of the Options and related terminating the Options and the Stock Plans and (D) as set forth on Section 5.01(d) of the Company Disclosure Schedule, (ii) hire any employee except (1) the replacement of any current employee of the Company or any of its subsidiaries whose employment with the Company or any of its subsidiaries is terminated for any reason (with such replacement employee receiving substantially similar compensation and benefits as such terminated employee) and (2) any new employee (other than replacement employees) whose reasonably anticipated annual base salary and bonus will not exceed $100,000 individually or $500,000 in the aggregate among all such new employees, (iii) except as may be required to comply with applicable Law and except as provided or otherwise contemplated in this Agreement (including, without limitation, Section 2.02 hereof), become obligated under any Benefit Plan that was not in existence on the date hereof or amend, modify or terminate any Benefit Plan or other employee benefit increasesplan or any agreement, arrangement, plan or policy for the benefit of any current or former director, officer or employee in existence on the date hereof or (iv) except as may be required to comply with applicable Law and except as provided or otherwise contemplated in this Agreement (including, without limitation, Section 2.02 hereof), pay any benefit not required by any plan or arrangement as in effect as of the date hereof (including, without limitation, securities exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, capital stock or other equity interests of the Company or any of its subsidiaries), except in connection with accelerating the vesting schedules of the Options and terminating the Options and the Stock Plans and except for the payment of the employer match under the Company’s 401(k) plan; (e) neither it nor the Company shall not, and shall not permit any of its Subsidiaries shall settle subsidiaries to, sell, lease, license, mortgage or compromise otherwise encumber or subject to any material claims Lien or litigation orotherwise dispose of, except or agree to sell, lease, license, mortgage or otherwise encumber or subject to any Lien or otherwise dispose of (including through any sale-leaseback or similar transaction), any of its properties or assets other than (i) pursuant to existing contracts and commitments described in Section 5.01(e) of the Company Disclosure Schedule, (ii) immaterial properties or assets (or immaterial portions of properties or assets), (iii) inventory in the ordinary and usual course of businessbusiness consistent with past practice, modify, amend or terminate any (iv) licenses granted by the Company in the ordinary course of its material Contracts or waive, release or assign any material rights or claimsbusiness to customers for such customers’ use of the Company’s products and services and (v) Permitted Liens; (f) the Company shall not, and shall not permit any of its subsidiaries to (i) incur, assume or pre-pay any indebtedness for borrowed money or enter into any agreement to incur, assume or pre-pay any indebtedness for borrowed money, or guarantee, or agree to guarantee, any such indebtedness or obligation of another person, or issue or sell, or agree to issue or sell, any debt securities or options, warrants or calls or rights to acquire any debt securities of the Company or any of its subsidiaries, guarantee any debt securities of others, enter into any “keep well” or other agreement to maintain any financial statement condition of another person or enter into any arrangement having the economic effect of any of the foregoing, (ii) make or forgive any loans, advances or capital contributions to, guarantees for the benefit of, or investments in, any person or entity, other than loans between or among the Company and any of its wholly-owned subsidiaries and cash advances to the Company’s or any such subsidiary’s employees for reimbursable travel and other business expenses incurred in the ordinary course of business consistent with past practice or (iii) assume, guarantee or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any other Person, except for the obligations of the subsidiaries of the Company permitted under this Agreement; (g) neither it the Company nor any of its Subsidiaries subsidiaries shall make adopt or put into effect a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other reorganization of the Company or any Tax election of its subsidiaries (other than any transaction specifically contemplated by this Agreement or as permitted by Section 5.10); (h) the Company shall not, and shall not permit any of its subsidiaries to, (i) enter into, or materially amend, modify or supplement any Material Contract outside the ordinary course of business consistent with past practice (except as may be necessary for the Company to comply with its obligations hereunder) or (ii) waive, release, grant, assign or transfer any of its material rights or claims (whether such rights or claims arise under a Material Contract or otherwise); (i) except for customer contracts entered into in the ordinary course of business, the Company shall not, and shall not permit its subsidiaries to, renegotiate or enter into any new license, agreement or arrangement relating to any Proprietary Rights; (j) the Company and its subsidiaries (i) shall comply with their obligations under the Material Contracts as such obligations become due, (ii) shall continue in force insurance covering risks of such types and in such amounts as are consistent with the Company’s past practices and (iii) shall use commercially reasonable efforts not to permit any insurance policy naming it as a beneficiary or loss-loss payable payee to be cancelled canceled or terminated terminated; (k) the Company shall not, and shall not permit any of its subsidiaries to, (i) establish or acquire any subsidiary other than wholly-owned subsidiaries or (ii) amend, modify or waive any term of any outstanding security of the Company or any of its subsidiaries, except (1) in connection with accelerating the vesting schedules of the Options or (2) in connection with terminating the Options and the Stock Plans; (l) the Company shall, and shall cause its subsidiaries to, (i) maintain any real property to which the Company and any of its subsidiaries have ownership or a leasehold interest (including, without limitation, the furniture, fixtures, equipment and systems therein) in its current condition, subject to reasonable wear and tear and subject to any casualty or condemnation, (ii) timely pay all taxes, water and sewage rents, assessments and insurance premiums affecting such real property and (iii) timely comply in all material respects with the terms and provisions of all leases, contracts and agreements relating to such real property and the use and operation thereof; (m) the Company shall not, and shall not permit any of its subsidiaries to, (i) settle or compromise any pending or threatened suit, action, claim or litigation, except with respect to the settlement or compromise of any such matter which does not involve equitable or injunctive relief and does not obligate the Company and its subsidiaries to make aggregate cash payments (excluding amounts covered by insurance) exceeding $300,000, (ii) change any of the material accounting policies, practices or procedures (including material tax accounting policies, practices and procedures) used by the Company and its subsidiaries as of the date hereof, except as may be required as a result of a change in applicable Law or in U.S. generally accepted accounting principles, (iii) revalue in any material respect any of its assets (including, without limitation, writing down or writing off any notes or accounts receivable in any material manner), except as required by U.S. generally accepted accounting principles or (iv) make or change any material tax election, make or change any material method of accounting with respect to Taxes except as may be required as a result of applicable Law, settle or compromise any material Tax liability or file any material amended Tax Return that would increase the tax liability of the Company or its subsidiaries after the Effective Time; (n) the Company shall not, and shall not permit any of its subsidiaries to, take, or agree or commit to take, any action that would, or is reasonably likely to, make any representation or warranty of the Company contained in this Agreement inaccurate at, or as of any time prior to, the Effective Time or result in any of the conditions to the Merger set forth in Article 6 not being satisfied, or omit, or agree to omit, to take any action necessary to prevent any such representation or warranty from being inaccurate in any material respect at any such time or to prevent any such condition from not being satisfied; (o) except as otherwise permitted by Section 5.01(m), the Company shall not, and shall not permit any of its subsidiaries to, pay, discharge or satisfy any material claim, liability or obligation (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction in the ordinary and usual course of businessbusiness and consistent with past practice of liabilities reflected on or reserved in the financial statements of the Company or incurred in the ordinary course of business and consistent with past practice; (p) the Company shall not, and shall not permit any of its subsidiaries to, incur any Expenses other than those that are reasonably necessary to consummate the Merger in accordance with the terms set forth in this Agreement or to defend any lawsuits with respect to, arising from or related to the Transactions; and (gq) neither it nor the Company shall not, and shall not permit any of its Subsidiaries will authorize subsidiaries to, agree or enter into an agreement commit to do any of the foregoing.

Interim Operations. The Company covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the earlier of the termination of this Agreement in accordance with its terms and the Effective Time (unless Parent shall otherwise approve consent in writing, which consent shall not unreasonably be withheld or delayed, and except as otherwise expressly set forth in or contemplated by this AgreementAgreement or described on Section 7.1 of the Company Disclosure Schedule): (a) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and its Subsidiaries shall use their respective best commercially reasonable efforts to preserve its business organization intact and maintain its existing relations and goodwill with customers, suppliers, distributors, strategic partners, creditors, lessors, employees and business associates; (b) it shall not (i) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (ii) amend its certificate of incorporation or by-laws; (iii) split, combine or reclassify its outstanding shares of capital stock; (iv) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly-owned Subsidiaries; or (v) except for the repurchase of the Class A Warrant contemplated by the Warrantholder Agreement and the repurchase of outstanding Class B Preferred Shares, repurchasepurchase, redeem or otherwise acquire, except for the acquisition of shares of Company Common Stock from holders of Company Stock Options in full or partial payment of the exercise price payable by such holder upon exercise of Company Stock Options to the extent required or permitted under the terms of such Company Stock Options, or permit any of its Subsidiaries to purchase or otherwise acquire, any shares of its capital stock or any securities convertible into or exchangeable or exercisable for any shares of its capital stock; (c) except as set forth in Section 6.1(c) of the Company Disclosure Letter, neither it nor any of its Subsidiaries shall (i) authorize, issue, sell, pledge, dispose of or encumber any shares of, or securities convertible into or exchangeable or exercisable for, or options, warrants, calls, commitments or rights of any kind (including but not limited to any “rights or poison pill” agreement) to acquire, any shares of its capital stock of any class class, or any Voting Debt or any other property or assets (other than Shares shares of Company Common Stock and associated rights issuable pursuant to options and other stock-based awards outstanding on the date hereof under the Company Stock Plan or upon conversion of the Class A Preferred Shares and Class C Preferred SharesPlans); or (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of of, abandon, cancel, surrender or allow to lapse or expire or encumber any material property or material assets (including capital stock of any of its Subsidiaries) or incur or modify any material indebtedness or other liability; or (iii) business, except as set forth for such transactions conducted in Section 6.1(c)(iii) the ordinary course of the Company Disclosure Letter, make or authorize or commit for any capital expenditures other than in amounts less than $25,000 individually and $100,000 in the aggregate or, by any means, make any acquisition of, or investment in, assets or stock of any other Person or entity in excess of $25,000Subsidiaries’ business; (d) neither it nor any of its Subsidiaries shall terminaterestructure, establishrecapitalize, adopt, enter into, make any new grants reorganize or awards under, amend completely or partially liquidate or adopt a plan of complete or partial liquidation or otherwise modify, enter into any Compensation and Benefit Plans agreement or increase arrangement imposing material changes or restrictions on the salary, wage, bonus operation of its assets or other compensation businesses or adopt resolutions providing for or authorizing any of any employees except increases for non-executive employees occurring in the ordinary and usual course of business (which shall include normal periodic performance reviews and related compensation and benefit increases)foregoing; (e) neither it nor any of its Subsidiaries shall settle acquire (i) by merging or compromise consolidating with, or by purchasing all or a substantial portion of the assets of or any material claims stock of, or litigation orby any other manner, any business or any corporation, partnership, joint venture, limited liability company, association or other business organization or division thereof, or (ii) any assets that are material, individually or in the aggregate, to the Company and any of its Subsidiaries, taken as a whole, except purchases of inventory and raw materials in the ordinary and usual course of business, modify, amend business (or terminate any of its material Contracts or waive, release or assign any material rights or claimsas permitted by Section 7.1(g)); (f) neither it nor any of its Subsidiaries shall (i) incur any indebtedness for borrowed money or guarantee any such indebtedness of another Person, (ii) issue, sell or amend any debt securities or warrants or other rights to acquire any debt securities of the Company or any of its Subsidiaries, guarantee any debt securities of another Person, enter into any “keep well” or other agreement to maintain any financial statement condition of another Person or enter into any arrangement having the economic effect of any of the foregoing, (iii) make any loans, advances (other than routine advances to employees of the Company and its Subsidiaries in the ordinary course of business) or capital contributions to, or investment in, any other Person, other than the Company or any of its direct or indirect wholly owned Subsidiaries, or (iv) other than in the ordinary course of business, enter into any hedging agreement or other financial agreement or arrangement designed to protect the Company or its Subsidiaries against fluctuations in commodities prices or exchange rates; (g) neither it nor any of its Subsidiaries shall make any capital expenditures or other expenditures with respect to property, plant or equipment in excess of $500,000 in the aggregate for the Company and its Subsidiaries, taken as a whole; (h) neither it nor any of its Subsidiaries shall make any material changes in accounting methods, principles or practices, except insofar as may have been required by a change in GAAP or applicable Law or, except as so required, change any assumption underlying, or method of calculating, any bad debt, contingency or other reserve; (i) neither it nor any of its Subsidiaries shall, except in the ordinary course of business consistent with past practice, enter into, renew, modify, amend, terminate, waive, delay the exercise of, release or assign any material rights or claims under, any Company Material Contract or Company Lease; provided, that, nothing herein shall permit the Company or any of its Subsidiaries to (i) enter into any Contract of the type specified in Section 5.5(a)(iii) to the extent such Contract would survive after the Effective Time or modify or amend in a manner adverse to the Company or any of its Subsidiaries any existing Contract of the type specified in Section 5.5(a)(iii) or (ii) except to the extent permitted by Section 7.2(a) of this Agreement, enter into, renew, modify, amend, terminate, waive, delay the exercise of, or release or assign any material rights or claims under, any confidentiality, standstill or similar agreement to which the Company or any of its Subsidiaries is bound by or subject; (j) neither it nor any of its Subsidiaries shall, except as required to comply with applicable Law, any express provision of this Agreement, or agreements, plans or arrangements existing on the date hereof, (i) take any action with respect to, adopt, enter into, terminate or amend any employment, severance, change in control, retirement, retention, welfare, incentive or similar agreement, arrangement or benefit plan for the benefit or welfare of any current or former director, officer, employee or consultant or any collective bargaining agreement, (ii) increase in any respect the compensation or fringe benefits of, or pay any bonus to, any director, officer, employee or consultant (except for annual increases of salaries of Persons who are not officers in the ordinary course of business that do not exceed 3.5%), (iii) amend or accelerate the payment, right to payment or vesting of any compensation or benefits, including any outstanding options or restricted stock awards, (iv) pay any benefit not provided for as of the date of this Agreement under any Company Benefit Plan, (v) grant any awards under any bonus, incentive, performance or other compensation plan or arrangement or benefit plan, including the grant of stock options, stock appreciation rights, stock based or stock related awards, performance units or restricted stock, or the removal of existing restrictions in any benefit plans or agreements or awards made thereunder; (k) neither it nor any of its Subsidiaries shall initiate, settle or compromise any litigation, claim, grievance, charge or proceeding involving any Intellectual Property or any matters reported as “Legal Proceedings” in any Company SEC Reports, or any other material litigation, claim, grievance, charge or proceeding (other than in connection with the enforcement of the Company’s rights under this Agreement); (l) neither it nor any of its Subsidiaries shall make or rescind any material Tax election election, amend any material Tax Return or permit any insurance policy naming it as a beneficiary or loss-payable payee to be cancelled or terminated in each case except in a manner consistent with past practice or as required by applicable Law; (m) neither it nor any of its Subsidiaries shall take any action or omit to take any action that is reasonably likely to result in any of the ordinary and usual course of businessconditions to the Merger set forth in Article VIII not being satisfied; and (gn) neither it nor any of its Subsidiaries will authorize any of, or enter into an agreement commit, resolve or agree, in writing or otherwise, to do take, any of the foregoingforegoing actions; provided, however, that nothing contained in this Agreement shall give to Parent, directly or indirectly, rights to control or direct the operations of the Company prior to Closing. Prior to Closing, the Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision of its and its Subsidiaries’ operations.

Interim Operations. The Except as otherwise contemplated by this Agreement or as set forth on the Company Disclosure Schedule or as agreed to by Parent, the Company covenants and agrees as to itself and its Subsidiaries that, after that during the period from the date hereof and prior of this Agreement to the earlier of the Effective Time (or until termination of this Agreement in accordance with its terms and the Effective Time (unless Parent shall otherwise approve in writing, and except as otherwise expressly contemplated by this AgreementArticle 7 hereof): (a) the business and operations of it the Company and its Subsidiaries subsidiaries shall be conducted only in the ordinary course of business and usual course and, to the extent consistent therewith, it Company and its Subsidiaries subsidiaries shall use their respective reasonable best efforts to preserve its intact their current business organization intact organizations, keep available the services of their current officers and maintain its existing relations employees and goodwill preserve their relationships with their material customers, suppliers, distributorslicensors, creditorslicensees, lessorsadvertisers, employees distributors and other material third parties having business associatesdealings with them and to preserve the goodwill of their respective businesses; (b) it the Company shall not (i) authorize for issuance, issue, selldeliver, pledgesell or agree or commit to issue, dispose sell or deliver (whether through the issuance or granting of options, commitments, subscriptions, rights to purchase or otherwise), pledge or otherwise encumber any shares of its capital stock owned by it in or the capital stock of any of its Subsidiaries; subsidiaries, any other securities or any securities convertible into, or any rights, warrants or options to acquire, any such shares, securities or convertible securities or any other securities or equity equivalents (including without limitation stock appreciation rights or phantom interests), except for issuances of Common Shares upon the exercise of Options outstanding on the date hereof, or (ii) amend its certificate of incorporation or by-laws; (iii) split, combine or reclassify its outstanding shares of capital stock; (iv) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly-owned Subsidiaries; or (v) except for the repurchase of the Class A Warrant contemplated by the Warrantholder Agreement and the repurchase of outstanding Class B Preferred Shares, repurchase, redeem or otherwise acquire, or permit any of its Subsidiaries subsidiaries to purchase repurchase, redeem or otherwise acquire, any shares of its capital stock or any securities convertible into or exchangeable or exercisable for any shares of its capital stock; (c) except as set forth in Section 6.1(c) other equity interests of the Company Disclosure Letter, neither it nor or any of its Subsidiaries shall subsidiaries (i) issueincluding, sellwithout limitation, pledge, dispose of or encumber any shares of, or securities convertible into or exchangeable or exercisable for, or options, warrants, calls, commitments or rights of any kind to acquire, capital stock or other equity interests of the Company or any of its subsidiaries); (c) the Company shall not (i) sell, transfer or pledge, or agree to sell, transfer or pledge, any equity interest owned by it in any of its material subsidiaries or alter through merger, liquidation, reorganization, restructuring or in any other fashion the corporate structure or ownership of any of its subsidiaries, (ii) amend or otherwise change the Company Certificate or Company Bylaws or permit any of its subsidiaries to amend its certificate of incorporation, bylaws or equivalent organizational documents or (iii) split, combine or reclassify any shares of its capital stock, and shall not permit any of its subsidiaries to split, combine or reclassify any shares of its capital stock; (d) the Company shall not, and shall not permit any of its subsidiaries to, declare, set aside or pay any dividends on (whether in cash, stock of any class or property), or make any other property distributions in respect of, any of its capital stock (except for dividends paid by direct or assets indirect wholly owned subsidiaries to the Company with respect to capital stock); (e) neither the Company nor any of its subsidiaries shall (i) grant or agree to any material increase in any manner the compensation or fringe benefits of, or pay any bonus to, any current or former director, officer or employee except for increases and bonuses expressly contemplated by or required under existing employment agreements, bonus plans and other than Shares issuable pursuant agreements and arrangements, and except in connection with accelerating the vesting schedules of the Options and terminating the Options and the Stock Option Plans, (ii) enter into any new or materially amend any existing employment, severance or termination agreement with any current, prospective or former director, officer or employee of the Company, (iii) except as may be required to options outstanding comply with applicable Law and except as provided or otherwise contemplated in this Agreement (including, without limitation, Section 2.02 hereof), become obligated under any employee benefit plan that was not in existence on the date hereof or amend, modify or terminate any Company plan or other employee benefit plan or any agreement, arrangement, plan or policy for the benefit of any current or former director, officer or employee in existence on the date hereof, (iv) except as may be required to comply with applicable Law and except as provided or otherwise contemplated in this Agreement (including, without limitation, Section 2.02 hereof), pay any benefit not required by any plan or arrangement as in effect as of the date hereof (including, without limitation, the granting of, acceleration of, exercisability of or vesting of stock options, stock appreciation rights or restricted stock), except in connection with accelerating the vesting schedules of the Options and terminating the Options and the Stock Option Plans and except for the payment of the employer match under the Stock Plan Company’s 401(k) plan; (f) the Company shall not, and shall not permit any of its subsidiaries to, acquire or upon conversion agree to acquire, including, without limitation, by merging or consolidating with, or purchasing all or substantially all the assets or capital stock or other equity interests of, or by any other manner, any business or any corporation, partnership, association or other business organization or division thereof, other than purchases of assets in the Class A Preferred Shares ordinary course of business consistent with past practice and Class C Preferred Shares); not in excess of $50,000 in any one instance or $250,000 in the aggregate; (iig) transferthe Company shall not, and shall not permit any of its subsidiaries to, sell, lease, license, mortgage or otherwise encumber or subject to any lien or otherwise dispose of, or agree to sell, lease, license, mortgage or otherwise encumber or subject to any lien or otherwise dispose of, any of its properties or assets other than (i) properties or assets not in excess of $25,000 in one instance or $250,000 in the aggregate, (ii) inventory in the ordinary course of business consistent with past practice, (iii) nonexclusive licenses granted by the Company in the ordinary course of business to customers for such customers’ use of the Company’s products and services and (iv) liens relating to Taxes that are not yet due and payable or otherwise being contested in good faith and as to which appropriate reserves have been established by the Company in accordance with generally accepted accounting principles; (h) the Company shall not, and shall not permit any of its subsidiaries to, incur, assume or pre-pay any indebtedness for borrowed money or enter into any agreement to incur, assume or pre-pay any indebtedness for borrowed money, or guarantee, sellor agree to guarantee, mortgageany such indebtedness or obligation of another person, pledgeguarantee any debt securities of others, dispose enter into any “keep well” or other agreement to maintain any financial statement condition of another person or encumber enter into any material property or assets (including capital stock arrangement having the economic effect of any of the foregoing; (i) the Company shall not, and shall not permit any of its Subsidiariessubsidiaries to, make or forgive any loans, advances or capital contributions to, guarantees for the benefit of, or investments in, any person or entity, other than loans between or among the Company and any of its wholly-owned subsidiaries and cash advances to the Company’s or any such subsidiary’s employees for reimbursable travel and other business expenses incurred in the ordinary course of business consistent with past practice; (j) the Company shall not, and shall not permit any of its subsidiaries to, assume, guarantee or incur otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any other Person, except for the obligations of the subsidiaries of the Company permitted under this Agreement; (k) the Company and its subsidiaries (i) shall continue in force insurance covering risks of such types and in such amounts as are consistent with the Company’s past practices and (ii) shall not permit any insurance policy naming it as beneficiary or loss payable payee to be canceled or terminated; (l) the Company shall not, and shall not permit any of its subsidiaries to, establish or acquire (i) any subsidiary other than wholly-owned subsidiaries or (ii) subsidiaries organized outside of the United States and its territorial possessions; (m) the Company shall not, and shall not permit any of its subsidiaries to, amend, modify or waive any material indebtedness term of any outstanding security of the Company or other liability; any of its subsidiaries, except (i) as required by this Agreement, (ii) in connection with accelerating the vesting schedules of the Options to the extent required by the Stock Option Plans or the agreements pursuant to which such Options were granted, and (iii) in connection with terminating the Options and the Stock Option Plans; (n) the Company shall not, and shall not permit any of its subsidiaries to, enter into any labor or collective bargaining agreement, memorandum or understanding, grievance settlement or any other agreement or commitment to or relating to any labor union, except as set forth in Section 6.1(c)(iiirequired by Law; (o) of the Company Disclosure Lettershall not, make and shall not permit any of its subsidiaries to, settle or authorize compromise any pending or commit for any capital expenditures other than in amounts less than $25,000 individually and $100,000 threatened suit, action, claim or litigation (except in the aggregate orordinary course of business), the settlement or compromise of which would result in payments by any means, make any acquisition of, or investment in, assets or stock of any other Person or entity the Company in excess of $25,000; (dp) neither it nor the Company shall not, and shall not permit any of its Subsidiaries shall terminatesubsidiaries to, establishchange any of the material accounting policies, adoptpractices or procedures (including material Tax accounting policies, enter intopractices and procedures) used by the Company and its subsidiaries as of the date hereof, make any new grants except as may be required as a result of a change in applicable Law or awards under, amend or otherwise modify, any Compensation and Benefit Plans or increase the salary, wage, bonus or other compensation of any employees except increases for non-executive employees occurring in the ordinary and usual course of business (which shall include normal periodic performance reviews and related compensation and benefit increases)United States generally accepted accounting principles; (eq) neither it nor the Company shall not, and shall not permit any of its Subsidiaries shall subsidiaries to, make or change any material tax election, make or change any material method of accounting with respect to Taxes except as may be required as a result of a change in applicable Law, settle or compromise any material claims tax liability or litigation orfile any material amended Tax Return; (r) the Company shall not, except and shall not permit any of its subsidiaries to, pay, discharge or satisfy any claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), other than (i) the payment, discharge or satisfaction in the ordinary and usual course of businessbusiness and consistent with past practice of liabilities reflected or reserved against in the financial statements of the Company or incurred in the ordinary course of business and consistent with past practice or (ii) the payment of the Company’s Expenses (as defined herein), modifyincluding the payment of the fees and expenses of the Special Committee and the costs, amend or terminate fees and expenses incurred by the Special Committee, which shall not exceed in the aggregate $5,000,000; (s) the Company shall not, and shall not permit any of its material Contracts subsidiaries to, transfer or waive, release license to any third party or assign otherwise amend or modify in any material rights or claimsrespect any contract relating to Company Intellectual Property other than the grant in the ordinary course of business of non-exclusive licenses to customers in connection with the sale of Company Products; (ft) neither it nor except as set forth in Section 5.01(t) of the Company Disclosure Schedule, the Company shall not have amended the Rights Plan in any manner without the prior consent of its Subsidiaries shall make any Tax election or permit any insurance policy naming it as a beneficiary or loss-payable payee to be cancelled or terminated except in the ordinary and usual course of businessParent; and (gu) neither it nor the Company shall not, and shall not permit any of its Subsidiaries will authorize subsidiaries to, agree or enter into an agreement commit to do any of the foregoing.

Interim Operations. The Company covenants From and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the earlier of the termination of this Agreement in accordance with its terms and or the Effective Time (unless Parent shall otherwise approve in writingTime, and except as otherwise expressly contemplated by this Agreement): (a) the business businesses of it the Company and its Subsidiaries shall be operated and conducted in the ordinary and usual course andcourse, to except as otherwise contemplated by this Agreement, as set forth in Schedule 7.1 of the extent consistent therewithCompany Disclosure Letter, it and as required by applicable Laws or as AEP shall otherwise consent in writing (which consent shall not be unreasonably withheld, conditioned or delayed). AEP shall not take or permit any of its Subsidiaries shall use their respective best efforts (including the Company or its Subsidiaries) to preserve its business organization intact and maintain its existing relations and goodwill with customers, suppliers, distributors, creditors, lessors, employees and business associates; (b) it shall not take any action or omit to take any action that is reasonably likely to (i) result in any of the conditions of the Merger set forth in Article VIII not being satisfied or (ii) prevent the consummation of the Merger. Without limiting the generality of the foregoing, from and after the date hereof and prior to the earlier of the termination of this Agreement or the Effective Time, the Company shall not, and shall not permit any of its Subsidiaries to, issue, sell, pledge, grant, transfer, encumber or otherwise dispose of or encumber any shares of capital stock owned by it in or other equity interests of the Company or any of its Subsidiaries; (ii) amend its certificate of incorporation or by-laws; (iii) split, combine or reclassify its outstanding shares of capital stock; (iv) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly-owned Subsidiaries; or (v) except for the repurchase of the Class A Warrant contemplated by the Warrantholder Agreement and the repurchase of outstanding Class B Preferred Shares, repurchase, redeem or otherwise acquire, or permit any of its Subsidiaries to purchase or otherwise acquire, any shares of its capital stock or any securities convertible into or exchangeable or exercisable for any shares of its capital stock; (c) except as set forth in Section 6.1(c) of the Company Disclosure Letter, neither it nor any of its Subsidiaries shall (i) issue, sell, pledge, dispose of or encumber any shares of, or securities convertible into or exchangeable or exercisable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class or any other property or assets (other than Shares issuable pursuant to options outstanding on the date hereof under the Stock Plan or upon conversion of the Class A Preferred Shares and Class C Preferred Shares); (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any material property or assets (including capital stock of any of its Subsidiaries) or incur or modify any material indebtedness or other liability; or (iii) except as set forth in Section 6.1(c)(iii) equity interests of the Company Disclosure Letter, make or authorize or commit for any capital expenditures other than in amounts less than $25,000 individually and $100,000 in the aggregate or, by any means, make any acquisition of, or investment in, assets or stock of any other Person or entity in excess of $25,000; (d) neither it nor any of its Subsidiaries shall terminateor declare, establish, adopt, enter into, make set aside or pay any new grants or awards under, amend or otherwise modify, any Compensation and Benefit Plans or increase the salary, wage, bonus dividend or other compensation of distribution payable in cash, stock or property (or any employees combination thereof) with respect to its capital stock or other equity interests (except increases for non-executive employees occurring dividends or other distributions in the ordinary and usual course of business (which shall include normal periodic performance reviews and related compensation and benefit increases); (e) neither it nor cash, stock or property paid by any of its Subsidiaries shall settle direct or compromise any material claims or litigation or, except in the ordinary and usual course of business, modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claims; (f) neither it nor any of its Subsidiaries shall make any Tax election or permit any insurance policy naming it as a beneficiary or loss-payable payee to be cancelled or terminated except in the ordinary and usual course of business; and (g) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any indirect wholly owned Subsidiary of the foregoingCompany to the Company or to any other direct or indirect wholly owned Subsidiary of the Company).

Interim Operations. The Except as otherwise contemplated by this Agreement or as set forth on the Company Disclosure Schedule or as agreed to in writing by Melita (which consent shall not be unreasonably conditioned, withheld or delayed), the Company covenants and agrees as to itself and its Subsidiaries that, after that during the period from the date hereof and prior of this Agreement to the earlier of the Effective Time (or until termination of this Agreement in accordance with its terms and the Effective Time (unless Parent shall otherwise approve in writing, and except as otherwise expressly contemplated by this AgreementArticle 7 hereof): (a) except as otherwise described in Section 5.01(a) of the Company Disclosure Schedule, the business and operations of it the Company and its Subsidiaries subsidiaries shall be conducted only in the ordinary course of business and usual course and, to the extent consistent therewith, it Company and its Subsidiaries subsidiaries shall use their respective reasonable best efforts to preserve its intact their current business organization intact organizations, keep available the services of their current officers and maintain its existing relations employees and goodwill preserve their relationships with their material customers, suppliers, distributorslicensors, creditorslicensees, lessorsadvertisers, employees distributors and other material third parties having business associatesdealings with them and to preserve the goodwill of their respective businesses; (b) it the Company shall not (i) authorize for issuance, issue, selldeliver, pledgesell or agree or commit to issue, dispose sell or deliver (whether through the issuance or granting of options, commitments, subscriptions, rights to purchase or otherwise), pledge or otherwise encumber any shares of its capital stock owned by it in or the capital stock of any of its Subsidiaries; subsidiaries, any other securities or any securities convertible into, or any rights, warrants or options to acquire, any such shares, securities or convertible securities or any other securities or equity equivalents (including without limitation stock appreciation rights or phantom interests), except for issuances of Common Shares upon the exercise of Options outstanding on or prior to the date hereof or (ii) amend its certificate of incorporation or by-laws; (iii) split, combine or reclassify its outstanding shares of capital stock; (iv) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly-owned Subsidiaries; or (v) except for the repurchase of the Class A Warrant contemplated by the Warrantholder Agreement and the repurchase of outstanding Class B Preferred Shares, repurchase, redeem or otherwise acquire, or permit any of its Subsidiaries subsidiaries to purchase repurchase, redeem or otherwise acquire, any shares of its capital stock or any securities convertible into or exchangeable or exercisable for any shares of its capital stock; (c) except as set forth in Section 6.1(c) other equity interests of the Company Disclosure Letter, neither it nor or any of its Subsidiaries shall subsidiaries (i) issueincluding, sellwithout limitation, pledge, dispose of or encumber any shares of, or securities convertible into or exchangeable or exercisable for, or options, warrants, calls, commitments or rights of any kind to acquire, capital stock or other equity interests of the Company or any of its subsidiaries), except for the purchase of Common Shares pursuant to the Company’s buy-back program; (c) the Company shall not (i) sell, transfer or pledge, or agree to sell, transfer or pledge, any equity interest owned by it in any of its material subsidiaries or alter through merger, liquidation, reorganization, restructuring or in any other fashion the corporate structure or ownership of any of its subsidiaries, except as otherwise provided on Section 5.01(c) of the Company Disclosure Schedule, (ii) amend or otherwise change its certificate of incorporation or bylaws or permit any of its subsidiaries to amend its certificate of incorporation, bylaws or equivalent organizational documents or (iii) split, combine or reclassify any shares of its capital stock of any class or any other property or assets (other than Shares issuable pursuant to options outstanding on the date hereof under the Stock Plan or upon conversion of the Class A Preferred Shares stock, and Class C Preferred Shares); (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any material property or assets (including capital stock of shall not permit any of its Subsidiaries) subsidiaries to split, combine or incur or modify reclassify any material indebtedness or other liability; or (iii) except as set forth in Section 6.1(c)(iii) of the Company Disclosure Letter, make or authorize or commit for any capital expenditures other than in amounts less than $25,000 individually and $100,000 in the aggregate or, by any means, make any acquisition of, or investment in, assets or stock of any other Person or entity in excess of $25,000; (d) neither it nor any shares of its Subsidiaries shall terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Compensation and Benefit Plans or increase the salary, wage, bonus or other compensation of any employees except increases for non-executive employees occurring in the ordinary and usual course of business (which shall include normal periodic performance reviews and related compensation and benefit increases)capital stock; (e) neither it nor any of its Subsidiaries shall settle or compromise any material claims or litigation or, except in the ordinary and usual course of business, modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claims; (f) neither it nor any of its Subsidiaries shall make any Tax election or permit any insurance policy naming it as a beneficiary or loss-payable payee to be cancelled or terminated except in the ordinary and usual course of business; and (g) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.

Interim Operations. The Company covenants and agrees as to itself and its Subsidiaries that, after (a) From the date hereof and prior to the earlier of the termination of this Agreement in accordance with its terms and until the Effective Time (unless Parent shall otherwise approve in writingTime, and except as otherwise expressly contemplated by this Agreement): (a) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and its Subsidiaries shall use their respective best efforts to preserve its business organization intact and maintain its existing relations and goodwill with customers, suppliers, distributors, creditors, lessors, employees and business associates; (b) it shall not (i) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (ii) amend its certificate of incorporation or by-laws; (iii) split, combine or reclassify its outstanding shares of capital stock; (iv) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly-owned Subsidiaries; or (v) except for the repurchase of the Class A Warrant contemplated by the Warrantholder Agreement and the repurchase of outstanding Class B Preferred Shares, repurchase, redeem or otherwise acquire, or permit any of its Subsidiaries to purchase or otherwise acquire, any shares of its capital stock or any securities convertible into or exchangeable or exercisable for any shares of its capital stock; (c) except as set forth in Section 6.1(c) 5.1 of the Company Disclosure LetterSchedule or as expressly contemplated by any other provision of this Agreement, neither it nor any unless the Parent has consented in writing thereto, the Company shall, and shall cause each of its Subsidiaries shall subsidiaries to: (i) conduct its business and operations only in the ordinary course of business consistent with past practice; (ii) use its reasonable efforts to preserve intact the business organizations, goodwill, rights, licenses, permits and franchises of the Company and its subsidiaries, and maintain their existing relationships with customers, suppliers and other persons having business dealings with them; (iii) use its commercially 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 amend or modify its respective certificate of incorporation, by-laws, partnership agreement or other charter or organization documents; (v) not authorize for issuance, issue, sell, pledgegrant, dispose of deliver, pledge or encumber or agree or commit to issue, sell, grant, deliver, pledge or encumber any shares ofof any class or series of capital stock of the Company or any of its subsidiaries or any other equity or voting security or equity or voting interest in the Company or any of its subsidiaries, or any securities convertible into or exercisable or exchangeable for any such shares, securities or exercisable forinterests, or any options, warrants, calls, commitments commitments, subscriptions or rights of to purchase or acquire any kind to acquiresuch shares, any shares of its capital stock of any class securities or any other property or assets interests (other than Shares issuable pursuant issuances of Company Common Stock upon exercise of Company Options granted prior to options outstanding on the date hereof under the Stock Plan or upon conversion of the Class A Preferred Shares this Agreement to directors, officers, employees and Class C Preferred Shares); (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any material property or assets (including capital stock of any of its Subsidiaries) or incur or modify any material indebtedness or other liability; or (iii) except as set forth in Section 6.1(c)(iii) consultants of the Company Disclosure Letter, make or authorize or commit for any capital expenditures other than in amounts less than $25,000 individually and $100,000 accordance with the Company Incentive Plan as currently in the aggregate or, by any means, make any acquisition of, or investment in, assets or stock of any other Person or entity in excess of $25,000; (d) neither it nor any of its Subsidiaries shall terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Compensation and Benefit Plans or increase the salary, wage, bonus or other compensation of any employees except increases for non-executive employees occurring in the ordinary and usual course of business (which shall include normal periodic performance reviews and related compensation and benefit increaseseffect); (e) neither it nor any of its Subsidiaries shall settle or compromise any material claims or litigation or, except in the ordinary and usual course of business, modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claims; (f) neither it nor any of its Subsidiaries shall make any Tax election or permit any insurance policy naming it as a beneficiary or loss-payable payee to be cancelled or terminated except in the ordinary and usual course of business; and (g) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.

Interim Operations. The Company covenants and agrees as to itself and its Subsidiaries that, after the date hereof of this Agreement and prior to the earlier of the termination of this Agreement in accordance with its terms and the Effective Time (unless Parent shall otherwise approve consent in writing, which consent will not unreasonably be withheld or delayed, and except as otherwise expressly set forth in or contemplated by this AgreementAgreement or Section 7.1 of the Company Disclosure Schedule): (a) the business of it and its Subsidiaries shall will be conducted in the ordinary and usual course and, to the extent consistent therewith, it and its Subsidiaries shall use their respective best commercially reasonable efforts to preserve its business organization intact and maintain its existing relations and goodwill with customers, suppliers, distributors, strategic partners, creditors, lessors, employees and business associates; (b) it shall not (i) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; , (ii) amend its certificate of incorporation or by-laws; laws (or its equivalent governing instruments), (iii) split, combine or reclassify its outstanding shares of capital stock; , (iv) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly-owned Subsidiaries; , or (v) except for the repurchase of the Class A Warrant contemplated by the Warrantholder Agreement and the repurchase of outstanding Class B Preferred Shares, repurchasepurchase, redeem or otherwise acquire, except for the acquisition of shares of Company Common Stock from holders of Company Stock Options in full or partial payment of the exercise price payable by such holder upon exercise of Company Stock Options to the extent required or permitted under the terms of such Company Stock Options, or permit any of its Subsidiaries to purchase or otherwise acquire, any shares of its capital stock or any securities convertible into or exchangeable or exercisable for any shares of its capital stock; (c) except as set forth in Section 6.1(c) of the Company Disclosure Letter, neither it nor any of its Subsidiaries shall (i) issue, sell, pledge, dispose of or encumber any shares of, or securities convertible into or exchangeable or exercisable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class or any other property or assets (other than Shares issuable pursuant to options outstanding on the date hereof under the Stock Plan or upon conversion of the Class A Preferred Shares and Class C Preferred Shares); (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any material property or assets (including capital stock of any of its Subsidiaries) or incur or modify any material indebtedness or other liability; or (iii) except as set forth in Section 6.1(c)(iii) of the Company Disclosure Letter, make or authorize or commit for any capital expenditures other than in amounts less than $25,000 individually and $100,000 in the aggregate or, by any means, make any acquisition of, or investment in, assets or stock of any other Person or entity in excess of $25,000; (d) neither it nor any of its Subsidiaries shall terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Compensation and Benefit Plans or increase the salary, wage, bonus or other compensation of any employees except increases for non-executive employees occurring in the ordinary and usual course of business (which shall include normal periodic performance reviews and related compensation and benefit increases); (e) neither it nor any of its Subsidiaries shall settle or compromise any material claims or litigation or, except in the ordinary and usual course of business, modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claims; (f) neither it nor any of its Subsidiaries shall make any Tax election or permit any insurance policy naming it as a beneficiary or loss-payable payee to be cancelled or terminated except in the ordinary and usual course of business; and (g) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.

Interim Operations. The Except as otherwise contemplated by this Agreement or as set forth on the Company Disclosure Schedule or as agreed to by Infor (which agreement, other than in the case of clauses (b), (c), (d), (e), (f), (g), (k), (l), (o), (q), (r), (s), (v) and (aa) below (and clause (bb) below, to the extent relating to any of the foregoing items), shall not be unreasonably withheld or delayed), the Company covenants and agrees as to itself and its Subsidiaries that, after that during the period from the date hereof and prior of this Agreement to the earlier of the Effective Time (or until termination of this Agreement in accordance with its terms and the Effective Time (unless Parent shall otherwise approve in writing, and except as otherwise expressly contemplated by this AgreementArticle 7 hereof): (a) the business and operations of it the Company and its Subsidiaries subsidiaries shall be conducted only in the ordinary course of business and usual course and, to the extent consistent therewith, it Company and its Subsidiaries subsidiaries shall use their respective best reasonable efforts to preserve its intact their current business organization intact organizations, keep available the services of their current officers and maintain its existing relations employees and goodwill preserve their relationships with their material customers, suppliers, distributorslicensors, creditorslicensees, lessorsadvertisers, employees distributors and other material third parties having business associatesdealings with them and to preserve the goodwill of their respective businesses; (b) it the Company shall not (i) authorize for issuance, issue, selldeliver, pledgesell or agree or commit to issue, dispose sell or deliver (whether through the issuance or granting of options, commitments, subscriptions, rights to purchase or otherwise), pledge or otherwise encumber any shares of its capital stock owned by it in or the capital stock of any of its Subsidiaries; subsidiaries, any other securities or any securities convertible into, or any rights, warrants or options to acquire, any such shares, securities or convertible securities or any other securities or equity equivalents (including without limitation stock appreciation rights or phantom interests), except for (A) issuances of Common Shares upon the exercise of Options and Warrants outstanding as of the date hereof and (B) issuances of Common Shares pursuant to the Purchase Plan or the DSIP or (ii) amend its certificate of incorporation or by-laws; (iii) split, combine or reclassify its outstanding shares of capital stock; (iv) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly-owned Subsidiaries; or (v) except for the repurchase of the Class A Warrant contemplated by the Warrantholder Agreement and the repurchase of outstanding Class B Preferred Shares, repurchase, redeem or otherwise acquire, or permit any of its Subsidiaries subsidiaries to purchase repurchase, redeem or otherwise acquire, any shares of its capital stock or any securities convertible into or exchangeable or exercisable for any shares of its capital stock; (c) except as set forth in Section 6.1(c) other equity interests of the Company Disclosure Letter, neither it nor or any of its Subsidiaries shall subsidiaries (i) issueincluding, sellwithout limitation, pledge, dispose of or encumber any shares of, or securities convertible into or exchangeable or exercisable for, or options, warrants, calls, commitments or rights of any kind to acquire, capital stock or other equity interests of the Company or any of its subsidiaries); (c) the Company shall not (i) sell, transfer or pledge, or agree to sell, transfer or pledge, any equity interest owned by it in any of its subsidiaries or alter through merger, liquidation, reorganization, restructuring or in any other fashion the corporate structure or ownership of any of its subsidiaries, (ii) amend or otherwise change its articles of incorporation or bylaws or permit any of its subsidiaries to amend its articles of incorporation, bylaws or equivalent organizational documents or (iii) split, combine or reclassify any shares of its capital stock of any class or any other property or assets (other than Shares issuable pursuant to options outstanding on the date hereof under the Stock Plan or upon conversion of the Class A Preferred Shares stock, and Class C Preferred Shares); (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any material property or assets (including capital stock of shall not permit any of its Subsidiaries) subsidiaries to split, combine or incur or modify reclassify any material indebtedness or other liability; or (iii) except as set forth in Section 6.1(c)(iii) shares of the Company Disclosure Letter, make or authorize or commit for any its capital expenditures other than in amounts less than $25,000 individually and $100,000 in the aggregate or, by any means, make any acquisition of, or investment in, assets or stock of any other Person or entity in excess of $25,000stock; (d) neither it nor the Company shall not, and shall not permit any of its Subsidiaries shall terminatesubsidiaries to, establishdeclare, adoptset aside or pay any dividends on (whether in cash, enter intostock or other property), or make any new grants or awards under, amend or otherwise modifyother distributions in respect of, any Compensation and Benefit Plans of its capital stock (except for dividends paid by direct or increase indirect wholly owned subsidiaries to the salary, wage, bonus or other compensation of any employees except increases for non-executive employees occurring in the ordinary and usual course of business (which shall include normal periodic performance reviews and related compensation and benefit increasesCompany); (e) neither it the Company nor any of its Subsidiaries subsidiaries shall settle (i) grant or compromise agree to any material claims increase in any manner the compensation or litigation orfringe benefits of, or pay any bonus to, any current or former director, officer or employee except (A) for increases and bonuses expressly contemplated by or required under existing employment agreements and bonus plans, (B) for increases in compensation to employees in the ordinary course of business consistent with past custom and practice, (C) in connection with accelerating the vesting schedules of the Options and terminating the Options and the Stock Plans and (D) as set forth in Section 5.01(e) of the Company Disclosure Schedule, (ii) enter into any new or materially amend any existing employment, consulting, severance, termination, change-of-control or indemnification agreement with any current or former director, officer or employee of the Company, (iii) except as may be required to comply with applicable Law and except as provided or otherwise contemplated in this Agreement (including, without limitation, Section 2.02 hereof), become obligated under any Benefit Plan that was not in existence on the date hereof or amend, modify or terminate any Benefit Plan or other employee benefit plan or any agreement, arrangement, plan or policy for the benefit of any current or former director, officer or employee in existence on the date hereof or (iv) except as may be required to comply with applicable Law and except as provided or otherwise contemplated in this Agreement (including, without limitation, Section 2.02 hereof), pay any benefit not required by any plan or arrangement as in effect as of the date hereof (including, without limitation, the granting of, acceleration of, exercisability of or vesting of stock options, stock appreciation rights or restricted stock, except as otherwise contemplated by this Agreement), except in connection with accelerating the ordinary vesting schedules of the Options and usual course terminating the Options and the Stock Plans and except for the payment of business, modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claimsthe employer match under the Company’s 401(k) plan; (f) the Company shall not, and shall not permit any of its subsidiaries to, acquire or agree to acquire, including, without limitation, by merging or consolidating with, or purchasing the assets or capital stock or other equity interests of, or by any other manner, any business or any corporation, partnership, association or other business organization or division thereof; (g) the Company shall not, and shall not permit any of its subsidiaries to, sell, lease, license, mortgage or otherwise encumber or subject to any Lien or otherwise dispose of, or agree to sell, lease, license, mortgage or otherwise encumber or subject to any Lien or otherwise dispose of, any of its properties or assets other than (i) pursuant to existing contracts and commitments described in Section 5.01(g) of the Company Disclosure Schedule, (ii) immaterial properties or assets (or immaterial portions of properties or assets), (iii) inventory in the ordinary course of business consistent with past practice, (iv) in the ordinary course of business, including without limitation, the grant of licenses by the Company to customers for such customers’ use of the Company’s products and services and (v) Liens relating to Taxes that are not yet due and payable or otherwise being contested in good faith and as to which appropriate reserves have been established by the Company in accordance with U.S. generally accepted accounting principles; (h) the Company shall not, and shall not permit any of its subsidiaries to, incur, assume or pre-pay any indebtedness for borrowed money or enter into any agreement to incur, assume or pre-pay any indebtedness for borrowed money, or guarantee, or agree to guarantee, any such indebtedness or obligation of another person, or issue or sell, or agree to issue or sell, any debt securities or options, warrants or calls or rights to acquire any debt securities of the Company or any of its subsidiaries, guarantee any debt securities of others, enter into any “keep well” or other agreement to maintain any financial statement condition of another person or enter into any arrangement having the economic effect of any of the foregoing; (i) the Company shall not, and shall not permit any of its subsidiaries to, make or forgive any loans, advances or capital contributions to, guarantees for the benefit of, or investments in, any person or entity, other than loans or capital contributions between or among the Company and any of its wholly-owned subsidiaries and cash advances to the Company’s or any such subsidiary’s employees for reimbursable travel and other business expenses incurred in the ordinary course of business consistent with past practice; (j) the Company shall not, and shall not permit any of its subsidiaries to, assume, guarantee or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any other Person, except for the obligations of the subsidiaries of the Company permitted under this Agreement; (k) neither it the Company nor any of its Subsidiaries subsidiaries shall adopt or put into effect a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other reorganization of the Company or any of its subsidiaries (other than any transaction specifically contemplated by this Agreement); (l) the Company shall not, and shall not permit any of its subsidiaries to, (i) enter into, or materially amend, modify or supplement any Material Contract outside the ordinary course of business consistent with past practice (except as may be necessary for the Company to comply with its obligations hereunder and except as set forth in item #1 in Section 5.01(l) of the Company Disclosure Schedule), (ii) waive, release, grant, assign or transfer any of its material rights or claims (whether such rights or claims arise under a Material Contract or otherwise) or (iii) amend, modify or supplement any agreement pursuant to which the Company or any of its subsidiaries leases any of the real property required to be disclosed in Section 3.25 of the Company Disclosure Schedule; (m) the Company shall not, and shall not permit any of its subsidiaries to, authorize or make any Tax election capital expenditures (other than pursuant to commitments prior to the date hereof disclosed in Section 5.01(m) of the Company Disclosure Schedule or otherwise required in the ordinary course of business); (n) the Company and its subsidiaries shall comply with their obligations under the Material Contracts as such obligations become due; (o) except for customer contracts entered into in the ordinary course of business, the Company shall not, and shall not permit its subsidiaries to, renegotiate or enter into any new license, agreement or arrangement relating to any Intellectual Property, including for any current or new Solution Partner Software; (p) the Company and its subsidiaries (i) shall continue in force insurance covering risks of such types and in such amounts as are consistent with the Company’s past practices and (ii) shall not permit any insurance policy naming it as a beneficiary or loss-loss payable payee to be cancelled canceled or terminated terminated; (q) the Company shall not, and shall not permit any of its subsidiaries to, enter into, amend, modify or supplement any agreement, transaction, commitment or arrangement with any current or former officer, director, employee or other affiliate of the Company or any of its subsidiaries (or any affiliate of any of the foregoing) other than as contemplated by this Agreement and other than employment of employees on an “at-will” basis and other modifications to employee compensation permitted by this Agreement; (r) the Company shall not, and shall not permit any of its subsidiaries to, establish or acquire (i) any subsidiary other than wholly-owned subsidiaries or (ii) subsidiaries organized outside of the United States and its territorial possessions; (s) the Company shall not, and shall not permit any of its subsidiaries to, amend, modify or waive any term of any outstanding security of the Company or any of its subsidiaries, except (i) as required by this Agreement, (ii) in connection with accelerating the vesting schedules of the Options to the extent required by the Stock Plans or the agreements pursuant to which such Options were granted and (iii) in connection with terminating the Options and the Stock Plans; (t) the Company shall, and shall cause its subsidiaries to, (i) maintain any real property to which the Company and any of its subsidiaries have a leasehold interest (including, without limitation, the furniture, fixtures, equipment and systems therein) in its current condition, subject to reasonable wear and tear and subject to any casualty or condemnation, (ii) timely pay all taxes, water and sewage rents, assessments and insurance premiums affecting such real property and (iii) timely comply in all material respects with the terms and provisions of all leases, contracts and agreements relating to such real property and the use and operation thereof; (u) the Company shall not, and shall not permit any of its subsidiaries to, enter into any labor or collective bargaining agreement, memorandum or understanding, grievance settlement or any other agreement or commitment to or relating to any labor union, except as required by Law; (v) the Company shall not, and shall not permit any of its subsidiaries to, settle or compromise any pending or threatened suit, action, claim or litigation, except with respect to the settlement or compromise of any such matter which does not involve equitable or injunctive relief and does not obligate the Company and its subsidiaries to make aggregate cash payments exceeding $50,000; (w) the Company shall not, and shall not permit any of its subsidiaries to, change any of the material accounting policies, practices or procedures (including material tax accounting policies, practices and procedures) used by the Company and its subsidiaries as of the date hereof, except as may be required as a result of a change in applicable Law or in U.S. generally accepted accounting principles; (x) the Company shall not, and shall not permit any of its subsidiaries to, revalue in any material respect any of its assets (including, without limitation, writing down or writing off any notes or accounts receivable in any material manner), except as required by U.S. generally accepted accounting principles; (y) the Company shall not, and shall not permit any of its subsidiaries to, make or change any material tax election, make or change any material method of accounting with respect to Taxes except as may be required as a result of a change in applicable Law, settle or compromise any material Tax liability or file any material amended Tax Return; (z) the Company shall not, and shall not permit any of its subsidiaries to, pay, discharge or satisfy any claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), other than (i) the payment, discharge or satisfaction in the ordinary and usual course of businessbusiness and consistent with past practice of liabilities reflected on or reserved in the financial statements of the Company or incurred in the ordinary course of business and consistent with past practice or (ii) the payment of the Company’s Expenses (as defined herein), including the payment of the fees and expenses of the Special Committee and the costs, fees and expenses incurred by the Special Committee; (aa) the Company shall not, and shall not permit any of its subsidiaries to, take, or agree or commit to take, any action that would, or is reasonably likely to, make any representation or warranty of the Company contained in this Agreement inaccurate at, or as of any time prior to, the Effective Time or result in any of the conditions to the Merger set forth in Article 6 not being satisfied, or omit, or agree to omit, to take any action necessary to prevent any such representation or warranty from being inaccurate in any material respect at any such time or to prevent any such condition from not being satisfied; and (gbb) neither it nor the Company shall not, and shall not permit any of its Subsidiaries will authorize subsidiaries to, agree or enter into an agreement commit to do any of the foregoing.

Interim Operations. The Except as expressly contemplated by this Agreement or the Company Disclosure Schedule or as consented to in writing by Parent, which consent, solely, with respect to clauses (e)(iv), (l), (m), (u) or, with respect to the foregoing, clause (z) below, shall not be unreasonably withheld) the Company covenants and agrees as to itself and its Subsidiaries that, after that during the period from the date hereof and prior of this Agreement to the earlier of the Effective Time (or until termination of this Agreement in accordance with its terms and the Effective Time (unless Parent shall otherwise approve in writing, and except as otherwise expressly contemplated by this AgreementArticle 7 hereof): (a) the business and operations of it the Company and its Subsidiaries subsidiaries shall be conducted only in the ordinary and usual course and, to of business and the extent consistent therewith, it Company and its Subsidiaries subsidiaries shall use their respective best commercially reasonable efforts to preserve its intact their current business organization organizations and preserve substantially intact and maintain its existing relations and the goodwill of those having business relationships with customers, suppliers, distributors, creditors, lessors, employees and business associatesit; (b) it the Company shall not (i) authorize for issuance, issue, selldeliver, pledgesell or agree or commit to issue, dispose sell or deliver (whether through the issuance or granting of options, commitments, subscriptions, rights to purchase or otherwise), pledge or otherwise encumber any shares of its capital stock owned by it in or the capital stock of any of its Subsidiaries; subsidiaries, any other securities or any securities convertible into, or any rights, warrants or options to acquire, any such shares, securities or convertible securities or any other securities or equity equivalents (including without limitation stock appreciation rights or phantom interests), except for issuances of Common Shares upon the exercise of Options outstanding prior to the date hereof or (ii) amend its certificate of incorporation or by-laws; (iii) split, combine or reclassify its outstanding shares of capital stock; (iv) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly-owned Subsidiaries; or (v) except for the repurchase of the Class A Warrant contemplated by the Warrantholder Agreement and the repurchase of outstanding Class B Preferred Shares, repurchase, redeem or otherwise acquire, or permit any of its Subsidiaries subsidiaries to purchase repurchase, redeem or otherwise acquire, any shares of its capital stock or any securities convertible into or exchangeable or exercisable for any shares of its capital stock; (c) except as set forth in Section 6.1(c) other equity interests of the Company Disclosure Letter, neither it nor or any of its Subsidiaries shall subsidiaries (i) issueincluding, sellwithout limitation, pledge, dispose of or encumber any shares of, or securities convertible into or exchangeable or exercisable for, or options, warrants, calls, commitments or rights of any kind to acquire, capital stock or other equity interests of the Company or any of its subsidiaries); (c) the Company shall not (i) sell, transfer or pledge, or agree to sell, transfer or pledge, any equity interest owned by it in any of its subsidiaries or alter through merger, liquidation, reorganization, restructuring or in any other fashion the corporate structure or ownership of any of its subsidiaries, (ii) amend or otherwise change its articles of incorporation or bylaws or permit any of its subsidiaries to amend its articles of incorporation, bylaws or equivalent organizational documents or (iii) split, combine or reclassify any shares of its capital stock of any class or any other property or assets (other than Shares issuable pursuant to options outstanding on the date hereof under the Stock Plan or upon conversion of the Class A Preferred Shares stock, and Class C Preferred Shares); (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any material property or assets (including capital stock of shall not permit any of its Subsidiariessubsidiaries to split, combine or reclassify any shares of its capital stock; (d) the Company shall not, and shall not permit any of its subsidiaries to, declare, set aside or incur pay any dividends on (whether in cash, stock or modify property), or make any material indebtedness other distributions in respect of, any of its capital stock (except for dividends paid by direct or other liability; or indirect wholly owned subsidiaries to the Company with respect to capital stock); (iiie) except as set forth in Section 6.1(c)(iii5.01(e) of the Company Disclosure LetterSchedule, make or authorize or commit for any capital expenditures other than in amounts less than $25,000 individually and $100,000 in neither the aggregate or, by any means, make any acquisition of, or investment in, assets or stock of any other Person or entity in excess of $25,000; (d) neither it Company nor any of its Subsidiaries subsidiaries shall terminate(i) grant or agree to any increase in any manner the compensation or fringe benefits of, establishor pay any bonus to, adoptany current or former director, officer or employee except for increases and bonuses expressly contemplated by or required under existing employment agreements, bonus plans and other agreements and arrangements listed in Section 5.01(e) of the Company Disclosure Schedule and periodic increases consistent with past practice for employees other than officers and directors of the Company, (ii) subject to the covenants set forth in clause (i) of this Section 5.01(e), enter into, make into any new grants or awards undermaterially amend any existing employment, amend severance or otherwise modifytermination agreement with any current or former director, officer or employee of the Company, (iii) except as may be required to comply with applicable law and except as provided in this Agreement, become obligated under any Compensation and Benefit Plans Plan that was not in existence on the date hereof or increase the salarymaterially amend, wage, bonus modify or terminate any Benefit Plan or other compensation employee benefit plan or any agreement, arrangement, plan or policy for the benefit of any employees current or former director, officer or employee in existence on the date hereof, (iv) hire any employee (A) except increases for non-executive employees occurring in the ordinary and usual course replacement of business (which shall include normal periodic performance reviews and related compensation and benefit increases); (e) neither it nor any current employee of the Company or any of its Subsidiaries shall settle subsidiaries whose employment with the Company or compromise any material claims or litigation or, except in the ordinary and usual course of business, modify, amend or terminate any of its material Contracts subsidiaries is terminated for any reason (with such replacement employee receiving substantially similar compensation and benefits as such terminated employee) or waive(B) new employees having anticipated annual compensation (including bonuses) not exceeding $100,000 individually or $500,000 in the aggregate, release or assign (v) except as may be required to comply with applicable law and except as provided in this Agreement, pay any material benefit not required by any plan or arrangement as in effect as of the date hereof (including, without limitation, the granting of, acceleration of, exercisability of or vesting of stock options, stock appreciation rights or claimsrestricted stock, except as otherwise contemplated by this Agreement); (f) the Company shall not, and shall not permit any of its subsidiaries to, acquire or agree to acquire, including, without limitation, by merging or consolidating with, or purchasing all or substantially all the assets or capital stock or other equity interests of, or by any other manner, any business or any corporation, partnership, association or other business organization or division thereof, other than purchases of inventory or supplies in the ordinary course of business consistent with past practice; (g) the Company shall not, and shall not permit any of its subsidiaries to, sell, lease, license, mortgage or otherwise encumber or subject to any Lien or otherwise dispose of, or agree to sell, lease, license, mortgage or otherwise encumber or subject to any Lien or otherwise dispose of, any of its properties or assets other than (i) pursuant to existing contracts and commitments described in Section 5.01(g) of the Company Disclosure Schedule, (ii) immaterial properties or assets (or immaterial portions of properties or assets) and (iii) inventory in the ordinary course of business consistent with past practice; (h) the Company shall not, and shall not permit any of its subsidiaries to, incur, assume or pre-pay any indebtedness for borrowed money or enter into any agreement to incur, assume or pre-pay any indebtedness for borrowed money, or guarantee, or agree to guarantee, any such indebtedness or obligation of another person, or issue or sell, or agree to issue or sell, any debt securities or options, warrants or calls or rights to acquire any debt securities of the Company or any of its subsidiaries, guarantee any debt securities of others, enter into any “keep well” or other agreement to maintain any financial statement condition of another person or enter into any arrangement having the economic effect of any of the foregoing, other than the incurrence of indebtedness under the Company’s existing revolving credit facility up to the limits of such facility as of the date hereof. (i) the Company shall not, and shall not permit any of its subsidiaries to, make or forgive any loans, advances or capital contributions to, guarantees for the benefit of, or investments in, any person or entity (other than loans between or among the Company and any of its wholly-owned subsidiaries and except for cash advances to employees for reimbursable travel and other reasonable business expenses in the ordinary course of business); (j) the Company shall not, and shall not permit any of its subsidiaries to, assume, guarantee or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any other Person, except for the obligations of the subsidiaries of the Company permitted under this Agreement; (k) neither it the Company nor any of its Subsidiaries subsidiaries shall adopt or put into effect a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other reorganization of the Company or any of its subsidiaries (other than any transaction specifically contemplated by this Agreement or set forth in Section 5.01(k) of the Company Disclosure Schedule); (l) the Company shall not, and shall not permit any of its subsidiaries to, (i) enter into, amend, modify or supplement any Material Contract or License Agreement outside of the ordinary course of business consistent with past practice (except as may be necessary for the Company to comply with its obligations hereunder or as set forth in Section 5.01(l) of the Company Disclosure Schedule) or (ii) waive, release, grant, assign or transfer any of its material rights or claims (whether such rights or claims arise under a Material Contract, License Agreement or otherwise); (m) the Company shall not, and shall not permit any of its subsidiaries to, authorize or make any Tax election capital expenditures (other than pursuant to commitments prior to the date hereof disclosed in Section 5.01(m) of the Company Disclosure Schedule) in excess of $750,000 in the aggregate for the Company and its subsidiaries taken as a whole; (n) the Company and its subsidiaries shall comply in all material respects with their obligations under the Material Contracts and License Agreements as such obligations become due; (o) the Company and its subsidiaries (i) shall continue in force with its existing or other reputable insurance companies, adequate insurance covering risks of such types and in such amounts as are consistent with the Company’s past practices and (ii) shall not permit any insurance policy naming it as a beneficiary or loss-loss payable payee to be cancelled canceled or terminated terminated; (p) the Company shall not, and shall not permit any of its subsidiaries to, enter into, amend, modify or supplement any material agreement, transaction, commitment or arrangement with any current or former officer, director, employee or other affiliate of the Company or any of its subsidiaries (or any affiliate of any of the foregoing) other than agreements, transactions, commitments and arrangements (i) permitted by Section 5.01(e) hereof or (ii) as otherwise expressly contemplated by this Agreement; (q) the Company shall not, and shall not permit any of its subsidiaries to, establish or acquire (i) any subsidiary other than wholly-owned subsidiaries or (ii) subsidiaries organized outside of the United States and its territorial possessions; (r) the Company shall not, and shall not permit any of its subsidiaries to, amend, modify or waive any term of any outstanding security of the Company or any of its subsidiaries, except as required by this Agreement; (s) the Company shall, and shall cause its subsidiaries to, (i) maintain any real property to which the Company and any of its subsidiaries have ownership or a leasehold interest (including, without limitation, the furniture, fixtures, equipment and systems therein) in its current condition, subject to reasonable wear and tear and subject to any casualty or condemnation, (ii) timely pay all material taxes, water and sewage rents, assessments and insurance premiums affecting such real property and (iii) timely comply in all material respects with the terms and provisions of all leases, contracts and agreements relating to such real property and the use and operation thereof; (t) the Company shall not, and shall not permit any of its subsidiaries to, enter into any labor or collective bargaining agreement, memorandum or understanding, grievance settlement or any other agreement or commitment to or relating to any labor union, except as required by Law or as set forth in Section 5.01(t) of the Company Disclosure Schedule; (u) the Company shall not, and shall not permit any of its subsidiaries to, settle or compromise any pending or threatened suit, action, claim or litigation (except in the ordinary and usual course of businessbusiness and with prior written notice to Parent); (v) the Company shall not, and shall not permit any of its subsidiaries to, change any of the accounting policies, practices or procedures (including tax accounting policies, practices and procedures) used by the Company and its subsidiaries as of the date hereof, except as may be required as a result of a change in applicable law or in United States generally accepted accounting principles; (w) the Company shall not, and shall not permit any of its subsidiaries to, revalue in any material respect any of its assets, including, without limitation, writing down the value of inventory in any material manner or the write-off of notes or accounts receivable in any material manner; (x) the Company shall not, and shall not permit any of its subsidiaries to, make or change any material tax election, make or change any method of accounting with respect to Taxes, file any amended Tax Return or settle or compromise any material tax liability; (y) the Company shall not, and shall not permit any of its subsidiaries to, pay, discharge or satisfy any claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction in the ordinary course of business and consistent with past practice of liabilities reflected or reserved against in the financial statements of the Company or incurred in the ordinary course of business and consistent with past practice; and (gz) neither it nor the Company shall not, and shall not permit any of its Subsidiaries will authorize subsidiaries to, agree or enter into an agreement commit to do any of the foregoing.

Interim Operations. The From the date of this Agreement until the earlier of the Funding Date or the termination of this Agreement, unless the prior written consent of the Investors shall have been obtained, the Company covenants and agrees as that it will not do or agree or commit to itself and its Subsidiaries that, after the date hereof and prior to the earlier of the termination of this Agreement in accordance with its terms and the Effective Time (unless Parent shall otherwise approve in writing, and except as otherwise expressly contemplated by this Agreement): (a) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and its Subsidiaries shall use their respective best efforts to preserve its business organization intact and maintain its existing relations and goodwill with customers, suppliers, distributors, creditors, lessors, employees and business associates; (b) it shall not (i) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (ii) amend its certificate of incorporation or by-laws; (iii) split, combine or reclassify its outstanding shares of capital stock; (iv) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly-owned Subsidiaries; or (v) except for the repurchase of the Class A Warrant contemplated by the Warrantholder Agreement and the repurchase of outstanding Class B Preferred Shares, repurchase, redeem or otherwise acquiredo, or permit any of its Subsidiaries to purchase do or agree or commit to do, any of the following: (a) amend the Company’s Certificate of Incorporation or bylaws or the certificate of incorporation or bylaws (or corresponding organizational documents) of any Company Subsidiaries, (b) incur or guarantee any additional Indebtedness except for (i) intercompany Indebtedness, (ii) borrowings under the Company’s credit facilities as in effect on the date of this Agreement and overnight borrowing in the ordinary course of business consistent with past practice. (c) repurchase, redeem, or otherwise acquireacquire or exchange, directly or indirectly, any shares of its capital stock shares, or any securities convertible into any shares, of the capital stock of the company or exchangeable or exercisable for any shares of its Subsidiaries, or make any other distribution in respect of the Company’s capital stock, except for repurchases made in connection with any Benefit Plan or cash dividends on Common Stock not to exceed $0.01 per share for each fiscal quarter; (cd) except for this Agreement, or pursuant to the exercise of stock options outstanding as set forth in Section 6.1(c) of the Company Disclosure Letterdate hereof and pursuant to and in accordance with the Benefit Plans as in existence on the date hereof, neither it nor any of its Subsidiaries shall (i) issue, sell, pledge, dispose of encumber, authorize the issuance of, enter into any contract to issue, sell, pledge, encumber, or encumber any shares authorize the issuance of, or securities convertible into or exchangeable or exercisable for, or options, warrants, calls, commitments or rights of any kind otherwise permit to acquirebecome outstanding, any additional shares of its Common Stock or any other capital stock of any class the Company or any Subsidiaries, or any stock appreciation rights, or any option, warrant, or other property or assets (other than Shares issuable pursuant to options outstanding on the date hereof under the Stock Plan or upon conversion right in respect of the Class A Preferred Shares and Class C Preferred Shares); (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any material property or assets (including capital stock of the Company or any of its Subsidiaries) or incur or modify any material indebtedness or other liability; or (iii) except as set forth in Section 6.1(c)(iii) of the Company Disclosure Letter, make or authorize or commit for any capital expenditures other than in amounts less than $25,000 individually and $100,000 in the aggregate or, by any means, make any acquisition of, or investment in, assets or stock of any other Person or entity in excess of $25,000; (d) neither it nor any of its Subsidiaries shall terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Compensation and Benefit Plans or increase the salary, wage, bonus or other compensation of any employees except increases for non-executive employees occurring in the ordinary and usual course of business (which shall include normal periodic performance reviews and related compensation and benefit increases); (e) neither it nor adjust, split, combine or reclassify any capital stock of the Company or any of its Subsidiaries shall or issue or authorize the issuance of any other securities in respect of or in substitution for shares of Common Stock or any other capital stock of the Company or any of its Subsidiaries, or sell, lease, mortgage, permit any Lien (other than, in the case of the following subclause (ii), Permitted Liens that are not material individually or in the aggregate), or otherwise dispose of or otherwise encumber (i) any shares of capital stock of any Company Subsidiaries or (ii) any material asset other than in the ordinary course of business consistent with past practice; (f) purchase any securities or make any material investment, either by purchase of stock or securities, contributions to capital, asset transfers, or purchase of any assets, in any Person other than a Company Subsidiary, or otherwise acquire direct or indirect control over any Person, other than in the ordinary course of business consistent with past practice; (g) (i) other than as required by the agreements executed in connection with this Agreement and identified on the Disclosure Schedule, grant any increase in compensation or benefits to the employees or officers of the Company or any of its Subsidiaries, except for merit-based salary increases for employees other than officers in the ordinary course in accordance with past practice; (ii) pay any (x) severance or termination pay or (y) any bonus, in either case other than as required by written severance policies or written contracts in effect on the date of this Agreement or in the ordinary course of business consistent with past practice; (iii) enter into or amend any severance agreements with employees or officers of the Company or any of its Subsidiaries; (iv) grant any increase in fees or other increases in compensation or other benefits to directors of the Company or any of its Subsidiaries except in the ordinary course of business consistent with past practice; or (v) waive any stock repurchase rights, accelerate, amend or change the period of exercisability of any stock options or other equity rights or restricted stock, or reprice any stock options or other equity rights granted under a Benefit Plan or authorize cash payments in exchange for any stock options or other equity rights; (h) enter into or amend any employment contract between the Company or any of its Subsidiaries and any Person that the Company or such Subsidiary does not have the unconditional right to terminate without liability (other than liability for services already rendered); (i) adopt any new Benefit Plan or terminate or withdraw from, or make any change in or to, any Benefit Plans other than any such change that is required by law or that, in the opinion of counsel, is necessary or advisable to maintain the tax qualified status of any such plan, or make any distributions from such Benefit Plans, except as required by law, the terms of such Benefit Plans as in effect on the date hereof or in the ordinary course of business consistent with past practice; (j) make any significant change in any accounting methods or systems of internal accounting controls, except as required by GAAP; (k) make, change or revoke any material Tax election, (ii) change any of its methods of accounting for Tax purposes, (iii) settle or compromise any material claims Tax liability or any Tax disputes, claims, audits, examinations, or other proceedings, (iv) file any material amended Tax return or (v) enter into a “closing agreement” described in Section 7121 of the Code (or any corresponding or comparable provision of state, local or foreign Law); (l) commence any litigation orother than in the ordinary course of business consistent with past practice, or settle any litigation (i) involving any liability to the Company or any of its Subsidiaries for money damages in excess of $500,000 or materially restricting or otherwise affecting the business or operations of the Company or any of its Subsidiaries or (ii) relating to the transactions contemplated hereby; (m) except in the ordinary and usual course of businessbusiness consistent with past practice, enter into, modify, amend or terminate any of its material Contracts Company Significant Agreement or waive, release release, compromise or assign any material rights or claims; (fn) neither it nor enter into any new line of business or change in any material respect its lending, investment, risk and asset-liability management, interest rate or fee pricing with respect to depository accounts, hedging and other material banking or operating policies except as required by law or by rules or policies imposed by a Governmental Entity; (o) make or commit to make any capital expenditure, except (i) capital expenditures of the Company and its Subsidiaries shall make any Tax election or permit any insurance policy naming it as a beneficiary or loss-payable payee to be cancelled or terminated except in the ordinary course of business on information technology used in the ordinary course of business not exceeding $5,000,000; and usual (ii) capital expenditures of the Company and its Subsidiaries in the ordinary course of business (other than capital expenditures described in the foregoing clause (i)) not exceeding $3,000,000; (p) except as required by law or applicable regulatory authorities, make any material changes in its credit administration policies or loan rating system, or otherwise make any material changes to its policies and practices with respect to underwriting, pricing, originating, acquiring, selling, servicing, or buying or selling rights to service, loans; (q) purchase or lease any real property in respect of any branch or other facility, or, without previously notifying and consulting with Investors, make any application to open, relocate or close, or open, relocate or close any branch or other facility; (r) sell, transfer or otherwise dispose of any property or assets that are, individually or in the aggregate, material, except for the sale of, in each case in the ordinary course of business; and, (i) Small Business Administration Loans, (ii) OREO and (iii) loans through the Mortgage Purchasing Department of the Bank; (gs) neither it nor without previously notifying and consulting with Investors, except for Loans or commitments for Loans that have previously been approved by the Bank prior to the date of this Agreement, make or acquire any Loan or issue a commitment (or renew or extend an existing commitment) for any Loan relationship aggregating in excess of $1,000,000, or amend or modify in any material respect any existing Loan relationship, that would result in total credit exposure to the applicable borrower (and its Subsidiaries will authorize affiliates) in excess of $1,000,000; (t) fail to comply with Regulatory Agreements or enter into an agreement the C&D Order; or (u) agree to do take, make any commitment to take, or adopt any resolutions of the Company’s Board of Directors in support of, any of the foregoingactions prohibited by this Section 3.1.

Interim Operations. The Except as otherwise contemplated by this Agreement or as set forth in SECTION 6.01 of the Company Disclosure Schedule or as consented to in writing by Parent, the Company covenants and agrees as to itself and its Subsidiaries that, after that during the period from the date hereof and prior of this Agreement to the earlier of the Effective Time (or until termination of this Agreement in accordance with its terms and the Effective Time (unless Parent shall otherwise approve in writing, and except as otherwise expressly contemplated by this AgreementARTICLE 8 hereof): (a) the business and operations of it the Company and its Subsidiaries shall be conducted only in the ordinary course of business and usual course and, to the extent consistent therewith, it Company and its Subsidiaries shall use their respective reasonable best efforts to preserve its intact their current business organization intact organizations, keep available the services of their current officers and maintain its existing relations employees and goodwill preserve their relationships with their material customers, suppliers, distributorslicensors, creditorslicensees, lessorsadvertisers, employees distributors and other material third parties having business associatesdealings with them and to preserve the goodwill of their respective businesses; (b) it the Company shall not (i) authorize for issuance, issue, selldeliver, pledgesell or agree or commit to issue, dispose sell or deliver (whether through the issuance or granting of options, commitments, subscriptions, rights to purchase or otherwise), pledge or otherwise encumber any shares of its capital stock owned by it in or the capital stock of any of its Subsidiaries; , any other securities or any securities convertible or exercisable into, or any rights, warrants or options to acquire, any such shares, securities or convertible securities or any other securities or equity equivalents (including without limitation stock appreciation rights or phantom interests), except for issuances of Common Shares upon the exercise of Options outstanding as of the date hereof or (ii) amend its certificate of incorporation or by-laws; (iii) split, combine or reclassify its outstanding shares of capital stock; (iv) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly-owned Subsidiaries; or (v) except for the repurchase of the Class A Warrant contemplated by the Warrantholder Agreement and the repurchase of outstanding Class B Preferred Shares, repurchase, redeem or otherwise acquire, or permit any of its Subsidiaries to purchase repurchase, redeem or otherwise acquire, any shares of its capital stock or any securities convertible into or exchangeable or exercisable for any shares of its capital stock; (c) except as set forth in Section 6.1(c) other equity interests of the Company Disclosure Letter, neither it nor or any of its Subsidiaries shall (i) issueincluding, sellwithout limitation, pledge, dispose of or encumber any shares of, or securities convertible into or exchangeable or exercisable for, or options, warrants, calls, commitments or rights of any kind to acquire, capital stock or other equity interests of the Company or any of its Subsidiaries); (c) the Company shall not (i) sell, transfer or pledge, or agree to sell, transfer or pledge, any equity interest owned by it in any of its Subsidiaries or alter through merger, liquidation, reorganization, restructuring or in any other fashion the corporate structure or ownership of any of its Subsidiaries, (ii) amend or otherwise change its charter, articles of incorporation or bylaws or permit any of its Subsidiaries to amend its articles of incorporation, bylaws or equivalent organizational documents or (iii) split, combine or reclassify any shares of its capital stock, and shall not permit any of its Subsidiaries to split, combine or reclassify any shares of its capital stock; (d) the Company shall not, and shall not permit any of its Subsidiaries to, declare, set aside or pay any dividends on (whether in cash, stock of any class or other property), or make any other property distributions in respect of, any of its capital stock (except for dividends paid by direct or assets indirect wholly owned Subsidiaries to the Company or to other wholly owned Subsidiaries of the Company consistent with past practices); (e) neither the Company nor any of its Subsidiaries shall (i) grant or agree to any increase in any manner the compensation or fringe benefits of, or pay any bonus to, any current or former director, officer or employee except increases in the ordinary course of business consistent with past practice of less than 10% of each such individual's salary for non-officer employees, increases and bonuses expressly contemplated by or required under existing employment agreements, bonus plans and other than Shares issuable pursuant to options outstanding on agreements and arrangements listed or described in SECTION 6.01(E) of the date hereof under Company Disclosure Schedule and except in connection with accelerating the vesting schedules of the Options and terminating the Options and the Stock Plan or upon conversion of the Class A Preferred Shares and Class C Preferred Shares); Plans, (ii) transferenter into any new or materially amend any existing employment, leaseconsulting, licenseseverance, guaranteetermination, sellchange-of-control or indemnification agreement with any current or former director, mortgageofficer or employee of the Company, pledge, dispose of or encumber any material property or assets (including capital stock of any of its Subsidiaries) or incur or modify any material indebtedness or other liability; or (iii) except as set forth in Section 6.1(c)(iiiSECTION 6.01(E) of the Company Disclosure LetterSchedule, make or authorize or commit for any capital expenditures other than in amounts less than $25,000 individually as may be required to comply with applicable Law and $100,000 in the aggregate or, by any means, make any acquisition of, or investment in, assets or stock of any other Person or entity in excess of $25,000; (d) neither it nor any of its Subsidiaries shall terminate, establish, adopt, enter into, make any new grants or awards under, amend as provided or otherwise modifycontemplated in this Agreement (including, without limitation, SECTION 3.02 hereof), become obligated under any Compensation and Benefit Plans Plan that was not in existence on the date hereof or increase the salaryamend, wage, bonus or other compensation of any employees except increases for non-executive employees occurring in the ordinary and usual course of business (which shall include normal periodic performance reviews and related compensation and benefit increases); (e) neither it nor any of its Subsidiaries shall settle or compromise any material claims or litigation or, except in the ordinary and usual course of business, modify, amend modify or terminate any Benefit Plan or other employee benefit plan or any agreement, arrangement, plan or policy for the benefit of its material Contracts any current or waiveformer director, release officer or assign any material rights employee in existence on the date hereof or claims; (fiv) neither it nor any of its Subsidiaries shall make any Tax election except as may be required to comply with applicable Law and except as provided or permit any insurance policy naming it as a beneficiary or loss-payable payee to be cancelled or terminated except otherwise contemplated in the ordinary and usual course of business; and this Agreement (g) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.including, without limitation, SECTION 40

Interim Operations. The From the date of this Agreement until the earlier of the Funding Date or the termination of this Agreement, unless the prior written consent of the Investors shall have been obtained, the Company covenants and agrees as that it will not do or agree or commit to itself and its Subsidiaries that, after the date hereof and prior to the earlier of the termination of this Agreement in accordance with its terms and the Effective Time (unless Parent shall otherwise approve in writing, and except as otherwise expressly contemplated by this Agreement): (a) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and its Subsidiaries shall use their respective best efforts to preserve its business organization intact and maintain its existing relations and goodwill with customers, suppliers, distributors, creditors, lessors, employees and business associates; (b) it shall not (i) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (ii) amend its certificate of incorporation or by-laws; (iii) split, combine or reclassify its outstanding shares of capital stock; (iv) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly-owned Subsidiaries; or (v) except for the repurchase of the Class A Warrant contemplated by the Warrantholder Agreement and the repurchase of outstanding Class B Preferred Shares, repurchase, redeem or otherwise acquiredo, or permit any of its Subsidiaries to purchase do or agree or commit to do, any of the following: (a) amend the Company’s Certificate of Incorporation or bylaws or the certificate of incorporation or bylaws (or corresponding organizational documents) of any Company Subsidiaries, (b) incur or guarantee any additional Indebtedness except for (i) intercompany Indebtedness, (ii) borrowings under the Company’s credit facilities as in effect on the date of this Agreement and overnight borrowing in the ordinary course of business consistent with past practice. (c) repurchase, redeem, or otherwise acquireacquire or exchange, directly or indirectly, any shares of its capital stock shares, or any securities convertible into any shares, of the capital stock of the company or exchangeable or exercisable for any shares of its Subsidiaries, or make any other distribution in respect of the Company’s capital stock, except for repurchases made in connection with any Benefit Plan or cash dividends on Common Stock not to exceed $0.01 per share for each fiscal quarter; (cd) except for this Agreement, or pursuant to the exercise of stock options outstanding as set forth in Section 6.1(c) of the Company Disclosure Letterdate hereof and pursuant to and in accordance with the Benefit Plans as in existence on the date hereof, neither it nor any of its Subsidiaries shall (i) issue, sell, pledge, dispose of encumber, authorize the issuance of, enter into any contract to issue, sell, pledge, encumber, or encumber any shares authorize the issuance of, or securities convertible into or exchangeable or exercisable for, or options, warrants, calls, commitments or rights of any kind otherwise permit to acquirebecome outstanding, any additional shares of its Common Stock or any other capital stock of any class the Company or any Subsidiaries, or any stock appreciation rights, or any option, warrant, or other property or assets (other than Shares issuable pursuant to options outstanding on the date hereof under the Stock Plan or upon conversion right in respect of the Class A Preferred Shares and Class C Preferred Shares); (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any material property or assets (including capital stock of the Company or any of its Subsidiaries) or incur or modify any material indebtedness or other liability; or (iii) except as set forth in Section 6.1(c)(iii) of the Company Disclosure Letter, make or authorize or commit for any capital expenditures other than in amounts less than $25,000 individually and $100,000 in the aggregate or, by any means, make any acquisition of, or investment in, assets or stock of any other Person or entity in excess of $25,000; (d) neither it nor any of its Subsidiaries shall terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Compensation and Benefit Plans or increase the salary, wage, bonus or other compensation of any employees except increases for non-executive employees occurring in the ordinary and usual course of business (which shall include normal periodic performance reviews and related compensation and benefit increases); (e) neither it nor adjust, split, combine or reclassify any capital stock of the Company or any of its Subsidiaries shall or issue or authorize the issuance of any other securities in respect of or in substitution for shares of Common Stock or any other capital stock of the Company or any of its Subsidiaries, or sell, lease, mortgage, permit any Lien (other than, in the case of the following subclause (ii), Permitted Liens that are not material individually or in the aggregate), or otherwise dispose of or otherwise encumber (i) any shares of capital stock of any Company Subsidiaries or (ii) any material asset other than in the ordinary course of business consistent with past practice; (f) purchase any securities or make any material investment, either by purchase of stock or securities, contributions to capital, asset transfers, or purchase of any assets, in any Person other than a Company Subsidiary, or otherwise acquire direct or indirect control over any Person, other than in the ordinary course of business consistent with past practice; (i) other than as required by the agreements executed in connection with this Agreement and identified on the Disclosure Schedule, grant any increase in compensation or benefits to the employees or officers of the Company or any of its Subsidiaries, except for merit-based salary increases for employees other than officers in the ordinary course in accordance with past practice; (ii) pay any (x) severance or termination pay or (y) any bonus, in either case other than as required by written severance policies or written contracts in effect on the date of this Agreement or in the ordinary course of business consistent with past practice; (iii) enter into or amend any severance agreements with employees or officers of the Company or any of its Subsidiaries; (iv) grant any increase in fees or other increases in compensation or other benefits to directors of the Company or any of its Subsidiaries except in the ordinary course of business consistent with past practice; or (v) waive any stock repurchase rights, accelerate, amend or change the period of exercisability of any stock options or other equity rights or restricted stock, or reprice any stock options or other equity rights granted under a Benefit Plan or authorize cash payments in exchange for any stock options or other equity rights; (h) enter into or amend any employment contract between the Company or any of its Subsidiaries and any Person that the Company or such Subsidiary does not have the unconditional right to terminate without liability (other than liability for services already rendered); (i) adopt any new Benefit Plan or terminate or withdraw from, or make any change in or to, any Benefit Plans other than any such change that is required by law or that, in the opinion of counsel, is necessary or advisable to maintain the tax qualified status of any such plan, or make any distributions from such Benefit Plans, except as required by law, the terms of such Benefit Plans as in effect on the date hereof or in the ordinary course of business consistent with past practice; (j) make any significant change in any accounting methods or systems of internal accounting controls, except as required by GAAP; (k) make, change or revoke any material Tax election, (ii) change any of its methods of accounting for Tax purposes, (iii) settle or compromise any material claims Tax liability or any Tax disputes, claims, audits, examinations, or other proceedings, (iv) file any material amended Tax return or (v) enter into a “closing agreement” described in Section 7121 of the Code (or any corresponding or comparable provision of state, local or foreign Law); (l) commence any litigation orother than in the ordinary course of business consistent with past practice, or settle any litigation (i) involving any liability to the Company or any of its Subsidiaries for money damages in excess of $500,000 or materially restricting or otherwise affecting the business or operations of the Company or any of its Subsidiaries or (ii) relating to the transactions contemplated hereby; (m) except in the ordinary and usual course of businessbusiness consistent with past practice, enter into, modify, amend or terminate any of its material Contracts Company Significant Agreement or waive, release release, compromise or assign any material rights or claims; (fn) neither it nor enter into any new line of business or change in any material respect its lending, investment, risk and asset-liability management, interest rate or fee pricing with respect to depository accounts, hedging and other material banking or operating policies except as required by law or by rules or policies imposed by a Governmental Entity; (o) make or commit to make any capital expenditure, except (i) capital expenditures of the Company and its Subsidiaries shall make any Tax election or permit any insurance policy naming it as a beneficiary or loss-payable payee to be cancelled or terminated except in the ordinary course of business on information technology used in the ordinary course of business not exceeding $5,000,000; and usual (ii) capital expenditures of the Company and its Subsidiaries in the ordinary course of business (other than capital expenditures described in the foregoing clause (i)) not exceeding $3,000,000; (p) except as required by law or applicable regulatory authorities, make any material changes in its credit administration policies or loan rating system, or otherwise make any material changes to its policies and practices with respect to underwriting, pricing, originating, acquiring, selling, servicing, or buying or selling rights to service, loans; (q) purchase or lease any real property in respect of any branch or other facility, or, without previously notifying and consulting with Investors, make any application to open, relocate or close, or open, relocate or close any branch or other facility; (r) sell, transfer or otherwise dispose of any property or assets that are, individually or in the aggregate, material, except for the sale of, in each case in the ordinary course of business; and, (i) Small Business Administration Loans, (ii) OREO and (iii) loans through the Mortgage Purchasing Department of the Bank; (gs) neither it nor without previously notifying and consulting with Investors, except for Loans or commitments for Loans that have previously been approved by the Bank prior to the date of this Agreement, make or acquire any Loan or issue a commitment (or renew or extend an existing commitment) for any Loan relationship aggregating in excess of $1,000,000, or amend or modify in any material respect any existing Loan relationship, that would result in total credit exposure to the applicable borrower (and its Subsidiaries will authorize affiliates) in excess of $1,000,000; (t) fail to comply with Regulatory Agreements or enter into an agreement the C&D Order; or (u) agree to do take, make any commitment to take, or adopt any resolutions of the Company’s Board of Directors in support of, any of the foregoingactions prohibited by this Section 3.1.

Interim Operations. The Except as otherwise expressly contemplated by this Agreement or as set forth in Section 5.01 of the Company Disclosure Schedule or as agreed to in writing by Parent, the Company covenants and agrees as to itself and its Subsidiaries that, after that during the period from the date hereof and prior of this Agreement to the earlier of the Effective Time (or until termination of this Agreement in accordance with its terms and the Effective Time (unless Parent shall otherwise approve in writing, and except as otherwise expressly contemplated by this AgreementArticle 7 hereof): (a) the business and operations of it the Company and its Subsidiaries subsidiaries shall be conducted only in the ordinary course of business and usual course and, to the extent consistent therewith, it Company and its Subsidiaries subsidiaries shall use their respective best commercially reasonable efforts to preserve its intact their current business organization intact organizations, keep available the services of their current officers and maintain its existing relations employees and preserve their relationships and goodwill with customers, suppliers, their material distributors, creditors, lessors, employees customers and suppliers and any other material third parties having business associates;dealings with them. (b) it the Company shall not (i) authorize for issuance, issue, selldeliver, pledgesell or agree or commit to issue, dispose sell or deliver (whether through the issuance or granting of options, commitments, subscriptions, rights to purchase or otherwise), pledge or otherwise encumber any shares of its capital stock owned by it in or the capital stock of any of its Subsidiaries; subsidiaries, any other securities or any securities convertible into, or any rights, warrants or options to acquire, any such shares, securities or convertible securities or any other securities or equity equivalents (including without limitation stock appreciation rights or phantom interests), except for issuances of Common Shares upon the exercise of Options outstanding as of the date hereof, (ii) amend its certificate of incorporation or by-laws; (iii) split, combine or reclassify its outstanding shares of capital stock; (iv) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly-owned Subsidiaries; or (v) except for the repurchase of the Class A Warrant contemplated by the Warrantholder Agreement and the repurchase of outstanding Class B Preferred Shares, repurchase, redeem or otherwise acquire, or permit any of its Subsidiaries subsidiaries to purchase repurchase, redeem or otherwise acquire, any shares of its capital stock or any securities convertible into or exchangeable or exercisable for any shares of its capital stock; (c) except as set forth in Section 6.1(c) other equity interests of the Company Disclosure Letter, neither it nor or any of its Subsidiaries shall subsidiaries (i) issueincluding, sellwithout limitation, pledge, dispose of or encumber any shares of, or securities convertible into or exchangeable or exercisable for, or options, warrants, calls, commitments or rights of any kind to acquire, capital stock or other equity interests of the Company or any of its subsidiaries), (iii) sell, transfer or pledge, or agree to sell, transfer or pledge, any equity interest owned by it in any of its subsidiaries or alter through merger, liquidation, reorganization, restructuring or in any other fashion the corporate structure or ownership of any of its subsidiaries, (iv) amend or otherwise change its articles of incorporation or bylaws or permit any of its subsidiaries to amend its articles of incorporation, bylaws or equivalent organizational documents or (v) split, combine or reclassify any shares of its capital stock, and shall not permit any of its subsidiaries to split, combine or reclassify any shares of its capital stock; (c) the Company shall not, and shall not permit any of its subsidiaries to (i) declare, set aside or pay any dividends on (whether in cash, stock or other property), or make any other distributions in respect of, any of its capital stock (except for dividends paid by direct or indirect wholly owned subsidiaries to the Company), (ii) acquire or agree to acquire, including, without limitation, by merging or consolidating with, or purchasing the assets (except raw materials, inventory or supplies in the ordinary course of business) or capital stock or other equity interests of, or by any class other manner, any business or any corporation, partnership, association or other property business organization or assets division thereof, (other than Shares issuable pursuant iii) authorize or make any capital expenditures in excess of $200,000 (the “Capital Expenditures Excess Amount”) in the aggregate in addition to options outstanding on the amount set forth in the Company’s budget for capital expenditures for the period of time between the date hereof under and the Stock Plan or upon conversion of the Class A Preferred Shares and Class C Preferred Shares); Effective Time (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any material property or assets (including which capital stock of any of its Subsidiaries) or incur or modify any material indebtedness or other liability; or (iii) except as budget is set forth in Section 6.1(c)(iii5.01(c) of the Company Disclosure LetterSchedule), make or authorize (iv) enter into, amend, modify or commit for supplement any capital expenditures agreement, transaction, commitment or arrangement with any current or former officer, director, employee or other affiliate of the Company or any of its subsidiaries (or any affiliate of any of the foregoing) other than in amounts less than $25,000 individually and $100,000 in the aggregate or, as contemplated by any means, make any acquisition of, or investment in, assets or stock of any other Person or entity in excess of $25,000this Agreement; (d) neither it the Company nor any of its Subsidiaries subsidiaries shall terminate(i) grant or agree to any increase in any manner the compensation or fringe benefits of, establishor pay any bonus to, adoptany current or former director, officer or employee except for (A) increases and bonuses expressly contemplated by or required under existing employment agreements or (B) bonus plans and other agreements and arrangements listed or described in Section 5.01(d) of the Company Disclosure Schedule and except in connection with terminating the Options and the Stock Plans, (ii) enter into, make into any new grants or awards undermaterially amend any existing employment, amend consulting, severance, termination, change-of-control or indemnification agreement with any current or former director, officer or employee of the Company, (iii) except as may be required to comply with applicable Law and except as provided or otherwise modifycontemplated in this Agreement (including, without limitation, Section 2.02 hereof), become obligated under any Compensation and Benefit Plans Plan that was not in existence on the date hereof or increase the salaryamend, wage, bonus modify or terminate any Benefit Plan or other compensation employee benefit plan or any agreement, arrangement, plan or policy for the benefit of any employees current or former director, officer or employee in existence on the date hereof or (iv) except increases as may be required to comply with applicable Law and except as provided or otherwise contemplated in this Agreement (including, without limitation, Section 2.02 hereof), pay any benefit not required by any plan or arrangement as in effect as of the date hereof (including, without limitation, the granting of, acceleration of, exercisability of or vesting of stock options, stock appreciation rights or restricted stock, except as otherwise contemplated by this Agreement), except in connection with terminating the Options and the Stock Plans and except for non-executive employees occurring in the ordinary and usual course payment of business (which shall include normal periodic performance reviews and related compensation and benefit increases)the employer match under the Company’s 401(k) plan; (e) neither it nor the Company shall not, and shall not permit any of its Subsidiaries shall settle subsidiaries to, sell, lease, license, mortgage or compromise otherwise encumber or subject to any material claims Lien or litigation orotherwise dispose of, except or agree to sell, lease, license, mortgage or otherwise encumber or subject to any Lien or otherwise dispose of, any of its properties or assets other than (i) immaterial properties or assets (or immaterial portions of properties or assets), (ii) inventory in the ordinary course of business consistent with past practice, (iii) licenses granted by the Company in the ordinary course of business to customers for such customers’ use of the Company’s products and usual services, (iv) Liens relating to Taxes that are not yet due and payable or otherwise being contested in good faith and as to which appropriate reserves have been established by the Company in accordance with U.S. generally accepted accounting principles, (v) Liens for assessments and other governmental charges or Encumbrances of landlords, carriers, warehousemen, mechanics and repairmen incurred in the ordinary course of business, modifyin each case for sums not yet due and payable or due but not delinquent or being contested in good faith and for which adequate reserves have been established and (vi) Liens incurred in the ordinary course of business in connection with workers’ compensation, amend unemployment insurance and other types of social security or terminate any to secure the performance of its material Contracts or waivetenders, release or assign any material rights or claimsstatutory obligations, surety and appeal bonds, bids, leases, government contracts, performance and return of money bonds and similar obligations; (f) the Company shall not, and shall not permit any of its subsidiaries to (i) incur, assume or pre-pay any Indebtedness or enter into any agreement to incur, assume or pre-pay any Indebtedness, or guarantee, or agree to guarantee, any such Indebtedness or obligation of another person, or issue or sell, or agree to issue or sell, any debt securities or options, warrants or calls or rights to acquire any debt securities of the Company or any of its subsidiaries, guarantee any debt securities of others, enter into any “keep well” or other agreement to maintain any financial statement condition of another person or enter into any arrangement having the economic effect of any of the foregoing, (ii) make or forgive any loans, advances or capital contributions to, guarantees for the benefit of, or investments in, any person or entity, other than loans between or among the Company and any of its wholly-owned subsidiaries and cash advances to the Company’s or any such subsidiary’s employees for reimbursable travel and other business expenses incurred in the ordinary course of business consistent with past practice or (iii) assume, guarantee or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any other Person, except for the obligations of the subsidiaries of the Company permitted under this Agreement; (g) neither it the Company nor any of its Subsidiaries subsidiaries shall make adopt or put into effect a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other reorganization of the Company or any Tax election of its subsidiaries (other than any transaction specifically contemplated by this Agreement); (h) the Company shall not, and shall not permit any of its subsidiaries to, (i) enter into, or materially amend, modify or supplement any Material Contract outside the ordinary course of business consistent with past practice (except as may be necessary for the Company to comply with its obligations hereunder) or (ii) waive, release, grant, assign or transfer any of its material rights or claims (whether such rights or claims arise under a Material Contract or otherwise); (i) except for customer contracts entered into in the ordinary course of business, the Company shall not, and shall not permit its subsidiaries to, renegotiate or enter into any new license, agreement or arrangement relating to any Proprietary Rights; (j) the Company and its subsidiaries (i) shall comply with their obligations under the Material Contracts as such obligations become due, (ii) shall continue in force insurance covering risks of such types and in such amounts as are consistent with the Company’s past practices and (iii) shall not permit any insurance policy naming it as a beneficiary or loss-loss payable payee to be cancelled canceled or terminated except terminated; (k) the Company shall not, and shall not permit any of its subsidiaries to, (i) establish or acquire any subsidiary other than wholly-owned subsidiaries or subsidiaries organized outside of the United States and its territorial possessions, (ii) pay, discharge or satisfy any claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), other than (x) the payment, discharge or satisfaction in the ordinary and usual course of businessbusiness and consistent with past practice of liabilities reflected on or reserved in the financial statements of the Company or incurred in the ordinary course of business and consistent with past practice or (y) the payment of the Company’s Expenses (as defined herein); (iii) amend, modify or waive any term of any outstanding security of the Company or any of its subsidiaries, except in connection with terminating the Options and the Stock Plans; (l) the Company shall, and shall cause its subsidiaries to, (i) maintain any real property to which the Company and any of its subsidiaries have ownership or a leasehold interest (including, without limitation, the furniture, fixtures, equipment and systems therein) in its current condition, subject to reasonable wear and tear and subject to any casualty or condemnation, (ii) timely pay all material taxes, water and sewage rents, assessments and insurance premiums affecting such real property other than those it is validly contesting and (iii) timely comply in all material respects with the terms and provisions of all leases, contracts and agreements relating to such real property and the use and operation thereof; (m) the Company shall not, and shall not permit any of its subsidiaries to, (i) settle or compromise any pending or threatened suit, action, claim or litigation, except with respect to the settlement or compromise of any such matter which does not involve equitable or injunctive relief and does not obligate the Company and its subsidiaries to make aggregate cash payments exceeding $50,000, (ii) change any of the material accounting policies, practices or procedures (including material tax accounting policies, practices and procedures) used by the Company and its subsidiaries as of the date hereof, except as may be required as a result of a change in applicable Law or in U.S. generally accepted accounting principles, (iii) revalue in any material respect any of its assets (including, without limitation, writing down or writing off any notes or accounts receivable in any material manner), except as required by U.S. generally accepted accounting principles or (iv) make or change any material tax election, make or change any material method of accounting with respect to Taxes except as may be required as a result of a change in applicable Law, settle or compromise any material Tax liability or file any material amended Tax Return; (n) the Company shall not, and shall not permit any of its subsidiaries to knowingly take, or knowingly agree or commit to take, any action that is reasonably likely to, make any representation or warranty of the Company contained in this Agreement inaccurate in any material respect at, or as of any time prior to, the Effective Time or result in any of the conditions to the Merger set forth in Article 6 not being satisfied, or knowingly omit, or knowingly agree to omit, to take any action necessary to prevent any such representation or warranty from being inaccurate in any material respect at any such time or to prevent any such condition from not being satisfied; and (go) neither it nor the Company shall not, and shall not permit any of its Subsidiaries will authorize subsidiaries to, agree or enter into an agreement commit to do any of the foregoing.

Interim Operations. The Except as otherwise contemplated by this Agreement or as set forth in Section 5.01 of the Company Disclosure Schedule or as consented to in writing by Parent, Company covenants and agrees as to itself and its Subsidiaries that, after that during the period from the date hereof and prior to the earlier of the Effective Time (or until termination of this Agreement in accordance with its terms and the Effective Time (unless Parent shall otherwise approve in writing, and except as otherwise expressly contemplated by this AgreementArticle 7): (a) the business and operations of it Company and its AVP Subsidiaries shall be conducted only in the ordinary course of business and usual course andCompany shall, to the extent consistent therewithand shall cause each AVP Subsidiary to, it and use its Subsidiaries shall use their respective reasonable best efforts to preserve intact its current business organization intact organizations, keep available the services of its current officers and maintain employees and preserve its existing relations and goodwill relationships with its material customers, suppliers, distributorslicensors, creditorslicensees, lessorsadvertisers, employees distributors and other material third parties having business associatesdealings with it and to preserve the goodwill of its respective businesses; (b) it Company shall not (i) authorize for issuance, issue, selldeliver, pledgesell or agree or commit to issue, dispose sell or deliver (whether through the issuance or granting of options, commitments, warrants, subscriptions, rights to purchase or otherwise), pledge or otherwise encumber any shares of its capital stock owned by it in or the capital stock of any AVP Subsidiary, any other securities or any securities convertible or exercisable into, or any rights, warrants or options to acquire, any such shares, securities or convertible securities or any other securities or equity equivalents (including without limitation stock appreciation rights or phantom interests), except for issuances of its Subsidiaries; Company Shares upon the exercise of Options or Warrants outstanding as of the date hereof or (ii) amend its certificate of incorporation or by-laws; (iii) split, combine or reclassify its outstanding shares of capital stock; (iv) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly-owned Subsidiaries; or (v) except for the repurchase of the Class A Warrant contemplated by the Warrantholder Agreement and the repurchase of outstanding Class B Preferred Sharespurchase, repurchase, redeem or otherwise acquire, or permit any of its Subsidiaries to purchase and shall ensure that no AVP Subsidiary shall purchase, repurchase, redeem or otherwise acquire, any shares of its capital stock or other equity interests of Company or any AVP Subsidiary (including, without limitation, securities convertible into or exchangeable or exercisable for any shares of its capital stock; (c) except as set forth in Section 6.1(c) of the Company Disclosure Letter, neither it nor any of its Subsidiaries shall (i) issue, sell, pledge, dispose of or encumber any shares of, or securities convertible into or exchangeable or exercisable for, or options, warrants, calls, commitments or rights of any kind to acquire, capital stock or other equity interests of Company or any AVP Subsidiary); (c) Company (i) shall retain, and shall not sell, transfer or pledge, or agree to sell, transfer or pledge, any equity interest owned by it directly or indirectly in any AVP Subsidiary or alter through merger, liquidation, reorganization, restructuring or in any other fashion the corporate structure or ownership of any AVP Subsidiary, (ii) shall not amend or otherwise change its Certificate of Incorporation or Bylaws, and shall ensure that no AVP Subsidiary shall amend its Certificate of Incorporation or Bylaws and (iii) shall not split, combine or reclassify any shares of its capital stock, and shall ensure that no AVP Subsidiary shall split, combine or reclassify any shares of its capital stock; (d) Company shall not, and shall ensure that no AVP Subsidiary shall, declare, set aside or pay any dividends on (whether in cash, stock of any class or other property), or make any other property distributions in respect of, any of its capital stock (except for dividends paid by AVP Subsidiaries to Company or assets to other AVP Subsidiaries consistent with past practices); (e) neither Company nor any AVP Subsidiary shall (i) grant or agree to any increase in any manner the compensation or fringe benefits of, or pay any bonus to, any current or former director, officer or employee except increases in the ordinary course of business consistent with past practice of less than ten percent (10%) of each such individual’s salary for non-officer employees, increases and bonuses expressly contemplated by or required under existing employment agreements, bonus plans and other than Shares issuable pursuant to options outstanding on agreements and arrangements listed or described in Section 5.01(e) of the date hereof under Company Disclosure Schedule and except in connection with accelerating the vesting schedules of the Options and the Warrants and terminating the Options, Warrants and the Stock Plan or upon conversion of the Class A Preferred Shares and Class C Preferred Shares); Plan, (ii) transferenter into any new or materially amend or terminate any existing employment, leaseconsulting, licenseseverance, guaranteetermination, sellchange-of-control or indemnification agreement with any current or former director, mortgageofficer or employee of Company, pledge, dispose of or encumber any material property or assets (including capital stock of any of its Subsidiaries) or incur or modify any material indebtedness or other liability; or (iii) except as set forth in Section 6.1(c)(iii5.01(e) of the Company Disclosure LetterSchedule, make as may be required to comply with applicable Law and as provided or authorize otherwise contemplated in this Agreement (including, without limitation, Section 2.02), become obligated under any Benefit Plan that was not in existence on the date hereof or commit amend, modify or terminate any Benefit Plan or other employee benefit plan or any agreement, arrangement, plan or policy for the benefit of any capital expenditures other than current or former director, officer or employee in amounts less than $25,000 individually existence on the date hereof or (iv) except as may be required to comply with applicable Law and $100,000 except as provided or otherwise contemplated in the aggregate orthis Agreement (including, without limitation, Section 2.02), pay any benefit not required by any meansplan or arrangement as in effect as of the date hereof (including, make any acquisition without limitation, the granting of, acceleration of, exercisability of or investment investing of stock options, assets stock appreciation rights or stock of any other Person or entity in excess of $25,000; (d) neither it nor any of its Subsidiaries shall terminaterestricted stock, establish, adopt, enter into, make any new grants or awards under, amend or except as otherwise modify, any Compensation and Benefit Plans or increase the salary, wage, bonus or other compensation of any employees except increases for non-executive employees occurring in the ordinary and usual course of business (which shall include normal periodic performance reviews and related compensation and benefit increasescontemplated by this Agreement); (e) neither it nor any of its Subsidiaries shall settle or compromise any material claims or litigation or, except in connection with accelerating the ordinary vesting schedules of the Options and usual course of businessthe Warrants and terminating the Options, modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claimsWarrants and the Stock Plan; (f) neither it nor Company shall not, and shall ensure that no AVP Subsidiary shall, acquire or agree to acquire, including, without limitation, by merging or consolidating with, or purchasing the assets or capital stock or other equity interests of, or by any other manner, any business or any corporation, partnership, association or other business organization or division thereof other than non-taxable transfers by or among AVP Subsidiaries; (g) Company shall not, and shall ensure that no AVP Subsidiary shall, sell, lease, license, mortgage or otherwise encumber or subject to any Lien or otherwise dispose of, or agree to sell, lease, license, mortgage or otherwise encumber or subject to any Lien or otherwise dispose of, any of its properties or assets other than (i) pursuant to existing contracts and commitments described in Section 5.01(g) of the Company Disclosure Schedule, (ii) immaterial properties or assets (or immaterial portions of properties or assets, including those described in Section 5.01(g) of the Company Disclosure Schedule), (iii) inventory in the ordinary course of business consistent with past practice, (iv) Permitted Liens and (v) non-taxable transfers by or among AVP Subsidiaries; (h) Company shall not, and shall ensure that no AVP Subsidiary shall, issue any letter of credit other than pursuant to the issuance of letters of credit in the ordinary course of business consistent with past practices of Company and AVP Subsidiaries in an amount not to exceed $150,000 in the aggregate, incur, assume or pre-pay any Indebtedness, enter into any agreement to incur, assume or pre-pay any Indebtedness, guarantee, or agree to guarantee, any such Indebtedness or obligation of another person, issue or sell, or agree to issue or sell, any debt securities or options, warrants or calls or rights to acquire any debt securities of Company or any AVP Subsidiary, guarantee any debt securities of others, enter into any “keep” well or other agreement to maintain any financial statement condition of another person or enter into any arrangement having the economic effect of any of the foregoing; (i) Company shall not, and shall ensure that no AVP Subsidiary shall, make or forgive any loans, advances or capital contributions to, guarantees for the benefit of, or investments in, any person or entity, other than (i) loans or advances in the ordinary course of business pursuant to Material Contracts in an amount not to exceed $50,000 in the aggregate, (ii) such loans between or among Company and any AVP Subsidiary and (iii) cash advances to Company’s or any such AVP Subsidiary’s employees for reimbursable travel and other business expenses incurred in the ordinary course of business consistent with past practice; (j) Company shall not, and shall ensure that no AVP Subsidiary shall, assume, guarantee or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any other Person, except for the obligations of AVP Subsidiaries permitted under this Agreement, other than in the ordinary course of business consistent with past practice; (k) neither Company nor any AVP Subsidiary shall adopt or put into effect a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other reorganization of Company or any AVP Subsidiary (other than any transaction specifically contemplated by this Agreement); (l) Company shall not, and shall ensure that no AVP Subsidiary shall, (i) enter into, terminate or materially amend, modify or supplement any Contract outside the ordinary course of business consistent with past practice (except as may be necessary for Company to comply with its obligations hereunder), (ii) enter into, terminate or materially amend, modify or supplement, any Lease or Material Contract, other than in the ordinary course of business consistent with past practice, or (iii) waive, release, grant, assign or transfer any of its material rights or claims (whether such rights or claims arise under a Contract or otherwise); (m) Company shall not, and shall ensure that no AVP Subsidiary shall, authorize or make any Tax election capital expenditures (other than pursuant to commitments prior to the date hereof or other planned capital expenditures in the ordinary course of business consistent with past practices disclosed in Section 5.01(m) of the Company Disclosure Schedule by category) or make any commitments with respect to capital expenditures or other planned capital expenditures in the ordinary course of business consistent with past practices in excess of $50,000 in the aggregate; (n) Company and AVP Subsidiaries (i) shall continue in force insurance with insurance companies who are experienced in underwriting insurance for businesses similar to Company’s business and adequately covering risks of such types and in such amounts as are consistent with Company’s past practices and (ii) shall use reasonable best efforts not permit any insurance policy naming it as a beneficiary or loss-loss payable payee to be cancelled canceled or terminated terminated; (o) Company shall not, and shall ensure that no AVP Subsidiary shall, establish or acquire (i) any Subsidiary other than wholly-owned Subsidiaries or (ii) Subsidiaries organized outside of the United States and its territorial possessions; (p) Company shall not, and shall ensure that no AVP Subsidiary shall, amend, modify or waive any term of any outstanding Options, Warrants or other securities of Company or any AVP Subsidiary, except (i) as required by this Agreement, or (ii) in connection with terminating the Options and the Stock Plan; (q) Company shall, and shall cause each AVP Subsidiary to, (i) maintain any real property in which any of Company and AVP Subsidiaries have any ownership or leasehold interest (including, without limitation, the furniture, fixtures, equipment and systems therein) in its current condition in all material respects, subject to reasonable wear and tear and subject to any casualty or condemnation and Permitted Liens, subject to the expiration of real property in accordance with their terms or (ii) pay, prior to the imposition of any Lien or material penalty all taxes, water and sewage rents, assessments and insurance premiums affecting such real property or contest them in good faith; (r) Company shall not, and shall ensure that no AVP Subsidiary shall, enter into, terminate or materially amend any labor or collective bargaining agreement, memorandum or understanding, grievance settlement or any other agreement or commitment to or relating to any labor union, except as required by Law; (s) Company shall not, and shall ensure that no AVP Subsidiary shall, conduct any plant closing or layoff that could implicate the WARN Act; (t) Company shall not, and shall ensure that no AVP Subsidiary shall, enter into any material settlement, conciliation or similar agreement; (u) Company shall not, and shall ensure that no AVP Subsidiary shall, settle or compromise any pending or threatened suit, action, claim or litigation, except with respect to the settlement or compromise of any such matter which does not involve equitable or injunctive relief and does not obligate Company and AVP Subsidiaries to make aggregate cash payments exceeding $50,000 individually or $100,000 in the aggregate; (v) except as set forth in Section 5.01(v) of the Company Disclosure Schedule, Company shall not, and shall ensure that no AVP Subsidiary shall, change any of the accounting policies, practices or procedures (including tax accounting policies, practices and procedures) used by Company and AVP Subsidiaries as of the date hereof, except as may be required as a result of a change in applicable Law or in U.S. generally accepted accounting principles; (w) Company shall not, and shall ensure that no AVP Subsidiary shall, revalue in any material respect any of its assets (including, without limitation, writing down or writing off any notes or accounts receivable in any material manner), except as required by U.S. generally accepted accounting principles; (x) Company shall not, and shall ensure that no AVP Subsidiary shall, pay, discharge or satisfy any material claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), other than (i) the payment, discharge or satisfaction in the ordinary and usual course of businessbusiness and consistent with past practice of Liabilities reflected on or reserved in the financial statements of Company or incurred in the ordinary course of business and consistent with past practice, (ii) the payment of Company’s Expenses, including the payment of the fees and Expenses of Special Committee and the costs, fees and Expenses incurred by Special Committee or (iii) the payment of claims under any of the Benefit Plans; (y) Company shall not, and shall ensure that no AVP Subsidiary shall, make or change any material tax election or change an annual accounting period with respect to Taxes, adopt or change any accounting method, file any amended Tax Return, enter into any closing agreement, settle or compromise any Tax claim, assessment or liability relating to Company or any AVP Subsidiary, or surrender any right to claim a refund of Taxes, consent to any extension or waiver of the limitation period applicable to any Tax claim or assessment relating to Company or any AVP Subsidiary, or take any other similar action, or omit to take any action relating to the filing of any Tax Return or the payment of any Tax; and (gz) neither it nor Company shall not, and shall not permit any of its Subsidiaries will authorize AVP Subsidiary to, agree or enter into an agreement commit to do any of the foregoing.

Interim Operations. The Except as otherwise expressly contemplated by this Agreement or as set forth in Section 5.01 of the Company Disclosure Schedule or as agreed to in writing by Parent, the Company covenants and agrees as to itself and its Subsidiaries that, after that during the period from the date hereof and prior of this Agreement to the earlier of the Effective Time (or until termination of this Agreement in accordance with its terms and the Effective Time (unless Parent shall otherwise approve in writing, and except as otherwise expressly contemplated by this AgreementArticle 7 hereof): (a) the business and operations of it the Company and its Subsidiaries subsidiaries shall be conducted only in the ordinary course of business and usual course and, to the extent consistent therewith, it Company and its Subsidiaries subsidiaries shall use their respective best commercially reasonable efforts to preserve its intact their current business organization intact organizations, keep available the services of their current officers and maintain its existing relations employees and preserve their relationships and goodwill with customers, suppliers, their material distributors, creditors, lessors, employees customers and suppliers and any other material third parties having business associates;dealings with them. (b) it the Company shall not (i) authorize for issuance, issue, selldeliver, pledgesell or agree or commit to issue, dispose sell or deliver (whether through the issuance or granting of options, commitments, subscriptions, rights to purchase or otherwise), pledge or otherwise encumber any shares of its capital stock owned by it in or the capital stock of any of its Subsidiaries; subsidiaries, any other securities or any securities convertible into, or any rights, warrants or options to acquire, any such shares, securities or convertible securities or any other securities or equity equivalents (including without limitation stock appreciation rights or phantom interests), except for issuances of Common Shares upon the exercise of Options outstanding as of the date hereof, (ii) amend its certificate of incorporation or by-laws; (iii) split, combine or reclassify its outstanding shares of capital stock; (iv) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly-owned Subsidiaries; or (v) except for the repurchase of the Class A Warrant contemplated by the Warrantholder Agreement and the repurchase of outstanding Class B Preferred Shares, repurchase, redeem or otherwise acquire, or permit any of its Subsidiaries subsidiaries to purchase repurchase, redeem or otherwise acquire, any shares of its capital stock or any securities convertible into or exchangeable or exercisable for any shares of its capital stock; (c) except as set forth in Section 6.1(c) other equity interests of the Company Disclosure Letter, neither it nor or any of its Subsidiaries shall subsidiaries (i) issueincluding, sellwithout limitation, pledge, dispose of or encumber any shares of, or securities convertible into or exchangeable or exercisable for, or options, warrants, calls, commitments or rights of any kind to acquire, capital stock or other equity interests of the Company or any of its subsidiaries), (iii) sell, transfer or pledge, or agree to sell, transfer or pledge, any equity interest owned by it in any of its subsidiaries or alter through merger, liquidation, reorganization, restructuring or in any other fashion the corporate structure or ownership of any of its subsidiaries, (iv) amend or otherwise change its articles of incorporation or bylaws or permit any of its subsidiaries to amend its articles of incorporation, bylaws or equivalent organizational documents or (v) split, combine or reclassify any shares of its capital stock, and shall not permit any of its subsidiaries to split, combine or reclassify any shares of its capital stock; (c) the Company shall not, and shall not permit any of its subsidiaries to (i) declare, set aside or pay any dividends on (whether in cash, stock or other property), or make any other distributions in respect of, any of its capital stock (except for dividends paid by direct or indirect wholly owned subsidiaries to the Company), (ii) acquire or agree to acquire, including, without limitation, by merging or consolidating with, or purchasing the assets (except raw materials, inventory or supplies in the ordinary course of business) or capital stock or other equity interests of, or by any class other manner, any business or any corporation, partnership, association or other property business organization or assets division thereof, (other than Shares issuable pursuant iii) authorize or make any capital expenditures in excess of $200,000 (the "Capital Expenditures Excess Amount") in the aggregate in addition to options outstanding on the amount set forth in the Company's budget for capital expenditures for the period of time between the date hereof under and the Stock Plan or upon conversion of the Class A Preferred Shares and Class C Preferred Shares); Effective Time (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any material property or assets (including which capital stock of any of its Subsidiaries) or incur or modify any material indebtedness or other liability; or (iii) except as budget is set forth in Section 6.1(c)(iii5.01(c) of the Company Disclosure LetterSchedule), make or authorize (iv) enter into, amend, modify or commit for supplement any capital expenditures agreement, transaction, commitment or arrangement with any current or former officer, director, employee or other affiliate of the Company or any of its subsidiaries (or any affiliate of any of the foregoing) other than in amounts less than $25,000 individually and $100,000 in the aggregate or, as contemplated by any means, make any acquisition of, or investment in, assets or stock of any other Person or entity in excess of $25,000this Agreement; (d) neither it the Company nor any of its Subsidiaries subsidiaries shall terminate(i) grant or agree to any increase in any manner the compensation or fringe benefits of, establishor pay any bonus to, adoptany current or former director, officer or employee except for (A) increases and bonuses expressly contemplated by or required under existing employment agreements or (B) bonus plans and other agreements and arrangements listed or described in Section 5.01(d) of the Company Disclosure Schedule and except in connection with terminating the Options and the Stock Plans, (ii) enter into, make into any new grants or awards undermaterially amend any existing employment, amend consulting, severance, termination, change-of-control or indemnification agreement with any current or former director, officer or employee of the Company, (iii) except as may be required to comply with applicable Law and except as provided or otherwise modifycontemplated in this Agreement (including, without limitation, Section 2.02 hereof), become obligated under any Compensation and Benefit Plans Plan that was not in existence on the date hereof or increase the salaryamend, wage, bonus modify or terminate any Benefit Plan or other compensation employee benefit plan or any agreement, arrangement, plan or policy for the benefit of any employees current or former director, officer or employee in existence on the date hereof or (iv) except increases as may be required to comply with applicable Law and except as provided or otherwise contemplated in this Agreement (including, without limitation, Section 2.02 hereof), pay any benefit not required by any plan or arrangement as in effect as of the date hereof (including, without limitation, the granting of, acceleration of, exercisability of or vesting of stock options, stock appreciation rights or restricted stock, except as otherwise contemplated by this Agreement), except in connection with terminating the Options and the Stock Plans and except for non-executive employees occurring in the ordinary and usual course payment of business (which shall include normal periodic performance reviews and related compensation and benefit increases)the employer match under the Company's 401(k) plan; (e) neither it nor the Company shall not, and shall not permit any of its Subsidiaries shall settle subsidiaries to, sell, lease, license, mortgage or compromise otherwise encumber or subject to any material claims Lien or litigation orotherwise dispose of, except or agree to sell, lease, license, mortgage or otherwise encumber or subject to any Lien or otherwise dispose of, any of its properties or assets other than (i) immaterial properties or assets (or immaterial portions of properties or assets), (ii) inventory in the ordinary course of business consistent with past practice, (iii) licenses granted by the Company in the ordinary course of business to customers for such customers' use of the Company's products and usual services, (iv) Liens relating to Taxes that are not yet due and payable or otherwise being contested in good faith and as to which appropriate reserves have been established by the Company in accordance with U.S. generally accepted accounting principles, (v) Liens for assessments and other governmental charges or Encumbrances of landlords, carriers, warehousemen, mechanics and repairmen incurred in the ordinary course of business, modifyin each case for sums not yet due and payable or due but not delinquent or being contested in good faith and for which adequate reserves have been established and (vi) Liens incurred in the ordinary course of business in connection with workers' compensation, amend unemployment insurance and other types of social security or terminate any to secure the performance of its material Contracts or waivetenders, release or assign any material rights or claimsstatutory obligations, surety and appeal bonds, bids, leases, government contracts, performance and return of money bonds and similar obligations; (f) the Company shall not, and shall not permit any of its subsidiaries to (i) incur, assume or pre-pay any Indebtedness or enter into any agreement to incur, assume or pre-pay any Indebtedness, or guarantee, or agree to guarantee, any such Indebtedness or obligation of another person, or issue or sell, or agree to issue or sell, any debt securities or options, warrants or calls or rights to acquire any debt securities of the Company or any of its subsidiaries, guarantee any debt securities of others, enter into any "keep well" or other agreement to maintain any financial statement condition of another person or enter into any arrangement having the economic effect of any of the foregoing, (ii) make or forgive any loans, advances or capital contributions to, guarantees for the benefit of, or investments in, any person or entity, other than loans between or among the Company and any of its wholly-owned subsidiaries and cash advances to the Company's or any such subsidiary's employees for reimbursable travel and other business expenses incurred in the ordinary course of business consistent with past practice or (iii) assume, guarantee or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any other Person, except for the obligations of the subsidiaries of the Company permitted under this Agreement; (g) neither it the Company nor any of its Subsidiaries subsidiaries shall make adopt or put into effect a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other reorganization of the Company or any Tax election of its subsidiaries (other than any transaction specifically contemplated by this Agreement); (h) the Company shall not, and shall not permit any of its subsidiaries to, (i) enter into, or materially amend, modify or supplement any Material Contract outside the ordinary course of business consistent with past practice (except as may be necessary for the Company to comply with its obligations hereunder) or (ii) waive, release, grant, assign or transfer any of its material rights or claims (whether such rights or claims arise under a Material Contract or otherwise); (i) except for customer contracts entered into in the ordinary course of business, the Company shall not, and shall not permit its subsidiaries to, renegotiate or enter into any new license, agreement or arrangement relating to any Proprietary Rights; (j) the Company and its subsidiaries (i) shall comply with their obligations under the Material Contracts as such obligations become due, (ii) shall continue in force insurance covering risks of such types and in such amounts as are consistent with the Company's past practices and (iii) shall not permit any insurance policy naming it as a beneficiary or loss-loss payable payee to be cancelled canceled or terminated except terminated; (k) the Company shall not, and shall not permit any of its subsidiaries to, (i) establish or acquire any subsidiary other than wholly-owned subsidiaries or subsidiaries organized outside of the United States and its territorial possessions, (ii) pay, discharge or satisfy any claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), other than (x) the payment, discharge or satisfaction in the ordinary and usual course of businessbusiness and consistent with past practice of liabilities reflected on or reserved in the financial statements of the Company or incurred in the ordinary course of business and consistent with past practice or (y) the payment of the Company's Expenses (as defined herein); (iii) amend, modify or waive any term of any outstanding security of the Company or any of its subsidiaries, except in connection with terminating the Options and the Stock Plans; (l) the Company shall, and shall cause its subsidiaries to, (i) maintain any real property to which the Company and any of its subsidiaries have ownership or a leasehold interest (including, without limitation, the furniture, fixtures, equipment and systems therein) in its current condition, subject to reasonable wear and tear and subject to any casualty or condemnation, (ii) timely pay all material taxes, water and sewage rents, assessments and insurance premiums affecting such real property other than those it is validly contesting and (iii) timely comply in all material respects with the terms and provisions of all leases, contracts and agreements relating to such real property and the use and operation thereof; (m) the Company shall not, and shall not permit any of its subsidiaries to, (i) settle or compromise any pending or threatened suit, action, claim or litigation, except with respect to the settlement or compromise of any such matter which does not involve equitable or injunctive relief and does not obligate the Company and its subsidiaries to make aggregate cash payments exceeding $50,000, (ii) change any of the material accounting policies, practices or procedures (including material tax accounting policies, practices and procedures) used by the Company and its subsidiaries as of the date hereof, except as may be required as a result of a change in applicable Law or in U.S. generally accepted accounting principles, (iii) revalue in any material respect any of its assets (including, without limitation, writing down or writing off any notes or accounts receivable in any material manner), except as required by U.S. generally accepted accounting principles or (iv) make or change any material tax election, make or change any material method of accounting with respect to Taxes except as may be required as a result of a change in applicable Law, settle or compromise any material Tax liability or file any material amended Tax Return; (n) the Company shall not, and shall not permit any of its subsidiaries to knowingly take, or knowingly agree or commit to take, any action that is reasonably likely to, make any representation or warranty of the Company contained in this Agreement inaccurate in any material respect at, or as of any time prior to, the Effective Time or result in any of the conditions to the Merger set forth in Article 6 not being satisfied, or knowingly omit, or knowingly agree to omit, to take any action necessary to prevent any such representation or warranty from being inaccurate in any material respect at any such time or to prevent any such condition from not being satisfied; and (go) neither it nor the Company shall not, and shall not permit any of its Subsidiaries will authorize subsidiaries to, agree or enter into an agreement commit to do any of the foregoing.

Interim Operations. The Except as otherwise contemplated by this Agreement or as set forth in SECTION 6.01 of the Company Disclosure Schedule or as consented to in writing by Parent, the Company covenants and agrees as to itself and its Subsidiaries that, after that during the period from the date hereof and prior of this Agreement to the earlier of the Effective Time (or until termination of this Agreement in accordance with its terms and the Effective Time (unless Parent shall otherwise approve in writing, and except as otherwise expressly contemplated by this AgreementARTICLE 8 hereof): (a) the business and operations of it the Company and its Subsidiaries shall be conducted only in the ordinary course of business and usual course and, to the extent consistent therewith, it Company and its Subsidiaries shall use their respective reasonable best efforts to preserve its intact their current business organization intact organizations, keep available the services of their current officers and maintain its existing relations employees and goodwill preserve their relationships with their material customers, suppliers, distributorslicensors, creditorslicensees, lessorsadvertisers, employees distributors and other material third parties having business associatesdealings with them and to preserve the goodwill of their respective businesses; (b) it the Company shall not (i) authorize for issuance, issue, selldeliver, pledgesell or agree or commit to issue, dispose sell or deliver (whether through the issuance or granting of options, commitments, subscriptions, rights to purchase or otherwise), pledge or otherwise encumber any shares of its capital stock owned by it in or the capital stock of any of its Subsidiaries; , any other securities or any securities convertible or exercisable into, or any rights, warrants or options to acquire, any such shares, securities or convertible securities or any other securities or equity equivalents (including without limitation stock appreciation rights or phantom interests), except for issuances of Common Shares upon the exercise of Options outstanding as of the date hereof or (ii) amend its certificate of incorporation or by-laws; (iii) split, combine or reclassify its outstanding shares of capital stock; (iv) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly-owned Subsidiaries; or (v) except for the repurchase of the Class A Warrant contemplated by the Warrantholder Agreement and the repurchase of outstanding Class B Preferred Shares, repurchase, redeem or otherwise acquire, or permit any of its Subsidiaries to purchase repurchase, redeem or otherwise acquire, any shares of its capital stock or any securities convertible into or exchangeable or exercisable for any shares of its capital stock; (c) except as set forth in Section 6.1(c) other equity interests of the Company Disclosure Letter, neither it nor or any of its Subsidiaries shall (i) issueincluding, sellwithout limitation, pledge, dispose of or encumber any shares of, or securities convertible into or exchangeable or exercisable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class or any other property or assets (other than Shares issuable pursuant to options outstanding on the date hereof under the Stock Plan or upon conversion equity interests of the Class A Preferred Shares and Class C Preferred Shares); (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of Company or encumber any material property or assets (including capital stock of any of its Subsidiaries) or incur or modify any material indebtedness or other liability; or (iii) except as set forth in Section 6.1(c)(iii) of the Company Disclosure Letter, make or authorize or commit for any capital expenditures other than in amounts less than $25,000 individually and $100,000 in the aggregate or, by any means, make any acquisition of, or investment in, assets or stock of any other Person or entity in excess of $25,000; (d) neither it nor any of its Subsidiaries shall terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Compensation and Benefit Plans or increase the salary, wage, bonus or other compensation of any employees except increases for non-executive employees occurring in the ordinary and usual course of business (which shall include normal periodic performance reviews and related compensation and benefit increases); (e) neither it nor any of its Subsidiaries shall settle or compromise any material claims or litigation or, except in the ordinary and usual course of business, modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claims; (f) neither it nor any of its Subsidiaries shall make any Tax election or permit any insurance policy naming it as a beneficiary or loss-payable payee to be cancelled or terminated except in the ordinary and usual course of business; and (g) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.

Interim Operations. The Except as otherwise contemplated by this Agreement or as set forth in Section 6.01 of the Company Disclosure Schedule or as consented to in writing by Parent, the Company covenants and agrees as to itself and its Subsidiaries that, after that during the period from the date hereof and prior of this Agreement to the earlier of the Effective Time (or until termination of this Agreement in accordance with its terms and the Effective Time (unless Parent shall otherwise approve in writing, and except as otherwise expressly contemplated by this AgreementArticle 8 hereof): (a) the business and operations of it the Company and its Subsidiaries shall be conducted only in the ordinary course of business and usual course and, to the extent consistent therewith, it Company and its Subsidiaries shall use their respective reasonable best efforts to preserve its intact their current business organization intact organizations, keep available the services of their current officers and maintain its existing relations employees and goodwill preserve their relationships with their material customers, suppliers, distributorslicensors, creditorslicensees, lessorsadvertisers, employees distributors and other material third parties having business associatesdealings with them and to preserve the goodwill of their respective businesses; (b) it the Company shall not (i) authorize for issuance, issue, selldeliver, pledgesell or agree or commit to issue, dispose sell or deliver (whether through the issuance or granting of options, commitments, subscriptions, rights to purchase or otherwise), pledge or otherwise encumber any shares of its capital stock owned by it in or the capital stock of any of its Subsidiaries; , any other securities or any securities convertible or exercisable into, or any rights, warrants or options to acquire, any such shares, securities or convertible securities or any other securities or equity equivalents (including without limitation stock appreciation rights or phantom interests), except for issuances of Common Shares upon the exercise of Options outstanding as of the date hereof or (ii) amend its certificate of incorporation or by-laws; (iii) split, combine or reclassify its outstanding shares of capital stock; (iv) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly-owned Subsidiaries; or (v) except for the repurchase of the Class A Warrant contemplated by the Warrantholder Agreement and the repurchase of outstanding Class B Preferred Shares, repurchase, redeem or otherwise acquire, or permit any of its Subsidiaries to purchase repurchase, redeem or otherwise acquire, any shares of its capital stock or any securities convertible into or exchangeable or exercisable for any shares of its capital stock; (c) except as set forth in Section 6.1(c) other equity interests of the Company Disclosure Letter, neither it nor or any of its Subsidiaries shall (i) issueincluding, sellwithout limitation, pledge, dispose of or encumber any shares of, or securities convertible into or exchangeable or exercisable for, or options, warrants, calls, commitments or rights of any kind to acquire, capital stock or other equity interests of the Company or any of its Subsidiaries); (c) the Company shall not (i) sell, transfer or pledge, or agree to sell, transfer or pledge, any equity interest owned by it in any of its Subsidiaries or alter through merger, liquidation, reorganization, restructuring or in any other fashion the corporate structure or ownership of any of its Subsidiaries, (ii) amend or otherwise change its charter, articles of incorporation or bylaws or permit any of its Subsidiaries to amend its articles of incorporation, bylaws or equivalent organizational documents or (iii) split, combine or reclassify any shares of its capital stock, and shall not permit any of its Subsidiaries to split, combine or reclassify any shares of its capital stock; (d) the Company shall not, and shall not permit any of its Subsidiaries to, declare, set aside or pay any dividends on (whether in cash, stock of any class or other property), or make any other property distributions in respect of, any of its capital stock (except for dividends paid by direct or assets indirect wholly owned Subsidiaries to the Company or to other wholly owned Subsidiaries of the Company consistent with past practices); (e) neither the Company nor any of its Subsidiaries shall (i) grant or agree to any increase in any manner the compensation or fringe benefits of, or pay any bonus to, any current or former director, officer or employee except increases in the ordinary course of business consistent with past practice of less than 10% of each such individual's salary for non-officer employees, increases and bonuses expressly contemplated by or required under existing employment agreements, bonus plans and other than Shares issuable pursuant to options outstanding on agreements and arrangements listed or described in Section 6.01(e) of the date hereof under Company Disclosure Schedule and except in connection with accelerating the vesting schedules of the Options and terminating the Options and the Stock Plan or upon conversion of the Class A Preferred Shares and Class C Preferred Shares); Plans, (ii) transferenter into any new or materially amend any existing employment, leaseconsulting, licenseseverance, guaranteetermination, sellchange-of-control or indemnification agreement with any current or former director, mortgageofficer or employee of the Company, pledge, dispose of or encumber any material property or assets (including capital stock of any of its Subsidiaries) or incur or modify any material indebtedness or other liability; or (iii) except as set forth in Section 6.1(c)(iii6.01(e) of the Company Disclosure LetterSchedule, as may be required to comply with applicable Law and as provided or otherwise contemplated in this Agreement (including, without limitation, Section 3.02 hereof), become obligated under any Benefit Plan that was not in existence on the date hereof or amend, modify or terminate any Benefit Plan or other employee benefit plan or any agreement, arrangement, plan or policy for the benefit of any current or former director, officer or employee in existence on the date hereof or (iv) except as may be required to comply with applicable Law and except as provided or otherwise contemplated in this Agreement (including, without limitation, Section 3.02 hereof), pay any benefit not required by any plan or arrangement as in effect as of the date hereof (including, without limitation, the granting of, acceleration of, exercisability of or vesting of stock options, stock appreciation rights or restricted stock, except as otherwise contemplated by this Agreement), except in connection with accelerating the vesting schedules of the Options and terminating the Options and the Stock Plans; (f) the Company shall not, and shall not permit any of its Subsidiaries to, acquire or agree to acquire, including, without limitation, by merging or consolidating with, or purchasing the assets or capital stock or other equity interests of, or by any other manner, any business or any corporation, partnership, association or other business organization or division thereof other than non-taxable transfers by or among the Company's Subsidiaries; (g) the Company shall not, and shall not permit any of its Subsidiaries to, sell, lease, license, mortgage or otherwise encumber or subject to any Lien or otherwise dispose of, or agree to sell, lease, license, mortgage or otherwise encumber or subject to any Lien or otherwise dispose of, any of its properties or assets other than (i) pursuant to existing contracts and commitments described in Section 6.01(g) of the Company Disclosure Schedule, (ii) immaterial properties or assets (or immaterial portions of properties or assets, including those described in Section 6.01(g) of the Company Disclosure Schedule), (iii) inventory in the ordinary course of business consistent with past practice, (iv) Permitted Liens, (v) Liens relating to Taxes that are not yet due and payable or otherwise being contested in good faith and as to which appropriate reserves have been established by the Company in accordance with U.S. generally accepted accounting principles and (vi) other than non-taxable transfers by or among the Company's Subsidiaries; (h) the Company shall not, and shall not permit any of its Subsidiaries to, issue any letter of credit other than pursuant to the issuance of letters of credit in the ordinary course of business consistent with past practices of the Company and its Subsidiaries in an amount not to exceed $10,000,000 in the aggregate, incur, assume or pre-pay any Indebtedness, enter into any agreement to incur, assume or pre-pay any Indebtedness, guarantee, or agree to guarantee, any such Indebtedness or obligation of another person, issue or sell, or agree to issue or sell, any debt securities or options, warrants or calls or rights to acquire any debt securities of the Company or any of its Subsidiaries, guarantee any debt securities of others, enter into any "keep well" or other agreement to maintain any financial statement condition of another person or enter into any arrangement having the economic effect of any of the foregoing; (i) the Company shall not, and shall not permit any of its Subsidiaries to, make or authorize forgive any loans, advances or commit capital contributions to, guarantees for any capital expenditures other than in amounts less than $25,000 individually and $100,000 in the aggregate or, by any means, make any acquisition benefit of, or investment investments in, assets any person or stock entity, other than (i) loans or advances in the ordinary course of business to facilitate construction or renovation of stores pursuant to Material Contracts in an amount not to exceed $2,000,000 in the aggregate, (ii) such loans between or among the Company and any of its wholly-owned Subsidiaries and (iii) cash advances to the Company's or any such Subsidiary's employees for reimbursable travel and other business expenses incurred in the ordinary course of business consistent with past practice; (j) the Company shall not, and shall not permit any of its Subsidiaries to, assume, guarantee or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any other Person or entity in excess Person, except for the obligations of $25,000the Subsidiaries of the Company permitted under this Agreement; (dk) neither it the Company nor any of its Subsidiaries shall terminateadopt or put into effect a plan of complete or partial liquidation, establishdissolution, adoptmerger, enter intoconsolidation, make any new grants or awards underrestructuring, amend or otherwise modify, any Compensation and Benefit Plans or increase the salary, wage, bonus 41 recapitalization or other compensation reorganization of the Company or any employees except increases for non-executive employees occurring in the ordinary and usual course of business its Subsidiaries (which shall include normal periodic performance reviews and related compensation and benefit increasesother than any transaction specifically contemplated by this Agreement); (el) neither it nor the Company shall not, and shall not permit any of its Subsidiaries to, (i) enter into, or materially amend, modify or supplement any Contract outside the ordinary course of business consistent with past practice (except as may be necessary for the Company to comply with its obligations hereunder), (ii) enter into, or materially amend, modify or supplement, any Lease or Material Contract, or (iii) waive, release, grant, assign or transfer any of its material rights or claims (whether such rights or claims arise under a Contract or otherwise); (m) the Company shall settle not, and shall not permit any of its Subsidiaries to, authorize or compromise make any material claims capital expenditures (other than pursuant to commitments prior to the date hereof or litigation or, except other planned capital expenditures in the ordinary and usual course of business consistent with past practices disclosed in Section 6.01(m) of the Company Disclosure Schedule by category) or make any commitments with respect to capital expenditures or other planned capital expenditures in the ordinary course of business consistent with past practices in excess of $1,000,000 in the aggregate; (n) except for customer contracts entered into in the ordinary course of business, modifythe Company shall not, amend and shall not permit its Subsidiaries to, renegotiate or terminate enter into any of its material Contracts new license, agreement or waive, release or assign arrangement relating to any material rights or claimsIntellectual Property; (fo) neither it nor any of the Company and its Subsidiaries (i) shall make any Tax election or continue in force insurance with good and responsible insurance companies adequately covering risks of such types and in such amounts as are consistent with the Company's past practices and (ii) shall use reasonable best efforts not permit any insurance policy naming it as a beneficiary or loss-loss payable payee to be cancelled canceled or terminated except in the ordinary and usual course of business; andterminated; (gp) neither it nor the Company shall not, and shall not permit any of its Subsidiaries will authorize to, establish or acquire (i) any Subsidiary other than wholly-owned Subsidiaries or (ii) Subsidiaries organized outside of the United States and its territorial possessions; (q) the Company shall not, and shall not permit any of its Subsidiaries to, amend, modify or waive any term of any outstanding security of the Company or any of its Subsidiaries, except (i) as required by this Agreement, (ii) except as set forth in Section 6.01(q) of the Company Disclosure Schedule, in connection with accelerating the vesting schedules of the Options to the extent required by the Stock Plans or the agreements pursuant to which such Options were granted or (iii) in connection with terminating the Options and the Stock Plans; (r) the Company shall, and shall cause its Subsidiaries to, (i) maintain any real property of which the Company and any of its Subsidiaries have ownership or a leasehold interest (including, without limitation, the furniture, fixtures, equipment and systems therein) in its current condition in all material respects, subject to reasonable wear and tear and subject to any casualty or condemnation and Permitted Liens, subject to the expiration of real property in accordance with their terms or (ii) pay, prior to the imposition of any Lien or material penalty all taxes, water and sewage rents, assessments and insurance premiums affecting such real property or contest them in good faith; (s) the Company shall not, and shall not permit any of its Subsidiaries to, enter into an or materially amend any labor or collective bargaining agreement, memorandum or understanding, grievance settlement or any other agreement or commitment to do or relating to any labor union, except as required by Law; (t) the Company shall not, and shall not permit any of its Subsidiaries to, conduct any plant closing or layoff that could implicate the WARN Act; (u) the Company shall not, and shall not permit any of its Subsidiaries to, settle or compromise any pending or threatened suit, action, claim or litigation, except with respect to the settlement or compromise of any such matter which does not involve equitable or injunctive relief and does not obligate the Company and its Subsidiaries to make aggregate cash payments exceeding $25,000 individually or $125,000 in the aggregate; (v) except as set forth in Section 6.01(v) of the Company Disclosure Schedule, the Company shall not, and shall not permit any of its Subsidiaries to, change any of the foregoing.accounting policies, practices or procedures (including tax accounting policies, practices and procedures) used by the Company and its Subsidiaries as of the date hereof, except as may be required as a result of a change in applicable Law or in U.S. generally accepted accounting principles; (w) the Company shall not, and shall not permit any of its Subsidiaries to, revalue in any material respect any of its assets (including, without limitation, writing down or writing off any notes or accounts receivable in any material manner), except as required by U.S generally accepted accounting principles; (x) the Company shall not, and shall not permit any of its Subsidiaries to, pay, discharge or satisfy any material claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), other than (i) the payment, discharge or satisfaction in the ordinary course of business and consistent with past practice of Liabilities reflected on or reserved in the financial statements of the Company or incurred in the ordinary course of business and consistent with past practice, (ii) the payment of the Company's Expenses (as defined herein), including the payment of the fees and expenses of the Special Committee and the costs, fees and expenses incurred by the Special Committee or (iii) the payment of claims under any of the Benefit Plans; (y) the Company shall not, and shall not permit any of its Subsidiaries to, knowingly and intentionally take, or agree or commit to take, any action that would, or is reasonably likely to, make any representation or warranty of the Company contained in this Agreement inaccurate at, or as of any time prior to, the Effective Time or result in any of the conditions to the Offer or any conditions to the Merger set forth in Article 7 not being satisfied, or knowingly and intentionally omit, or agree to omit, to take any action necessary to prevent any such representation or warranty from being inaccurate at any such time or to prevent any such condition from not being satisfied; (z) the Company shall not, and shall not permit any of its Subsidiaries to make or change any material tax election or change an annual accounting period with respect to Taxes, adopt or change any accounting method, file any amended Tax Return, enter into any closing agreement, settle or compromise any Tax claim, assessment or liability relating to the Company or any of its Subsidiaries, or surrender any right to claim a refund of Taxes, except as set forth in Section 6.01(z) of the Company Disclosure Schedule, consent to any extension or waiver of the limitation period applicable to any Tax claim or assessment relating to the Company or any of its Subsidiaries, or take any other similar action, or omit to take any action relating to the filing of any Tax Return or the payment of any Tax, if such election, adoption, change, amendment, agreement, settlement, surrender, consent or other

Interim Operations. The Company covenants During the period from March 31, 1998 and agrees as to itself and its Subsidiaries that, after continuing until the date hereof and prior to the earlier of the termination of this Agreement in accordance with its terms and the Effective Time (unless Parent shall otherwise approve in writing, and except as otherwise expressly contemplated by this Agreement):Closing: (a) The Shareholders agree (except as expressly contemplated by or disclosed within this Agreement, including any Exhibits and Schedules hereto, or to the extent that Buyer shall otherwise consent in writing) that as to the Company: (1) The Company shall carry on its business of it and its Subsidiaries shall be conducted in the usual, regular and ordinary and usual course in substantially the same manner as heretofore conducted and, to the extent consistent therewithwith such business, it and its Subsidiaries shall use their respective best all reasonable efforts to preserve intact its present business organization intact and maintain its existing relations and goodwill with customers, suppliers, distributors, creditors, lessors, employees and business associates;organization, (b2) it The Company shall not and shall not propose to: (i) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (ii) amend its certificate of incorporation or by-laws; (iii) split, combine or reclassify its outstanding shares of capital stock; (iva) declare, set aside or pay any dividend payable in cashdividend, stock on, or property make other distributions in respect of any capital stock other than dividends from its direct or indirect wholly-owned Subsidiaries; or (v) except for the repurchase of the Class A Warrant contemplated by the Warrantholder Agreement and the repurchase of outstanding Class B Preferred Sharesof, repurchase, redeem or otherwise acquire, or permit any of its Subsidiaries to capital stock, or purchase or otherwise acquire, redeem any shares of its capital stock other than a cash dividend to be distributed to the Shareholders in an amount equal to the Shareholders' liability for federal and state taxes on the earnings from operations of the Company during 1998 through the Closing Date (exclusive of any income or gain on sale associated with the transactions covered by this Agreement) as more fully described at Section 5.4 hereafter; (b) split, combine or reclassify any of its capital stock or issue, authorize or propose the issuance of any other securities convertible into in respect of, in lieu of or exchangeable in substitution for shares of its capital stock; (c) redeem, repurchase or exercisable for otherwise acquire any shares of its capital stock;; or (d) otherwise change its capitalization. (c3) except Except as set forth in Section 6.1(c) of contemplated by this Agreement, the Company Disclosure Lettershall not sell, neither it nor any of its Subsidiaries shall (i) issue, sell, pledge, dispose of authorize or encumber any shares propose the sale or issuance of, pledge or securities convertible into purchase or exchangeable or exercisable for, or options, warrants, calls, commitments or rights of any kind to acquirepropose the purchase of, any shares of its capital stock of any class or securities convertible into, or rights, warrants or options to acquire, any such shares or other property convertible securities. (4) The Company shall not amend its articles of incorporation or assets its Bylaws. (other than Shares issuable pursuant to options outstanding on the date hereof under the Stock Plan or upon conversion of the Class A Preferred Shares and Class C Preferred Shares); (ii5) transferThe Company shall not sell, lease, licensepledge, guarantee, encumber or otherwise dispose of or agree to sell, mortgagelease, pledge, encumber or otherwise dispose of or encumber any material property or assets (including capital stock of of, any of its Subsidiariesassets that are material except in the ordinary course of business consistent with prior practice and in no event amounting in the aggregate to more than $75,000. (6) The Company shall not incur any indebtedness for borrowed money or incur or modify guarantee any material such indebtedness or other liability; issue or (iii) except as set forth in Section 6.1(c)(iii) sell any debt securities of the Company Disclosure Letter, make or authorize or commit for guarantee any capital expenditures debt securities of others other than in amounts less than $25,000 individually the ordinary course of business consistent with prior practice and $100,000 in no event (disregarding for these purposes ordinary trade accounts payable and operating accruals) amounting in the aggregate orto more than $75,000. (7) The Company shall not adopt or amend in any material respect any collective bargaining agreement or Employee Benefit Plan. (8) The Company shall not grant to any Shareholder-employee any increase in compensation or in severance or termination pay, or enter into any employment agreement with any executive officer. (9) The Company shall not acquire (by merger, consolidation or acquisition of stock or assets or otherwise) any meanscorporation, partnership or other business organization or subdivision thereof, or make any acquisition ofinvestment by either purchase of stock or securities, or investment incontributions to capital, assets or stock of any other Person or entity in excess of $25,000; (d) neither it nor any of its Subsidiaries shall terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Compensation and Benefit Plans or increase the salary, wage, bonus or other compensation of any employees except increases for non-executive employees occurring in the ordinary and usual course of business (which shall include normal periodic performance reviews and related compensation and benefit increases); (e) neither it nor any of its Subsidiaries shall settle or compromise any material claims or litigation property transfer or, except in the ordinary and usual course of business, modifypurchase of any property or assets, amend of any other individual or terminate entity. (10) The Company shall not make any of its material Contracts tax election or settle or compromise any material federal, state, local or foreign tax liability. (11) The Company shall not waive, release release, grant or assign transfer any rights of material value or modify or change in any material rights or claims; (f) neither it nor respect any of its Subsidiaries shall make any Tax election or permit any insurance policy naming it as a beneficiary or loss-payable payee to be cancelled or terminated except Material Contract other than in the ordinary and usual course of business; andbusiness and consistent with past practice. (g12) neither it nor any of its Subsidiaries will authorize or The Company shall not enter into an any agreement or arrangement to do any of the foregoing. The Company shall not take any action, or fail to take any action, that is reasonably likely to result in any of the representations and warranties of the Company set forth in this Agreement becoming untrue in any material respect.