Common use of Interim Changes Clause in Contracts

Interim Changes. Except as set forth in Section 2.10 of the Disclosure Schedule, since the date of the 2006 Balance Sheet, the Companies have been operated only in the ordinary course of business consistent with past practice in all respects, and the Companies have not: (a) suffered any changes, nor has there occurred or arisen any events, facts, circumstances or conditions, that have had or could reasonably be expected to have, either singly or in the aggregate, a material adverse effect on the business, operations, condition (financial or otherwise), properties, liabilities, client relations, or prospects of the Companies or on any Transferred Assets listed on the Schedule of Enumerated Assets (a “Material Adverse Effect”) or to materially diminish the value to Purchaser of the transactions contemplated hereby; (b) made any capital expenditures which are more than $20,000 individually or $50,000 in the aggregate; (c) employed, engaged or entered into any new contract with or amended any existing contract for the employment of, any person by the Companies or increased the compensation or benefits of any employee of the Companies; (d) sold, assigned, transferred, conveyed, leased or otherwise disposed of or agreed to sell, assign, transfer, convey, lease or otherwise dispose of any portion of its properties or assets, except in the ordinary course of business and consistent with past practice in all respects; (e) suffered any damage, destruction or loss of property related to the Companies, whether or not covered by insurance; (f) declared, paid or set aside for payment any dividend or other distribution (whether in cash, stock or property or any combination thereof), directly or indirectly, in respect of the Companies’ capital stock or other securities; (g) made any change in its accounting principles or methods; (h) written down the value of any inventory (including write-downs by reason of shrinkage or ▇▇▇▇-down) or assets or written off as uncollectible any notes or accounts receivable, except for such write-downs or write-offs in the ordinary course of business consistent with past practice in all respects, nor suffered any change or experienced any condition which would require any such write-down or write-off; (i) paid, loaned or advanced any amount, other than advances to employees for travel and entertainment expenses in the ordinary course of business and consistent with past practice in all respects, or sold, transferred or leased any properties or assets (real, personal or mixed, tangible or intangible), other than properties or assets of nominal value, to any of its employees, officers or directors or any affiliate or associate of any of its employees, officers or directors; or (j) agreed, whether in writing or otherwise, to take any action described in this Section 2.10.

Interim Changes. Except Since September 30, 1998, the business of the --------------- Company has been operated in the ordinary course and, except as set forth in Section 2.10 on Schedule 8.7, or as otherwise contemplated by this Agreement, the Company has ------------- not (nor has it authorized or proposed or entered into any contract, agreement, commitment or arrangement to do any of the Disclosure Schedulefollowing) where such action, since contract, agreement, commitment or arrangement, when considered separately or together with other actions, contracts, agreements, commitments or arrangements, would have a Material Adverse Effect on the date Company: (i) to the knowledge of the 2006 Balance SheetRepresenting Shareholders and the Company, incurred or become subject to, or agreed to incur or become subject to, any material liability (whether secured or unsecured, accrued, absolute, contingent or otherwise), except any such liabilities incurred in the Companies have been operated only ordinary course of its business, consistent with past practice, and such other liabilities or obligations disclosed herein or in the Schedules hereto; (ii) except with respect to the transactions contemplated by this Agreement, entered into (A) any material transaction, contract or commitment outside the ordinary course of business, or (B) any other material commitment outside the ordinary course of business not terminable by the Company in less than thirty (30) days; (iii) experienced any Material Adverse Change in its business or customer relations; (iv) granted any general pay increases to its employees, officers or directors or changed the rate of compensation, commission, bonus or other remuneration payable to any of its employees, directors, officers, agents or shareholders, with the exception of increases to any such Person made in the ordinary course of business consistent in all material respects with past practice practices; (v) sustained any damage or loss to its business or properties in excess of $50,000 in the aggregate (whether or not covered by insurance), except as reflected in all respects, and material respects in the Companies have not:1998 Financial Statements; (avi) suffered paid, canceled, waived or discharged any changesLien other than in the ordinary course of business; (vii) instituted or settled any litigation, nor has there occurred action or arisen proceeding relating to its business; (viii) entered into any eventslease, factswhether as lessor or lessee, circumstances for real property or conditionsincurred any obligation to enter into any such lease or purchased any real property; (ix) changed in any material respect its investment practices, that have had payment and processing practices, policies regarding intercompany transactions or could reasonably be expected other policies or practices affecting in a material respect its assets, liabilities or business; (x) made any direct or indirect redemption, purchase or other acquisition of any of its capital stock; or split, combined or reclassified any of its capital stock or issued any other security in respect of or in substitution therefor; or repurchased, redeemed or otherwise acquired any of its shares of capital stock, except pursuant to havethis Agreement; (xi) canceled, either singly amended or established any Employee Plan or made any payments or distributions under any Employee Plan, except for distributions and payments in the ordinary course to or for the benefit of plan participants in accordance with the applicable provisions of such Plan; (xii) issued, delivered, pledged, encumbered, sold or purchased any shares of its capital stock or securities convertible into, or rights, warrants or options to acquire, any shares of its capital stock or other convertible securities of the Company; (xiii) acquired or agreed to acquire by merging or consolidating with, or by purchasing any material portion of the capital stock or assets of, or by any other manner, any business, corporation, partnership, association or other business organization, or any division thereof; (xiv) amended, canceled or terminated (other than by its terms) or waived any material provision of any Contract to which it is a party which required, requires or is anticipated to require payments in excess of $50,000 in the aggregate, a material adverse effect on the business, operations, condition (financial or otherwise), properties, liabilities, client relations, or prospects of the Companies or on in any Transferred Assets listed on the Schedule of Enumerated Assets (a “Material Adverse Effect”) or to materially diminish the value to Purchaser of the transactions contemplated herebytwelve-month period; (bxv) granted any Lien that is material in the context of the Company or its business; (xvi) entered into any employment compensation or other agreement with any of its officers, directors, shareholders, Affiliates, employees or agents (other than in connection with the hiring of new employees in the ordinary course of business at an annual compensation not in excess of $100,000 for any person) or terminated the employment of any of its officers or employees, except in the case of employees, non management employees in the ordinary course of business; (xvii) canceled or compromised any of its material claims or liabilities other than in the ordinary course of business, or paid, canceled, waived or discharged any material Lien other than in the ordinary course of business; (xviii) amended the Articles of Incorporation or bylaws of the Company; (xix) received any notice of a material default under any Contract; (xx) disposed of or permitted the lapse of any material Intellectual Property Rights; (xxi) sold any marketable securities that were material to the Company other than in the ordinary course of business; (xxii) disposed of or changed in any material respect any assets of the Company that were or are material to the Company or its business, other than in the ordinary course of business; (xxiii) made any material changes in its methods of operation, other than changes in the ordinary course of business; (xxiv) made any capital commitments or expenditures which are more than $20,000 individually or $50,000 in excess of $ 150,000 in the aggregate; (cxxv) employed, engaged paid or declared any dividends or issued or purchased any capital stock or rights relating thereto; (xxvi) entered into any new contract with or amended any existing contract for the employment of, any person contracts not terminable at will by the Companies or increased the compensation or benefits of any employee of the CompaniesCompany; (dxxvii) sold, assigned, transferred, conveyed, leased made any material changes in its financial structure or otherwise disposed of or agreed to sell, assign, transfer, convey, lease or otherwise dispose of any portion of its properties or assets, except in the ordinary course of business and consistent with past practice in all respectsaccounting practices; (exxviii) suffered failed to pay or make any damagematerial bonus, destruction incentive, contingent or loss of property related other payments or expenditures which are consistent with historical practices or planned pursuant to the Companies, whether or not covered by insurance; (f) declared, paid or set aside for payment any dividend or other distribution (whether in cash, stock or property or any combination thereof), directly or indirectly, in respect capital and operating budgets of the Companies’ capital stock Company for its 1998 fiscal year or other securities; (g) made any change required by agreements in its accounting principles or methods; (h) written down the value of any inventory (including write-downs by reason of shrinkage or ▇▇▇▇-down) or assets or written off as uncollectible any notes or accounts receivable, except for such write-downs or write-offs in the ordinary course of business consistent with past practice in all respects, nor suffered any change or experienced any condition which would require any such write-down or write-off; (i) paid, loaned or advanced any amount, other than advances to employees for travel and entertainment expenses in the ordinary course of business and consistent with past practice in all respects, or sold, transferred or leased any properties or assets (real, personal or mixed, tangible or intangible), other than properties or assets of nominal value, to any of its employees, officers or directors or any affiliate or associate of any of its employees, officers or directorsplace at January 1,1998; or (jxxix) agreedotherwise suffered a Material Adverse Change. From and after the date of execution of this Agreement and until the Closing Date or the date of termination of this Agreement, whether in writing the Company shall not, without the prior approval of the Buyer, undertake or otherwise, to take enter into any action of the actions described in this Section 2.108.7 where such action, contract, agreement, ----------- commitment or arrangement, when considered separately or together with other actions, contracts, agreements, commitments or arrangements, could reasonably be considered to have a Material Adverse Effect on the Company.

Interim Changes. Except as set forth in Section 2.10 of the Disclosure Scheduleon Schedule 4.36, since the date of the 2006 Balance SheetOctober 31, the Companies have 2006, there has been operated only in the ordinary course of business consistent with past practice in all respects, and the Companies have notno: (a) suffered any changeschange in the condition, nor has there occurred financial or arisen any eventsotherwise, factsof the Company, circumstances which had, or conditions, that have had or could would reasonably be expected to have, either singly or in the aggregate, a material adverse effect on the business, operations, condition (financial or otherwise), properties, liabilities, client relations, or prospects of the Companies or on any Transferred Assets listed on the Schedule of Enumerated Assets (a “Material Adverse Effect”) or to materially diminish the value to Purchaser of the transactions contemplated hereby; (b) made material loss, damage or destruction of or to any capital expenditures which are more than $20,000 individually or $50,000 in the aggregate; (c) employed, engaged or entered into any new contract with or amended any existing contract for the employment of, any person by the Companies or increased the compensation or benefits of any employee of the Companies; (d) sold, assigned, transferred, conveyed, leased or otherwise disposed of or agreed to sell, assign, transfer, convey, lease or otherwise dispose of any portion of its properties or Company’s assets, except in the ordinary course of business and consistent with past practice in all respects; (e) suffered any damage, destruction or loss of property related to the Companies, whether or not covered by insurance; (c) sale, lease, transfer or other disposition by the Company of, or mortgages or pledges of or the imposition of any Lien (other than Permitted Liens) on, any portion of the Company’s assets, other than the sale of assets in the ordinary course of the Company’s business; (d) increase in the compensation payable by the Company to employees, directors, independent contractors or consultants, any change to any of the Benefit Plans set forth on Schedule 4.13, or institution of any new Benefit Plan; (e) adjustment or write-off of accounts receivable outside of the ordinary course of business or any change in the collection, payment or credit experience or practices of the Company; (f) declared, paid change in the Tax or set aside for payment any dividend cash basis accounting methods or other distribution (whether practices employed by the Company or change in cash, stock depreciation or property or any combination thereof), directly or indirectly, in respect of the Companies’ capital stock or other securitiesamortization policies; (g) made issuance or sale by the Company, or any change in its accounting principles Contract entered into by the Company for the issuance or methodssale, of any shares of Stock or securities convertible into or exchangeable for Stock of the Company; (h) written down payment by the value Company of any inventory (including write-downs by reason of shrinkage dividend, distribution or ▇▇▇▇-down) extraordinary or assets unusual disbursement or written off as uncollectible any notes or accounts receivableexpenditure, except for any dividends or distributions to the Seller’s related to the Company’s status as a so-called “S corporation” consistent with past practice, and distributions to be made prior to Closing as contemplated by this Agreement; (i) merger, consolidation or similar transaction involving the Company; (j) strike, work stoppage or other labor dispute adversely affecting the Business; (k) termination, waiver or cancellation of any material rights or claims of the Company, under any Contract or otherwise; (l) incurrence of indebtedness outside of the ordinary course of business; (m) new Contract (or amendment to any existing Contract) obligating the Company to purchase goods or services, any amendment or termination of any Contract or license relating to the Business or any waiver of material claims or rights of the Company against third parties in each case outside the ordinary course of business; (n) agreement, arrangement or transaction between the Company and any Affiliate of the Company; (o) creation of any new employment or consulting positions and the hiring of any personnel for such write-downs or write-offs positions with an annual salary in excess of $30,000. (p) other transaction not in the ordinary course of business consistent with past practice in all respects, nor suffered any change or experienced any condition which would require any such write-down or write-off; (i) paid, loaned or advanced any amount, other than advances to employees for travel and entertainment expenses in the ordinary course of business Business and consistent with past practice of the Business that, individually or in all respectsthe aggregate, or sold, transferred or leased any properties or assets (real, personal or mixed, tangible or intangible), other than properties or assets of nominal value, to any of its employees, officers or directors or any affiliate or associate of any of its employees, officers or directorscould have a Material Adverse Effect; or (jq) agreed, whether in writing or otherwise, binding commitment with respect to take any action described in this Section 2.10of the foregoing.

Interim Changes. Except as set forth in Section 2.10 of the Disclosure Scheduleon Schedule 3.7, since the date of the 2006 Latest Balance SheetSheet the Company and each Operating Subsidiary have conducted their businesses, in all material respects, in the Companies ordinary course and in a manner consistent with past practice (except in connection with the negotiation and execution and delivery of this Agreement), and there have been operated only not been: (a) any changes in the financial condition, assets, liabilities, personnel or operations of the Company or any Operating Subsidiary or in the Company's or any Operating Subsidiary's relationships with suppliers, distributors, lessors or others with whom they have business dealings, other than changes which individually or in the aggregate do not have a Material Adverse Effect; (b) any damage, destruction or loss, whether or not covered by insurance, materially and adversely affecting the Company or any Operating Subsidiary; (c) any increase in the compensation, bonus or benefits paid or to become payable to any officers of the Company or any Operating Subsidiary or, other than in the ordinary course and in a manner consistent with past practice, any increase in the compensation or benefits payable to non-officer employees of the Company or any Operating Subsidiary; (d) any transfer, lease, license or other disposition of assets of the Company or any Operating Subsidiary other than sales of inventory in the ordinary course of business consistent with past practice in all respects, and the Companies have not:business; (ae) suffered any changesincurrence of indebtedness for borrowed money other than pursuant to the Company's revolving line of credit or any Encumbrances placed on any of the assets of the Company or any Operating Subsidiary; (f) any new contract (or amendment to any existing contract) obligating the Company or any Operating Subsidiary to purchase goods or services for a period of 90 days or more, nor has there occurred any amendment or arisen termination of any eventsmaterial lease, factscontract, circumstances license or conditionsother agreement or any waiver of material claims or rights of the Company or any Operating Subsidiary against third parties; (g) any material change in the collection, that have had payment or could reasonably be expected to have, either singly credit experience or practices or in the aggregateaccounting practices, a material adverse effect on the business, operations, condition (financial procedures or otherwise), properties, liabilities, client relations, or prospects methods of the Companies Company or on any Transferred Assets listed on the Schedule of Enumerated Assets (a “Material Adverse Effect”) or to materially diminish the value to Purchaser of the transactions contemplated herebyOperating Subsidiary; (bh) made any capital expenditures which are more than $20,000 individually material agreement, arrangement or $50,000 in transaction between the aggregateCompany or any Operating Subsidiary and any Affiliate of the Company or any Operating Subsidiary; (ci) employedany declaration, engaged setting aside or entered into payment of any new contract with dividend or amended distribution in respect of any existing contract capital stock of the Company for any redemption, purchases or other acquisitions of any of the Company's securities (except for the employment ofredemption of the Company 15% Debt and the waiver of any rights of conversion associated therewith, any person by the Companies or increased the compensation or benefits of any employee conversion of the CompaniesCompany 11% Debt and any redemption of the warrants issued to ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇ and listed on Schedule 3.3A); (dj) soldother than as required by law, assignedany increase in, transferredamendment to, conveyed, leased or otherwise disposed of or agreed to sell, assign, transfer, convey, lease or otherwise dispose establishment of any portion bonus, insurance, severance, deferred compensation, pension, retirement, profit sharing, stock option, stock purchase or other employee benefit plan; (k) paid any bonus to the employees of its properties the Company or assets, except any Operating Subsidiary; (l) any other transaction not in the ordinary course of business and consistent with past practice in all respects; (e) suffered any damage, destruction or loss practices of property related to the Companies, whether or not covered by insurance; (f) declared, paid or set aside for payment any dividend or other distribution (whether in cash, stock or property Company or any combination thereof)Operating Subsidiary that, directly individually or indirectly, in respect of the Companies’ capital stock or other securities; (g) made any change in its accounting principles or methods; (h) written down the value of any inventory (including write-downs by reason of shrinkage or ▇▇▇▇-down) or assets or written off as uncollectible any notes or accounts receivable, except for such write-downs or write-offs in the ordinary course of business consistent with past practice in all respectsaggregate, nor suffered any change or experienced any condition which would require any such write-down or write-off; (i) paid, loaned or advanced any amount, other than advances could reasonably be expected to employees for travel and entertainment expenses in the ordinary course of business and consistent with past practice in all respects, or sold, transferred or leased any properties or assets (real, personal or mixed, tangible or intangible), other than properties or assets of nominal value, to any of its employees, officers or directors or any affiliate or associate of any of its employees, officers or directorshave a Material Adverse Effect; or (jm) agreed, whether in writing or otherwise, any commitment with respect to take any action described in this Section 2.10of the foregoing.

Interim Changes. Except Since October 1, 1996, the business of the Company has been operated in the ordinary course and, except as set forth in Section 2.10 on Schedule 8.7, the Company has not (nor has it authorized or proposed or entered into any contract, agreement, commitment or arrangement to do any of the Disclosure Schedulefollowing): (i) incurred or become subject to, since or agreed to incur or become subject to, any liability (whether secured or unsecured, accrued, absolute, contingent or otherwise), except (a) any such liabilities incurred in the date ordinary course of its business, consistent with past practice, and (b) loans to employees, officers, directors or Affiliates of the 2006 Balance SheetCompany made in the ordinary course of business but not exceeding $1,000 in the aggregate outstanding at any time; (ii) except with respect to the transactions contemplated by this Agreement, entered into (A) any transaction, contract or commitment outside the Companies have been operated only ordinary course of business, or (B) any commitment not terminable by the Company in less than thirty (30) days; (iii) experienced any work stoppage with respect to the business of the Company or obtained Knowledge of the Company of any threatened or anticipated work stoppage; (iv) experienced any Material Adverse Change in its business or customer relations; (v) granted any general pay increases to its employees, officers or directors or changed the rate of compensation, commission, bonus or other remuneration payable to any of its employees, directors, officers, agents or shareholders with the exception of increases not exceeding 3% to any such Person made in the ordinary course of business consistent with past practice in all respects, and the Companies have not:practices; (avi) suffered sustained any changesdamage or loss to its business or properties in excess of $10,000 in the aggregate (whether or not covered by insurance); (vii) paid, nor has there occurred canceled, waived or arisen discharged any eventsLien other than in the ordinary course of business; (viii) instituted or settled any litigation, factsaction or proceeding relating to its business; (ix) entered into any lease, circumstances whether as lessor or conditionslessee, that have had for real property or could reasonably be expected incurred any obligation to haveenter into any such lease or purchased any real property; (x) changed its investment practices, either singly actuarial practices, underwriting standards or retention policies, claims, payment and processing practices, policies regarding intercompany transactions or other policies or practices affecting its assets, liabilities or business; (xi) made any direct or indirect redemption, purchase or other acquisition of any of its capital stock; or split, combined or reclassified any of its capital stock or issued any other security in respect of or in substitution therefor; or repurchased, redeemed or otherwise acquired any of its shares of capital stock; (xii) canceled, amended or established any Employee Plan or made any payments or distributions under any Employee Plan; (xiii) issued, delivered, pledged, encumbered, sold or purchased any shares of its capital stock or securities convertible into, or rights, warrants or options to acquire, any shares of its capital stock or other convertible securities of the Company; (xiv) acquired or agreed to acquire by merging or consolidating with, or by purchasing any material portion of the capital stock or assets of, or by any other manner, any business, corporation, partnership, association or other business organization, or any division thereof; (xv) amended, canceled or terminated (other than by its terms) or waived any provision of any Contract to which it is a party which required, requires or is anticipated to require payments in excess of $5,000 in the aggregate, a material adverse effect on the business, operations, condition (financial or otherwise), properties, liabilities, client relations, or prospects of the Companies or on in any Transferred Assets listed on the Schedule of Enumerated Assets (a “Material Adverse Effect”) or to materially diminish the value to Purchaser of the transactions contemplated herebytwelve-month period; (bxvi) granted a Lien; (xvii) entered into any employment compensation or other agreement with any of its officers, directors, shareholders, Affiliates, employees or agents (other than in connection with the hiring of new employees in the ordinary course of business at an annual compensation not in excess of $50,000 for any person) or terminated the employment of any of its employees (other than in the ordinary course of business) or officers; (xviii) canceled or compromised any of its claims or liabilities other than in the ordinary course of business or paid, canceled, waived or discharged any Lien other than in the ordinary course of business; (xix) amended the Articles of Incorporation or bylaws of the Company; (xx) received any notice of default under any Contract; (xxi) disposed of or permitted the lapse of any Intellectual Property Rights; (xxii) sold any marketable securities other than in the ordinary course of business; or (xxiii) disposed of or changed its assets other than in the ordinary course of business; (xxiv) made any material changes in its methods of operation; (xxv) made any capital commitments or expenditures which are more than in excess of $20,000 individually or $50,000 100,000 in the aggregate; (cxxvi) employedpaid or declared any dividends or issued or purchased any capital stock or rights relating thereto except Tax Distributions with respect to the Company's fiscal year ending on September 30, engaged or 1997; provided that such Tax Distributions shall not exceed One Million Two Hundred Thousand Dollars ($1,200,000) in the aggregate; (xxvii) entered into any new contract with or amended any existing contract for the employment of, any person contracts not terminable at will by the Companies or increased the compensation or benefits of any employee of the CompaniesCompany; (dxxviii) sold, assigned, transferred, conveyed, leased made any material changes in its financial structure or otherwise disposed of or agreed to sell, assign, transfer, convey, lease or otherwise dispose of any portion of its properties or assets, except in the ordinary course of business and consistent with past practice in all respectsaccounting practices; (exxix) suffered failed to pay or make any damagebonus, destruction incentive, contingent or loss of property related other payments or expenditures which are consistent with historical practices or planned pursuant to the Companies, whether or not covered by insurance; (f) declared, paid or set aside for payment any dividend or other distribution (whether in cash, stock or property or any combination thereof), directly or indirectly, in respect capital and operating budgets of the Companies’ capital stock Company for its fiscal year ending September 30, 1997 (the "Budgets") or other securities; (g) made any change required by agreements in its accounting principles or methods; (h) written down place at June 30, 1997 except the value amount of any inventory (including write-downs by reason of shrinkage or bonus payable to ▇▇▇▇-down) or assets or written off as uncollectible any notes or accounts receivable, except ▇ for such write-downs or write-offs in the ordinary course of business consistent with past practice in all respects, nor suffered any change or experienced any condition fiscal year which would require any such write-down or write-off; (i) paid, loaned or advanced any amount, other than advances to employees for travel and entertainment expenses in the ordinary course of business and consistent with past practice in all respects, or sold, transferred or leased any properties or assets (real, personal or mixed, tangible or intangible), other than properties or assets of nominal value, to any of its employees, officers or directors or any affiliate or associate of any of its employees, officers or directorshe may waive; or (jxxx) agreed, whether in writing or otherwise, to take any action described in this Section 2.10otherwise suffered a Material Adverse Change.

Interim Changes. Except as set forth in Section 2.10 of the Disclosure Scheduleon Schedule 6.17 hereto, ------------- since the date of the 2006 Latest Balance SheetSheet there have not been: (a) any changes in the financial condition, assets, liabilities, personnel or operations of the Companies have been operated only Seller or in its relationships with suppliers, customers, distributors, lessors, licensors or others, other than changes in the ordinary course of business consistent with past practice in all respects, and the Companies have not: (a) suffered any changes, nor has there occurred or arisen any events, facts, circumstances or conditions, that have had or could reasonably be expected to have, either singly which would not individually or in the aggregate, aggregate result in a material adverse effect on the business, operations, condition (financial or otherwise), properties, liabilities, client relations, or prospects of the Companies or on any Transferred Assets listed on the Schedule of Enumerated Assets (a “Material Adverse Effect”) or to materially diminish the value to Purchaser of the transactions contemplated hereby; (b) made any capital expenditures which are more than $20,000 individually or $50,000 in the aggregate; (c) employed, engaged or entered into any new contract with or amended any existing contract for the employment of, any person by the Companies or increased the compensation or benefits of any employee of the Companies; (d) sold, assigned, transferred, conveyed, leased or otherwise disposed of or agreed to sell, assign, transfer, convey, lease or otherwise dispose of any portion of its properties or assets, except in the ordinary course of business and consistent with past practice in all respects; (e) suffered any damage, destruction or loss of property related to the Companiesloss, whether or not covered by insurance, adversely affecting the Transferred Assets; (c) any indebtedness for borrowed money or any forgiveness or cancellation of indebtedness owing to the Seller or waiver of any claims or rights by the Seller; (d) any increase in the compensation or benefits paid or to become payable by the Seller to any of its officers or employees, except for increases in the Ordinary Course of Business to hourly-paid employees that in the aggregate are not material; (e) any dividends or distributions or any transfer, lease, license or other disposition of assets of the Seller, other than sales of inventory in the Ordinary Course of Business; (f) declared, paid or set aside for payment any dividend or other distribution (whether in cash, stock or property or Liens placed on any combination thereof), directly or indirectly, in respect of the Companies’ capital stock or other securitiesTransferred Assets; (g) made any change in its accounting principles amendment or methodstermination of any lease, contract, license or other agreement to which the Seller is a party; (h) written down the value of any inventory (including write-downs by reason of shrinkage or ▇▇▇▇-down) or assets or written off as uncollectible any notes or accounts receivable, except for such write-downs or write-offs change in the ordinary course collection, payment or credit experience or practices of business consistent with past practice the Seller or in all respectsthe accounting practices, nor suffered any change procedures or experienced any condition which would require any such write-down or write-offmethods of the Seller; (i) paidany agreement, loaned arrangement or advanced transaction between the Seller and any amountaffiliate of the Seller or any officer or employee of the Seller; (j) a delay or postponement (beyond the Seller's normal practice) of the payment of the Seller's accounts payable or other Liabilities; (k) the mortgage, pledge or creation of a Lien against any of the Transferred Assets, except Liens for current property taxes not yet due and payable; (l) the sale, assignment or transfer of any of the Transferred Assets, except in the Ordinary Course of Business, or the cancellation without fair consideration of any debts or claims owing to or held by the Seller; (m) the sale, assignment or transfer of any Proprietary Rights, or the disclosure of any proprietary confidential information to any Person or the granting of any license or sublicense of any rights under or with respect to any Proprietary Rights; (n) any extraordinary losses or waiver of any rights of value by the Seller, whether or not in the Ordinary Course of Business other than advances to employees for travel and entertainment expenses those not having a Material Adverse Effect; (o) any capital expenditures or commitments therefor that aggregate in excess of $50,000. (p) any other transaction not in the ordinary course Ordinary Course of business Business and consistent with past practice in all respects, or sold, transferred or leased any properties or assets (real, personal or mixed, tangible or intangible), other than properties or assets of nominal value, to any of its employees, officers or directors practices or any affiliate material change in the business policies or associate practices of any of its employees, officers or directorsthe Seller; or (jq) agreed, whether in writing or otherwise, any commitment by the Seller to take do any action described in this Section 2.10of the foregoing.

Interim Changes. Except Since December 31, 1996, the business of the Seller and each Subsidiary has been operated in the ordinary course consistent with prior practice and, except as set forth in Section 2.10 on SCHEDULE 3.7, neither the Seller nor any Subsidiary has (nor has it authorized or proposed or entered into any contract, agreement, commitment or arrangement to do any of the Disclosure Schedulefollowing): (i) suffered any Material Adverse Effect; (ii) incurred any obligation or liability, absolute, accrued or otherwise, whether due or to become due, except current liabilities for trade or business obligations incurred in connection with the purchase of goods or services in the ordinary course of business consistent with prior practice, none of which liabilities, in any case or in the aggregate, could have a Material Adverse Effect; (iii) discharged or satisfied any Lien other than those then required to be discharged or satisfied, or paid any obligation or liability, absolute, accrued, contingent or otherwise, whether due or to become due, other than current liabilities shown on the Audited Balance Sheet and current liabilities incurred since the date thereof in the ordinary course of business consistent with prior practice; (iv) mortgaged, pledged or subjected to Lien, any property, business or assets, tangible or intangible, held in connection with the Business; (v) sold, transferred, leased to others or otherwise disposed of any of the 2006 Balance Sheetassets used in the Operations, except for inventory sold in the Companies have been operated only ordinary course of business, or canceled or compromised any debt or claim, or waived or released any right of substantial value; (vi) received any notice of termination of any contract, lease or other agreement or suffered any damage, destruction or loss (whether or not covered by insurance) which, in any case or in the aggregate, has had a Material Adverse Effect; (vii) transferred or granted any rights under, or entered into any settlement regarding the breach or infringement of, any Intellectual Property, or modified any existing rights with respect thereto; (viii) made any change in the rate of compensation, commission, bonus or other direct or indirect remuneration payable, or paid or agreed or orally promised to pay, conditionally or otherwise, any bonus, incentive, retention or other compensation, retirement, welfare, fringe or severance benefit or vacation pay, to or in respect of any shareholder, director, officer, employee, salesman, distributor or agent of any Seller relating to the Business; (ix) encountered any labor union organizing activity, had any actual or threatened employee strikes, work stoppages, slowdowns or lockouts, or had any material change in its relations with its employees, agents, customers or suppliers; (x) failed to replenish its inventories and supplies in a normal and customary manner consistent with its prior practice and prudent business practices prevailing in the industry, or made any purchase commitment in excess of the normal, ordinary and usual requirements of its business or at any price in excess of the then current market price or upon terms and conditions more onerous than those usual and customary in the industry, or made any change in its selling, pricing, advertising, or personnel practices inconsistent with its prior practice and prudent business practices prevailing in the industry; (xi) made any capital expenditures or capital additions or improvements in excess of an aggregate of $100,000; (xii) instituted, settled or agreed to settle any litigation, action or proceeding before any court or governmental body relating to the Business or the Assets other than in the ordinary course of business consistent with past practice practices but not in all respects, and the Companies have not: (a) suffered any changes, nor has there occurred or arisen any events, facts, circumstances or conditions, that have had or could reasonably be expected to have, either singly or case involving amounts in the aggregate, a material adverse effect on the business, operations, condition (financial or otherwise), properties, liabilities, client relations, or prospects excess of the Companies or on any Transferred Assets listed on the Schedule of Enumerated Assets (a “Material Adverse Effect”) or to materially diminish the value to Purchaser of the transactions contemplated hereby$10,000; (bxiii) made any capital expenditures which are more than $20,000 individually or $50,000 in the aggregate; (c) employed, engaged or entered into any new transactions, contract with or amended any existing contract for the employment of, any person by the Companies or increased the compensation or benefits of any employee of the Companies; (d) sold, assigned, transferred, conveyed, leased or otherwise disposed of or agreed to sell, assign, transfer, convey, lease or otherwise dispose of any portion of its properties or assets, except commitment other than in the ordinary course of business and consistent with past practice in all respects; (e) suffered any damage, destruction or loss of property related to the Companies, whether or not covered by insurance; (f) declared, paid or set aside for payment agreed to pay any dividend legal, accounting, brokerage, finder's fee, Taxes or other distribution (whether expenses in cashconnection with, stock or property or incurred any combination thereof), directly or indirectly, in respect of the Companies’ capital stock or other securities; (g) made any change in its accounting principles or methods; (h) written down the value of any inventory (including write-downs severance pay obligations by reason of shrinkage of, this Agreement or ▇▇▇▇-down) or assets or written off as uncollectible any notes or accounts receivable, except for such write-downs or write-offs in the ordinary course of business consistent with past practice in all respects, nor suffered any change or experienced any condition which would require any such write-down or write-off; (i) paid, loaned or advanced any amount, other than advances to employees for travel and entertainment expenses in the ordinary course of business and consistent with past practice in all respects, or sold, transferred or leased any properties or assets (real, personal or mixed, tangible or intangible), other than properties or assets of nominal value, to any of its employees, officers or directors or any affiliate or associate of any of its employees, officers or directorstransactions contemplated hereby; or (jxiv) agreed, whether in writing taken any action or otherwise, omitted to take any action described that would result in this Section 2.10the occurrence of any of the foregoing.

Interim Changes. Except as set forth otherwise disclosed in Section 2.10 of the Disclosure Scheduleany subsequent filings on Form 10-QSB or Form 8-K, since the date of Buyer’s most recent filing with the 2006 Balance SheetSEC on Form 10-KSB, there has been no: (a) change in the Companies condition, financial or otherwise, of Buyer, which has, or could reasonably be expected to have been operated only a Material Adverse Effect; (b) loss, damage or destruction of or to any of Buyer’s assets, whether or not covered by insurance; (c) increase in the compensation payable by Buyer to its employees, directors, managers, independent contractors or agents other than in the ordinary course of business consistent with past practice, or any increase in, or institution of, any bonus, insurance, pension, profit sharing or other employee benefit plan or arrangements made to, for, or with the employees, directors, managers, or independent contractors of Buyer; (d) adjustment or write-off of accounts receivable other than in the ordinary course of business consistent with past practice in all respects, and the Companies have not: (a) suffered or any changes, nor has there occurred or arisen any events, facts, circumstances or conditions, that have had or could reasonably be expected to have, either singly or change in the aggregatecollection, a material adverse effect on the business, operations, condition (financial payment or otherwise), properties, liabilities, client relations, credit experience or prospects practices of the Companies or on any Transferred Assets listed on the Schedule of Enumerated Assets (a “Material Adverse Effect”) or to materially diminish the value to Purchaser of the transactions contemplated hereby; (b) made any capital expenditures which are more than $20,000 individually or $50,000 in the aggregate; (c) employed, engaged or entered into any new contract with or amended any existing contract for the employment of, any person by the Companies or increased the compensation or benefits of any employee of the Companies; (d) sold, assigned, transferred, conveyed, leased or otherwise disposed of or agreed to sell, assign, transfer, convey, lease or otherwise dispose of any portion of its properties or assets, except in the ordinary course of business and consistent with past practice in all respectsBuyer; (e) suffered any damage, destruction change in the Tax or loss of property related to the Companies, whether cash basis accounting methods or not covered practices employed by insuranceBuyer or change in depreciation or amortization policies; (f) declaredstrike, paid or set aside for payment any dividend work stoppage or other distribution (whether in cash, stock or property or any combination thereof), directly or indirectly, in respect labor dispute adversely affecting the business of the Companies’ capital stock or other securitiesBuyer; (g) made any change in its accounting principles termination, waiver or methods; (h) written down the value cancellation of any inventory (including write-downs by reason material rights or claims of shrinkage Buyer under any Contract or ▇▇▇▇-down) or assets or written off as uncollectible any notes or accounts receivableotherwise, except for such write-downs or write-offs other than in the ordinary course of business consistent with past practice practice; (h) any incurrence of indebtedness for borrowed money other than in all respects, nor suffered any change or experienced any condition which would require any such write-down or write-offthe ordinary course of Buyer’s business consistent with past practice; (i) paidany new Contract (or amendment to any existing Contract) obligating Buyer to purchase goods or services, loaned any amendment or advanced termination of any amountMaterial Contract or license relating to the business of Buyer or any waiver of material claims or rights of Buyer against third parties, in each case other than advances to employees for travel and entertainment expenses in the ordinary course of business consistent with past practice; (j) any Contract, arrangement or transaction between Buyer and any Affiliate of Buyer; (k) any other transaction not in the ordinary course of Buyer’s business and consistent with past practice in all respects, or sold, transferred or leased any properties or assets (real, personal or mixed, tangible or intangible), other than properties or assets of nominal value, to any of its employeesbusiness that, officers individually or directors or any affiliate or associate of any of its employeesin the aggregate, officers or directorscould have a Material Adverse Effect; or (jl) agreed, whether in writing or otherwise, any commitment with respect to take any action described in this Section 2.10of the foregoing.