VIOLATE, CONTRAVENE, OR
CONSTITUTE A DEFAULT UNDER ANY PROVISION OF (I) ANY APPLICABLE LAW OR
REGULATION, (II) THE CHARTER, BY-LAWS OR OTHER ORGANIZATIONAL DOCUMENTS OF SUCH
OBLIGOR, (III) ANY ORDER, JUDGMENT, DECREE OR INJUNCTION OF ANY GOVERNMENTAL
AUTHORITY, (IV) ANY AGREEMENT OR INSTRUMENT EVIDENCING OR GOVERNING DEBT OF SUCH
OBLIGOR, EXCEPT FOR ANY CONTRAVENTION OR DEFAULT UNDER ANY SUCH AGREEMENT OR
INSTRUMENT EVIDENCING OR GOVERNING SUCH DEBT IN AN AGGREGATE PRINCIPAL AMOUNT,
INDIVIDUALLY OR IN THE AGGREGATE FOR ALL SUCH AGREEMENTS OR INSTRUMENTS IN
RESPECT OF WHICH THERE IS A CONTRAVENTION OR DEFAULT, NOT IN EXCESS OF
$25,000,000 OR (V) ANY OTHER MATERIAL AGREEMENT OR INSTRUMENT BINDING UPON SUCH
OBLIGOR OR ITS ASSETS.
SECTION 3.04
FINANCIAL CONDITION; NO MATERIAL ADVERSE CHANGE.
(A)
THE GUARANTOR HAS HERETOFORE FURNISHED TO THE ADMINISTRATIVE AGENT
(I) ITS CONSOLIDATED BALANCE SHEET AND STATEMENTS OF INCOME, SHAREHOLDERS EQUITY
AND CASH FLOWS AS OF AND FOR THE FISCAL YEAR ENDED SEPTEMBER 29, 2006, REPORTED
ON BY DELOITTE & TOUCHE LLP, INDEPENDENT PUBLIC ACCOUNTANTS, AND (II) ITS PRO
FORMA CONSOLIDATED BALANCE SHEET AND STATEMENTS OF INCOME AS OF SUCH DATE AND
FOR SUCH PERIOD, ADJUSTED TO GIVE PRO FORMA EFFECT TO THE CONSUMMATION OF THE
SEPARATION TRANSACTIONS, CERTIFIED BY ITS CHIEF FINANCIAL OFFICER (THE
"SEPARATION PRO FORMAS").
SUCH FINANCIAL STATEMENTS, (A) IN THE CASE OF THE
FINANCIAL STATEMENTS DESCRIBED IN CLAUSE (I), PRESENT FAIRLY, IN ALL MATERIAL
RESPECTS, THE CONSOLIDATED FINANCIAL POSITION AND RESULTS OF OPERATIONS AND CASH
FLOWS OF THE GUARANTOR AS OF SUCH DATE AND FOR SUCH PERIOD IN ACCORDANCE WITH
GAAP, AND (B) IN THE CASE OF THE SEPARATION PRO FORMAS, HAVE BEEN PREPARED IN
GOOD FAITH BY THE GUARANTOR, BASED ON ASSUMPTIONS USED TO PREPARE THE PRO FORMA
FINANCIAL INFORMATION CONTAINED IN THE S-1 REGISTRATION STATEMENT FILED BY THE
BORROWER AND THE GUARANTOR
28
WITH THE SEC ON JANUARY 18, 2007, AS AMENDED BY THE AMENDMENT THERETO FILED WITH
THE SEC ON APRIL 20, 2007 (THE "TOPAZ REGISTRATION STATEMENT") (WHICH
ASSUMPTIONS ARE BELIEVED BY THE GUARANTOR ON THE CLOSING DATE TO BE REASONABLE
UNDER THE CIRCUMSTANCES AND WERE BASED UPON CURRENTLY AVAILABLE INFORMATION AS
OF THE DATE OF FILING), AND REFLECT ON A PRO FORMA BASIS THE ESTIMATED
CONSOLIDATED FINANCIAL POSITION AND RESULTS OF OPERATIONS OF THE GUARANTOR AND
ITS SUBSIDIARIES AS OF SUCH DATE, ASSUMING THE SPIN DISTRIBUTIONS HAD ACTUALLY
OCCURRED (X) AT SEPTEMBER 29, 2006, IN THE CASE OF SUCH BALANCE SHEET, OR (Y) ON
OCTOBER 1, 2005, IN THE CASE OF SUCH STATEMENTS OF INCOME, AND GIVING PRO FORMA
EFFECT TO THE OTHER EVENTS AND ADJUSTMENTS REFERRED TO WITH RESPECT TO SUCH
FINANCIAL STATEMENTS IN THE TOPAZ REGISTRATION STATEMENT.
(B)
SINCE SEPTEMBER 29, 2006, EXCEPT FOR THE SEPARATION TRANSACTIONS,
THERE HAS BEEN NO MATERIAL ADVERSE CHANGE IN (I) THE CONSOLIDATED FINANCIAL
CONDITION, BUSINESS OR OPERATIONS OF THE GUARANTOR AND ITS SUBSIDIARIES, TAKEN
AS A WHOLE OR (II) THE FIRE & SAFETY AND ENGINEERED PRODUCTS BUSINESS OR
OPERATIONS OF THE GUARANTOR AND ITS SUBSIDIARIES, TAKEN AS A WHOLE; PROVIDED
THAT, FOR