NOT YET DUE AND PAYABLE AND (B) POSSIBLE MINOR LIENS AND
ENCUMBRANCES WHICH DO NOT IN ANY CASE MATERIALLY DETRACT FROM THE VALUE OF THE
PROPERTY SUBJECT THERETO OR MATERIALLY IMPAIR THE OPERATIONS OF THE COMPANY OR
ANY OF ITS SUBSIDIARIES, AND WHICH HAVE ARISEN IN THE ORDINARY COURSE OF
BUSINESS AND SHALL BE REMOVED WITHIN A REASONABLE PERIOD, THE COMPANY AND EACH
OF ITS SUBSIDIARIES HAS GOOD AND MARKETABLE TITLE OR LEASEHOLD TITLE TO ALL
PROPERTIES AND ASSETS NECESSARY TO THEIR RESPECTIVE BUSINESSES AS PRESENTLY
CONDUCTED AND TO ALL OF THEIR RESPECTIVE PROPERTIES AND ASSETS, FREE AND CLEAR
OF ALL MORTGAGES, SECURITY INTERESTS, LIENS, RESTRICTIONS OR ENCUMBRANCES.
ALL
MACHINERY AND EQUIPMENT INCLUDED IN SUCH PROPERTIES WHICH IS NECESSARY TO THE
BUSINESS OF THE
5
COMPANY OR ANY OF ITS SUBSIDIARIES IS IN GOOD CONDITION AND REPAIR EXCEPT FOR
REASONABLE WEAR AND TEAR, AND ALL LEASES OF REAL OR PERSONAL PROPERTY TO WHICH
THE COMPANY OR ANY OF ITS SUBSIDIARIES IS A PARTY ARE FULLY EFFECTIVE AND AFFORD
THE COMPANY AND ITS SUBSIDIARIES PEACEFUL AND UNDISTURBED POSSESSION OF THE
SUBJECT MATTER OF THE LEASE.
NEITHER THE COMPANY NOR ANY OF ITS SUBSIDIARIES IS
IN MATERIAL VIOLATION OF ANY ZONING, BUILDING OR SAFETY ORDINANCE, REGULATION OR
REQUIREMENT OR OTHER LAW OR REGULATION APPLICABLE TO THE OPERATION OF OWNED OR
LEASED PROPERTIES LIKELY TO IMPEDE THE NORMAL OPERATION OF THE BUSINESS OF THE
COMPANY OR ANY OF ITS SUBSIDIARIES, AND NEITHER THE COMPANY NOR ANY OF ITS
SUBSIDIARIES HAS RECEIVED ANY WRITTEN NOTICE OF VIOLATION WITH WHICH IT HAS NOT
COMPLIED.
2.9.
TAX MATTERS.
THERE ARE NO FEDERAL, STATE, COUNTY, LOCAL OR
FOREIGN TAXES DUE AND PAYABLE BY THE COMPANY OR ANY OF ITS SUBSIDIARIES THAT
HAVE NOT BEEN PAID.
EXCEPT AS SET FORTH ON SECTION 2.9 OF THE DISCLOSURE
SCHEDULE, THERE HAVE BEEN NO EXAMINATIONS OR AUDITS OF ANY TAX RETURNS OR
REPORTS BY ANY APPLICABLE FEDERAL, STATE, LOCAL OR FOREIGN GOVERNMENTAL AGENCY.
THE COMPANY AND EACH OF ITS SUBSIDIARIES HAS DULY FILED ALL FEDERAL, STATE,
COUNTY, LOCAL AND FOREIGN TAX RETURNS REQUIRED TO HAVE BEEN FILED BY IT AND
THERE ARE IN EFFECT NO WAIVERS OF APPLICABLE STATUTES OF LIMITATIONS WITH
RESPECT TO TAXES FOR ANY YEAR.
2.10.
CONTRACTS AND COMMITMENTS.
THE COMPANY'S ANNUAL REPORT ON FORM
10-K FOR THE FISCAL YEAR ENDED OCTOBER 31, 2004 AND ITS QUARTERLY REPORTS ON
FORM 10-Q FOR THE FISCAL QUARTERS ENDED JANUARY 31, 2005, APRIL 30, 2005 AND
JULY 31, 2005 INCLUDE EACH MATERIAL CONTRACT, OBLIGATION OR COMMITMENT OF THE
COMPANY AND EACH OF ITS SUBSIDIARIES, AND ANY MATERIAL EMPLOYMENT CONTRACTS
(EXCLUDING ANY STATUTORY EMPLOYMENT ARRANGEMENTS REQUIRED BY LAW), STOCK
REDEMPTION OR PURCHASE AGREEMENTS, FINANCING AGREEMENTS, DISTRIBUTION RIGHT
AGREEMENTS, ROYALTY AGREEMENTS, LICENSES UNDER WHICH THE COMPANY OR ANY OF ITS
SUBSIDIARIES IS LICENSEE OR LICENSOR, LEASES OF REAL PROPERTY, PENSION,
PROFIT-SHARING, RETIREMENT OR STOCK OPTION PLANS, AGREEMENTS LIMITING
COMPETITION OR THE CONDUCT OF BUSINESS, AGREEMENTS WHICH BY THEIR TERMS EXPIRE
ONE YEAR OR MORE AFTER THE DATE HEREOF, OR ANY MATERIAL AGREEMENTS