REQUIREMENTS AND THE RULES AND
REGULATIONS OF THE COMMISSION WITH RESPECT THERETO AS IN EFFECT AT THE TIME OF
FILING.
SUCH FINANCIAL STATEMENTS HAVE BEEN PREPARED IN ACCORDANCE WITH UNITED
STATES GENERALLY ACCEPTED ACCOUNTING PRINCIPLES APPLIED ON A CONSISTENT BASIS
DURING THE PERIODS INVOLVED ("GAAP"), EXCEPT AS MAY BE OTHERWISE SPECIFIED IN
SUCH FINANCIAL STATEMENTS OR THE NOTES THERETO AND EXCEPT THAT UNAUDITED
FINANCIAL STATEMENTS MAY NOT CONTAIN ALL FOOTNOTES REQUIRED BY GAAP, AND FAIRLY
PRESENT IN ALL MATERIAL RESPECTS THE FINANCIAL POSITION OF THE COMPANY AND ITS
CONSOLIDATED SUBSIDIARIES AS OF AND FOR THE DATES THEREOF
10
AND THE RESULTS OF OPERATIONS AND CASH FLOWS FOR THE PERIODS THEN ENDED,
SUBJECT, IN THE CASE OF UNAUDITED STATEMENTS, TO NORMAL, IMMATERIAL, YEAR-END
AUDIT ADJUSTMENTS.
(I)
MATERIAL CHANGES; UNDISCLOSED EVENTS, LIABILITIES OR DEVELOPMENTS.
SINCE
THE DATE OF THE LATEST AUDITED FINANCIAL STATEMENTS INCLUDED WITHIN THE SEC
REPORTS, EXCEPT AS SPECIFICALLY DISCLOSED IN THE SEC REPORTS, (I) THERE HAS BEEN
NO EVENT, OCCURRENCE OR DEVELOPMENT THAT HAS HAD OR THAT COULD REASONABLY BE
EXPECTED TO RESULT IN A MATERIAL ADVERSE EFFECT, (II) THE COMPANY HAS NOT
INCURRED ANY LIABILITIES (CONTINGENT OR OTHERWISE) OTHER THAN (A) TRADE PAYABLES
AND ACCRUED EXPENSES INCURRED IN THE ORDINARY COURSE OF BUSINESS CONSISTENT WITH
PAST PRACTICE AND (B) LIABILITIES NOT REQUIRED TO BE REFLECTED IN THE COMPANY'S
FINANCIAL STATEMENTS PURSUANT TO GAAP OR REQUIRED TO BE DISCLOSED IN FILINGS
MADE WITH THE COMMISSION, (III) THE COMPANY HAS NOT ALTERED ITS METHOD OF
ACCOUNTING, (IV) THE COMPANY HAS NOT DECLARED OR MADE ANY DIVIDEND OR
DISTRIBUTION OF CASH OR OTHER PROPERTY TO ITS STOCKHOLDERS OR PURCHASED,
REDEEMED OR MADE ANY AGREEMENTS TO PURCHASE OR REDEEM ANY SHARES OF ITS CAPITAL
STOCK AND (V) THE COMPANY HAS NOT ISSUED ANY EQUITY SECURITIES TO ANY OFFICER,
DIRECTOR OR AFFILIATE, EXCEPT PURSUANT TO EXISTING COMPANY STOCK OPTION PLANS.
EXCEPT FOR THE ISSUANCE OF THE SECURITIES CONTEMPLATED BY THIS AGREEMENT OR AS
SET FORTH ON SCHEDULE 3.1(I) OF THE DISCLOSURE SCHEDULES, NO EVENT, LIABILITY OR
DEVELOPMENT HAS OCCURRED OR EXISTS WITH RESPECT TO THE COMPANY OR ITS
SUBSIDIARIES OR THEIR RESPECTIVE BUSINESS, PROPERTIES, OPERATIONS OR FINANCIAL
CONDITION, THAT WOULD BE REQUIRED TO BE DISCLOSED BY THE COMPANY UNDER
APPLICABLE SECURITIES LAWS AT THE TIME THIS REPRESENTATION IS MADE THAT HAS NOT
BEEN PUBLICLY DISCLOSED ONE (1) TRADING DAY PRIOR TO THE DATE THAT THIS
REPRESENTATION IS MADE.
(J)
LITIGATION.
EXCEPT AS DISCLOSED IN THE SEC REPORTS, THERE IS NO ACTION,
SUIT, INQUIRY, NOTICE OF VIOLATION, PROCEEDING OR INVESTIGATION PENDING OR, TO
THE KNOWLEDGE OF THE COMPANY, THREATENED AGAINST OR AFFECTING THE COMPANY, ANY
SUBSIDIARY OR ANY OF THEIR RESPECTIVE PROPERTIES BEFORE OR BY ANY COURT,
ARBITRATOR, GOVERNMENTAL OR ADMINISTRATIVE AGENCY OR REGULATORY AUTHORITY
(FEDERAL, STATE, COUNTY, LOCAL OR FOREIGN) (COLLECTIVELY, AN "ACTION") WHICH
(I) ADVERSELY AFFECTS OR CHALLENGES THE LEGALITY, VALIDITY OR ENFORCEABILITY OF
ANY OF THE TRANSACTION DOCUMENTS OR THE SECURITIES OR (II) COULD, IF THERE WERE
AN UNFAVORABLE DECISION, HAVE OR REASONABLY BE EXPECTED TO RESULT IN A MATERIAL