SECRETS OR OTHER PROPRIETARY RIGHTS OF ANY
OTHER PERSON OR ENTITY, NOR IS ANY MAKER AWARE OF ANY BASIS THEREFOR.
(III)
NO MAKER BELIEVES IT IS OR WILL BE NECESSARY
TO UTILIZE ANY INVENTIONS, TRADE SECRETS OR PROPRIETARY INFORMATION OF ANY OF
ITS EMPLOYEES MADE PRIOR TO THEIR EMPLOYMENT BY ANY MAKER, EXCEPT FOR
INVENTIONS, TRADE SECRETS OR PROPRIETARY INFORMATION THAT HAVE BEEN RIGHTFULLY
ASSIGNED TO THE MAKERS
(R)
LITIGATION.
EXCEPT AS SET FORTH ON
SCHEDULE 10(R), THERE IS NO ACTION, SUIT, PROCEEDING OR INVESTIGATION PENDING
OR, TO ANY MAKER'S KNOWLEDGE, CURRENTLY THREATENED AGAINST ANY MAKER THAT
PREVENTS THE MAKERS FROM ENTERING INTO THIS NOTE, FROM CONSUMMATING THE
TRANSACTIONS CONTEMPLATED HEREBY OR WHICH HAS HAD, OR COULD REASONABLY BE
EXPECTED TO HAVE, A MATERIAL ADVERSE EFFECT, NOR IS ANY MAKER AWARE THAT THERE
IS ANY BASIS TO ASSERT ANY OF THE FOREGOING.
NO MAKER IS A PARTY OR SUBJECT TO
THE PROVISIONS OF ANY ORDER, WRIT, INJUNCTION, JUDGMENT OR DECREE OF ANY COURT
OR GOVERNMENT AGENCY OR INSTRUMENTALITY.
THERE IS NO ACTION, SUIT, PROCEEDING
OR INVESTIGATION BY ANY MAKER CURRENTLY PENDING OR WHICH ANY MAKER INTENDS TO
INITIATE.
(S)
SEC REPORTS.
BIO-KEY HAS FILED ALL PROXY
STATEMENTS, REPORTS AND OTHER DOCUMENTS REQUIRED TO BE FILED BY IT UNDER THE
EXCHANGE ACT.
EACH FILING MADE WITH THE SEC SINCE JANUARY 1, 2004 (THE "SEC
REPORTS") WAS, AT THE TIME OF ITS FILING, IN SUBSTANTIAL COMPLIANCE WITH THE
REQUIREMENTS OF ITS RESPECTIVE FORM AND NONE OF THE SEC REPORTS, NOR THE
FINANCIAL STATEMENTS (AND THE NOTES THERETO) INCLUDED IN THE SEC REPORTS, AS OF
THEIR RESPECTIVE FILING DATES, CONTAINED ANY UNTRUE STATEMENT OF A MATERIAL FACT
OR OMITTED TO STATE A MATERIAL FACT REQUIRED TO BE STATED THEREIN OR NECESSARY
TO MAKE THE STATEMENTS THEREIN, IN LIGHT OF THE CIRCUMSTANCES UNDER WHICH THEY
WERE MADE, NOT MISLEADING.
14
(T)
ENVIRONMENTAL AND SAFETY LAWS.
NO MAKER
IS IN VIOLATION OF ANY APPLICABLE STATUTE, LAW OR REGULATION RELATING TO THE
ENVIRONMENT OR OCCUPATIONAL HEALTH AND SAFETY, AND TO ITS KNOWLEDGE, NO MATERIAL
EXPENDITURES ARE OR WILL BE REQUIRED IN ORDER TO COMPLY WITH ANY SUCH EXISTING
STATUTE, LAW OR REGULATION.
EXCEPT AS SET FORTH ON SCHEDULE 10(T), NO HAZARDOUS
MATERIALS ARE USED OR HAVE BEEN USED, STORED, OR DISPOSED OF BY THE MAKERS OR,
TO THE MAKER'S KNOWLEDGE, BY ANY OTHER PERSON ON ANY PROPERTY OWNED, LEASED OR
USED BY THE MAKERS.
(U)
OTHER AGREEMENTS.
ANY MAKER IS IN DEFAULT
UNDER THE TERMS OF ANY COVENANT, INDENTURE OR AGREEMENT OF OR AFFECTING ANY
MAKER OR ANY OF ITS PROPERTY, WHICH DEFAULT IF UNCURED COULD REASONABLY BE
EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT.
(V)
NO DEFAULT.
NO DEFAULT OR EVENT OF DEFAULT
HAS OCCURRED AND IS CONTINUING.
(W)
CONDITIONS PRECEDENT. THERE ARE NO CONDITIONS
PRECEDENT TO THE EFFECTIVENESS OF THIS NOTE THAT HAVE NOT BEEN SATISFIED OR
WAIVED.
11.
COVENANTS.
EACH MAKER AGREES THAT, UNTIL
THIS NOTE IS INDEFEASIBLY PAID IN FULL IN CASH AND CANCELLED, EXCEPT TO THE
EXTENT COMPLIANCE IN ANY