IN SCHEDULE B (PART 3) HERETO.
WITH RESPECT TO EACH LEASE (I) ALL
RENTS AND ADDITIONAL RENTS HAVE BEEN PAID, (II) NO WAIVER, INDULGENCE OR
POSTPONEMENT OF THE LESSEE'S OBLIGATIONS HAS BEEN GRANTED BY THE LESSOR,
(III) THERE EXISTS NO EVENT OF DEFAULT OR EVENT, OCCURRENCE, CONDITION OR ACT
(INCLUDING THE PURCHASE OF THE PURCHASED SHARES) WHICH, WITH THE GIVING OF
NOTICE, THE LAPSE OF TIME OR THE HAPPENING OF ANY OTHER EVENT OR CONDITION,
WOULD BECOME A DEFAULT UNDER THE LEASE, AND (IV) TO THE BEST KNOWLEDGE OF THE
VENDORS, ALL OF THE COVENANTS TO BE PERFORMED BY ANY PARTY UNDER THE LEASE HAVE
BEEN FULLY PERFORMED.
(U)
KEY CONTRACTS.
EXCEPT FOR THE CONTRACTS
DESCRIBED IN SCHEDULE P HERETO (COLLECTIVELY, THE "MATERIAL CONTRACTS"), THE
LEASES, THE EMPLOYEE PLANS AND THE INSURANCE POLICIES SET OUT IN SCHEDULE Q
(PART I) HERETO, NEITHER OF THE CORPORATIONS IS A PARTY TO OR BOUND BY:
(I)
ANY DISTRIBUTOR, SALES, ADVERTISING,
AGENCY OR MANUFACTURER'S REPRESENTATIVE CONTRACT;
(II)
ANY CONTINUING CONTRACT FOR THE PURCHASE
OF MATERIALS, SUPPLIES, EQUIPMENT OR SERVICES INVOLVING IN THE CASE OF ANY SUCH
CONTRACT MORE THAN $50,000 OVER THE LIFE OF THE CONTRACT;
19
(III)
ANY CONTRACT THAT EXPIRES OR MAY BE RENEWED
AT THE OPTION OF ANY PERSON OTHER THAN THE CORPORATIONS SO AS TO EXPIRE MORE
THAN ONE YEAR AFTER THE DATE OF THIS AGREEMENT;
(IV)
ANY TRUST INDENTURE, MORTGAGE, PROMISSORY
NOTE, LOAN AGREEMENT OR OTHER CONTRACT FOR THE BORROWING OF MONEY, ANY CURRENCY
EXCHANGE, COMMODITIES OR OTHER HEDGING ARRANGEMENT OR ANY LEASING TRANSACTION OF
THE TYPE REQUIRED TO BE CAPITALIZED IN ACCORDANCE WITH GAAP;
(V)
ANY CONTRACTS FOR CAPITAL EXPENDITURES IN
EXCESS OF $50,000, IN THE AGGREGATE;
(VI)
ANY CONFIDENTIALITY, SECRECY OR NON-DISCLOSURE
CONTRACT OR ANY CONTRACT LIMITING THE FREEDOM OF EITHER OF THE CORPORATIONS TO
ENGAGE IN ANY LINE OF BUSINESS, COMPETE WITH ANY OTHER PERSON, OPERATE THE
ASSETS AT MAXIMUM PRODUCTION CAPACITY OR OTHERWISE CONDUCT THE BUSINESS;
(VII)
ANY CONTRACT PURSUANT TO WHICH EITHER OF THE
CORPORATIONS IS A LESSOR OF ANY MACHINERY, EQUIPMENT, MOTOR VEHICLES, OFFICE
FURNITURE, FIXTURES OR OTHER PERSONAL PROPERTY;
(VIII)
ANY CONTRACT WITH ANY PERSON WITH WHOM EITHER OF
THE CORPORATIONS OR ANY OF THE VENDORS DOES NOT DEAL AT ARM'S LENGTH WITHIN THE
MEANING OF THE INCOME TAX ACT (CANADA);
(IX)
ANY AGREEMENT OF GUARANTEE, SUPPORT,
INDEMNIFICATION, ASSUMPTION OR ENDORSEMENT OF, OR ANY SIMILAR COMMITMENT WITH
RESPECT TO, THE OBLIGATIONS, LIABILITIES (WHETHER ACCRUED, ABSOLUTE, CONTINGENT
OR OTHERWISE) OR INDEBTEDNESS OF ANY OTHER PERSON; OR
(X)
ANY CONTRACT MADE OUT OF THE ORDINARY
COURSE.
(V)
NO BREACH OF MATERIAL CONTRACTS.
EACH OF
THE CORPORATIONS HAS PERFORMED ALL OF THE OBLIGATIONS REQUIRED TO BE PERFORMED
BY IT AND IS ENTITLED TO ALL BENEFITS UNDER, AND IS NOT ALLEGED TO BE IN DEFAULT
OF ANY MATERIAL CONTRACT.
EACH OF THE MATERIAL CONTRACTS IS IN FULL FORCE AND
EFFECT, UNAMENDED, AND THERE EXISTS NO DEFAULT OR EVENT OF DEFAULT OR EVENT,
OCCURRENCE, CONDITION OR ACT (INCLUDING THE PURCHASE OF THE PURCHASED SHARES)
WHICH, WITH