BASED ON THE FINANCIAL CONDITION OF THE COMPANY AS OF THE
CLOSING DATE: (I) THE FAIR MARKET VALUE OF THE COMPANY'S ASSETS EXCEEDS THE
AMOUNT THAT WILL BE REQUIRED TO BE PAID ON OR IN RESPECT OF THE COMPANY'S
EXISTING DEBTS AND OTHER LIABILITIES (INCLUDING KNOWN CONTINGENT LIABILITIES) AS
THEY MATURE; (II) THE COMPANY'S ASSETS DO NOT CONSTITUTE UNREASONABLY SMALL
CAPITAL TO CARRY ON ITS BUSINESS FOR THE CURRENT FISCAL YEAR AS NOW CONDUCTED
AND AS PROPOSED TO BE CONDUCTED INCLUDING ITS CAPITAL NEEDS TAKING INTO ACCOUNT
THE PARTICULAR CAPITAL REQUIREMENTS OF THE BUSINESS CONDUCTED BY THE COMPANY,
AND PROJECTED CAPITAL REQUIREMENTS AND CAPITAL AVAILABILITY THEREOF; AND (III)
THE CURRENT CASH FLOW OF THE COMPANY, TOGETHER WITH THE PROCEEDS THE COMPANY
WOULD RECEIVE, WERE IT TO LIQUIDATE ALL OF ITS ASSETS, AFTER TAKING INTO ACCOUNT
ALL ANTICIPATED USES OF THE CASH, WOULD BE SUFFICIENT TO PAY ALL AMOUNTS ON OR
IN RESPECT OF ITS DEBT WHEN SUCH AMOUNTS ARE REQUIRED TO BE PAID.
THE COMPANY
DOES NOT INTEND TO INCUR DEBTS BEYOND ITS ABILITY TO PAY SUCH DEBTS AS THEY
MATURE (TAKING INTO ACCOUNT THE TIMING AND AMOUNTS OF CASH TO BE PAYABLE ON OR
IN RESPECT OF ITS DEBT). THE COMPANY HAS NO KNOWLEDGE OF ANY FACTS OR
CIRCUMSTANCES WHICH LEAD IT TO BELIEVE THAT IT WILL FILE FOR REORGANIZATION OR
LIQUIDATION UNDER THE BANKRUPTCY OR REORGANIZATION LAWS OF ANY JURISDICTION
WITHIN ONE YEAR FROM THE CLOSING DATE.
THE SEC REPORTS SET FORTH AS OF THE
DATES THEREOF ALL MATERIAL OUTSTANDING SECURED AND UNSECURED INDEBTEDNESS OF THE
COMPANY OR ANY SUBSIDIARY, OR FOR WHICH THE COMPANY OR ANY SUBSIDIARY HAS
COMMITMENTS. FOR THE PURPOSES OF THIS AGREEMENT, "INDEBTEDNESS" SHALL MEAN (A)
ANY LIABILITIES FOR BORROWED MONEY OR AMOUNTS OWED IN EXCESS OF $50,000 (OTHER
THAN TRADE ACCOUNTS PAYABLE INCURRED IN THE ORDINARY COURSE OF BUSINESS), (B)
ALL GUARANTIES, ENDORSEMENTS AND OTHER CONTINGENT OBLIGATIONS RELATED TO
INDEBTEDNESS OF OTHERS, WHETHER OR NOT THE SAME ARE OR SHOULD BE REFLECTED IN
THE COMPANY'S BALANCE SHEET OR THE NOTES THERETO, IN EXCESS OF $50,000, EXCEPT
GUARANTIES BY ENDORSEMENT OF NEGOTIABLE INSTRUMENTS FOR DEPOSIT OR COLLECTION IN
THE ORDINARY COURSE OF BUSINESS, AND (C) THE PRESENT VALUE OF ANY LEASE PAYMENTS
IN EXCESS OF $50,000 DUE UNDER LEASES REQUIRED TO BE CAPITALIZED IN ACCORDANCE
WITH GAAP.
EXCEPT AS DISCLOSED IN THE SEC REPORTS, NEITHER THE COMPANY NOR ANY
SUBSIDIARY IS IN DEFAULT WITH RESPECT TO ANY INDEBTEDNESS.
(T)
CERTAIN FEES.
NO BROKERAGE OR FINDER'S
FEES OR COMMISSIONS ARE OR WILL BE PAYABLE BY THE COMPANY TO ANY BROKER,
FINANCIAL ADVISOR OR CONSULTANT, FINDER, PLACEMENT AGENT, INVESTMENT BANKER,
BANK OR OTHER PERSON WITH RESPECT TO THE TRANSACTIONS
13
CONTEMPLATED BY THIS AGREEMENT, AND THE COMPANY HAS NOT TAKEN ANY ACTION THAT
WOULD CAUSE ANY PURCHASER TO BE LIABLE FOR ANY SUCH FEES OR COMMISSIONS.
THE
COMPANY AGREES THAT THE PURCHASERS SHALL HAVE NO OBLIGATION WITH RESPECT TO ANY
FEES OR WITH RESPECT TO ANY CLAIMS MADE BY OR ON BEHALF OF ANY PERSON