THE COMPANY SHALL CONTINUE TO OPERATE
CONSISTENT WITH THE COMPANY'S PAST BUSINESS PRACTICES AND OPERATING PROCEDURES
APPLICABLE ON THE CLOSING DATE.
(III)
BRAND SHALL BE THE PRESIDENT OF THE COMPANY
AND SHALL HAVE THE AUTHORITY TO RUN THE DAY-TO-DAY OPERATIONS OF THE COMPANY IN
ACCORDANCE WITH THE TERMS AND CONDITIONS CONTAINED IN THE BRAND EMPLOYMENT
AGREEMENT.
(IV)
BUYER SHALL NOT (I) COMBINE THE BUSINESS
OPERATIONS OF THE COMPANY WITH ANY EMRISE DIVISION, SUBSIDIARY OR AFFILIATE OR
(II) CHANGE THE LOCATION OF ANY OF THE COMPANY'S FACILITIES.
(V)
BUYER SHALL ENSURE THAT WORKING CAPITAL,
INCLUDING CASH, OF THE COMPANY IS SUFFICIENT TO MEET THE REQUIREMENTS OF THE
FORECASTS FOR THE MEASUREMENT PERIODS SET FORTH IN EXHIBIT 2.6(F) ATTACHED
HERETO (THE "FORECASTS"); PROVIDED, HOWEVER, THAT BUYER SHALL ALSO ENSURE THAT
WORKING CAPITAL IS SUFFICIENT TO MEET THE REQUIREMENTS OF ADDITIONAL BONA FIDE
OPPORTUNITIES ("UNFORECASTED OPPORTUNITIES") NOT PREVIOUSLY IDENTIFIED IN THE
FORECASTS WHICH REQUIRE (I) WORKING CAPITAL IN EXCESS OF THE WORKING CAPITAL
REQUIREMENTS SET FORTH IN THE FORECASTS IN AN AGGREGATE AMOUNT NOT TO EXCEED
$1,000,000 AND (II) CAPITAL EXPENDITURES (WHICH SHALL INCLUDE BUT NOT BE LIMITED
TO EXPENDITURES FOR ANY REQUIRED LEASEHOLD IMPROVEMENTS AND/OR CAPITAL LEASES)
IN EXCESS OF THE CAPITAL EXPENDITURE REQUIREMENTS SET FORTH IN THE FORECASTS IN
AN AGGREGATE AMOUNT NOT EXCEED $500,000.
TO BE ELIGIBLE FOR FUNDING BY BUYER,
(A) UNFORECASTED OPPORTUNITIES (INCLUDING ESTIMATED WORKING CAPITAL AND CAPITAL
EXPENDITURE REQUIREMENTS) SHALL BE IDENTIFIED BY BRAND WHEN THEY INITIALLY ARISE
AND THE
25
PORTFOLIO OF UNFORECASTED OPPORTUNITIES SHALL BE UPDATED AT LEAST MONTHLY, AND
(B) BRAND SHALL PROVIDE NOTICE TO BUYER AT LEAST FORTY-FIVE (45) DAYS BEFORE ANY
ADDITIONAL WORKING CAPITAL OR CAPITAL EXPENDITURE RELATED TO AN UNFORECASTED
OPPORTUNITY IS REQUIRED.
WITH RESPECT TO ANY EQUIPMENT REQUIRED FOR
UNFORECASTED OPPORTUNITIES WHICH IS ACQUIRED BY THE COMPANY PURSUANT TO THIS
SECTION 2.5(F)(V), BUYER SHALL HAVE THE SOLE RIGHT TO DETERMINE WHETHER THE
COMPANY PURCHASES OR LEASES SUCH EQUIPMENT (BUT NOT WHETHER SUCH EQUIPMENT IS
ACQUIRED).
(VI)
ANY INTER-COMPANY TRANSACTIONS BY AND AMONG
THE COMPANY, EMRISE AND ITS SUBSIDIARIES AND AFFILIATES, INCLUDING THE
INTER-RELATIONSHIP BETWEEN THE RADIO FREQUENCY DEVICE BUSINESS OF PASCALL
ELECTRONICS LIMITED (A SUBSIDIARY OF EMRISE) AND THE COMPANY, WILL BE ACCOUNTED
FOR AT INTER-COMPANY TRANSFER RATES MUTUALLY AGREED TO BY BUYER AND SELLERS.
(VII)
THE COMPANY'S EMPLOYEE BENEFITS PLANS AND
PROGRAMS EXISTING AS OF THE CLOSING DATE SHALL NOT BE CHANGED OR REPLACED UNLESS
PLANS AND PROGRAMS CONTAINING COMPARABLE BENEFITS ARE OFFERED TO THE COMPANY'S
EMPLOYEES.
BUYER AND SELLERS AGREE THAT IF BUYER BREACHES ANY OBLIGATION AND/OR REFRAINS
FROM TAKING THE ACTIONS, AS THE CASE MAY BE, SET FORTH IN THIS SECTION 2.6(F),
SELLERS' SOLE REMEDY SHALL BE (I) THAT THE MAXIMUM DEFERRED PURCHASE AMOUNT
SHALL BE DEEMED EARNED AND (II) SUBJECT TO ANY ADJUSTMENT TO THE PRINCIPAL
BALANCE OF THE SUBORDINATED CONTINGENT NOTES PURSUANT TO SECTION 2.5(B), THE
PRINCIPAL BALANCE OF THE SUBORDINATED CONTINGENT NOTES IN THE AGGREGATE SHALL BE
SET TO $2,000,000 (WITH THE PRINCIPAL AMOUNT OF EACH SUBORDINATED CONTINGENT
NOTE IN PROPORTION TO THE