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Due Diligence Checklist

Chapter 21 B. Forms and Documents

DUE DILIGENCE CHECKLIST

1. The Certificate of Incorporation (including the terms of any preferred stock), as amended to date, of the parent company (the "Company") and of each domestic or foreign corporation owns an equity interest of 10% or more (the Company and any such corporations collectively referred to as the "Companies").

2. The By-laws, as amended to date, of the Companies.

3. Specimen of all securities of each of the Companies presently outstanding (including options, warrants, and other rights) and the number of shares, units or principal amount thereof outstanding as of a recent date.

4. The stockholders list of each of the Companies as of a recent date, indicating the class and number of shares held by each stockholder and, regarding the Company, the state or jurisdiction of residence of the stockholders.

5. A list indicating, as to each of the Companies, each state of jurisdiction in which it is qualified to do business, conducts business, or owns, leases, or licenses real property (if not obtained as a representation in the underwriting agreement).

6. Each proxy statement, annual report to shareholders, and other communications form the Companies to their respective shareholders during the last five (--) years.

7. Each registration statement and prospectus filed by any of the Companies with the Securities and Exchange Commission (the "Commission"), together with each exhibit thereto not otherwise furnished hereunder.

8. Each report (i.e., Forms 8-K, 10-K, and 10-Q) filed by any of the Companies during the last five (--) years with the Commission.

9. All correspondence between the Commission and any of the Companies during the last five (--) years.

10. Filings under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, by any of the Companies, including any filings related to the proposed transaction.

11. Any Schedules 13D, 13G, and 14D-1 filed by any of the Companies with the Commission with respect to the securities of other issuers.

12. Each report or other document filed by any of the Companies with a federal, state, or local governmental authority during the last five (--) years.

13. Each correspondence between any of the Companies and a federal, state, or local governmental authority during the last five (--) years.

14. Each listing application to a national securities exchange filed by any of the Companies during the last five (--) years.

15. Any Schedules 13D, 13G, 14D-1, and 14D-9 filed by any person with respect to the securities of any of the Companies.

16. All press releases issued by any of the Companies during the last five (--) years.

17. Minutes of all meeting of shareholders, directors, and committees of directors of each of the Companies for the last five (--) years.

18. A list showing each of the officers and directors of each of the Companies as of a recent date.

19. Forms 3, 4, and 5 filed during the last five (--) years with respect to the securities of any of the Companies by any officer, director, or 10% shareholder of any of the Companies.

20. Audited statements of income, balance sheets, statements of capital surplus, and statements of changes in financial position and notes thereto of each of the Companies covering their respective last five (--) fiscal years.

21. Unaudited statement of income, balance sheet, statements of changes in financial position and notes thereto of each of the Companies covering their respective periods since the end of their respective last fiscal year.

22. All reports or memoranda relating to broad aspects of the financial condition, results of operations, business, properties, assets, liabilities, or future prospects of any of the Companies made within the last five (--) years. All written financial plans, budgets, projections, market studies, feasibility studies, and similar materials prepared by or for any of the Companies during the last five (--) years. All management financial reports submitted to the directors or a committee of directors of any of the Companies during the last five (--) years.

23. Each federal, state, and local tax return, taxing authority report and assessment, and related material sent, filed, or received by any of the Companies regarding any fiscal year not barred by the applicable statute of limitations and the three fiscal years prior thereto.

24. Each document evidencing the terms and conditions of any merger, acquisition, reorganization, or other major event of the Company.

25. Each agreement, instrument, or document evidencing or otherwise containing the terms and conditions of any material right or obligation of any of the Companies, including any of the following to which any of the Companies is a party or by which any of the Companies are bound:

a. Monetary documents, such as loan agreements, letters of credit, promissory notes, factoring agreements, and other documents evidencing indebtedness (including waivers, consents, notices, and amendments of each of the foregoing);

b. Conduct of business documents, including material sales, supply and distribution agreements, price lists, warranty information, dealer arrangements, brokerage agreements, defense agreements, advertising agreements and the like;

c. Employee and employee benefit documents, including employment, management, and consulting contracts, employee patent assignment agreements, union contracts and collective bargaining agreements, stock option and stock purchase plans, pension and other retirement plans (including all correspondence and filings with regulatory authorities), profit sharing plans and agreements, group insurance plans, actuarial reports and other documents from actuaries relating to any of the above plans or agreements rendered in the last five (--) years, Form 5500 filed with respect to each pension and retirement plan, and any other similar materials;

d. Documents relating to intangibles, including trademark registrations and licenses, patent ant patent licenses, copyright registrations, assignments, and licenses, agreements with employees with respect to proprietary information, and other license agreements;

e. All documents evidencing or pertaining to the ownership, lease, lien, or encumbrance of any interest of any of the Companies in real property;

f. All governmental contracts and permits relating to any of the Companies; g. Any franchise agreement between any of the Companies and any other person;

h. Copies of all insurance policies held by any of the Companies;

i. Any non-competition agreement to which any of the Companies is a party; and

j. Contracts between any of the Companies and either its directors, officers, employees, or stockholders, any of their respective relatives or affiliates, or any other corporation or enterprise in which any such director, officer, employee, stockholder, relative, or affiliate then had or now has a 5 percent or greater equity or voting or other substantial interest.

26. A list describing any agreement, instrument, or document binding on any of the Companies under which a default has occurred, will occur after the passage of time or the giving of notice, or is claimed to have occurred, setting forth the nature of the default, the name of the party in default, the monetary amount claimed, and the current status.

27. A description of all oral contracts, agreements, and commitments in which any of the Companies has a material right or obligation.

28. A description (together with any pleading and motions) of all pending or threatened litigation or arbitration to which any of the Companies is or may become a party or by which they or their respective businesses, properties, or assets are or may be bound which may have a material effect on any of the Companies or their respective businesses, assets, prospects, or properties.

29. Letters from attorneys for any of the Companies sent to the Companies' independent certified public accountants in the last five (--) years.

30. Representation letters from any of the Companies submitted to the Companies' independent certified public accountants in the last five (--) years.

31. Letters from any of the Companies' independent certified public accountants to the directors or a committee of directors or to the management of any of the Companies in the last five (--) years. Any internal memoranda of the Companies' independent certified public accountants relating to an audit of the Companies prepared during the last five (--) years.

32. Protection Agency or comparable state or local agencies to which any of the Companies is or may be a party or by which they or their respective operations or assets are or may be bound.

33. Files relating to matters regarding the Occupational Safety and Health Act or comparable state or local agencies to which any of the Companies is or may be a party or by which they or their respective businesses, properties, or assets are or may be bound.

34. All private placement memoranda, subscription agreements, and other documents related to a private placement of securities of any of the Companies.

35. The Companies' stock books and transfer records.

36. A list of the Companies' major competitors.

37. A list indicating any other agreement, instrument, document, or information relating to any of the Companies as to which there is a substantial likelihood that a reasonable investor would consider important or which should be considered or reviewed in connection with the preparation of the registration statement.