IN ALL MATERIAL RESPECTS WITH ALL REQUIREMENTS OF LAW APPLICABLE TO THE
COLLATERAL OR ANY PART THEREOF OR TO THE OPERATION OF THE DEBTOR'S BUSINESS;
PROVIDED, HOWEVER, THAT THE DEBTOR MAY CONTEST ANY REQUIREMENT OF LAW IN ANY
REASONABLE MANNER WHICH SHALL NOT, IN THE SOLE OPINION OF THE SECURED PARTY,
ADVERSELY AFFECT THE SECURED PARTY'S RIGHTS OR THE PRIORITY OF ITS LIENS ON THE
COLLATERAL.
(F)
COMPLIANCE WITH TERMS OF CONTRACTS, ETC.
THE DEBTOR WILL PERFORM AND COMPLY IN ALL MATERIAL RESPECTS WITH ALL ITS
OBLIGATIONS UNDER THE CONTRACTS AND ALL ITS OTHER CONTRACTUAL OBLIGATIONS
RELATING TO THE COLLATERAL EXCEPT WHERE SUCH NONPERFORMANCE AND NONCOMPLIANCE
COULD NOT REASONABLY BE EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT.
(G)
PAYMENT OF OBLIGATIONS.
THE DEBTOR WILL PAY
PROMPTLY WHEN DUE ALL TAXES, ASSESSMENTS AND GOVERNMENTAL CHARGES OR LEVIES
IMPOSED UPON THE COLLATERAL OR IN RESPECT OF ITS INCOME OR PROFITS THEREFROM, AS
WELL AS ALL CLAIMS OF ANY KIND (INCLUDING, WITHOUT LIMITATION, CLAIMS FOR LABOR,
MATERIALS AND SUPPLIES) AGAINST OR WITH RESPECT TO THE COLLATERAL, EXCEPT THAT
NO SUCH CHARGE NEED BE PAID IF (I) THE VALIDITY THEREOF IS BEING CONTESTED IN
GOOD FAITH BY APPROPRIATE PROCEEDINGS, (II) SUCH PROCEEDINGS DO NOT INVOLVE ANY
MATERIAL DANGER OF THE SALE, FORFEITURE OR LOSS OF ANY OF THE COLLATERAL OR ANY
INTEREST THEREIN AND (III) SUCH CHARGE IS ADEQUATELY RESERVED AGAINST ON THE
DEBTOR'S BOOKS IN ACCORDANCE WITH GAAP.
(H)
LIMITATION ON LIENS ON COLLATERAL.
THE
DEBTOR WILL NOT CREATE, INCUR OR PERMIT TO EXIST, WILL DEFEND THE COLLATERAL
AGAINST, AND WILL TAKE SUCH OTHER ACTION AS IS NECESSARY TO REMOVE, ANY LIEN OR
CLAIM ON OR TO THE COLLATERAL, OTHER THAN THE LIENS CREATED HEREBY AND PERMITTED
LIENS, AND WILL DEFEND THE RIGHT, TITLE AND INTEREST OF THE SECURED PARTY IN AND
TO ANY OF THE COLLATERAL AGAINST THE CLAIMS AND DEMANDS OF ALL PERSONS
WHOMSOEVER.
(I)
LIMITATIONS ON DISPOSITIONS OF
COLLATERAL.
THE DEBTOR WILL NOT SELL, TRANSFER, LEASE OR OTHERWISE DISPOSE OF
ANY OF THE COLLATERAL, OR ATTEMPT, OFFER OR CONTRACT TO DO SO EXCEPT FOR (X)
SALES OF INVENTORY IN THE ORDINARY COURSE OF ITS BUSINESS AND (Y) SO LONG AS NO
DEFAULT OR EVENT OF DEFAULT HAS OCCURRED AND IS CONTINUING, THE DISPOSITION IN
THE ORDINARY COURSE
8
OF BUSINESS OF PROPERTY NOT MATERIAL TO THE CONDUCT OF ITS BUSINESS OR AS
OTHERWISE PERMITTED UNDER THE CREDIT AGREEMENT.
(J)
LIMITATIONS ON MODIFICATIONS, WAIVERS,
EXTENSIONS OF CONTRACTS AND AGREEMENTS GIVING RISE TO ACCOUNTS.
THE DEBTOR WILL
NOT (I) AMEND, MODIFY, TERMINATE OR WAIVE ANY PROVISION OF ANY CONTRACT OR ANY
AGREEMENT GIVING RISE TO AN ACCOUNT IN ANY MANNER WHICH COULD REASONABLY BE
EXPECTED TO MATERIALLY ADVERSELY AFFECT THE VALUE OF SUCH CONTRACTS OR ACCOUNTS
AS COLLATERAL WHEN EXAMINED IN THE AGGREGATE, (II) FAIL TO EXERCISE PROMPTLY AND
DILIGENTLY EACH AND EVERY MATERIAL RIGHT WHICH IT MAY HAVE UNDER EACH CONTRACT
AND EACH AGREEMENT GIVING RISE TO AN ACCOUNT (OTHER THAN ANY RIGHT OF
TERMINATION) WHERE SUCH FAILURE COULD HAVE