PARENT'S SUBSIDIARIES ARE DULY EXISTING AND IN GOOD
STANDING IN THEIR RESPECTIVE JURISDICTIONS OF FORMATION AND ARE QUALIFIED AND
LICENSED TO DO BUSINESS AND ARE IN GOOD STANDING IN ANY JURISDICTION IN WHICH
THE CONDUCT OF THEIR BUSINESS OR THEIR OWNERSHIP OF PROPERTY REQUIRES THAT THEY
BE QUALIFIED EXCEPT WHERE THE FAILURE TO DO SO COULD NOT REASONABLY BE EXPECTED
TO HAVE A MATERIAL ADVERSE EFFECT ON ANY BORROWER'S OR PARENT'S BUSINESS.
PURSUANT TO SECTION 3.1(E), EACH BORROWER SHALL DELIVER TO BANK A COMPLETED
"PERFECTION CERTIFICATE", IN THE FORM PREVIOUSLY PROVIDED BY BANK, SIGNED BY
BORROWER AND PARENT. EACH BORROWER REPRESENTS AND WARRANTS TO BANK THAT (A) SUCH
BORROWER'S EXACT LEGAL NAME IS THAT INDICATED ON ITS PERFECTION CERTIFICATE AND
ON THE SIGNATURE PAGE HEREOF; (B) SUCH BORROWER IS AN ORGANIZATION OF THE TYPE
AND IS ORGANIZED IN THE JURISDICTION SET FORTH IN ITS PERFECTION CERTIFICATE;
(C) ITS PERFECTION CERTIFICATE ACCURATELY SETS FORTH SUCH BORROWER'S
ORGANIZATIONAL IDENTIFICATION NUMBER OR ACCURATELY STATES THAT SUCH BORROWER HAS
NONE; (D) ITS PERFECTION CERTIFICATE ACCURATELY SETS FORTH SUCH BORROWER'S PLACE
OF BUSINESS, OR, IF MORE THAN ONE, ITS CHIEF EXECUTIVE OFFICE AS WELL AS SUCH
BORROWER'S MAILING ADDRESS (IF DIFFERENT THAN ITS CHIEF EXECUTIVE OFFICE);
(E) SUCH BORROWER (AND EACH OF ITS PREDECESSORS) HAS NOT, IN THE PAST FIVE (5)
YEARS, CHANGED ITS STATE OF FORMATION, ORGANIZATIONAL STRUCTURE OR TYPE, OR ANY
ORGANIZATIONAL NUMBER ASSIGNED BY ITS JURISDICTION; AND (F) ALL OTHER
INFORMATION SET FORTH ON ITS PERFECTION CERTIFICATE PERTAINING TO SUCH BORROWER
AND EACH OF ITS SUBSIDIARIES IS ACCURATE AND COMPLETE.
The execution, delivery and performance of the Loan Documents have been duly
authorized, and do not conflict with such Borrower's organizational documents,
nor constitute an event of default under any material agreement by which such
Borrower is bound. Neither such Borrower nor Parent nor any of Parent's
Subsidiaries is in default under any agreement to which it is a party or by
which it is bound in which the default could reasonably be expected to have a
material adverse effect on any Borrower's or Parent's business.
5.2
COLLATERAL. EACH BORROWER HAS GOOD TITLE TO,
HAS RIGHTS IN, AND THE POWER TO TRANSFER EACH ITEM OF THE COLLATERAL UPON WHICH
IT PURPORTS TO GRANT A LIEN HEREUNDER, FREE AND CLEAR OF ANY AND ALL LIENS
EXCEPT PERMITTED LIENS. NONE OF THE BORROWERS, PARENT OR ANY OF PARENT'S
DOMESTIC SUBSIDIARIES HAVE ANY DEPOSIT ACCOUNTS OTHER THAN THE DEPOSIT ACCOUNTS
WITH BANK, THE DEPOSIT ACCOUNTS, IF ANY, DESCRIBED IN THE PERFECTION
CERTIFICATES OF BORROWERS AND PARENT THAT WERE DELIVERED TO BANK IN CONNECTION
HEREWITH, OR OF WHICH BORROWERS HAVE GIVEN BANK NOTICE AND TAKEN SUCH ACTIONS AS
ARE NECESSARY TO GIVE BANK A PERFECTED SECURITY INTEREST THEREIN (SUBJECT TO
SECTION 6.6 HEREOF). THE ACCOUNTS ARE BONA FIDE, EXISTING OBLIGATIONS OF THE
ACCOUNT DEBTORS.
7
THE COLLATERAL IS NOT IN THE POSSESSION OF ANY THIRD PARTY BAILEE (SUCH AS A
WAREHOUSE) EXCEPT AS OTHERWISE PROVIDED IN THE PERFECTION CERTIFICATE. NONE OF
THE COMPONENTS OF THE