THE OPERATION OF THE BUSINESS.
(J)
ACQUIRED TANGIBLE ASSETS.
THE MACHINERY, EQUIPMENT, AND OTHER
TANGIBLE ASSETS INCLUDED IN THE ACQUIRED ASSETS ARE FREE FROM MATERIAL DEFECTS
(PATENT AND LATENT), HAVE BEEN MAINTAINED IN ACCORDANCE WITH NORMAL INDUSTRY
PRACTICE, AND ARE IN GOOD OPERATING CONDITION AND REPAIR (SUBJECT TO NORMAL WEAR
AND TEAR).
(K)
ACQUIRED INVENTORY.
THE ACQUIRED INVENTORY CONSISTS OF
MANUFACTURED AND PROCESSED PARTS, WORK IN PROCESS, AND FINISHED GOODS, ALL OF
WHICH IS FIT FOR THE PURPOSE FOR WHICH IT WAS PROCURED OR MANUFACTURED, AND NONE
OF WHICH IS OBSOLETE, EXCESS, DAMAGED, OR DEFECTIVE.
INVENTORY NOW ON HAND THAT
WAS PURCHASED AFTER THE FINANCIAL STATEMENT DATE AND INVENTORY PURCHASED
PURSUANT TO THE ASSUMED PURCHASE ORDERS BUT NOT YET ON HAND WAS PURCHASED IN THE
ORDINARY COURSE OF BUSINESS AT A COST NOT EXCEEDING MARKET PRICES PREVAILING AT
THE TIME OF PURCHASE.
(L)
ACQUIRED CONTRACTS
SCHEDULE 1A CONTAINS A LIST OF, AND SELLER
HAS DELIVERED TO BUYER A CORRECT AND COMPLETE COPY OF, EACH WRITTEN ACQUIRED
CONTRACT (AS AMENDED TO DATE) AND A WRITTEN SUMMARY SETTING FORTH THE MATERIAL
TERMS AND CONDITIONS OF EACH ORAL ACQUIRED CONTRACT.
WITH RESPECT TO SELLER,
AND, TO THE BEST KNOWLEDGE OF SELLER, EACH OTHER PARTY TO EACH ACQUIRED
CONTRACT: (A) THE AGREEMENT IS LEGAL, VALID, BINDING AND ENFORCEABLE IN
ACCORDANCE WITH ITS TERMS, AND IN FULL FORCE AND EFFECT; (B) NO PARTY IS IN
MATERIAL BREACH OR DEFAULT, AND NO EVENT HAS OCCURRED THAT WITH NOTICE OR LAPSE
OF TIME WOULD CONSTITUTE A MATERIAL BREACH OR DEFAULT, OR PERMIT TERMINATION,
MODIFICATION, OR ACCELERATION, UNDER THE AGREEMENT; AND (C) NO PARTY HAS
REPUDIATED ANY PROVISION OF THE AGREEMENT.
(M)
ACQUIRED RECEIVABLES.
The Acquired Receivables are all of the receivables related to that portion of
the Business conducted with the Acquired Assets.
All Acquired Receivables are
valid receivables subject to no setoffs or counterclaims and are current and
collectible in accordance with their terms and at their recorded amounts,
subject only to the reserve for bad debts, charge-backs and the like set
17
forth in Exhibits CB, CB 1.0, CB 2.0, CB 3.0 and CB 4.0 to the Closing Date Net
Asset Value Statement (without duplication).
(N)
ENVIRONMENTAL, HEALTH, AND SAFETY MATTERS.
WITH RESPECT TO THE OPERATIONS CONDUCTED AT ANY LEASED REAL PROPERTY:
(I)
SELLER HAS COMPLIED AND IS IN COMPLIANCE, IN EACH CASE IN ALL
MATERIAL RESPECTS, WITH ALL ENVIRONMENTAL, HEALTH, AND SAFETY REQUIREMENTS.
(II)
WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, SELLER HAS
OBTAINED, HAS COMPLIED, AND IS IN COMPLIANCE WITH, IN EACH CASE IN ALL RESPECTS,
ALL MATERIAL PERMITS, LICENSES AND OTHER AUTHORIZATIONS THAT ARE REQUIRED
PURSUANT TO ENVIRONMENTAL, HEALTH, AND SAFETY REQUIREMENTS FOR THE OCCUPATION OF
THE LEASED REAL PROPERTY AND THE OPERATION OF ITS BUSINESS AS CONDUCTED THEREON;
AND A LIST OF ALL SUCH MATERIAL PERMITS, LICENSES AND OTHER AUTHORIZATIONS IS
SET FORTH IN SECTION 3(N)(II) OF THE DISCLOSURE SCHEDULE.
(III)
SELLER HAS NOT RECEIVED ANY WRITTEN OR ORAL NOTICE, REPORT OR
OTHER INFORMATION REGARDING ANY ACTUAL OR ALLEGED MATERIAL