FISCAL YEAR MAY LACK CERTAIN FOOTNOTE DISCLOSURES WHICH
WOULD OTHERWISE BE REQUIRED BY GAAP AND MAY BE SUBJECT TO NORMAL YEAR-END
ADJUSTMENTS.
SINCE DECEMBER 31, 2006, THERE HAS BEEN NO CHANGE IN ANY
CIRCUMSTANCES, FACTS OR CONDITIONS NOR SHALL AN EVENT HAVE TAKEN PLACE WHICH,
INDIVIDUALLY OR IN THE AGGREGATE, COULD REASONABLY BE EXPECTED TO HAVE A
MATERIAL ADVERSE EFFECT.
(G)
TITLE TO PROPERTY; LIENS; VESSEL DUE DOCUMENTATION
(I)
EACH OF THE BORROWER AND EACH OF THE BORROWER'S SUBSIDIARIES HAS
GOOD AND MARKETABLE TITLE TO, OR A VALID LEASEHOLD INTEREST IN, ALL OF ITS
PROPERTIES AND ASSETS, REAL AND PERSONAL, OF ANY NATURE WHATSOEVER, FREE AND
CLEAR OF ALL LIENS, EXCEPT FOR LIENS PERMITTED BY SECTION 6.2(H).
THE ASSETS
AND PROPERTIES OWNED BY AND LEASED TO THE BORROWER OR ANY OF THE BORROWER'S
SUBSIDIARIES WHICH ARE NECESSARY IN THE CONDUCT OF THEIR RESPECTIVE BUSINESSES
ARE IN ADEQUATE OPERATING CONDITION AND REPAIR, ORDINARY WEAR AND TEAR AND
DAMAGE DUE TO CASUALTY EXCEPTED, ARE FREE AND CLEAR OF ANY KNOWN DEFECTS EXCEPT
SUCH DEFECTS AS DO NOT SUBSTANTIALLY INTERFERE WITH THE CONTINUED USE THEREOF IN
THE CONDUCT OF NORMAL OPERATIONS, AND ARE ABLE TO SERVE THE FUNCTION FOR WHICH
THEY ARE INTENDED IN THE CONDUCT OF SUCH PERSON'S BUSINESS.
(II)
AS OF THE CLOSING DATE AND AS OF THE DATE OF EACH ANNUAL DELIVERY
OF THE LIST OF DESIGNATED VESSELS PURSUANT TO SECTION 6.4(G), THE BORROWER AND
THE SUBSIDIARY GUARANTORS ARE THE SOLE OWNERS OF EACH DESIGNATED VESSEL AND HOLD
VALID LEGAL TITLE TO THE WHOLE OF SUCH DESIGNATED VESSELS.
THE BORROWER AND THE
SUBSIDIARY GUARANTORS LAWFULLY OWN AND ARE LAWFULLY POSSESSED OF EACH DESIGNATED
VESSEL FREE FROM ANY LIEN, CHARGE OR ENCUMBRANCE WHATSOEVER, EXCEPT AS PERMITTED
PURSUANT TO SECTION 6.2(H) AND EXCEPT TO THE EXTENT SET FORTH ON SCHEDULE
5.1(G), AND WILL WARRANT AND DEFEND THE TITLE AND POSSESSION THERETO AND TO
EVERY PART THEREOF FOR THE BENEFIT OF THE LENDERS AGAINST THE MATERIAL CLAIMS
AND DEMANDS OF ANY PERSON WHOMSOEVER.
(H)
NO DEFAULT.
NONE OF THE BORROWER OR ANY OF THE BORROWER'S
SUBSIDIARIES IS IN VIOLATION OF ANY APPLICABLE LAW, OR IN DEFAULT UNDER ANY
AGREEMENT OR INSTRUMENT TO WHICH ANY OF SUCH PERSONS IS A PARTY OR BY WHICH ANY
OF THEIR RESPECTIVE PROPERTIES OR ASSETS IS BOUND OR AFFECTED, WHICH VIOLATION
OR DEFAULT COULD REASONABLY BE EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT.
NO
EVENT OF DEFAULT OR DEFAULT HAS OCCURRED AND IS CONTINUING.
(I)
LITIGATION; CONTINGENT LIABILITIES; LABOR MATTERS.
36
(I)
EXCEPT AS SET FORTH IN SCHEDULE 5.1(I) OR IN THE FINANCIAL
STATEMENTS DESCRIBED IN SECTION 5.1(F), NO CLAIMS, LITIGATION, ARBITRATION
PROCEEDINGS OR GOVERNMENTAL PROCEEDINGS ARE PENDING OR, TO THE KNOWLEDGE OF THE
LOAN PARTIES, OVERTLY THREATENED AGAINST OR, TO THE KNOWLEDGE OF THE LOAN
PARTIES, ARE AFFECTING THE BORROWER OR ANY OF THE BORROWER'S SUBSIDIARIES, OR
ANY OF THEIR RESPECTIVE PROPERTIES, ASSETS OR REVENUES, THE RESULTS OF WHICH
COULD REASONABLY BE EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT.
(II)
OTHER THAN ANY LIABILITY INCIDENT TO