TO ENTER INTO THIS AGREEMENT, EACH BORROWER
MAKES THE FOLLOWING REPRESENTATIONS AND WARRANTIES WHICH SHALL BE TRUE, CORRECT,
AND COMPLETE IN ALL RESPECTS AS OF THE DATE HEREOF, AND SHALL BE TRUE, CORRECT,
AND COMPLETE IN ALL RESPECTS AS OF THE CLOSING DATE, AND AT AND AS OF THE DATE
OF THE ISSUANCE OF EACH LETTER OF CREDIT MADE THEREAFTER, AS THOUGH MADE ON AND
AS OF THE DATE OF SUCH LETTER OF CREDIT (EXCEPT TO THE EXTENT THAT SUCH
REPRESENTATIONS AND WARRANTIES RELATE SOLELY TO AN EARLIER DATE) AND SUCH
REPRESENTATIONS AND WARRANTIES SHALL SURVIVE THE EXECUTION AND DELIVERY OF THIS
AGREEMENT:
5.1
No Encumbrances.
Each Borrower has good and
indefeasible title to the Collateral, free and clear of Liens except for
Permitted Liens.
5.2
Location of Inventory and Equipment.
The
Inventory (other than Inventory in transit) and Equipment are not stored with a
bailee, warehouseman, or similar party (without Agent's prior written consent)
and are located only at the locations identified on Schedule 5.2 or otherwise
permitted by Section 6.11 of the Revolving Credit Agreement.
5.3
Inventory Records.
Each Borrower keeps
correct and accurate records itemizing and describing the kind, type, quality
and quantity of its Inventory and each Borrower's cost therefor in accordance
with the retail method of accounting.
5.4
Location of Chief Executive Office; FEIN.
The
chief executive office of Borrowers is located at the address indicated in the
preamble to this Agreement and Parent's FEIN is 31-1241495 and Services
Company's FEIN is 20-0850965.
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5.5
Due Organization and Qualification;
Subsidiaries.
(A)
EACH BORROWER IS DULY ORGANIZED AND
EXISTING AND IN GOOD STANDING UNDER THE LAWS OF THE JURISDICTION OF ITS
INCORPORATION AND QUALIFIED AND LICENSED TO DO BUSINESS IN, AND IN GOOD STANDING
IN, ANY STATE WHERE THE FAILURE TO BE SO LICENSED OR QUALIFIED REASONABLY COULD
BE EXPECTED TO CAUSE A MATERIAL ADVERSE CHANGE.
(B)
SET FORTH ON SCHEDULE 5.5 IS A COMPLETE AND
ACCURATE LIST OF EACH BORROWER'S DIRECT AND INDIRECT SUBSIDIARIES, SHOWING: (I)
THE JURISDICTION OF THEIR INCORPORATION; (II) THE NUMBER OF SHARES OF EACH CLASS
OF COMMON AND PREFERRED STOCK AUTHORIZED FOR EACH OF SUCH SUBSIDIARIES; AND
(III) THE NUMBER AND THE PERCENTAGE OF THE OUTSTANDING SHARES OF EACH SUCH CLASS
OWNED DIRECTLY OR INDIRECTLY BY THE APPLICABLE BORROWER.
ALL OF THE OUTSTANDING
CAPITAL STOCK OF EACH SUCH SUBSIDIARY HAS BEEN VALIDLY ISSUED AND IS FULLY PAID
AND NON-ASSESSABLE.
(C)
EXCEPT AS SET FORTH ON SCHEDULE 5.5, NO
CAPITAL STOCK (OR ANY SECURITIES, INSTRUMENTS, WARRANTS, OPTIONS, PURCHASE
RIGHTS, CONVERSION OR EXCHANGE RIGHTS, CALLS, COMMITMENTS OR CLAIMS OF ANY
CHARACTER CONVERTIBLE INTO OR EXERCISABLE FOR CAPITAL STOCK) OF ANY DIRECT OR
INDIRECT SUBSIDIARY OF ANY BORROWER IS SUBJECT TO THE ISSUANCE OF ANY SECURITY,
INSTRUMENT, WARRANT, OPTION, PURCHASE RIGHT, CONVERSION OR EXCHANGE RIGHT, CALL,
COMMITMENT OR CLAIM OF ANY RIGHT, TITLE, OR INTEREST THEREIN OR THERETO.
5.6
Due Authorization; No Conflict. (a) The
execution and delivery by each Borrower of each Loan Document to which it is a
party; each Borrower's