BECOME DELINQUENT OR IN DEFAULT, EXCEPT WHERE (A) THE VALIDITY OR AMOUNT THEREOF
IS BEING CONTESTED IN GOOD FAITH BY APPROPRI­ATE PROCEEDINGS, (B) THE BORROWER
OR SUCH SUBSIDIARY HAS SET ASIDE ON ITS BOOKS ADEQUATE RESERVES WITH RESPECT
THERETO IN ACCORDANCE WITH GAAP AND (C) THE FAILURE TO MAKE PAYMENT PENDING SUCH
CONTEST COULD NOT REASONABLY BE EXPECTED TO RESULT IN A MATERIAL ADVERSE EFFECT.
SECTION 5.05.
MAINTENANCE OF PROPERTIES; INSURANCE.
THE BORROWER WILL, AND
WILL CAUSE EACH OF ITS SUBSIDIARIES TO, (A) KEEP AND MAINTAIN ALL PROPERTY
MATERIAL TO THE CONDUCT OF ITS BUSINESS IN GOOD WORKING ORDER AND CONDITION,
ORDINARY WEAR AND TEAR EXCEPTED, AND (B) MAINTAIN, WITH FINANCIALLY SOUND AND
REPUTABLE INSURANCE COMPANIES, INSURANCE IN SUCH AMOUNTS AND AGAINST SUCH RISKS
AS ARE CUSTOMARILY MAINTAINED BY COMPANIES ENGAGED IN THE SAME OR SIMILAR
BUSINESSES OPERATING IN THE SAME OR SIMILAR LOCATIONS.
SECTION 5.06.
BOOKS AND RECORDS; INSPECTION RIGHTS.
THE BORROWER WILL, AND
WILL CAUSE EACH OF ITS SUBSIDIARIES TO, KEEP PROPER BOOKS OF RECORD AND ACCOUNT
IN WHICH FULL, TRUE AND CORRECT ENTRIES ARE MADE OF ALL DEALINGS AND
TRANSACTIONS IN RELATION TO ITS BUSINESS AND ACTIVITIES.
THE BORROWER WILL, AND
WILL CAUSE EACH OF ITS SUBSIDIARIES TO, PERMIT ANY REPRESENTATIVES DESIGNATED BY
THE ADMINISTRATIVE AGENT OR ANY LENDER, UPON REASONABLE PRIOR NOTICE, TO VISIT
AND INSPECT ITS PROPERTIES, TO EXAMINE AND MAKE EXTRACTS FROM ITS BOOKS AND
RECORDS, AND TO DISCUSS ITS AFFAIRS, FINANCES AND CONDITION
38
with its officers and independent accountants, all at such reasonable times and
as often as reasonably requested.
SECTION 5.07.
COMPLIANCE WITH LAWS.
THE BORROWER WILL, AND WILL CAUSE EACH OF
ITS SUBSIDIARIES TO, COMPLY WITH ALL LAWS, RULES, REGULATIONS AND ORDERS OF ANY
GOVERNMENTAL AUTHORITY APPLICABLE TO IT OR ITS PROPERTY, EXCEPT WHERE THE
FAILURE TO DO SO, INDIVIDUALLY OR IN THE AGGREGATE, COULD NOT REASONABLY BE
EXPECTED TO RESULT IN A MATERIAL ADVERSE EFFECT.
THE BORROWER WILL NOT, AND
WILL NOT PERMIT ANY OF ITS SUBSIDIARIES, TO BE OR BECOME SUBJECT AT ANY TIME TO
ANY LAW, REGULATION, OR LIST OF ANY GOVERNMENT AGENCY (INCLUDING, WITHOUT
LIMITATION, THE U.S. OFFICE OF FOREIGN ASSET CONTROL LIST) THAT PROHIBITS OR
LIMITS ANY LENDER FROM MAKING ANY ADVANCE OR EXTENSION OF CREDIT TO THE BORROWER
OR GUARANTOR OR FROM OTHERWISE CONDUCTING BUSINESS WITH THE BORROWER OR
GUARANTOR, OR FAIL TO PROVIDE DOCUMENTARY AND OTHER EVIDENCE OF THE BORROWER'S
OR GUARANTOR'S IDENTITY AS MAY BE REASONABLY REQUESTED BY ANY BANK AT ANY TIME
TO ENABLE SUCH LENDER TO VERIFY THE BORROWER'S OR GUARANTOR'S IDENTITY OR TO
COMPLY WITH ANY APPLICABLE LAW OR REGULATION, INCLUDING, WITHOUT LIMITATION,
SECTION 326 OF THE USA PATRIOT ACT OF 2001, 31 U.S.C. SECTION 5318.
SECTION 5.08.
USE OF PROCEEDS AND LETTERS OF CREDIT.
THE PROCEEDS OF THE LOANS
WILL BE USED ONLY TO REFINANCE EXISTING INDEBTEDNESS, TO CONSUMMATE THE
ACQUISITION OF UTILIMASTER HOLDINGS, INC. AND FOR GENERAL CORPORATE PURPOSES.
NO PART OF THE PROCEEDS OF ANY LOAN WILL BE USED, WHETHER DIRECTLY OR
INDIRECTLY, FOR ANY