FISCAL YEAR THEN
ENDED, ACCOMPANIED BY THE REPORT THEREON OF ITS INDEPENDENT CERTIFIED PUBLIC
ACCOUNTANTS, ERNST & YOUNG.
FLEETWOOD HAS ALSO DELIVERED TO THE AGENT AND THE
LENDERS THE UNAUDITED BALANCE SHEET AND RELATED STATEMENTS OF INCOME AND CASH
FLOWS FOR FLEETWOOD AND ITS CONSOLIDATED SUBSIDIARIES AS OF THE FISCAL QUARTER
ENDING JANUARY 23, 2005.
SUCH FINANCIAL STATEMENTS ARE ATTACHED HERETO AS
EXHIBIT C.
ALL SUCH FINANCIAL STATEMENTS HAVE BEEN PREPARED IN ACCORDANCE WITH
GAAP AND PRESENT ACCURATELY AND FAIRLY IN ALL MATERIAL RESPECTS THE FINANCIAL
POSITION OF FLEETWOOD AND ITS CONSOLIDATED SUBSIDIARIES AS AT THE DATES THEREOF
AND THEIR RESULTS OF OPERATIONS FOR THE PERIODS THEN ENDED, SUBJECT IN THE CASE
OF THE UNAUDITED STATEMENTS TO NORMAL YEAR END AUDIT ADJUSTMENTS AND TO THE
OMISSION OF FOOTNOTES REQUIRED BY GAAP.
(B)
THE LATEST PROJECTIONS WHEN SUBMITTED TO THE
LENDERS AS REQUIRED HEREIN REPRESENT THE GOOD FAITH ESTIMATE BY THE BORROWERS OF
THE FUTURE FINANCIAL PERFORMANCE OF FLEETWOOD AND ITS CONSOLIDATED SUBSIDIARIES
FOR THE PERIODS SET FORTH THEREIN.
THE LATEST PROJECTIONS HAVE BEEN PREPARED ON
THE BASIS OF THE ASSUMPTIONS SET FORTH THEREIN, WHICH THE BORROWERS BELIEVE ARE
FAIR AND REASONABLE IN LIGHT OF CURRENT AND REASONABLY FORESEEABLE BUSINESS
CONDITIONS AT THE TIME SUBMITTED TO THE LENDERS.
6.7
CAPITALIZATION.
SCHEDULE 6.7 TO THE
EXISTING CREDIT AGREEMENT, AS AMENDED PRIOR TO THE CLOSING DATE, SETS FORTH, AS
OF THE FIRST AMENDMENT AND RESTATEMENT DATE OR OF SUCH AMENDMENT, THE
CAPITALIZATION OF FLEETWOOD AND ITS SUBSIDIARIES AND ALL OF THE AUTHORIZED AND
ISSUED CAPITAL STOCK OF EACH SUCH PERSON.
ALL OUTSTANDING CAPITAL STOCK HAS
BEEN VALIDLY ISSUED, AND IS FULLY PAID AND NON-ASSESSABLE.
ALL OF THE CAPITAL
STOCK OF SUBSIDIARIES IS OWNED, BENEFICIALLY AND OF RECORD, BY THE PERSON SET
FORTH ON SUCH SCHEDULE 6.7 TO THE EXISTING CREDIT AGREEMENT, AS AMENDED PRIOR TO
THE CLOSING DATE.
6.8
SOLVENCY.
EACH OF FLEETWOOD, HOLDINGS AND
RETAIL IS, AND UPON THE INCURRENCE OF ANY OBLIGATIONS BY SUCH LOAN PARTY WILL
BE, SOLVENT.
EACH OF FMC, TAKEN AS A WHOLE, AND FRC, TAKEN AS A WHOLE, IS, AND
UPON THE INCURRENCE OF ANY OBLIGATIONS BY ANY LOAN PARTY WILL BE SOLVENT.
6.9
DEBT.
AFTER GIVING EFFECT TO THE REVOLVING
LOANS OUTSTANDING AS OF AND THE MAKING OF THE TERM LOAN ON THE CLOSING DATE,
FLEETWOOD AND ITS SUBSIDIARIES HAVE NO DEBT ON THE CLOSING DATE, EXCEPT (A) THE
OBLIGATIONS, (B) THE SUBORDINATED DEBT EXISTING ON THE CLOSING DATE IN AN AMOUNT
(INCLUDING PRINCIPAL AND ACCRUED BUT UNPAID INTEREST) OF NOT MORE THAN
$375,000,000, AND THE TRUST SECURITIES IN RELATION THERETO ALSO OUTSTANDING ON
THE CLOSING DATE, (C) DEBT DESCRIBED ON SCHEDULE 6.9 HERETO, (D) FLOOR PLAN DEBT
INCURRED IN ACCORDANCE WITH
41
SECTION 7.13, (E) DEBT OUTSTANDING UNDER ANY WAREHOUSE FINANCING LINES OF CREDIT
INCURRED IN ACCORDANCE WITH SECTION 7.13, (G) GUARANTIES ENTERED INTO IN
ACCORDANCE WITH SECTION 7.12 AND (H) OTHER DEBT IN AN AGGREGATE AMOUNT OF NOT
MORE THAN $5,000,000.
6.10
DISTRIBUTIONS.
SINCE JUNE 12, 2001, NO
DISTRIBUTION HAS BEEN DECLARED, PAID,