THIS SECTION WILL BE COMPUTED IN ACCORDANCE WITH
GENERALLY ACCEPTED ACCOUNTING PRINCIPLES APPLIED ON A BASIS CONSISTENT WITH
FINANCIAL STATEMENTS PREVIOUSLY SUBMITTED BY THE BORROWER TO THE BANK.
5.2
WITHOUT THE WRITTEN CONSENT OF THE BANK, THE
BORROWER WILL NOT:
A.
DEBT.
INCUR, CONTRACT FOR, ASSUME, OR PERMIT TO REMAIN
OUTSTANDING, INDEBTEDNESS FOR BORROWED MONEY, INSTALLMENT OBLIGATIONS, OR
OBLIGATIONS UNDER CAPITAL LEASES OR OPERATING LEASES, OTHER THAN (1) UNSECURED
TRADE DEBT INCURRED IN THE ORDINARY COURSE OF BUSINESS, (2) INDEBTEDNESS OWING
TO THE BANK, (3) INDEBTEDNESS REFLECTED IN THE LATEST FINANCIAL STATEMENT OF THE
BORROWER FURNISHED TO THE BANK PRIOR TO EXECUTION OF THIS AGREEMENT AND THAT IS
NOT TO BE PAID WITH PROCEEDS OF BORROWINGS UNDER THE CREDIT FACILITIES, AND (4)
INDEBTEDNESS OUTSTANDING AS OF THE DATE HEREOF THAT HAS BEEN DISCLOSED TO THE
BANK IN WRITING AND THAT IS NOT TO BE PAID WITH PROCEEDS OF BORROWINGS UNDER THE
CREDIT FACILITIES.
B.
GUARANTIES.
GUARANTEE OR OTHERWISE BECOME OR REMAIN SECONDARILY
LIABLE ON THE UNDERTAKING OF ANOTHER, EXCEPT FOR ENDORSEMENT OF DRAFTS FOR
DEPOSIT AND COLLECTION IN THE ORDINARY COURSE OF BUSINESS.
C.
LIENS.
CREATE OR PERMIT TO EXIST ANY LIEN ON ANY OF ITS PROPERTY,
REAL OR PERSONAL, EXCEPT: EXISTING LIENS KNOWN TO THE BANK; LIENS TO THE BANK;
LIENS INCURRED IN THE ORDINARY COURSE OF
5
BUSINESS SECURING CURRENT NON-DELINQUENT LIABILITIES FOR TAXES, WORKER'S
COMPENSATION, UNEMPLOYMENT INSURANCE, SOCIAL SECURITY AND PENSION LIABILITIES.
D.
USE OF PROCEEDS.
USE, OR PERMIT ANY PROCEEDS OF THE CREDIT
FACILITIES TO BE USED, DIRECTLY OR INDIRECTLY, FOR: (1) ANY PERSONAL, FAMILY OR
HOUSEHOLD PURPOSE; OR (2) THE PURPOSE OF "PURCHASING OR CARRYING ANY MARGIN
STOCK" WITHIN THE MEANING OF FEDERAL RESERVE BOARD REGULATION U. AT THE BANK'S
REQUEST, THE BORROWER WILL FURNISH A COMPLETED FEDERAL RESERVE BOARD FORM U-1.
E.
CONTINUITY OF OPERATIONS.
(1) ENGAGE IN ANY BUSINESS ACTIVITIES
SUBSTANTIALLY DIFFERENT FROM THOSE IN WHICH THE BORROWER IS PRESENTLY ENGAGED;
(2) CEASE OPERATIONS, LIQUIDATE, MERGE, TRANSFER, ACQUIRE OR CONSOLIDATE WITH
ANY OTHER ENTITY, CHANGE ITS NAME, DISSOLVE, OR SELL ANY ASSETS OUT OF THE
ORDINARY COURSE OF BUSINESS; (3) ENTER INTO ANY ARRANGEMENT WITH ANY PERSON
PROVIDING FOR THE LEASING BY THE BORROWER OR ANY SUBSIDIARY OF REAL OR PERSONAL
PROPERTY WHICH HAS BEEN SOLD OR TRANSFERRED BY THE BORROWER OR SUBSIDIARY TO
SUCH PERSON; OR (4) CHANGE ITS BUSINESS ORGANIZATION, THE JURISDICTION UNDER
WHICH ITS BUSINESS ORGANIZATION IS FORMED OR ORGANIZED, OR ITS CHIEF EXECUTIVE
OFFICE, OR ANY PLACES OF ITS BUSINESSES.
F.
LIMITATION ON NEGATIVE PLEDGE CLAUSES.
ENTER INTO ANY AGREEMENT
WITH ANY PERSON OTHER THAN THE BANK WHICH PROHIBITS OR LIMITS THE ABILITY OF THE
BORROWER OR ANY OF ITS SUBSIDIARIES TO CREATE OR PERMIT TO EXIST ANY LIEN ON ANY
OF ITS PROPERTY, ASSETS OR REVENUES, WHETHER NOW OWNED OR HEREAFTER ACQUIRED.
G.
CONFLICTING AGREEMENTS.
ENTER INTO ANY AGREEMENT CONTAINING ANY
PROVISION WHICH WOULD BE VIOLATED OR BREACHED BY THE PERFORMANCE OF THE
BORROWER'S OBLIGATIONS UNDER THIS AGREEMENT OR ANY OF THE OTHER RELATED
DOCUMENTS.
H.
PARTNERSHIP