THAT ANY PART OF THE INTELLECTUAL PROPERTY VIOLATES THE
RIGHTS OF ANY THIRD PARTY.
Except as noted on the Perfection Certificate, Borrower is not a party to, nor
is it bound by, any Restricted License.
5.3
ACCOUNTS RECEIVABLE; INVENTORY.
(A)
FOR EACH ACCOUNT WITH RESPECT TO WHICH ADVANCES ARE REQUESTED, ON
THE DATE EACH ADVANCE IS REQUESTED AND MADE, SUCH ACCOUNT SHALL BE AN ELIGIBLE
ACCOUNT.
(B)
ALL STATEMENTS MADE AND ALL UNPAID BALANCES APPEARING IN ALL
INVOICES, INSTRUMENTS AND OTHER DOCUMENTS EVIDENCING THE ELIGIBLE ACCOUNTS ARE
AND SHALL BE TRUE AND CORRECT AND ALL SUCH INVOICES, INSTRUMENTS AND OTHER
DOCUMENTS, AND ALL OF BORROWER'S BOOKS ARE GENUINE AND IN ALL RESPECTS WHAT THEY
PURPORT TO BE.
WHETHER OR NOT AN EVENT OF DEFAULT HAS OCCURRED AND IS
CONTINUING, BANK MAY NOTIFY ANY ACCOUNT DEBTOR OWING BORROWER MONEY OF BANK'S
SECURITY INTEREST IN SUCH FUNDS.
ALL SALES AND OTHER TRANSACTIONS UNDERLYING OR
GIVING RISE TO EACH ELIGIBLE ACCOUNT SHALL COMPLY IN ALL MATERIAL RESPECTS WITH
ALL APPLICABLE LAWS AND GOVERNMENTAL RULES AND REGULATIONS.
BORROWER HAS NO
KNOWLEDGE OF ANY ACTUAL OR IMMINENT INSOLVENCY PROCEEDING OF ANY ACCOUNT DEBTOR
WHOSE ACCOUNTS ARE ELIGIBLE ACCOUNTS IN ANY TRANSACTION REPORT.
TO THE BEST OF
BORROWER'S KNOWLEDGE, ALL SIGNATURES AND ENDORSEMENTS ON ALL DOCUMENTS,
INSTRUMENTS, AND AGREEMENTS RELATING TO ALL ELIGIBLE ACCOUNTS ARE GENUINE, AND
ALL SUCH DOCUMENTS, INSTRUMENTS AND AGREEMENTS ARE LEGALLY ENFORCEABLE IN
ACCORDANCE WITH THEIR TERMS.
(C)
FOR ANY ITEM OF INVENTORY, SUCH INVENTORY (I) MEETS ALL APPLICABLE
GOVERNMENTAL STANDARDS; (II) HAS BEEN MANUFACTURED IN COMPLIANCE WITH THE FAIR
LABOR STANDARDS ACT; (III) IS NOT SUBJECT TO ANY LIENS, EXCEPT THE FIRST
PRIORITY LIENS GRANTED IN FAVOR OF BANK UNDER THIS AGREEMENT OR ANY OF THE OTHER
LOAN DOCUMENTS OR PERMITTED LIENS; AND (IV) IS LOCATED AT (A) THE HEADQUARTERS
LOCATION WHICH IS (1) PRIOR TO THE REAL ESTATE FINANCING, OWNED BY BORROWER OR
(2) AFTER THE REAL ESTATE FINANCING, EITHER OWNED BY BORROWER OR OWNED BY THE
SPECIAL SUBSIDIARY PROVIDED THAT BANK HAS RECEIVED A LANDLORD'S WAIVER IN FORM
AND SUBSTANCE REASONABLY SATISFACTORY TO BANK OR (B) BORROWER'S 33 CHERRY HILL
DRIVE, BEVERLY, MASSACHUSETTS OR 54 CHERRY HILL DRIVE, BEVERLY, MASSACHUSETTS
LOCATIONS PROVIDED THAT BANK HAS RECEIVED A LANDLORD WAIVER FOR THE RESPECTIVE
LOCATION IN FORM AND SUBSTANCE REASONABLY SATISFACTORY TO BANK.
5.4
LITIGATION.
THERE ARE NO ACTIONS OR PROCEEDINGS PENDING OR, TO THE
KNOWLEDGE OF THE RESPONSIBLE OFFICERS, THREATENED IN WRITING BY OR AGAINST
BORROWER OR ANY OF ITS SUBSIDIARIES INVOLVING MORE THAN, INDIVIDUALLY OR IN THE
AGGREGATE, ONE MILLION DOLLARS ($1,000,000) OR THAT WOULD REASONABLY BE EXPECTED
TO HAVE A MATERIAL ADVERSE EFFECT ON BORROWER'S BUSINESS.
5.5
NO MATERIAL DEVIATION IN FINANCIAL STATEMENTS.
ALL CONSOLIDATED
FINANCIAL STATEMENTS FOR BORROWER AND ANY OF ITS SUBSIDIARIES DELIVERED TO BANK
FAIRLY PRESENT IN ALL MATERIAL RESPECTS BORROWER'S CONSOLIDATED FINANCIAL
CONDITION AND BORROWER'S CONSOLIDATED RESULTS OF OPERATIONS.
THERE HAS NOT BEEN
ANY MATERIAL DETERIORATION IN BORROWER'S CONSOLIDATED FINANCIAL CONDITION SINCE
THE DATE OF THE MOST RECENT FINANCIAL STATEMENTS SUBMITTED TO BANK.
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