STATEMENTS
DESCRIBED ON SCHEDULE E ATTACHED HERETO.
THESE STATEMENTS WERE PREPARED IN
ACCORDANCE WITH GAAP AND PRESENT FAIRLY THE FINANCIAL CONDITION OF BORROWER AND
ITS CONSOLIDATED SUBSIDIARIES.
THERE HAS BEEN NO MATERIAL ADVERSE CHANGE IN THE
CONDITION OF BORROWER, FINANCIAL OR OTHERWISE, SINCE THE DATE OF THE MOST RECENT
OF SUCH FINANCIAL STATEMENTS.
(I)
THE VALUE OF THE ASSETS AND PROPERTIES OF BORROWER AT A FAIR
VALUATION AND AT THEIR THEN PRESENT FAIR SALABLE VALUE IS AND, AFTER GIVING
EFFECT TO ANY PENDING ADVANCE AND THE APPLICATION OF THE AMOUNT ADVANCED, WILL
BE MATERIALLY GREATER THAN ITS TOTAL LIABILITIES, INCLUDING CONTINGENT
OBLIGATIONS, AND BORROWER HAS (AND HAS NO REASON TO BELIEVE THAT IT WILL NOT
HAVE) CAPITAL SUFFICIENT TO PAY ITS LIABILITIES, INCLUDING CONTINGENT
OBLIGATIONS, AS THEY BECOME DUE.
(J)
BORROWER IS IN COMPLIANCE WITH ALL REQUIREMENTS OF LAW RELATING
TO POLLUTION CONTROL AND ENVIRONMENTAL REGULATIONS IN THE RESPECTIVE
JURISDICTIONS WHERE BORROWER IS PRESENTLY DOING BUSINESS OR CONDUCTING
OPERATIONS.
(K)
ALL AMOUNTS OBTAINED PURSUANT TO ADVANCES WILL BE USED FOR
BORROWER'S WORKING CAPITAL PURPOSES AND TO FINANCE CAPITAL EXPENDITURES
PERMITTED TO MADE PURSUANT HERETO.
THE TERM LOAN A PROCEEDS WILL BE USED SOLELY
TO PARTIALLY FINANCE THE PROJECT COSTS AND THE TERM LOAN B PROCEEDS WILL BE USED
SOLELY TO PARTIALLY FINANCE THE CARD CLUB SUPPLY COSTS.
NO PART OF ANY LOAN
SHALL BE USED AT ANY TIME BY BORROWER TO PURCHASE OR CARRY MARGIN STOCK (WITHIN
THE MEANING OF REGULATION U PROMULGATED BY THE BOARD OF GOVERNORS OF THE FEDERAL
RESERVE SYSTEM) OR TO EXTEND CREDIT TO OTHERS FOR THE PURPOSE OF PURCHASING OR
CARRYING ANY MARGIN STOCK.
BORROWER IS NOT ENGAGED PRINCIPALLY, OR AS ONE OF
ITS IMPORTANT ACTIVITIES, IN THE BUSINESS OF EXTENDING CREDIT FOR THE PURPOSES
OF PURCHASING OR CARRYING ANY SUCH MARGIN STOCK.
NO PART OF THE PROCEEDS OF ANY
LOAN WILL BE USED BY BORROWER FOR ANY PURPOSE WHICH VIOLATES, OR WHICH IS
INCONSISTENT WITH, ANY REGULATIONS PROMULGATED BY THE BOARD OF GOVERNORS OF THE
FEDERAL RESERVE SYSTEM.
(L)
EXCEPT FOR THE TRADEMARKS, PATENTS, COPYRIGHTS AND FRANCHISE
RIGHTS LISTED ON SCHEDULE F ATTACHED HERETO, BORROWER IS NOT THE OWNER OF ANY
PATENT, TRADEMARK, COPYRIGHT OR FRANCHISE RIGHTS.
BORROWER IS NOT AN
"INVESTMENT COMPANY", OR AN "AFFILIATED PERSON" OF, OR A "PROMOTER" OR
"PRINCIPAL UNDERWRITER" FOR, AN "INVESTMENT COMPANY", AS SUCH TERMS ARE DEFINED
IN THE INVESTMENT COMPANY ACT OF 1940, AS AMENDED.
THE MAKING OF THE LOANS, THE
APPLICATION OF THE PROCEEDS AND REPAYMENT THEREOF BY BORROWER AND THE
PERFORMANCE OF THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT WILL NOT VIOLATE
ANY PROVISION OF SAID ACT, OR ANY RULE, REGULATION OR ORDER ISSUED BY THE
SECURITIES AND EXCHANGE COMMISSION THEREUNDER.
(M)
(I) EACH PLAN IS IN COMPLIANCE IN ALL MATERIAL RESPECTS WITH ALL
APPLICABLE PROVISIONS OF ERISA AND THE CODE; (II) THE AGGREGATE PRESENT VALUE OF
ALL ACCRUED VESTED BENEFITS UNDER ALL PLANS (CALCULATED ON THE BASIS OF THE
ACTUARIAL ASSUMPTIONS SPECIFIED IN THE MOST RECENT ACTUARIAL VALUATION FOR SUCH
PLANS) DID NOT EXCEED AS