TAX RETURNS AND PAYMENTS; PENSION CONTRIBUTIONS.
BORROWER HAS TIMELY FILED ALL REQUIRED TAX RETURNS AND REPORTS, AND BORROWER HAS
TIMELY PAID ALL FOREIGN, FEDERAL, STATE AND LOCAL TAXES, ASSESSMENTS, DEPOSITS
AND CONTRIBUTIONS OWED BY BORROWER. BORROWER MAY DEFER PAYMENT OF ANY CONTESTED
TAXES, PROVIDED THAT BORROWER (A) IN GOOD FAITH CONTESTS ITS OBLIGATION TO PAY
THE TAXES BY APPROPRIATE PROCEEDINGS PROMPTLY AND DILIGENTLY INSTITUTED AND
CONDUCTED, (B) NOTIFIES BANK IN WRITING OF THE COMMENCEMENT OF, AND ANY MATERIAL
DEVELOPMENT IN, THE PROCEEDINGS, (C) POSTS BONDS OR TAKES ANY OTHER STEPS
REQUIRED TO PREVENT THE GOVERNMENTAL AUTHORITY LEVYING SUCH CONTESTED TAXES FROM
OBTAINING A LIEN UPON ANY OF THE COLLATERAL THAT IS OTHER THAN A "PERMITTED
LIEN". BORROWER HAS NO KNOWLEDGE OF ANY CLAIMS OR ADJUSTMENTS PROPOSED FOR ANY
OF BORROWER'S PRIOR TAX YEARS WHICH COULD RESULT IN ADDITIONAL TAXES BECOMING
DUE AND PAYABLE BY BORROWER. BORROWER HAS PAID ALL AMOUNTS NECESSARY TO FUND ALL
PRESENT PENSION, PROFIT SHARING AND DEFERRED COMPENSATION PLANS IN ACCORDANCE
WITH THEIR TERMS, AND BORROWER HAS NOT WITHDRAWN FROM PARTICIPATION IN, AND HAS
NOT PERMITTED PARTIAL OR COMPLETE TERMINATION OF, OR PERMITTED THE OCCURRENCE OF
ANY OTHER EVENT WITH RESPECT TO, ANY SUCH PLAN WHICH COULD REASONABLY BE
EXPECTED TO RESULT IN ANY LIABILITY OF BORROWER, INCLUDING ANY LIABILITY TO THE
PENSION BENEFIT GUARANTY CORPORATION OR ITS SUCCESSORS OR ANY OTHER GOVERNMENTAL
AGENCY.
5.10.
USE OF PROCEEDS. BORROWER SHALL USE THE PROCEEDS OF
THE CREDIT EXTENSIONS SOLELY AS WORKING CAPITAL, AND TO FUND ITS GENERAL
BUSINESS REQUIREMENTS AND NOT FOR PERSONAL, FAMILY, HOUSEHOLD OR AGRICULTURAL
PURPOSES.
5.11.
FULL DISCLOSURE. NO WRITTEN REPRESENTATION, WARRANTY
OR OTHER STATEMENT OF BORROWER IN ANY CERTIFICATE OR WRITTEN STATEMENT GIVEN TO
BANK, AS OF THE DATE SUCH REPRESENTATIONS, WARRANTIES, OR OTHER STATEMENTS WERE
MADE, TAKEN TOGETHER WITH ALL SUCH WRITTEN CERTIFICATES AND WRITTEN STATEMENTS
GIVEN TO BANK, CONTAINS ANY UNTRUE STATEMENT OF A MATERIAL FACT OR OMITS TO
STATE A MATERIAL FACT NECESSARY TO MAKE THE STATEMENTS CONTAINED IN THE
CERTIFICATES OR STATEMENTS NOT MISLEADING (IT BEING RECOGNIZED BY BANK THAT THE
PROJECTIONS AND FORECASTS PROVIDED BY BORROWER IN GOOD FAITH AND BASED UPON
REASONABLE ASSUMPTIONS ARE NOT VIEWED AS FACTS AND THAT ACTUAL RESULTS DURING
THE PERIOD OR PERIODS COVERED BY SUCH PROJECTIONS AND FORECASTS MAY DIFFER FROM
THE PROJECTED OR FORECASTED RESULTS).
6.
AFFIRMATIVE COVENANTS
Borrower shall do all of the following:
6.1.
GOVERNMENT COMPLIANCE. BORROWER SHALL, AND SHALL
CAUSE EACH OF ITS SUBSIDIARIES TO, MAINTAIN ITS LEGAL EXISTENCE AND GOOD
STANDING IN ITS JURISDICTION OF FORMATION AND EACH JURISDICTION IN WHICH THE
NATURE OF ITS
6
BUSINESS REQUIRES THEM TO BE SO QUALIFIED, EXCEPT WHERE THE FAILURE TO TAKE SUCH
ACTION WOULD NOT REASONABLY BE EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT ON
BORROWER'S AND ITS SUBSIDIARIES' BUSINESS OR OPERATIONS, TAKEN AS A WHOLE;
PROVIDED, THAT (A) THE LEGAL EXISTENCE OF ANY SUBSIDIARY THAT IS NOT A GUARANTOR
MAY BE TERMINATED OR PERMITTED TO LAPSE, AND ANY QUALIFICATION OF SUCH
SUBSIDIARY TO DO BUSINESS MAY BE TERMINATED