DEFAULT, WOULD OCCUR BY REASON OF THE ENTERING INTO THEREOF, AND
(2) NO BREACH OF THE COVENANTS, AGREEMENTS OR OBLIGATIONS CONTAINED IN SECTIONS
5.24 THROUGH 5.26, INCLUSIVE, OR 5.29 OF THIS AGREEMENT WOULD OCCUR BY REASON OF
THE ENTERING INTO THEREOF IF SUCH COVENANTS WERE MEASURED AS OF THE DATE SUCH
GUARANTY IS PROPOSED TO BE GIVEN, AND (III) AS SET FORTH ON EXHIBIT B ATTACHED
HERETO.
5.7
RESTRICTIONS ON LIENS.
NO BORROWER SHALL, OR SHALL CAUSE OR
PERMIT ANY OF ITS SUBSIDIARIES AT ANY TIME TO, CREATE, INCUR, ASSUME OR SUFFER
TO EXIST ANY MORTGAGE, PLEDGE, SECURITY INTEREST, LIEN OR OTHER CHARGE OR
ENCUMBRANCE, INCLUDING THE LIEN OR RETAINED SECURITY TITLE OF A VENDOR,
("ENCUMBRANCES") UPON OR WITH RESPECT TO ANY PROPERTY OR ASSETS, REAL OR
PERSONAL, OF SUCH BORROWER, OR ASSIGN OR OTHERWISE CONVEY ANY RIGHT TO RECEIVE
INCOME, EXCEPT:
(I)
ENCUMBRANCES EXISTING ON THE DATE OF THIS AGREEMENT AND SET FORTH
ON EXHIBIT B ATTACHED HERETO; OR
(II)
IN ADDITION TO THE ENCUMBRANCES REFERRED TO IN CLAUSE (I) HEREOF,
ENCUMBRANCES SECURING INDEBTEDNESS FOR THE PURCHASE PRICE OF CAPITAL ASSETS AND
CAPITALIZED LEASES TO THE EXTENT SUCH INDEBTEDNESS IS PERMITTED BY
SECTION 5.5(III) HEREOF, PROVIDED THAT (A) EACH SUCH ENCUMBRANCE IS GIVEN SOLELY
TO SECURE THE PURCHASE PRICE OF SUCH PROPERTY, DOES NOT EXTEND TO ANY OTHER
PROPERTY AND IS GIVEN AT THE TIME OF ACQUISITION OF THE PROPERTY, AND (B) THE
INDEBTEDNESS SECURED THEREBY DOES NOT EXCEED THE LESSER OF THE COST OF SUCH
PROPERTY OR ITS FAIR MARKET VALUE AT THE TIME OF ACQUISITION; OR
49
(III)
LIENS FOR TAXES, FEES, ASSESSMENTS AND OTHER GOVERNMENTAL CHARGES
TO THE EXTENT THAT PAYMENT OF THE SAME IS NOT REQUIRED IN ACCORDANCE WITH THE
PROVISIONS OF SECTION 5.4 HEREOF; OR
(IV)
ENCUMBRANCES IN FAVOR OF THE AGENT, FOR THE RATABLE BENEFIT OF THE
BANKS; OR
(V)
LIENS OF MECHANICS, LABORERS, MATERIALMEN, CARRIERS AND
WAREHOUSEMEN ARISING BY OPERATION OF LAW TO SECURE PAYMENT FOR LABOR, MATERIALS,
SUPPLIES OR SERVICES INCURRED IN THE ORDINARY COURSE OF SUCH BORROWER'S
BUSINESS, BUT ONLY IF THE PAYMENT THEREOF IS NOT AT THE TIME REQUIRED, SUCH
LIENS ARE JUNIOR TO ENCUMBRANCES IN FAVOR OF THE AGENT AND SUCH LIENS DO NOT,
INDIVIDUALLY OR IN THE AGGREGATE, MATERIALLY DETRACT FROM THE VALUE OR LIMIT THE
USE OF ANY PROPERTY SUBJECT THERETO; OR
(VI)
DEPOSITS MADE IN THE ORDINARY COURSE OF SUCH BORROWER'S BUSINESS
IN CONNECTION WITH WORKMEN'S COMPENSATION, UNEMPLOYMENT INSURANCE, SOCIAL
SECURITY AND OTHER SIMILAR LAWS.
In addition, the Borrowers shall not enter into or permit to exist any
arrangement or agreement which directly or indirectly prohibits the Borrowers
from creating or incurring any Encumbrance in favor of the Agent for the benefit
of the Banks and the Agent under the Loan Documents.
5.8
MERGER, ACQUISITIONS AND PURCHASE AND SALE OF ASSETS.
NO BORROWER
SHALL, OR SHALL CAUSE OR PERMIT ANY OF ITS SUBSIDIARIES AT ANY TIME TO,
CONSOLIDATE OR MERGE WITH OR INTO ANY OTHER CORPORATION OR OTHER ENTITY,
LIQUIDATE AND/OR DISSOLVE, ACQUIRE THE