eTrade 2005 Annual Report Download - page 298

ARTICLE 14
REPRESENTATIONS AND WARRANTIES TO
COLLATERAL AGENT; HOLDER COVENANTS
Section14.01
Representations and Warranties
. Each Holder from time to time, acting through the Purchase Contract Agent as
attorney-in-fact (it being understood that the Purchase Contract Agent shall not be liable for any representation or warranty made by
or on behalf of a Holder), hereby represents and warrants to the Collateral Agent and the Company (with respect to such Holder’s
interest in the Collateral), which representations and warranties shall be deemed repeated on each day a Holder effects a Transfer of
Collateral, that:
(a) such Holder has the power to grant a security interest in and lien on the Collateral;
(b) such Holder is the sole beneficial owner of the Collateral and, in the case of Collateral delivered in physical form, is the sole holder
of such Collateral and is the sole beneficial owner of, or has the right to Transfer, the Collateral it Transfers to the Collateral Agent for
credit to the Collateral Account, free and clear of any security interest, lien, encumbrance, call, liability to pay money or other
restriction other than the security interest and lien granted under Article 11;
(c) upon the Transfer of the Collateral to the Securities Intermediary for credit to the Collateral Account, the Collateral Agent, for the
benefit of the Company, will have a valid and perfected first priority security interest therein (assuming that any central clearing
operation or any securities intermediary or other entity not within the control of the Holder involved in the Transfer of the Collateral,
including the Collateral Agent and the Securities Intermediary, gives the notices and takes the action required of it hereunder and
under applicable law for perfection of that interest and assuming the establishment and exercise of control pursuant to Article 12
hereof); and
(d) the execution and performance by the Holder of its obligations under this Agreement will not result in the creation of any security
interest, lien or other encumbrance on the Collateral (other than the security interest and lien granted under Article 11 hereof) or violate
any provision of any existing law or regulation applicable to it or of any mortgage, charge, pledge, indenture, contract or undertaking
to which it is a party or which is binding on it or any of its assets.
Section14.02
Covenants
. The Purchase Contract Agent and the Holders from time to time, acting through the Purchase Contract
Agent as their attorney-in-fact (it being understood that the Purchase Contract Agent shall not be liable for any covenant made by or
on behalf of a Holder), hereby covenant to the Collateral Agent and the Company that for so long as the Collateral remains subject to
the Pledge:
(a) neither the Purchase Contract Agent nor such Holders will create or purport to create or allow to subsist any mortgage, charge, lien,
pledge or any other security interest whatsoever over the Collateral or any part of it other than pursuant to this Agreement; and
(b) neither the Purchase Contract Agent nor such Holders will sell or otherwise dispose (or attempt to dispose) of the Collateral or any
part of it except for the beneficial interest therein, subject to the Pledge hereunder, transferred in connection with a Transfer of the
Units.
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2006. EDGAR Online, Inc.