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applicable law. Such transfer, grant, bargain, sale, assignment, conveyance, set over and
<br />delivery is hereby expressly stated to be a sale and, pursuant to Section 6588.6(b) of the
<br />California Government Code, shall be treated as an absolute sale and transfer of the Proposition
<br />lA Receivable, and not as a grant of a security interest by the Seller to secure a borrowing. This
<br />is the statement referred to in Sections 6588.6(b) and (c) of the California Government Code.
<br />4. Representations and Warranties of the Purchaser. The Purchaser represents
<br />and warrants to the Seller, as of the date hereof, as follows:
<br />(a) The Purchaser is duly organized, validly existing and in good standing under
<br />the laws of the State of California.
<br />(b) The Purchaser has full power and authority to enter into this Agreement and to
<br />perform its obligations hereunder and has duly authorized such purchase and assignment of the
<br />Proposition lA Receivable by the Purchaser by all necessary action.
<br />(c) Neither the execution and delivery by the Purchaser of this Agreement, nor
<br />the performance by the Purchaser of its obligations hereunder, shall conflict with or result in a
<br />breach or default under any of its organizational documents, any law, rule, regulation, judgment,
<br />order or decree to which it is subject or any agreement or instrument to which it is a party.
<br />(d) To the best of the knowledge of the Purchaser, no action, suit, proceeding,
<br />inquiry or investigation, at law or in equity, before or by any court, public board or body, is
<br />pending or threatened in any way against the Purchaser affecting the existence of the Purchaser
<br />or the titles of its commissioners or officers, or seeking to restrain or to enjoin the purchase of
<br />the Proposition lA Receivable or to direct the application of the proceeds of the purchase
<br />thereof, or in any way contesting or affecting the validity or enforceability of any of the
<br />Transaction Documents or any other applicable agreements or any action of the Purchaser
<br />contemplated by any of said documents, or in any way contesting the powers of the Purchaser or
<br />its authority with respect to the Transaction Documents to which it is a parry or any other
<br />applicable agreement, or any action on the part of the Purchaser contemplated by the Transaction
<br />Documents, or in any way seeking to enjoin or restrain the Purchaser from purchasing the
<br />Proposition lA Receivable or which if determined adversely to the Purchaser would have an
<br />adverse effect upon the Purchaser's ability to purchase the Proposition lA Receivable, nor to the
<br />knowledge of the Purchaser is there any basis therefor.
<br />(e) This Agreement, and its execution, delivery and performance hereof have
<br />been duly authorized by it, and this Agreement has been duly executed and delivered by it and
<br />constitutes its valid and binding obligation enforceable against it in accordance with the terms
<br />hereof, subject to the effect of bankruptcy, insolvency, reorganization, moratorium, fraudulent
<br />conveyance and other similar laws relating to or affecting creditors' rights generally or the
<br />application of equitable principles in any proceeding, whether at law or in equity.
<br />(f) The Purchaser is a separate legal entity, acting solely through its authorized
<br />representatives, from the Seller, maintaining separate records, books of account, assets, bank
<br />accounts and funds, which are not and have not been commingled with those of the Seller.
<br />4
<br />55A-12
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