Common use of Ownership and Defense of Title Clause in Contracts

Ownership and Defense of Title. (a) Except for Permitted Liens, a Borrower shall at all times be the sole owner or lessee of each and every item of Collateral and shall not create any lien on, or sell, lease, exchange, assign, transfer, pledge, hypothecate, grant a security interest or security title in or to or otherwise dispose of, any of the Collateral or any interest therein, except for sales of Inventory in the ordinary course of business, for cash or on open account or on terms of payment ordinarily extended to its customers, sales of property that is obsolete, worn out or no longer useful in the Borrowers' businesses, and except for dispositions contemplated pursuant to SECTION 12.7 or that are otherwise expressly permitted under this Agreement. The inclusion of "proceeds" of the Collateral under the Security Interest shall not be deemed a consent by the Administrative Agent or the Lenders to any other sale or other disposition of any Collateral. 104 113 (b) Each Borrower shall defend its title or leasehold interest in and to, and the Security Interest in, the Collateral against the claims and demands of all Persons.