Common use of Representations and Warranties by Borrower Clause in Contracts

Representations and Warranties by Borrower. 7.1 There are no actions or proceedings pending by or against Borrower or its officers and Guarantors before any court or administrative or regulatory agency and Borrower does not have knowledge or belief of any pending, threatened, or imminent litigation, governmental investigations, or claims, complaints, actions, or prosecutions involving Borrower, its officers or any Guarantor of the Obligations, except for (a) ongoing collection matters in which Borrower is the plaintiff, (b) matters that have been previously disclosed, prior to the date hereof, in Borrower’s 10-K or 10-Q filings with the Securities and Exchange Commission (the “Prior Filings”) or (c) matters which could not reasonably be expected to result in monetary liability against Borrower in excess of $100,000 for any such matter individually or $250,000 for all such matters in the aggregate. 7.2 All financial statements relating to Borrower that have been delivered by Borrower to Lender have been prepared in accordance with GAAP and fairly present Borrower’s financial condition as of the date thereof and Borrower’s results of operations for the period then ended. There has not been a material adverse change in the financial condition of Borrower since the date of the latest financial statements submitted to Lender on or before the date hereof. 7.3 Borrower agrees to maintain books and records and its records pertaining to the Collateral in accordance with GAAP and in such additional detail, form and scope, as Lender shall reasonably require. 7.4 Borrower certifies that, to the best of Borrower’s knowledge, Borrower has not been designated, and is not owned or controlled, by a “suspected terrorist” as defined in Executive Order 13224. Borrower hereby acknowledges that Lender seeks to comply with all applicable laws concerning money laundering and related activities. In furtherance of those efforts, Borrower hereby represents, warrants and agrees that: (i) none of the cash or property that Borrower will pay or will contribute to Lender has been or shall be derived from, or related to, any activity that is deemed criminal under United States or Canadian law; and (ii) no contribution or payment by Borrower to Lender, to the extent that they are within Borrower’s control shall cause Lender to be in violation of the United States Bank Secrecy Act, the United States International Money Laundering Control Act of 1986 or the United States International Money Laundering Abatement and Anti-Terrorist Financing Act of 2001, or any similar Canadian statute and/or law. Borrower shall promptly notify Lender if any of these representations ceases to be true and accurate. Borrower shall provide Lender any additional information regarding Borrower that Lender deems necessary or convenient to ensure compliance with all applicable laws concerning money laundering and similar activities. Borrower understands and agrees that if at any time it is discovered that any of the foregoing representations are incorrect, or if otherwise required by applicable law or regulation related to money laundering similar activities, Lender may undertake appropriate actions to ensure compliance with applicable law or regulation, including but not limited to segregation and/or redemption of Lender’s investment in Borrower. Borrower further understands that Lender may release confidential information about Borrower and, if applicable, any underlying beneficial owners, to proper authorities if Lender, in its sole discretion, determines that it is in the best interests of Lender in light of relevant rules and regulations under the laws set forth in subsection (ii) above. 7.5 Borrower MusclePharm Corporation is a corporation, validly formed, existing in the State of Nevada, and is in good standing under the laws of the State of Nevada and is properly licensed and authorized to operate its business in any other jurisdiction in which it conducts business. Borrower’s organizational identification number assigned by the above state is E05807520060. Borrower’s taxpayer identification number, if applicable, for U.S. Federal Income Tax purposes is 7▇-▇▇▇▇▇▇▇. The undersigned signatory on behalf of Borrower represents that he or she has full power and authority to execute this Agreement and bind Borrower hereto.

Representations and Warranties by Borrower. 7.1 There are no actions or proceedings pending by or against Borrower or its officers and Guarantors before any court or administrative or regulatory agency and Borrower does not have knowledge or belief of any pending, threatened, or imminent litigation, governmental investigations, or claims, complaints, actions, or prosecutions involving Borrower, its officers Borrower or any Guarantor of the Obligations, except for (a) ongoing collection matters in which Borrower is the plaintiff, (b) matters that have been previously disclosed, prior to the date hereof, in Borrower’s 10-K or 10-Q filings with the Securities and Exchange Commission (the “Prior Filings”) or (c) matters which could not reasonably be expected to result in monetary liability against Borrower in excess of $100,000 for any such matter individually or $250,000 for all such matters in the aggregate. 7.2 All financial statements relating to Borrower that have been delivered by Borrower to Lender have been prepared in accordance with GAAP and fairly present Borrower’s financial condition as of the date thereof and Borrower’s results of operations for the period then ended. There has not been a material adverse change in the financial condition of Borrower since the date of the latest financial statements submitted to Lender on or before the date hereof. 7.3 Borrower agrees to maintain books and records and its records pertaining to the Collateral in accordance with GAAP and in such additional detail, form and scope, as Lender shall reasonably require. 7.4 Borrower certifies that, to the best of Borrower’s knowledge, Borrower has not been designated, and is not owned or controlled, by a “suspected terrorist” as defined in Executive Order 13224. Borrower hereby acknowledges that Lender seeks to comply with all applicable laws concerning money laundering and related activities. In furtherance of those efforts, Borrower hereby represents, warrants and agrees that: (i) none of the cash or property that Borrower will pay or will contribute to Lender has been or shall be derived from, or related to, any activity that is deemed criminal under United States or Canadian law; and (ii) no contribution or payment by Borrower to Lender, to the extent that they are within Borrower’s control shall cause Lender to be in violation of the United States Bank Secrecy Act, the United States International Money Laundering Control Act of 1986 or the United States International Money Laundering Abatement and Anti-Terrorist Anti­Terrorist Financing Act of 2001, or any similar Canadian statute and/or law. Borrower shall promptly notify Lender if any of these representations ceases to be true and accurate. Borrower shall provide Lender any additional information regarding Borrower that Lender deems deem necessary or convenient to ensure compliance with all applicable laws concerning money laundering and similar activities. Borrower understands and agrees that if at any time it is discovered that any of the foregoing representations are incorrect, or if otherwise required by applicable law or regulation related to money laundering similar activities, Lender may undertake appropriate actions to ensure compliance with applicable law or regulation, including but not limited to segregation and/or redemption of Lender’s ’ investment in Borrower. Borrower further understands that Lender may release confidential information about Borrower and, if applicable, any underlying beneficial owners, to proper authorities if Lender, in its sole discretion, determines that it is in the best interests of Lender in light of relevant rules and regulations under the laws set forth in subsection (ii) above. 7.5 Borrower MusclePharm Corporation is a corporation, validly formed, existing in the State of Nevada, and is in good standing under the laws of the State of Nevada and is properly licensed and authorized to operate its business in any other jurisdiction in which it conducts business. Borrower’s organizational identification number assigned by the above state is E05807520060. Borrower’s taxpayer identification number, if applicable, for U.S. Federal Income Tax purposes is 7▇-▇▇▇▇▇▇▇. The undersigned signatory on behalf of Borrower represents that he or she has full power and authority to execute this Agreement and bind Borrower hereto.

Representations and Warranties by Borrower. 7.1 There are no actions or proceedings pending by or against Borrower or its officers and Guarantors before any court or administrative or regulatory agency and Borrower does not have knowledge or belief of any pending, threatened, or imminent litigation, governmental investigations, or claims, complaints, actions, or prosecutions involving Borrower, its officers officer or any Guarantor of the Obligations, except for (a) for ongoing collection matters in which Borrower is the plaintiff, plaintiff or (b) matters that have been previously disclosed, prior to the date hereof, in Borrower’s 10-K or 10-Q filings with extent the Securities same do not constitute and Exchange Commission (the “Prior Filings”) or (c) matters which could would not reasonably be expected to result in monetary liability against Borrower in excess of $100,000 for any such matter constitute, individually or $250,000 for all such matters in the aggregate, a Material Adverse Change. 7.2 All financial statements relating to Borrower that have been delivered by Borrower to Lender have been prepared in accordance with GAAP and fairly present Borrower’s financial condition as of the date thereof and Borrower’s results of operations for the period then ended. There has not been a material adverse change in the financial condition of Borrower since the date of the latest financial statements submitted to Lender on or before the date hereof. 7.3 Borrower agrees to maintain accurate books and records and its records pertaining to the Collateral in accordance with GAAP and in such additional detail, form and scope, as Lender shall reasonably requireGAAP. 7.4 Borrower certifies that, to the best of Borrower’s knowledge, Borrower has not been designated, and is not owned or controlled, by a “suspected terrorist” as defined in Executive Order 13224. Borrower hereby acknowledges that Lender seeks to comply with all applicable laws concerning money laundering and related activities. In furtherance of those efforts, Borrower hereby represents, warrants and agrees that: (i) none of the cash or property that Borrower will pay or will contribute to Lender has been or shall be derived from, or related to, any activity that is deemed criminal under United States or Canadian law; and (ii) no contribution or payment by Borrower to Lender, to the extent that they are within Borrower’s control shall cause Lender to be in violation of the United States Bank Secrecy Act, the United States International Money Laundering Control Act of 1986 or the United States International Money Laundering Abatement and Anti-Terrorist Financing Act of 2001, or any similar Canadian statute and/or law. Borrower shall promptly notify Lender if any of these representations ceases to be true and accurate. Borrower shall provide Lender any additional information regarding Borrower that Lender deems deem necessary or convenient to ensure compliance with all applicable laws concerning money laundering and similar activities. Borrower understands and agrees that if at any time it is discovered that any of the foregoing representations are incorrect, or if otherwise required by applicable law or regulation related to money laundering similar activities, Lender may undertake appropriate actions to ensure compliance with applicable law or regulation, including but not limited to segregation and/or redemption of Lender’s ’ investment in Borrower. Borrower further understands that Lender may release confidential information about Borrower and, if applicable, any underlying beneficial owners, to proper authorities if Lender, in its sole discretion, determines that it is in the best interests of Lender in light of relevant rules and regulations under the laws set forth in subsection (ii) above. 7.5 Borrower MusclePharm Corporation is a corporation, duly organized, validly formed, existing in the State of Nevada, and is in good standing under the laws of the State of Nevada Minnesota and is properly licensed and authorized qualified to operate its do business as a foreign entity in any other each jurisdiction in which it conducts businessthe failure of the Borrower to be so qualified could reasonably be expected to have a Material Adverse Effect. Borrower’s organizational identification number assigned by the above state is E058075200604383092-3. Borrower’s taxpayer identification number, if applicable, number for U.S. Federal Income Tax purposes is 7▇▇-▇▇▇▇▇▇▇. The undersigned signatory on behalf of Borrower represents that he or she has full power and authority to execute this Agreement and bind Borrower hereto. 7.6 The execution, delivery and performance by Borrower of this Agreement and the other Loan Documents does not constitute a violation of any law, regulation, judgment, order, material contract, charter, by-laws, or other material instrument to which Borrower is a party or is otherwise bound or subject. 7.7 Other than with respect to and in connection with the Store Closures, Borrower is not in default under any loan agreement, mortgage, lease, trust deed, or similar agreement relating to the borrowing of money in excess of $50,000 and to which Borrower is a party or is otherwise bound 7.8 Other than with respect to and in connection with the Store Closures, Borrower and Guarantor(s) are neither party to any lawsuit, administrative proceedings, arbitration proceeding, or other adversarial proceeding, nor are they involved in any way in any pending or, to their knowledge, threatened investigations or proceedings which, individually or in the aggregate, could reasonably be expected to result in liabilities of any Obligor in excess of $50,000 or a Material Adverse Change. 7.9 [Intentionally left blank] 7.10 Borrower has entered into the Merchant Processing Agreement, a copy of which has been provided to Lender. The Merchant Processing Agreement is in full force and effect and (a) no material default exists, (b) no other default exists for which Borrower has received written notice from the Merchant Processor and (c) to Borrower’s knowledge, no material default is threatened with respect thereto. All payments due to Borrower under the Merchant Processing Agreement have been duly and validly assigned by Borrower to Lender. 7.11 All information (other than forward-looking information and projections and information of a general economic nature and general information about Borrower’s industry) All information, whether financial or otherwise, provided to Lender by Borrower shall be true, accurate and correct in all material respects on the date as of which such information is dated or certified. 7.12 Borrower has not transferred, pledged or granted a security interest in its assets, or any of them except for a security interest granted to Appliance Recycling Centers of America, Inc., a Nevada corporation (“ARCA”), to the extent such security interest is subordinated to the security interest of Lender pursuant to the subordination and intercreditor agreement executed and delivered in connection with this Agreement. 7.13 Borrower shall notify Lender immediately upon becoming aware of any issue that materially affects, or that could reasonably be expected to materially affect, the value or condition of any Inventory. 7.14 Borrower’s Inventory is: 7.14.1 owned by the Borrower free and clear of all encumbrances other than security interests or liens subject to a subordination or intercreditor agreement, acceptable to Lender, executed by the holder(s) thereof; 7.14.2 except with respect to In-Transit Inventory, at all times at a location under the control of the Borrower and such location(s) are listed in Exhibit 7.14.2 attached hereto; 7.14.3 reported to Lender at the lower of cost or market value including reserves for obsolescence or slow moving Inventory as would otherwise be required under GAAP; 7.14.4 in salable condition as is and ready for shipment; and 7.14.5 not subject to any license agreement except as disclosed to Lender in writing.