Duchouquette P. A. and Seller hereby jointly and severally represent and warrant to Purchaser as follows:
Duchouquette P. A. is a professional association duly organized, validly existing, and in good standing under the laws of the State of Texas.
Duchouquette P. A. has paid the debts of the Practice in the usual and ordinary course of its business since July 1, 1996.
Duchouquette P. A. is not liable upon or with respect to, or obligated in any other way to provide funds in respect of, or to guarantee or assume in any manner, any Liability of any Person.
Duchouquette P. A. owns or has the sole right to use (pursuant to a valid lease or license disclosed on Schedule 8(p)) all operating assets and properties necessary for Seller and Duchouquette P.A. to carry on the Practice in the manner presently conducted by Seller and Duchouquette P.A. (collectively, the "Assets").
Duchouquette P. A. has good and marketable title to all the Assets, and title to the Assets is free and clear of all mortgages, liens, pledges, conditional sales agreements, charges, easements, covenants, assessments, options, restrictions, and other encumbrances of any nature whatsoever.
Duchouquette P. A. does not own any real property.
Duchouquette P. A. holds all such Licenses and Permits and they are validly issued and in full force and effect.
Duchouquette P. A. does not now hold any deposits or prepayments by third parties with respect to any of the assets of the Practice which are not reflected as liabilities in the Financial Statements.
Duchouquette P. A. Stock") which represents all of the issued and outstanding shares of stock of Duchouquette P.A. As part of the consideration for the Duchouquette P.A. Stock acquired by Physician Group pursuant to the Stock Purchase Agreement, Physician Group executed and delivered that one certain Secured Promissory Note dated September 20, 1996 in the principal amount of $843,750.00 (the "Note") to Secured Party (a copy of the Note is attached as Exhibit 1). As an additional inducement to Secured Party to accept the Note as part of the consideration for the Duchouquette P.A. Stock and as additional security for the prompt satisfaction of all the terms and conditions of the Note, Physician Group executed a Pledge Agreement of even date herewith (the "Pledge Agreement") and pledged the Duchouquette P.A. Stock to Secured Party and granted Secured Party a lien on and security interest in the Duchouquette P.A. Stock (a copy of the Pledge Agreement is attached as Exhibit 2). As a result of Physician Group's execution and delivery of the Note to Secured Party, Physician Group is indebted to Secured Party in the principal amount of Eight Hundred Forty Three Thousand Seven Hundred Fifty Dollars ($843,750.00) pursuant to Note. It is a condition to acceptance by Secured Party of the Note that Physician Group, as the new sole shareholder of Grantor, cause Grantor grant a security interest to Secured Party in all of the assets and property of Grantor (Duchouquette P.A.). In consideration of the foregoing recitals and the mutual covenants and obligations of the parties set forth in this Agreement, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties, intending to be legally bound, agree as follows:
