Common use of Certain Tests Clause in Contracts

Certain Tests. (a) Notwithstanding anything to the contrary herein, for purposes of determining compliance with any provision of this Agreement, if any Indebtedness (including any Incremental Amount), Lien, Disposition, Restricted Payment (or a portion thereof), repayment of Junior Financing or Investment would be permitted pursuant to one or more provisions of this Agreement, the Borrowers, in their sole discretion, may divide and classify or reclassify such Indebtedness (including any Incremental Amount), Lien, Disposition, Restricted Payment (or a portion thereof), repayment of Junior Financing or Investment within such covenant in any manner that complies with the applicable terms of this Agreement, and may later divide and reclassify any such Indebtedness (including any Incremental Amount), Lien, Disposition, Restricted Payment (or a portion thereof), repayment of Junior Financing or Investment so long as the Indebtedness (including any Incremental Amount), Lien, Disposition, Restricted Payment (or a portion thereof), repayment of Junior Financing or Investment (as so redivided and/or reclassified) would be permitted to be made in reliance on the applicable exception as of the date of such redivision or reclassification (it being understood that any Indebtedness (including any Incremental Amount), Lien, Disposition, Restricted Payment (or a portion thereof), repayment of Junior Financing or Investment made pursuant to a Fixed Amount shall cease to be deemed made pursuant to such Fixed Amount but shall automatically be deemed made pursuant to an applicable Incurrence-Based Amount from and after the first date on which the Borrowers or such Restricted Subsidiary, as the case may be, could have incurred such Indebtedness (including any Incremental Amount), incurred such Lien, consummated such Disposition, made such Restricted Payment, repaid such Junior Financing or made such Investment pursuant to such Incurrence-Based Amount); provided that any secured Indebtedness shall only be automatically reclassified to the extent that such Liens could also have been incurred); provided, further, that (x) all Indebtedness under the Facilities may only be Incurred pursuant to Section 7.03(b)(i) and the Borrowers shall not be permitted to reclassify all or any portion of such Indebtedness, (y) Indebtedness under the Senior Notes may only be Incurred pursuant to Section 7.03(a) and the Borrowers shall not be permitted to reclassify all or any portion of such Indebtedness and (z) Indebtedness Incurred under Sections 7.03(b)(i), 7.03(b)(xiii) and 7.03(b)(xxx), to the extent such Indebtedness is secured by Liens on the Collateral that are pari passu with or junior to the Liens on the Collateral securing the Facilities, may not be reclassified to any other clause of Section 7.03. (b) Notwithstanding anything to the contrary herein, unless the Borrowers otherwise notify the Administrative Agent, with respect to any amounts incurred or transactions entered into (or consummated) in reliance on a provision of this Agreement that does not require compliance with a financial ratio or test (including any First Lien Net Leverage Ratio, Senior Secured Net Leverage Ratio, Total Net Leverage Ratio and/or Fixed Charge Coverage Ratio test) (any such amounts, the “Fixed Amounts”) substantially concurrently with any amounts incurred or transactions entered into (or consummated) in reliance on a provision of this Agreement that requires compliance with a financial ratio or test (including any First Lien Net Leverage Ratio, Senior Secured Net Leverage Ratio, Total Net Leverage Ratio and/or Fixed Charge Coverage Ratio test) (any such amounts, the “Incurrence-Based Amounts”), it is understood and agreed that the Fixed Amounts shall be disregarded in the calculation of the financial ratio or test applicable to the Incurrence-Based Amounts. (c) So long as no Default or Event of Default shall have occurred and be continuing, each Subsidiary of Holdings that is required to be joined as a Loan Party pursuant to Section 6.12 or 6.16 shall, until the completion of such joinder, be deemed for the purposes of Article VII of this Agreement to be a Loan Party from and after the later of the Eleventh Amendment Effective Date, the date of formation of such Subsidiary or the date of acquisition of such Subsidiary.