Common use of Disposal of Assets or Subsidiary Stock Clause in Contracts

Disposal of Assets or Subsidiary Stock. The Credit Parties shall not and shall not cause or permit their Subsidiaries to directly or indirectly convey, sell, lease, sublease, transfer or otherwise dispose of, or grant any Person an option to acquire, in one transaction or a series of related transactions, any of its property, business or assets, whether now owned or hereafter acquired, except for (a) sales of inventory in good faith to customers for fair value in the ordinary course of business and dispositions of obsolete equipment not used or useful in the business and (b) Asset Dispositions by Borrowers and their Subsidiaries (excluding sales of Accounts and Stock of any of Holdings' Subsidiaries) if all of the following conditions are met: (i) the market value of assets sold or otherwise disposed of in any single transaction or series of related transactions does not exceed $500,000 and the aggregate market value of assets sold or otherwise disposed of in any Fiscal Year does not exceed $1,000,000; (ii) the consideration received is at least equal to the fair market value of such assets; (iii) the sole consideration received is cash other than notes received from the buyer of any such assets not exceeding $500,000 outstanding at any time (such amount being determined without giving effect to any write-offs or write-downs of such notes); (iv) the Net Proceeds of such Asset Disposition are applied as required by Section 1.5(c); (v) after giving effect to the Asset Disposition and the repayment of Indebtedness with the proceeds thereof, Borrowers are in compliance on a pro forma basis with the covenants set forth in Section 4 recomputed for the most recently ended quarter for which information is available and is in compliance with all other terms and conditions of this Agreement; and (vi) no Default or Event of Default then exists or would result from such Asset Disposition.

Disposal of Assets or Subsidiary Stock. The Credit Parties shall Borrower will not and shall will not cause or permit their any of its Subsidiaries to directly or indirectly to: convey, sell, lease, sublease, transfer or otherwise dispose of, or grant any Person an option to acquire, in one transaction or a series of related transactions, any of its property, business or assets, or the capital stock of or other equity interests in any of its Subsidiaries, whether now owned or hereafter acquired, except for (a) bona fide sales of inventory in good faith to customers for fair value in the ordinary course of business and dispositions of obsolete equipment not used or useful in the business and (b) Asset Dispositions by Borrowers and their Subsidiaries (excluding sales of Accounts and Stock of any of Holdings' Subsidiaries) if all of the following conditions are met: (i) the market value of assets sold or otherwise disposed of in any single transaction or series of related transactions does not exceed $500,000 250,000 and the aggregate market value of assets sold or otherwise disposed of in any Fiscal Year fiscal year of Borrower does not exceed $1,000,000500,000; (ii) the consideration received is at least equal to the fair market value of such assets; (iii) the sole consideration received is cash other than notes received from the buyer of any such assets not exceeding $500,000 outstanding at any time (such amount being determined without giving effect to any write-offs or write-downs of such notes)cash; (iv) the Net Proceeds of such Asset Disposition are applied as required by Section 1.5(csubsection 1.5(C); (v) after giving effect to the sale or other disposition of the assets included within the Asset Disposition and the repayment of Indebtedness with the proceeds thereof, Borrowers are Borrower is in compliance on a pro forma basis with the covenants set forth in Section 4 recomputed for the most recently ended quarter month for which information is available and is in compliance with all other terms and conditions of contained in this Agreement; and (vi) no Default or Event of Default then exists or would shall result from such Asset Dispositionsale or other disposition.

Disposal of Assets or Subsidiary Stock. The Credit Parties shall Borrower will not, and will not and shall not cause or permit their Subsidiaries to any of the Loan Parties, directly or indirectly indirectly, to: convey, sell, lease, sublease, transfer or otherwise dispose of, or grant any Person an option to acquire, in one transaction or a series of related transactions, any of its property, business or assets, or the capital stock of or any other Equity Interests in any of the Loan Parties, whether now owned or hereafter acquired, except for for: (a) bona fide sales of inventory in good faith to customers for fair value in the ordinary course Ordinary Course of business and dispositions of obsolete equipment not used or useful in the business and Business; (b) transfers of assets by, between or among Borrower and the Affiliate Guarantors in the Ordinary Course of Business; and (c) Asset Dispositions by Borrowers and their Subsidiaries (excluding sales of Accounts and Stock of any of Holdings' Subsidiaries) if Dispositions, if, but only if, all of the following conditions are met: (i) the market aggregate value of total assets sold or otherwise disposed of in any single transaction or series fiscal year of related transactions Borrower and its Subsidiaries, based on the sales price received therefor, does not exceed Five Hundred Thousand Dollars ($500,000 and the aggregate market value of assets sold or otherwise disposed of in any Fiscal Year does not exceed $1,000,000500,000); (ii) the consideration received sale or other disposition is at least equal made to the fair market value a Person which is other than an Affiliate of such assetsBorrower; (iii) the sole consideration received is cash other than notes received from or property in which Agent, for its benefit and the buyer ratable benefit of any such assets not exceeding $500,000 outstanding at any time Lenders, has a first priority security interest (such amount being determined without giving effect subject to any write-offs or write-downs of such notesPermitted Encumbrances); (iv) the Net Proceeds of such Asset Disposition are applied as required by in repayment of any Loans then outstanding until fully paid in the manner prescribed in Section 1.5(c)1.3; (v) after giving effect to the sale or other disposition of the assets included within the Asset Disposition and the repayment of Indebtedness with the proceeds thereof, Borrowers are Borrower is in compliance on a pro forma basis with the covenants set forth in Section 4 4.2 recomputed on a pro forma basis using financial data for the most recently ended quarter month for which information is available and is in compliance with all other terms and conditions of contained in this Agreement; and (vi) no Default or Event of Default then exists or would shall result from such Asset Dispositionsale or other disposition.

Disposal of Assets or Subsidiary Stock. The Credit Parties shall not and shall not cause or permit their Subsidiaries to directly or indirectly convey, sell, lease, sublease, transfer or otherwise dispose of, or grant any Person an option to acquire, in one transaction or a series of related transactions, any of its property, business or assets, whether now owned or hereafter acquired, except for (a) sales of inventory in good faith to customers for fair value in the ordinary course of business and dispositions of obsolete equipment not used or useful in the business and (b) Asset Dispositions by Borrowers and their Subsidiaries (excluding sales of Accounts and Stock of any of Holdings' Subsidiaries) if all of the following conditions are met: (i) the market value of assets sold or otherwise disposed of in any single transaction or series of related transactions does not exceed $500,000 600,000 and the aggregate market value of assets sold or otherwise disposed of in any Fiscal Year does not exceed $1,000,0001,100,000; (ii) the consideration received is at least equal to the fair market value of such assets; (iii) the sole consideration received is cash other than notes received from the buyer of any such assets not exceeding $500,000 600,000 outstanding at any time (such amount being determined without giving effect to any write-offs or write-downs of such notes); (iv) the Net Proceeds of such Asset Disposition are applied as required by Section 1.5(c); (v) after giving effect to the Asset Disposition and the repayment of Indebtedness with the proceeds thereof, Borrowers are in compliance on a pro forma basis with the covenants set forth in Section 4 recomputed for the most recently ended quarter for which information is available and is in compliance with all other terms and conditions of this Agreement; and (vi) no Default or Event of Default then exists or would result from such Asset Disposition. In all respects, the foregoing is subject to the provisions of the Intercreditor Agreement.

Disposal of Assets or Subsidiary Stock. The Credit Parties Except as described on Schedule 3.7, Borrower shall not and shall not cause or permit their its Subsidiaries to directly or indirectly convey, sell, lease, sublease, license, assign, transfer or otherwise dispose of, or grant any Person an option to acquire, in one transaction or a series of related transactions, any of its property, business or assets, whether now owned or hereafter acquired, except for (a) sales of inventory in good faith to customers for fair value in the ordinary course of business and dispositions of obsolete equipment and parts and supplies not used or useful in the business and business, (b) Asset Dispositions by Borrowers Borrower and their its Subsidiaries (excluding sales of Accounts and Stock of any of Holdings' Subsidiaries) if all of the following conditions are met: (i) the fair market value of assets sold or otherwise disposed of in any single transaction or series of related transactions does not exceed $500,000 and the aggregate market value of assets sold or otherwise disposed of 2,000,000 in any Fiscal Year does not exceed $1,000,000Year; (ii) the consideration received is at least equal to the fair market value of such assets; (iii) the sole consideration received by Borrower and its Subsidiaries in such transaction is at least 75% in the form of cash other than notes received from the buyer of any such assets not exceeding $500,000 outstanding at any time (such amount being determined without giving effect to any write-offs or write-downs of such notes)and Cash Equivalents; (iv) the Net Proceeds of such any Specified Asset Disposition are applied as required by Section 1.5(c)1.9; (v) after giving effect to the Asset Disposition and the repayment of Indebtedness with the proceeds thereof, Borrowers are Borrower is in compliance on a pro forma basis with the covenants set forth in Section 4 recomputed for the most recently ended quarter Fiscal Quarter for which information is available and is in compliance with all other terms and conditions of this Agreement; and (vi) no Default or Event of Default then exists or would result from such Asset Disposition, (c) transactions permitted by Section 3.3 and Section 3.6(a) and (d) Permitted Sale-Leasebacks.

Disposal of Assets or Subsidiary Stock. The Credit Parties shall Borrower will not and shall will not cause or permit their any of its Restricted Subsidiaries to directly or indirectly to convey, sell, lease, sublease, transfer or otherwise dispose of, or grant any Person an option to acquire, in one transaction or a series of related transactions, any of its property, business or assets, or the capital stock of or other equity interests in any of its Restricted Subsidiaries, whether now owned or hereafter acquired, except for (a) bona fide sales of inventory in good faith to customers for fair value in the ordinary course of business and dispositions of obsolete equipment not used or useful in the business and business; (b) Asset Dispositions by Borrowers and their Subsidiaries (excluding sales of Accounts and Stock of any of Holdings' Subsidiaries) if all of the following conditions are met: (i) (A) in the case of Asset Dispositions involving assets deemed by Borrower to be no longer useful in the business, the market value of such assets sold or otherwise disposed of in any single transaction or series of related transactions does not exceed $500,000 (or the equivalent thereof in another currency) and the aggregate market value of such assets sold or otherwise disposed of by Borrower and its Restricted Subsidiaries in any fiscal year of Borrower does not exceed $2,500,000 (or the equivalent thereof in another currency) and (B) in the case of Asset Dispositions involving other assets, the market value of such assets sold or otherwise disposed of in any Fiscal Year single transaction or series of related transactions does not exceed $1,000,0001,000,000 (or the equivalent thereof in another currency) and the aggregate market value of such assets sold or otherwise disposed of by Borrower and its Restricted Subsidiaries in any fiscal year of Borrower does not exceed $5,000,000 (or the equivalent thereof in another currency); (ii) the consideration received is at least equal to the fair market value of such assets; (iii) at least eighty percent (80%) of the sole consideration received is cash other than (exclusive of non-cash consideration received in the form of promissory notes received from in an aggregate amount not in excess of $3,000,000 during the buyer term of any such assets not exceeding $500,000 outstanding at any time (such amount being determined without giving effect to any write-offs or write-downs of such notesthis Agreement); (iv) the Net Proceeds of such Asset Disposition are applied as required by Section 1.5(c); (v) after giving effect to the Asset Disposition and the repayment of Indebtedness with the proceeds thereof, Borrowers are Borrower is in compliance on a pro forma basis with the covenants set forth in Section 4 recomputed for the most recently ended quarter for which information is available and is in compliance with all other terms and conditions of this Agreement; and (viv) no Default or Event of Default then exists or would result from such Asset Disposition; (c) loans and leases of equipment in the ordinary course of business of Borrower, provided that the aggregate value of all such equipment that is loaned during any fiscal year of Borrower shall not exceed one and one-fifth percent (1.2%) of Borrower’s total annual sales revenues for the immediately preceding fiscal year; (d) any Restricted Subsidiary may convey all or any portion of its property and assets to Borrower or to any Restricted Subsidiary that is a Loan Party, and (e) the sale of up to $4,000,000 of equipment which is listed on Schedule 3.7 and is transferred pursuant to sale and leaseback transactions completed on or before August 31, 2008. Following Payment in Full of the Senior Secured Debt, in the event that Borrower or any Restricted Subsidiary makes an Asset Disposition that, but for the operation of this sentence, would result in Borrower’s being obligated to make an Asset Sale Offer (as defined in the Senior Note Indenture), then immediately following such Asset Disposition, the Net Proceeds of such Asset Disposition shall be applied in prepayment of the Term Loan.

Disposal of Assets or Subsidiary Stock. The Credit Parties shall Issuer will not and shall -------------------------------------- will not cause or permit their any of its Subsidiaries to directly or indirectly to convey, sell, lease, sublease, transfer or otherwise dispose of, or grant any Person an option to acquire, in one transaction or a series of related transactions, any of its property, business or assets, or the capital stock of or other equity interests in any of its Subsidiaries, whether now owned or hereafter acquired, except for (a) bona fide sales of inventory in good faith to customers for fair value in the ordinary course of business and dispositions of obsolete equipment not used or useful in the business business, and (b) Asset Dispositions by Borrowers and their Subsidiaries (excluding sales of Accounts and Stock of any of Holdings' Subsidiaries) Sales if all of the following conditions are met: (i) the market value of assets sold or otherwise disposed of in any single transaction or series of related transactions does not exceed $500,000 250,000 and the aggregate market value of assets sold or otherwise disposed of in any Fiscal Year does not exceed $1,000,000500,000; (ii) the consideration received is at least equal to the fair market value of such assets; (iii) the sole consideration received is cash other than notes received from the buyer of any such assets not exceeding $500,000 outstanding at any time (such amount being determined without giving effect to any write-offs or write-downs of such notes); (iv) the Net Cash Proceeds of such Asset Disposition are applied as required by Section 1.5(c)Sections 2.06 and 6.11; (viii) after ------------- ---- giving effect to the Asset Disposition Sale and the repayment of Indebtedness with the proceeds thereof, Borrowers are Issuer is in compliance on a pro forma basis with the covenants set forth in Section 4 Sections 6.16, 6.17 and 6.18 recomputed for the most ------------------- ---- recently ended quarter for which information is available and is in compliance with all other terms and conditions of this Agreement; and (viiv) no Default or Event of Default then exists or would result from such Asset Disposition.Sale; provided, -------- however, that clause (i) subsection (b) hereof shall not apply to an Asset Sale ------- with respect to Discontinued Operations. 50

Disposal of Assets or Subsidiary Stock. The Credit Parties shall not and shall not cause or permit their Subsidiaries to directly or indirectly convey, sell, lease, sublease, license, assign, transfer or otherwise dispose of, or grant any Person an option to acquire, in one transaction or a series of related transactions, any of its property, business or assets, whether now owned or hereafter acquired, except for (a) sales of inventory in good faith to customers for fair value in the ordinary course of business and dispositions of obsolete equipment not used or useful in the business and (b) Asset Dispositions by Borrowers Borrower and their its Subsidiaries (excluding sales of Accounts and sales of Stock of any of Holdings' Subsidiaries) if all of the following conditions are met: (i) the market value of assets sold or otherwise disposed of in any single transaction or series of related transactions (except in the case of the sale of EVI Audio (Aust) Pty Limited) does not exceed $500,000 1,000,000 and the aggregate market value of assets sold or otherwise disposed of in any Fiscal Year (except in the case of the sale of EVI Audio (Aust) Pty Limited) does not exceed $1,000,0005,000,000; (ii) the consideration received is at least equal to the fair market value of such assets; (iii) 75% of the sole consideration received is cash other than notes received from the buyer of any such assets not exceeding $500,000 outstanding at any time (such amount being determined without giving effect to any write-offs or write-downs of such notes)cash; (iv) the Net Proceeds of such Asset Disposition are applied as required by Section 1.5(c); (v) after giving effect to the Asset Disposition and the repayment of Indebtedness with the proceeds thereof, Borrowers are Borrower is in compliance on a pro forma basis with the covenants set forth in Section 4 recomputed for the most recently ended quarter Fiscal Quarter for which information is available and is in compliance with all other terms and conditions of this Agreement; and (vi) no Default or Event of Default then exists or would result from such Asset Disposition.

Disposal of Assets or Subsidiary Stock. The Credit Parties shall Each Borrower will not and shall will not cause or permit their its Subsidiaries to directly or indirectly to: convey, sell, lease, sublease, transfer or otherwise dispose of, or grant any Person an option to acquire, in one transaction or a series of related transactions, any of its property, business or assets, or the capital stock of or other equity interests in any such Subsidiary whether now owned or hereafter acquired, except for (ai) bona fide sales of inventory in good faith to customers for fair value in the ordinary course of business and dispositions of obsolete equipment not used or useful in the business, (ii) fair market value sales of Cash Equivalents, (iii) the transfer, sale, lease, assignment or other disposition of assets to any Borrower or any wholly-owned Subsidiary of any Borrower, (iv) the sale or discount without recourse of accounts receivable arising in the ordinary course of business in connection with the compromise or collection thereof, (v) the lease or sublease of property in the ordinary course of business, and (bvi) Asset Dispositions by Borrowers and their Subsidiaries (excluding sales all other dispositions of Accounts and Stock of any of Holdings' Subsidiaries) assets if all of the following conditions are met: (ia) the market value of assets sold or otherwise disposed of in any single transaction or series of related transactions does not exceed $500,000 and the aggregate market value of assets sold or otherwise disposed of in any Fiscal Year one transaction or series of related transaction for any calendar year does not exceed $1,000,0001,000,000 for Borrower and its Subsidiaries; (iib) the consideration received is at least equal to the fair market value of such assets; (iiic) the sole consideration received is cash other than notes received from the buyer of any such assets not exceeding $500,000 outstanding at any time (such amount being determined without giving effect to any write-offs or write-downs of such notes)cash; (iv) the Net Proceeds of such Asset Disposition are applied as required by Section 1.5(c); (vd) after giving effect to the Asset Disposition and the repayment sale or other disposition of Indebtedness such assets, Borrower, on a consolidated basis with the proceeds thereofits Subsidiaries, Borrowers are is in compliance on a pro forma basis with the covenants set forth in Section 4 recomputed for the most recently ended quarter month for which information is available and is in compliance with all other terms and conditions of this Agreementavailable; and (vie) no Default or Event of Default then exists or would shall result from such Asset Dispositionsale or other disposition.

Disposal of Assets or Subsidiary Stock. The Credit Parties shall Borrower will not and shall will not cause or permit their any of its Restricted Subsidiaries to directly or indirectly to convey, sell, lease, sublease, transfer or otherwise dispose of, or grant any Person an option to acquire, in one transaction or a series of related transactions, any of its property, business or assets, or the capital stock of or other equity interests in any of its Restricted Subsidiaries, whether now owned or hereafter acquired, except for (a) bona fide sales of inventory in good faith to customers for fair value in the ordinary course of business and dispositions of obsolete equipment not used or useful in the business and business; (b) Asset Dispositions by Borrowers and their Subsidiaries (excluding sales of Accounts and Stock of any of Holdings' Subsidiaries) if all of the following conditions are met: (i) (A) in the case of Asset Dispositions involving assets deemed by Borrower to be no longer useful in the business, the market value of such assets sold or otherwise disposed of in any single transaction or series of related transactions does not exceed $500,000 (or the equivalent thereof in another currency) and the aggregate market value of such assets sold or otherwise disposed of by Borrower and its Restricted Subsidiaries in any fiscal year of Borrower does not exceed $2,500,000 (or the equivalent thereof in another currency) and (B) in the case of Asset Dispositions involving other assets, the market value of such assets sold or otherwise disposed of in any Fiscal Year single transaction or series of related transactions does not exceed $1,000,0001,000,000 (or the equivalent thereof in another currency) and the aggregate market value of such assets sold or otherwise disposed of by Borrower and its Restricted Subsidiaries in any fiscal year of Borrower does not exceed $5,000,000 (or the equivalent thereof in another currency); (ii) the consideration received is at least equal to the fair market value of such assets; (iii) at least eighty percent (80%) of the sole consideration received is cash other than (exclusive of non-cash consideration received in the form of promissory notes received from in an aggregate amount not in excess of $3,000,000 during the buyer term of any such assets not exceeding $500,000 outstanding at any time (such amount being determined without giving effect to any write-offs or write-downs of such notesthis Agreement); (iv) the Net Proceeds of such Asset Disposition are applied as required by Section 1.5(c); (v) after giving effect to the Asset Disposition and the repayment of Indebtedness with the proceeds thereof, Borrowers are Borrower is in compliance on a pro forma basis with the covenants set forth in Section 4 recomputed for the most recently ended quarter for which information is available and is in compliance with all other terms and conditions of this Agreement; and (viv) no Default or Event of Default then exists or would result from such Asset Disposition; (c) loans and leases of equipment in the ordinary course of business of Borrower, provided that the aggregate value of all such equipment that is loaned during any fiscal year of Borrower shall not exceed one and one-fifth percent (1.2%) of Borrower's total annual sales revenues for the immediately preceding fiscal year; (d) Asset Dispositions the net proceeds of which are used to purchase replacement assets within ninety (90) days of such Asset Disposition. Notwithstanding the foregoing, Borrower may sell all or any portion of the Chino Property, the Sumter Property or the Xxxxxxxxx Property so long as such sale complies with the requirements of this subsection 3.7(b)(ii), (iii), (iv) and (v); and (e) any Restricted Subsidiary may convey all or any portion of its property and assets to Borrower or to any Restricted Subsidiary that is a Loan Party. In the event that Borrower or any Restricted Subsidiary makes an Asset Disposition that, but for the operation of this sentence, would result in Borrower's being obligated to make an Asset Sale Offer (as defined in the Senior Note Indenture), then immediately following such Asset Disposition, the Net Proceeds of such Asset Disposition shall be applied in repayment of the Revolving Loans, and upon such repayment, the Revolving Loan Commitment shall be permanently reduced to the extent necessary to prevent Borrower from being required to make an Asset Sale Offer.

Disposal of Assets or Subsidiary Stock. The Except as described on Schedule 3.7, the Credit Parties shall not and shall not cause or permit their Subsidiaries to directly or indirectly convey, sell, lease, sublease, license, assign, transfer or otherwise dispose of, or grant any Person an option to acquire, in one transaction or a series of related transactions, any of its property, business or assets, whether now owned or hereafter acquired, except for (a) sales of inventory in good faith to customers for fair value in the ordinary course of business and dispositions of obsolete equipment Equipment and Parts and Supplies not used or useful in the business and business, (b) Asset Dispositions by Borrowers and their Subsidiaries (excluding sales of Accounts and Stock of any of Holdings' Subsidiaries) if all of the following conditions are met: (i) the market value of assets sold or otherwise disposed of in any single transaction or series of related transactions does not exceed $500,000 100,000 and the aggregate market value of assets sold or otherwise disposed of in any Fiscal Year does not exceed $1,000,000250,000; (ii) the consideration received is at least equal to the fair market value of such assets; (iii) the sole consideration received is cash other than notes received from the buyer of any such assets not exceeding $500,000 outstanding at any time (such amount being determined without giving effect to any write-offs or write-downs of such notes)cash; (iv) the Net Proceeds of such Asset Disposition are applied as required by Section 1.5(c); (v) after giving effect to the Asset Disposition and the repayment of Indebtedness with the proceeds thereof, Borrowers are in compliance on a pro forma basis with the covenants set forth in Section 4 recomputed for the most recently ended quarter Fiscal Quarter for which information is available and is in compliance with all other terms and conditions of this Agreement; and (vi) no Default or Event of Default then exists or would result from such Asset DispositionDisposition and (c) Permitted Sale-Leasebacks.

Disposal of Assets or Subsidiary Stock. The Credit Parties shall not and shall not cause Borrower will not, directly -------------------------------------- or permit their Subsidiaries to directly or indirectly indirectly, convey, sell, lease, sublease, transfer or otherwise dispose of, or grant any Person an option to acquire, in one transaction or a series of related transactions, any of its property, business or assets, or the partnership interests in Borrower, whether now owned or hereafter acquired, except for (ai) bona fide sales of inventory in good faith to customers for fair value in the ordinary course of business and dispositions of obsolete equipment not used or useful in the business business; (ii) fair market value sales of Cash Equivalents; and (biii) all other Asset Dispositions by Borrowers and their Subsidiaries (excluding sales of Accounts and Stock of any of Holdings' Subsidiaries) if all of the following conditions are met: (ia) the Loan Agreement/Texas Unwired aggregate market value of assets sold or otherwise disposed of in any single one transaction or series of related transactions does not exceed $500,000 and 100,000; (b) the aggregate market value of assets (including such assets but excluding any assets sold pursuant to clauses (i) through (v) above inclusive) sold or otherwise disposed of in any Fiscal Year the immediately preceding 12-month period does not exceed $1,000,000250,000 in the aggregate for Borrower; (iic) the consideration received is at least equal to the fair market value of such assets; (iiid) the sole consideration received is cash other than notes received from the buyer of any such assets not exceeding $500,000 outstanding at any time (such amount being determined without giving effect to any write-offs or write-downs of such notes)cash; (iv) the Net Proceeds of such Asset Disposition are applied as required by Section 1.5(c); (ve) after giving effect to the Asset Disposition and the repayment sale or other disposition of Indebtedness with the proceeds thereofsuch assets, Borrowers are Borrower, is in compliance on a pro forma basis with the covenants set forth in Section 4 recomputed for the most recently ended quarter month for which information is available and Borrower is in compliance with all other terms and conditions of contained in this Agreement; and (vif) no Default or Event of Default then exists or would shall result from such Asset Dispositionsale or other disposition.

Disposal of Assets or Subsidiary Stock. The Credit Parties shall Borrower will not and shall will not cause or permit their any of its Restricted Subsidiaries to directly or indirectly to convey, sell, lease, sublease, transfer or otherwise dispose of, or grant any Person an option to acquire, in one transaction or a series of related transactions, any of its property, business or assets, or the capital stock of or other equity interests in any of its Restricted Subsidiaries, whether now owned or hereafter acquired, except for (a) bona fide sales of inventory in good faith to customers for fair value in the ordinary course of business and dispositions of obsolete equipment not used or useful in the business and business; (b) Asset Dispositions by Borrowers and their Subsidiaries (excluding sales of Accounts and Stock of any of Holdings' Subsidiaries) if all of the following conditions are met: (i) (A) in the case of Asset Dispositions involving assets deemed by Borrower to be no longer useful in the business, the market value of such assets sold or otherwise disposed of in any single transaction or series of related transactions does not exceed $500,000 (or the equivalent thereof in another currency) and the aggregate market value of such assets sold or otherwise disposed of by Borrower and its Restricted Subsidiaries in any fiscal year of Borrower does not exceed $2,500,000 (or the equivalent thereof in another currency) and (B) in the case of Asset Dispositions involving other assets, the market value of such assets sold or otherwise disposed of in any Fiscal Year single transaction or series of related transactions does not exceed $1,000,0001,000,000 (or the equivalent thereof in another currency) and the aggregate market value of such assets sold or otherwise disposed of by Borrower and its Restricted Subsidiaries in any fiscal year of Borrower does not exceed $5,000,000 (or the equivalent thereof in another currency); (ii) the consideration received is at least equal to the fair market value of such assets; (iii) at least eighty percent (80%) of the sole consideration received is cash other than (exclusive of non-cash consideration received in the form of promissory notes received from in an aggregate amount not in excess of $3,000,000 during the buyer term of any such assets not exceeding $500,000 outstanding at any time (such amount being determined without giving effect to any write-offs or write-downs of such notesthis Agreement); (iv) the Net Proceeds of such Asset Disposition are applied as required by Section 1.5(c); (v) after giving effect to the Asset Disposition and the repayment of Indebtedness with the proceeds thereof, Borrowers are Borrower is in compliance on a pro forma basis with the covenants set forth in Section 4 recomputed for the most recently ended quarter for which information is available and is in compliance with all other terms and conditions of this Agreement; and (viv) no Default or Event of Default then exists or would result from such Asset Disposition; (c) loans and leases of equipment in the ordinary course of business of Borrower, provided that the aggregate value of all such equipment that is loaned during any fiscal year of Borrower shall not exceed one and one-fifth percent (1.2%) of Borrower’s total annual sales revenues for the immediately preceding fiscal year; and (d) any Restricted Subsidiary may convey all or any portion of its property and assets to Borrower or to any Restricted Subsidiary that is a Loan Party. In the event that Borrower or any Restricted Subsidiary makes an Asset Disposition that, but for the operation of this sentence, would result in Borrower’s being obligated to make an Asset Sale Offer (as defined in the Senior Note Indenture), then immediately following such Asset Disposition, the Net Proceeds of such Asset Disposition shall be applied in prepayment of the Term Loans.

Disposal of Assets or Subsidiary Stock. The Credit Parties shall not and shall not cause or permit their Subsidiaries to directly or indirectly convey, sell, leaselease (as lessor), sublease, transfer or otherwise dispose of, or grant any Person an option to acquire, in one transaction or a series of related transactions, any of its property, business or assets, whether now owned or hereafter acquired, except for (a) sales of inventory in good faith to customers for fair value in the ordinary course of business and dispositions of obsolete equipment not used or useful in the business and business; (b) Asset Dispositions by Borrowers and their Subsidiaries (excluding sales of Accounts and Stock of any of Holdings' Ultimate Holdco's Subsidiaries) if all of the following conditions are met: met (i) the market value of assets sold or otherwise disposed of in any single transaction or series of related transactions does not exceed $500,000 and 250,000 end the aggregate market value of assets sold or otherwise disposed of in any Fiscal Year does not exceed $1,000,000; 500,000, (ii) the consideration received is at least equal to the fair market value of such assets; , (iii) the sole consideration received is cash other cash, or as otherwise approved by Administrative Agent with not less than notes received from the buyer 80% of any such assets not exceeding $500,000 outstanding at any time (such amount being determined without giving effect to any write-offs or write-downs of such notes); consideration in cash, (iv) the Net Proceeds of such Asset Disposition are applied as required by Section 1.5(c1.5(e); , (v) after giving effect to the Asset Disposition and the repayment of Indebtedness with the proceeds thereof, Borrowers are in compliance on a pro forma basis with the covenants set forth in Section 4 recomputed for the most recently ended quarter for which information is available and is in compliance with all other terms and conditions of this Agreement; , and (vi) no Default or Event of Default then exists or would result from such Asset Disposition; (c) sales of property (other than as permitted in clause (a) above) to any other Credit Party not exceeding $250,000 in the aggregate in any Fiscal Year; (d) Asset Dispositions set forth on Schedule 3.7; provided that the sole consideration received is cash, or as otherwise approved by Administrative Agent with not less than 80% of consideration in cash; (e) sales of assets not otherwise permitted in clauses (a) through (d) above and (f) through (h) below, in an aggregate amount not exceeding $1,000,000 with the prior written consent of Administrative Agent; provided that the sole consideration received is cash, or as otherwise approved by Administrative Agent with not less than 80% of consideration in cash; (f) transfers of the Stock of certain Credit Parties to TWHC and Holdco permitted under Section 3.6(d); (g) the sale of defaulted consumer accounts receivable that have been repurchased by a US Borrower, a European Borrower or one of its direct Subsidiaries from consumer finance companies pursuant to such Credit Party's contractual repurchase obligations; (h) the sale of the German Property and (i) dispositions associated with the dissolution by TWHC of Tempur World Holding Sweden AB. No European Credit Party shall license or otherwise transfer any of its Intellectual Property rights for use in North America nor sell or otherwise transfer any of its Licensed Products for use in North America (or distribution rights in respect thereof) to any Person, without the written consent of Administrative Agent, other than (x) Holdco and the US Borrower, and (y) pursuant to the Canadian Distribution Agreement with respect to Canada.

Disposal of Assets or Subsidiary Stock. The Credit Parties shall Borrower will not and shall will not cause or permit their its Subsidiaries to directly or indirectly to: convey, sell, lease, sublease, transfer or otherwise dispose of, or grant any Person an option to acquire, in one transaction or a series of related transactions, any of its property, business or assets, or the capital stock of or other equity interests in any Subsidiary whether now owned or hereafter acquired, except for (ai) bona fide sales of inventory in good faith to customers for fair value in the ordinary course of business and dispositions of obsolete equipment not used or useful in the business, (ii) fair market value sales of Cash Equivalents, (iii) the transfer, sale, lease, assignment or other disposition of assets to Borrower or any wholly-owned Subsidiary of Borrower, (iv) the sale or discount without recourse of accounts receivable arising in the ordinary course of business in connection with the compromise or collection thereof, (v) sales of the Investments listed on Schedule 3.3, and (bvi) Asset Dispositions by Borrowers and their Subsidiaries (excluding sales all other dispositions of Accounts and Stock of any of Holdings' Subsidiaries) assets if all of the following conditions are met: (ia) the market value of assets sold or otherwise disposed of in any single transaction or series of related transactions does not exceed $500,000 and the aggregate market value of assets sold or otherwise disposed of in any Fiscal Year one transaction or series of related transaction for any calendar year does not exceed $1,000,0001,000,000 for Borrower and its Subsidiaries; (iib) the consideration received is at least equal to the fair market value of such assets; (iiic) the sole consideration received is cash other than notes received from the buyer of any such assets not exceeding $500,000 outstanding at any time (such amount being determined without giving effect to any write-offs or write-downs of such notes)cash; (iv) the Net Proceeds of such Asset Disposition are applied as required by Section 1.5(c); (vd) after giving effect to the Asset Disposition and the repayment sale or other disposition of Indebtedness such assets, Borrower, on a consolidated basis with the proceeds thereofits Subsidiaries, Borrowers are is in compliance on a pro forma basis with the covenants set forth in Section 4 recomputed for the most recently ended quarter month for which information is available and is in compliance with all other terms and conditions of this Agreementavailable; and (vie) no Default or Event of Default then exists or would shall result from such Asset Dispositionsale or other disposition.

Disposal of Assets or Subsidiary Stock. The Credit Parties shall Each Loan Party will not and shall will not cause or permit their its Subsidiaries to directly or indirectly to: convey, sell, lease, sublease, transfer or otherwise dispose of, or grant any Person an option to acquire, in one transaction or a series of related transactions, any of its property, business or assets, or the capital stock of or other equity interests in any Subsidiary whether now owned or hereafter acquired, except for (ai) bona fide sales of inventory in good faith to customers for fair value in the ordinary course of business and dispositions of obsolete equipment not used or useful in the business, (ii) fair market value sales of Cash Equivalents, (iii) the transfer, sale, lease, assignment or other disposition of assets to a Loan Party or any wholly-owned Subsidiary of a Loan Party, (iv) the sale or discount without recourse of accounts receivable arising in the ordinary course of business in connection with the compromise or collection thereof, (v) sales of the Investments listed on Schedule 3.3, and (bvi) Asset Dispositions by Borrowers and their Subsidiaries (excluding sales all other dispositions of Accounts and Stock of any of Holdings' Subsidiaries) assets if all of the following conditions are met: (ia) the market value of assets sold or otherwise disposed of in any single transaction or series of related transactions does not exceed $500,000 and the aggregate market value of assets sold or otherwise disposed of in any Fiscal Year one transaction or series of related transaction for any calendar year does not exceed $1,000,0001,000,000 for Loan Parties and their Subsidiaries; (iib) the consideration received is at least equal to the fair market value of such assets; (iiic) the sole consideration received is cash other than notes received from the buyer of any such assets not exceeding $500,000 outstanding at any time (such amount being determined without giving effect to any write-offs or write-downs of such notes)cash; (iv) the Net Proceeds of such Asset Disposition are applied as required by Section 1.5(c); (vd) after giving effect to the Asset Disposition and the repayment sale or other disposition of Indebtedness such assets, Borrower, on a consolidated basis with the proceeds thereofits Subsidiaries, Borrowers are is in compliance on a pro forma basis with the covenants set forth in Section 4 recomputed for the most recently ended quarter month for which information is available and is in compliance with all other terms and conditions of this Agreementavailable; and (vie) no Default or Event of Default then exists or would shall result from such Asset Dispositionsale or other disposition.

Disposal of Assets or Subsidiary Stock. The Credit Parties shall not and shall not cause or permit their Subsidiaries to directly or indirectly convey, sell, leaselease (as lessor), sublease, transfer or otherwise dispose of, or grant any Person an option to acquire, in one transaction or a series of related transactions, any of its property, business or assets, whether now owned or hereafter acquired, except for (a) sales of inventory in good faith to customers for fair value in the ordinary course of business and dispositions of obsolete equipment not used or useful in the business and business; (b) Asset Dispositions by Borrowers and their Subsidiaries (excluding sales of Accounts and Stock of any of Holdings' Ultimate Holdco’s Subsidiaries) if all of the following conditions are met: met (i) the market value of assets sold or otherwise disposed of in any single transaction or series of related transactions does not exceed $500,000 1,000,000 and the aggregate market value of assets sold or otherwise disposed of in any Fiscal Year does not exceed $1,000,000; 5,000,000, (ii) the consideration received is at least equal to the fair market value of such assets; , (iii) the sole consideration received is cash other cash, or as otherwise approved by Administrative Agent with not less than notes received from the buyer 80% of any such assets not exceeding $500,000 outstanding at any time (such amount being determined without giving effect to any write-offs or write-downs of such notes); consideration in cash, (iv) the Net Proceeds of such Asset Disposition are applied as required by Section 1.5(c); , (v) after giving effect to the Asset Disposition and the repayment of Indebtedness with the proceeds thereof, Borrowers are in compliance on a pro forma basis with the covenants set forth in Section 4 recomputed for the most recently ended quarter for which information is available and is in compliance with all other terms and conditions of this Agreement; , and (vi) no Default or Event of Default then exists or would result from such Asset Disposition; (c) sales of property (i) by any US Credit Party to any other US Credit Party or (ii) by any European Credit Party to any other Credit Party; (d) Asset Dispositions set forth on Schedule 3.7; provided that the sole consideration received is cash, or as otherwise approved by Administrative Agent with not less than 80% of consideration in cash; (e) sales of assets not otherwise permitted in clauses (a) through (d) above and (f) through (h) below, in an aggregate amount not exceeding $1,000,000 with the prior written consent of Administrative Agent; provided that the sole consideration received is cash, or as otherwise approved by Administrative Agent with not less than 80% of consideration in cash; (f) transfers of the Stock of certain Credit Parties to DF and Holdco permitted under Section 3.6(d); (g) the sale of defaulted consumer accounts receivable that have been repurchased by a US Borrower, a European Borrower or one of its direct Subsidiaries from consumer finance companies pursuant to such Credit Party’s contractual repurchase obligations; (h) the sale of the German Property, (i) dispositions associated with the dissolution by DF of Tempur World Holding Sweden AB, (j) the sale leaseback permitted pursuant to Section 3.17(b) and (k) the licensing of intellectual property rights by any Credit Party in the ordinary course of its business; provided, however, that notwithstanding any of the foregoing, no European Credit Party shall license or otherwise transfer any of its Intellectual Property rights for use in North America nor sell or otherwise transfer any of its Licensed Products for use in North America (or distribution rights in respect thereof) to any Person, without the written consent of Administrative Agent, other than (x) Holdco and the US Borrower, and (y) pursuant to the Canadian Distribution Agreement with respect to Canada.

Disposal of Assets or Subsidiary Stock. The Credit Parties shall Each Borrower will not -------------------------------------- and shall will not cause or permit their any of its Subsidiaries to directly or indirectly to: convey, sell, lease, sublease, transfer or otherwise dispose of, or grant any Person an option to acquire, in one transaction or a series of related transactions, any of its property, business or assets, or the capital stock of or other equity interests in any of its Subsidiaries, whether now owned or hereafter acquired, except for (a) bona fide sales of inventory in good faith to customers for fair value in the ordinary course of business and dispositions of obsolete equipment not used or useful in the business and (b) Asset Dispositions by Borrowers and their Subsidiaries (excluding sales of Accounts and Stock of any of Holdings' Subsidiaries) if all of the following conditions are met: (i) the market value of assets sold or otherwise disposed of in any single transaction or series of related transactions does not exceed $500,000 and the aggregate market value of assets sold or otherwise disposed of in any Fiscal Year fiscal year of Borrowers does not exceed $1,000,000500,000; (ii) the consideration received is at least equal to the fair market value of such assetsassets as determined in the good faith judgment of the Board of Directors of Parent; (iii) not less than the sole consideration greater of 75% of the sales price therefor and the amount of the mandatory prepayment required pursuant to subsection 1.5(C) is received is cash other than notes received from the buyer of any such assets not exceeding $500,000 outstanding at any time (such amount being determined without giving effect to any write-offs or write-downs of such notes)cash; (iv) the Net Proceeds of such Asset Disposition are applied as required by Section 1.5(csubsection 1.5(C); (v) after giving effect to the Asset Disposition and the repayment of Indebtedness with the proceeds thereof, Borrowers are in compliance on a pro forma basis with the covenants set forth in Section 4 recomputed for the most recently ended calendar quarter for which information is available and is in compliance with all other terms and conditions of contained in this Agreement; and (vi) no Default or Event of Default then exists or would shall result from such Asset Disposition.