Dividends. The Lead Borrower will not, and will not permit any of its Restricted Subsidiaries to, authorize, declare or pay any Dividends with respect to the Lead Borrower or any of its Restricted Subsidiaries, except that: (i) any Restricted Subsidiary of the Lead Borrower may pay Dividends or return capital or make distributions and other similar payments with regard to its Equity Interests to the Lead Borrower or to other Restricted Subsidiaries of the Lead Borrower which directly or indirectly own equity therein; (ii) any non-Wholly-Owned Subsidiary of the Lead Borrower may declare and pay cash Dividends to its shareholders generally so long as the Lead Borrower or its Restricted Subsidiary which owns the Equity Interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary); (iii) so long as no Default or Event of Default exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, the Lead Borrower may pay cash Dividends to Holdings to allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of such Parent Company from current or former members of management, employees, consultants, officers and directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by the Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $5,000,000; (xv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as (x) at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi).

Appears in 6 contracts

Sources: First Lien Term Loan Credit Agreement (PAE Inc), Second Lien Term Loan Credit Agreement (PAE Inc), Second Lien Term Loan Credit Agreement (PAE Inc)

Dividends. The ~~Lead Borrower will not~~holders of the Deferral Preferred Shares, Series-[·] shall be entitled to receive and ~~will not permit any~~ the Corporation shall pay thereon, as and when declared by the board of ~~its Restricted Subsidiaries to, authorize, declare or pay any Dividends with respect~~ directors out of the monies of the Corporation properly applicable to the ~~Lead Borrower or any~~ payment of ~~its Restricted Subsidiaries~~dividends, ~~except that:~~ on each Dividend Payment Date, fixed cumulative preferential cash dividends equal to the quotient obtained by dividing: (ix) ~~any Restricted Subsidiary~~ the product obtained by multiplying $1,000 by a rate per annum equal to the rate of interest payable by the Trust on the Trust Notes as of the Lead Borrower may pay Dividends or return capital or make distributions and other similar payments with regard to its Equity Interests to the Lead Borrower or to other Restricted Subsidiaries of the Lead Borrower which directly or indirectly own equity therein; Issue Date, by (iiy) any non-Wholly-Owned Subsidiary of the Lead Borrower may declare and pay cash Dividends to its shareholders generally so long as the Lead Borrower or its Restricted Subsidiary which owns the Equity Interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary); (iii) so long as no Default or Event of Default exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, the Lead Borrower may pay cash Dividends to Holdings to allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of such Parent Company from current or former members of management, employees, consultants, officers and directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiariesfour; provided that if an event (Aincluding a redemption) shall occur that results in accrued and unpaid dividends for a partial Dividend Period becoming payable, the ~~aggregate~~ dividend payable for any partial Dividend Periods shall be equal to the product obtained by multiplying the amount in (x) above by a fraction, the numerator of ~~Dividends made by~~ which is the ~~Lead Borrower~~ actual number of days attributable to ~~Holdings pursuant to this clause (iii),~~ the partial Dividend Period and the ~~aggregate amount paid by Holdings in respect~~ denominator of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase)which is 365, in either case, exceed during any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, subject in each case to ~~members~~ any applicable withholding tax. If on any Dividend Payment Date the dividend payable on such date is not paid in full on all of ~~management~~the Deferral Preferred Shares, ~~managers~~Series-[·] then issued and outstanding, such dividend or the unpaid part thereof shall be paid on a subsequent date or dates to be determined by the board of directors ~~or consultants~~ on which the Corporation shall have sufficient monies properly applicable, under the provisions of any ~~Parent Company or any of its Subsidiaries that occurs after~~ applicable law and under the ~~Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount~~ provisions of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of managementtrust indenture securing bonds, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options debentures or other securities ~~convertible into or exchangeable for Equity Interests~~ of the ~~Lead Borrower or any Parent Company; (F)~~ Corporation, to the ~~purchase or other acquisition by any parent~~ payment of the ~~Lead Borrower of all or substantially all~~ same. The holders of the ~~property and assets~~ Deferral Preferred Shares, Series-[·] shall not be entitled to any dividends other than or ~~business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all~~ in excess of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance cumulative preferential cash dividends hereinbefore provided. Payment shall be made ~~concurrently with~~ by electronic funds transfer or by cheque of or on behalf of the ~~closing~~ Corporation payable in lawful money of ~~such purchase or other acquisition and~~ the United States (~~B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests~~less any tax required to be deducted) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate payment thereof shall satisfy such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $5,000,000; (xv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as (x) at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi)dividends.

Appears in 6 contracts

Sources: Assignment and Set Off Agreement (TransCanada Trust), Assignment and Set Off Agreement (Transcanada Pipelines LTD), Assignment and Set Off Agreement (TransCanada Trust)

Dividends. The ~~Lead Borrower~~ Parent will not, and will not permit any of its ~~Restricted~~ Subsidiaries to, authorize, declare or pay any Dividends with respect to the ~~Lead Borrower~~ Parent or any of its ~~Restricted~~ Subsidiaries, except that: (i) ~~any Restricted Subsidiary~~ Subsidiaries of the ~~Lead Borrower~~ Parent may pay Dividends to another member of the NCLC Group; provided that the Borrower shall procure that any Dividends or ~~return capital or make~~ other distributions and interest paid or payable in connection with such Dividends or other ~~similar payments with regard~~ distributions to ~~its Equity Interests to~~ NCL International, Ltd., NCL America Holdings, LLC or Arrasas Limited shall be received promptly by the ~~Lead Borrower or to other Restricted Subsidiaries of the Lead Borrower which~~ Parent directly or indirectly ~~own equity therein~~by way of Dividend; (ii) ~~any non-Wholly-Owned Subsidiary of~~ the Lead Borrower may declare and pay cash Dividends to its shareholders generally so long as the Lead Borrower or its Restricted Subsidiary which owns the Equity Interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary); (iii) so long as no Default or Event of Default exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, the Lead Borrower Parent may pay ~~cash~~ Dividends to Holdings to allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of such Parent Company from current or former members of management, employees, consultants, officers and directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by the Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than the tax liability to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including jurisdiction in respect of ~~any reports filed~~ consolidated, combined, unitary or affiliated tax returns for each relevant jurisdiction of the NCLC Group or holder of the Parent’s Capital Stock with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any income taxable ~~year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated~~ as a ~~corporation~~ result of any member of the NCLC Group being taxed as a pass-through entity for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federalFederal, state and local income ~~Taxes (including minimum Taxes) (~~tax purposes or ~~franchise and similar Taxes imposed in lieu of such minimum Taxes) that are~~ attributable to ~~the taxable income~~ any member of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax NCLC Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $5,000,000; (xv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (~~xix~~iii) ~~any Dividends~~the Parent may pay Dividends in an amount not to exceed 50% of Consolidated Net Income of the Parent and its Subsidiaries for the period (taken as one period) commencing on January 1, 2010 and ending on the date prior to such Dividend for which financial statements are available so long as (x) no Default or Event or Default exists or would result from such Dividend and (y) at the time ~~of,~~ of such Dividend and after giving effect ~~to such Dividend, no Event~~ thereto the ratio of ~~Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated~~ Total Net ~~Leverage Ratio does not exceed 3.25~~ Funded Debt to ~~1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of~~ Consolidated EBITDA ~~and Consolidated Net Income), amounts loaned or advanced~~ for the four consecutive fiscal quarters last ended for which financial statements have been provided to ~~Holdings~~ the Facility Agent pursuant to Section ~~10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi)~~9.01 is less than 5.50:1.00.

Appears in 5 contracts

Sources: Credit Agreement (Norwegian Cruise Line Holdings Ltd.), Credit Agreement (Norwegian Cruise Line Holdings Ltd.), Ninth Supplemental Deed (Norwegian Cruise Line Holdings Ltd.)

Dividends. The ~~Lead Borrower~~ Borrowers will not, and will not permit any of ~~its~~ the Restricted Subsidiaries to, authorize, declare or pay any Dividends with respect to ~~the~~ Lead Borrower or any of its Restricted Subsidiaries, except that: (i) any Restricted Subsidiary of ~~the Lead~~ a Borrower may pay Dividends or return capital or make distributions and other similar payments with regard to its Equity Interests to ~~the~~ Lead Borrower or to other Restricted Subsidiaries of ~~the~~ Lead Borrower which directly or indirectly own equity therein; (ii) any non-Wholly-Owned Subsidiary of ~~the~~ Lead Borrower may declare and pay cash Dividends to its shareholders generally so long as ~~the~~ Lead Borrower or its Restricted Subsidiary which owns the Equity Interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary); (iii) so long as no Default or Event of Default exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, ~~the~~ Lead Borrower may pay cash Dividends to Holdings to allow Holdings to pay cash dividends or make cash distributions to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of Holdings or such other Parent Company from ~~current or former members of~~ management, employees~~, consultants~~, officers and directors (and their successors and assigns) of ~~the~~ Lead Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by ~~the~~ Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings or such other Parent Company in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings ~~(but in no event from any Initial Public Offering)~~ from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to ~~the~~ Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of ~~the~~ Lead Borrower, the greater of $~~10,000,000~~ 20,000,000 and 1.50% of Consolidated Total Assets (measured at the time of such Dividend) (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by ~~the~~ Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the ~~Closing~~ First Restatement Effective Date, where the net proceeds of such sale are received by or contributed to ~~the~~ Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (~~b)(x)(ii~~a)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to ~~the~~ Lead Borrower from ~~current or former~~ members of management, officers, directors, employees of ~~the~~ Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of Holdings or any other Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) ~~the~~ Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to ~~the~~ Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to ~~the~~ Lead Borrower or the relevant Restricted Subsidiary of ~~the~~ Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) ~~the~~ Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) ~~the~~ Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their ~~existence~~existence to the extent such Taxes, fees and expenses are reasonably attributable to the operations of Holdings, Lead Borrower and its Restricted Subsidiaries; (B) with respect to any taxable year (or portion thereof) ending after the ~~Closing~~ First Restatement Effective Date with respect to which ~~the Lead~~ any Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which Holdings or any other Parent Company ~~or other entity~~ is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of ~~the~~ Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that ~~the~~ Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to ~~the Lead~~ a Borrower or ~~its~~ the Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other ~~compensation and~~ benefits payable to ~~current and former officers, directors, consultants~~ officers and employees of any Parent Company to the extent such salaries, bonuses and other ~~compensation and~~ benefits are reasonably attributable to the ownership or operations of ~~the~~ Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of ~~the~~ Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of ~~the~~ Lead Borrower or any Parent Company; (F) the purchase or other acquisition by Holdings or any ~~parent~~ other Parent Company of ~~the~~ Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by ~~the~~ Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to ~~the~~ Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into ~~the~~ Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such ~~purchaser~~ purchase or other acquisition;; and (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of ~~the~~ Lead Borrower and its Restricted Subsidiaries; provided that the aggregate amount of Dividends made pursuant to subclauses (C), (D) and (G) of this clause (vi) shall not exceed the greater of $14,000,000 and 1.00% of Consolidated Total Assets (measured at the time of such Dividend) in any fiscal year; (vii) reasonable and customary indemnities to directors, officers and employees of Holdings or any other Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of ~~the~~ Lead Borrower and its Restricted Subsidiaries; (viii) ~~the~~ Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of ~~the~~ Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory ~~Agreement (as in effect on the Closing Date~~Agreement; (ix) any Dividend used to fund the Transaction, including Transaction ~~Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement~~Costs; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii)[Reserved]; (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or ~~the settlement or vesting of other~~ similar equity incentive awards; (xii) a Dividend to ~~any Parent Company~~ Verra Mobility to fund a payment of dividends on ~~such Parent Company~~Verra Mobility’s common ~~stock following an Initial Public Offering~~ stock, not to exceed, in any fiscal year, 5% of ~~such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering~~Verra Mobility’s market capitalization; (xiii) ~~on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00,~~ any Dividends to the extent the same are made solely with the Available Amount, so long as as, solely to the extent clause (a)(i)(B) of the definition of “Available Amount” is being utilized, at the time of, and after giving effect to such ~~Dividend~~Dividend on a Pro Forma Basis, (i) no Event of Default shall have occurred and be ~~continuing~~continuing and (ii) the Consolidated Total Net Leverage Ratio, on a Pro Forma Basis as of the last day of the most recently ended Test Period, does not exceed 5.20:1.00; (xiv) purchases of minority interests in ~~non-~~Restricted Subsidiaries that are not Wholly-Owned Subsidiaries by ~~the~~ Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed the greater of $~~5,000,000~~25,000,000 and 1.75% of Consolidated Total Assets (measured at the time of such Dividend); (xv) the declaration and payment of ~~dividends~~ Dividends or the payment of other distributions by ~~the~~ Lead Borrower in an aggregate amount since the ~~Closing~~ First Restatement Effective Date not to exceed the greater of $~~35,000,000~~120,000,000 and 8.50% of Consolidated Total Assets (measured at the time of such Dividend); (xvi) ~~the~~ Lead Borrower and each Restricted Subsidiary may declare and make ~~dividend~~ Dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of ~~dividend~~ Dividend or other distribution by a Restricted Subsidiary, ~~the~~ Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) ~~the~~ Lead Borrower may ~~make payments~~ pay Dividends with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (~~iii~~xvii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (~~b)(x)(ii~~a)(ii) of the definition of “Available Amount”; (xviii) ~~the~~ Lead Borrower and any Restricted Subsidiary may pay ~~dividends and distributions~~ Dividends within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as ~~(x) at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y)~~ on a Pro Forma Basis, as of the last day of the most recently ended Test Period, the Consolidated Total Net Leverage Ratio does not exceed ~~3.25 to 1.00~~3.75:1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the ~~definition~~ definitions of “Consolidated ~~EBITDA~~ EBITDA” and “Consolidated Net Income”), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) ~~shall~~ shall, to the extent such loan or advance remains unpaid, be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi).

Appears in 5 contracts

Sources: First Lien Term Loan Credit Agreement (VERRA MOBILITY Corp), First Lien Term Loan Credit Agreement (VERRA MOBILITY Corp), First Lien Term Loan Credit Agreement (VERRA MOBILITY Corp)

Dividends. ~~The Lead~~ Borrower will not, and will not permit any of ~~its~~ the Restricted Subsidiaries to, authorize, declare or pay any Dividends with respect to ~~the Lead~~ Borrower or any of its Restricted Subsidiaries, except that: (i) any Restricted Subsidiary of ~~the Lead~~ Borrower may authorize, declare and pay Dividends or return capital or make distributions and other similar payments with regard to its Equity Interests to ~~the Lead~~ Borrower or to other Restricted Subsidiaries of ~~the Lead~~ Borrower which directly or indirectly own equity therein; (ii) any non-Wholly-Owned Subsidiary of ~~the Lead~~ Borrower may authorize, declare and pay cash Dividends to its shareholders generally so long as ~~the Lead~~ Borrower or its Restricted Subsidiary which owns the Equity Interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary); (iii) so long as no ~~Default or~~ Event of Default exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, ~~the Lead~~ Borrower may authorize, declare and pay cash Dividends to Holdings to allow Holdings to pay cash dividends or make cash distributions to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of Holdings or such other Parent Company from ~~current or former members of~~ management, employees~~, consultants~~, officers and directors (and their successors and assigns) of ~~the Lead~~ Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by ~~the Lead~~ Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings or such other Parent Company in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to ~~the Lead~~ Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of ~~the Lead~~ Borrower, (x) the greater of $~~10,000,000~~ 35,000,000 and 6.25% of Consolidated EBITDA of Borrower and its Restricted Subsidiaries for the most recently ended Test Period (measured at the time of such Dividend) or (y) subsequent to the consummation of any Initial Public Offering of common stock or other comparable equity interests of Borrower or any direct or indirect parent of Borrower, the greater of $55,000,000 and 10% of Consolidated EBITDA of Borrower and its Restricted Subsidiaries for the most recently ended Test Period (measured at the time of such Dividend) (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by ~~the Lead~~ Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to ~~the Lead~~ Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (~~b)(x)(ii~~a)(iii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to ~~the Lead~~ Borrower from ~~current or former~~ members of management, officers, directors, employees of ~~the Lead~~ Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of Holdings or any other Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) ~~the Lead~~ Borrower may authorize, declare and pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to ~~the Lead~~ Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to ~~the Lead~~ Borrower or the relevant Restricted Subsidiary of ~~the Lead~~ Borrower out of the proceeds of such offering promptly if such offering is completed; (v) ~~the Lead~~ Borrower may authorize, declare and pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with ~~applicable laws~~Requirements of Law, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the ~~Securities~~ Exchange Act or the respective rules and regulations promulgated thereunder; (vi) ~~the Lead~~ Borrower may authorize, declare and pay cash ~~dividends~~ Dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their ~~existence~~existence to the extent such Taxes, fees and expenses are reasonably attributable to the operations of Holdings, Borrower and its Restricted Subsidiaries; (B) with respect to any taxable ~~year (or portion thereof)~~ period ending after the Closing Date ~~with respect to~~ for which ~~the Lead~~ Borrower ~~(a) is treated as a corporation for U.S. federal, state,~~ and/or ~~local income tax purposes and (b) is a member~~ any of its Subsidiaries are members of a consolidated, combined or similar income tax group ~~(a “Tax Group”)~~ for U.S. federal and/or applicable state, local or foreign income or similar tax purposes of which ~~any Parent Company~~ a direct or ~~other entity~~ indirect parent of Borrower is the common parent, the portion of any such U.S. federal, ~~state~~ state, local and/or foreign income and ~~local income Taxes~~ similar taxes (including any alternative minimum ~~Taxes~~taxes) ~~(or franchise and similar Taxes imposed in lieu~~ of such ~~minimum Taxes)~~ tax group that is attributable to the taxable income of Borrower and its applicable Restricted Subsidiaries and, to the extent of the amount actually received for such purpose from its applicable Unrestricted Subsidiaries, in amounts required to pay any such taxes that are attributable to the taxable income of ~~the Lead Borrower and its~~ such Unrestricted Subsidiaries; provided that ~~for each taxable period,~~ the aggregate amount of such payments ~~made in~~ with respect to such period (regardless of ~~such taxable period in the aggregate~~ when paid) shall not exceed the aggregate amount of such Taxes that Borrower and/or its applicable Restricted Subsidiaries (and, subject to the ~~Lead Borrower and its~~ limitation described above, any applicable Unrestricted Subsidiaries of Borrower) would have been required to pay as with respect to such period were such entities stand-alone corporate taxpayers or a stand-alone ~~Tax Group; provided, further, that~~ corporate tax group for all applicable taxable periods ending after the ~~permitted payment pursuant~~ Closing Date taking into account any applicable limitations on the ability to ~~this clause (B) with respect to~~ utilize net operating loss carryforwards and similar tax attributes under the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar TaxesCode; (C) customary salary, bonus and other ~~compensation and~~ benefits payable to ~~current and former officers,~~ directors, ~~consultants~~ officers and employees of any Parent Company to the extent such salaries, bonuses and other ~~compensation and~~ benefits are reasonably attributable to the ownership or operations of ~~the Lead~~ Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead ~~costs~~ costs, fees and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such ~~costs~~ costs, fees and expenses are reasonably attributable to the ownership or operations of ~~the Lead~~ Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of ~~the Lead~~ Borrower or any Parent Company; (F) the purchase or other acquisition by Holdings or any ~~parent~~ other Parent Company of ~~the Lead~~ Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by ~~the Lead~~ Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such ~~parent~~ Parent Company shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to ~~the Lead~~ Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into ~~the Lead~~ Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such ~~purchaser~~ purchase or other acquisition;; and (G) any customary fees and expenses related to any successful or unsuccessful debt or equity offering by any Parent Company directly attributable to the operations of ~~the Lead~~ Borrower and its Restricted Subsidiaries; (vii) Borrower and its Restricted Subsidiaries may give reasonable and customary indemnities to directors, officers and employees of Holdings or any other Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of ~~the Lead~~ Borrower and its Restricted Subsidiaries; (viii) ~~the Lead~~ Borrower may authorize, declare and pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of ~~the Lead~~ Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory ~~Agreement (as in effect on the Closing Date~~Agreement; (ix) any Dividend used (x) to fund the Transaction, including Transaction ~~Costs and the Special Dividend~~Costs, and (y) in order to satisfy deferred purchase price, earn-outs and contingent payments in respect of any ~~Dividend from proceeds received~~ amounts due and owing as provided for in ~~connection with any working capital adjustment pursuant to~~ the Acquisition Agreement; (x) ~~the Lead~~ Borrower may authorize, declare and pay cash Dividends to Holdings (who may subsequently authorize, declare and pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v), 10.06(vii) and ~~10.06(vii~~10.06(xii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or ~~the settlement or vesting of other~~ similar equity incentive awards; (xii) a Dividend (including to any Parent ~~Company~~ Company) to fund a payment of dividends on ~~such~~ Borrower’s or any Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, not to exceed, in any fiscal year, the sum of ~~up to 6~~(x) 6.0% ~~per annum~~ of the net cash proceeds received by or contributed to the capital of ~~the Lead~~ Borrower from any such Initial Public ~~Offering~~Offering and (y) 7.0% of Borrower’s (or any Parent Company’s) Market Capitalization; (xiii) ~~on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00,~~ any Dividends to the extent the same are made solely with the Available Amount, so long as as, solely to the extent clause (a)(ii) of the definition of “Available Amount” is being utilized, at the time of, and after giving effect to such ~~Dividend~~Dividend on a Pro Forma Basis, (i) no Event of Default shall have occurred and be ~~continuing~~continuing and (ii) the Consolidated First Lien Net Leverage Ratio, on a Pro Forma Basis as of the last day of the most recently ended Test Period, does not exceed 4.05:1.00; (xiv) purchases of minority interests in ~~non-~~Restricted Subsidiaries that are not Wholly-Owned Subsidiaries by ~~the Lead~~ Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed the greater of $~~5,000,000~~27,500,000 and 5.0% of Consolidated EBITDA of Borrower and its Restricted Subsidiaries for the most recently ended Test Period (measured at the time of such Dividend); (xv) the authorization, declaration and payment of ~~dividends~~ Dividends or the payment of other distributions by ~~the Lead~~ Borrower in an aggregate amount since the Closing Date not to exceed the greater of $~~35,000,000~~250,000,000 and 50.0% of Consolidated EBITDA of Borrower and its Restricted Subsidiaries for the most recently ended Test Period (measured at the time of such Dividend); (xvi) ~~the Lead~~ Borrower and each Restricted Subsidiary may authorize, declare and make ~~dividend~~ Dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of ~~dividend~~ Dividend or other distribution by a Restricted Subsidiary, ~~the Lead~~ Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) ~~the Lead~~ Borrower may ~~make payments~~ authorize, declare and pay Dividends with the cash proceeds contributed to its common equity (including from the net cash proceeds of any equity issuance by any Parent Company), so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (~~iii~~xvii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (~~b)(x)(ii~~a)(iii) of the definition of “Available Amount”; (xviii) ~~the Lead~~ Borrower and any Restricted Subsidiary may authorize, declare and pay ~~dividends and distributions~~ Dividends within 60 90 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03~~; and~~; (xix) any Dividends, so long as (x) at the time ~~of,~~ of and after giving effect to such Dividend, no Event of Default ~~shall have~~ has occurred and be is continuing and (y) on a Pro Forma Basis, as of the last day of the most recently ended Test Period, the Consolidated Total Net Leverage Ratio does not exceed ~~3.25~~ 4.30:1.00; (xx) so long as no Event of Default under Section 11.01 or 11.05 has occurred and is continuing or would result therefrom, Borrower and any Restricted Subsidiary may authorize, declare and pay Dividends with any Leverage Excess Proceeds; and (xxi) any payment that is intended to ~~1.00~~prevent any Indebtedness of Borrower from being treated as an “applicable high yield discount obligation” within the meaning of Section 163(i)(1) of the Code. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the ~~definition~~ definitions of “Consolidated ~~EBITDA~~ EBITDA” and “Consolidated Net Income”), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) ~~shall~~ shall, to the extent such loan or advance remains unpaid, be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi).

Appears in 4 contracts

Sources: Credit Agreement (McGraw Hill, Inc.), Credit Agreement (McGraw Hill, Inc.), Credit Agreement (McGraw Hill, Inc.)

Dividends. ~~The Lead Borrower will not, and will not permit any of its Restricted Subsidiaries to, authorize, declare or pay any Dividends with respect to~~ Notwithstanding the Lead Borrower or any of its Restricted Subsidiaries, except that: (i) any Restricted Subsidiary of the Lead Borrower may pay Dividends or return capital or make distributions and other similar payments with regard to its Equity Interests to the Lead Borrower or to other Restricted Subsidiaries of the Lead Borrower which directly or indirectly own equity therein; (ii) any non-Wholly-Owned Subsidiary of the Lead Borrower may declare and pay cash Dividends to its shareholders generally so long as the Lead Borrower or its Restricted Subsidiary which owns the Equity Interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary); (iii) so long as no Default or Event of Default exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect theretoforegoing, the Lead Borrower may pay cash Dividends to Holdings to allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of such Parent Company from current or former members of management, employees, consultants, officers and directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by the Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased Employee shall not ~~(net of~~ have the right to receive any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, including any special or ~~make loans~~ extraordinary dividends or ~~advances to, any Parent Company or the equity interest holders thereof~~ distributions (with all references to “dividends” in ~~amounts required for any Parent Company or the equity interest holders thereof~~ this Agreement being deemed to ~~pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect~~ also include reference to any ~~taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal~~such special distributions), state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the ~~Taxes of any Unrestricted Subsidiary for any taxable period~~ Restricted Shares granted hereby unless and until the Restricted Shares become Earned Shares. Any such dividends declared and paid with respect to already Earned Shares shall be ~~limited to~~ paid no later than the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations end of the ~~Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative~~calendar year in which the dividend for such class of stock is paid to stockholders of such class or, ~~legal~~if later, ~~accounting and similar expenses provided by third parties) of any Parent Company to~~ the ~~extent such costs and expenses are reasonably attributable to the ownership or operations~~ 15th day of the ~~Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with~~ third month following the ~~exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of~~ date the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division dividend is paid to stockholders of such ~~Person~~class of stock. In the event the Company declares and pays a dividend in respect of its Common Stock and, ~~or of all of~~ on the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) record date for such dividend, ~~distribution, loan or advance shall be made concurrently with~~ the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Employee holds Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment Shares granted pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments this Agreement that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does have not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $5,000,000; (xv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiaryyet become Earned Shares, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, dividends with respect to such Restricted Shares shall be credited to an account maintained by the Company or the transfer agent for the Employee’s benefit (such dividends, “Unvested Dividends”). Such account is intended to constitute an “unfunded” account, and neither this Section 3(d) nor any action taken pursuant to or in accordance with this Section 3(d) shall be construed to create a trust of any kind. Amounts credited to such ~~payments, no Event of Default shall have occurred~~ account with respect to Restricted Shares that become Earned Shares will become “Vested Dividends” on the date that such Restricted Shares vest in accordance with Section 3(b) and will be ~~continuing or would result therefrom~~paid to the Employee as soon as administratively practicable following that date; provided that, in all cases, any Vested Dividends that ~~the amount of any such cash proceeds that are utilized for any Dividend under~~ become payable pursuant to this ~~clause (iii~~Section 3(d) ~~will not~~ shall be ~~considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii)~~ paid no later than March 15 of the ~~definition of “Available Amount”;~~ calendar year following the calendar year during which such dividends become Vested Dividends pursuant to paragraphs (~~xviii~~b) ~~the Lead Borrower~~ and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision (d) of this Section ~~10.03; and (xix)~~ 3. The Employee shall not be entitled to receive any ~~Dividends~~interest with respect to the timing of payment of dividends. In the event all or any portion of the Restricted Shares granted hereby fail to become Earned Shares, ~~so long as (x) at~~ Unvested Dividends accumulated in the ~~time of, and after giving effect~~ Employee’s account with respect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) Restricted Shares shall be ~~deemed to be cash Dividends paid to Holdings~~ forfeited to the ~~extent provided in said Section 10.05(vi)~~Company.

Appears in 4 contracts

Sources: Restricted Stock Agreement (Targa Resources Corp.), Restricted Stock Agreement (Targa Resources Corp.), Restricted Stock Agreement (Targa Resources Corp.)

Dividends. ~~The~~ Each of the Lead Borrower ~~will not,~~ and any Restricted Subsidiary will not ~~permit any of its Restricted Subsidiaries to,~~ authorize, declare or pay any Dividends with respect to the Lead Borrower or any ~~of its~~ Restricted ~~Subsidiaries~~Subsidiary, except that: (i) any Restricted Subsidiary ~~of the Lead Borrower~~ may pay Dividends or return capital or make distributions and other similar payments with regard to its Equity Interests to the Lead Borrower or to other Restricted Subsidiaries ~~of the Lead Borrower~~ which directly or indirectly own equity therein; (ii) any non-Wholly-Owned Subsidiary of the Lead Borrower may declare and pay cash Dividends to its shareholders generally so long as the Lead Borrower or ~~its~~ any Restricted Subsidiary which owns the Equity Interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary); (iii) so long as no Default or Event of Default exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, the Lead Borrower may pay cash Dividends to Holdings to allow Holdings to ~~pay cash dividends to any other Parent Company to~~ redeem or repurchase, contemporaneously with such Dividend, Equity Interests of ~~such Parent Company~~ Holdings from ~~current or former members of~~ management, employees~~, consultants~~, officers and directors (and their successors and assigns) of the Lead Borrower and ~~its~~ any Restricted ~~Subsidiaries~~Subsidiary; provided that (A) the aggregate amount of Dividends made by the Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings ~~(but in no event from any Initial Public Offering)~~ from issuances of its Equity Interests ~~(other than to the extent included in the Available Amount)~~ and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed ~~during any fiscal year of the Lead Borrower,~~ $~~10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid~~ 5,000,000 in any ~~fiscal~~ calendar year ~~pursuant to this clause~~ (~~iii) shall increase the amount of cash Dividends~~ with unused amounts in any calendar year being permitted to be ~~paid~~ carried over for the next two succeeding calendar years in an amount not exceeding $10,000,000 in the ~~succeeding two fiscal years pursuant to this clause (iii)~~aggregate); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any ~~of its~~ Restricted ~~Subsidiaries~~ Subsidiary after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of ~~any Parent Company~~ Holdings or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from ~~current or former~~ members of management, officers, directors, employees of the Lead Borrower or any ~~of its Subsidiaries~~ Subsidiary in connection with a repurchase of Equity Interests of ~~any Parent Company~~ Holdings will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings ~~(or subsequently paid to any other Parent Company)~~ to pay expenses incurred by Holdings ~~or any other Parent Company~~ in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings ~~and any other Parent Company~~ shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings ~~(or subsequently paid to any other Parent Company)~~ to pay costs (including all professional fees and expenses) incurred by Holdings ~~or any other Parent Company~~ in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other ~~distributions~~payments to, or make loans or advances to, any ~~Parent Company~~ Holdings or the equity interest holders thereof in amounts required for any ~~Parent Company~~ Holdings or the equity interest holders thereof to pay, in each case without duplication: (Aa) franchise and similar Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company corporate existence to the extent such ~~salaries~~Taxes, ~~bonuses~~ fees and ~~other compensation and benefits~~ expenses are reasonably attributable to the ownership or operations of the Lead Borrower and ~~its~~ any Restricted ~~Subsidiaries~~Subsidiary; (Db) for any taxable period for which Lead Borrower and/or any of its Subsidiaries are members of a consolidated, combined or similar income tax group for U.S. federal and/or applicable state, local or foreign income tax purposes of which a direct or indirect parent of the Lead Borrower is the common parent (a “Tax Group”), the portion of any U.S. federal, foreign, state and local income and similar Taxes (including alternative minimum Taxes) of such Tax Group, as applicable, for such taxable period that are attributable to the income of the Lead Borrower and/or its Subsidiaries, as applicable, provided that, in each case (i) the amount of such payments for any taxable period shall not exceed the amount of such Taxes that Lead Borrower and/or such Subsidiaries, as applicable, would have paid had Lead Borrower and/or such Subsidiaries, as applicable, been a stand-alone corporate taxpayer (or a stand-alone corporate group) with respect to all taxable periods (or portions thereof) beginning after the Closing Date and (ii) the amount of such payments for any taxable period in respect of an Unrestricted Subsidiary shall be permitted only to the extent that cash distributions were made by such Unrestricted Subsidiary to the Lead Borrower or any of its Restricted Subsidiaries for such purpose; (c) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of ~~any Parent Company~~ Holdings to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and ~~its~~ any Restricted ~~Subsidiaries~~Subsidiary; (Ed) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or ~~any Parent Company~~Holdings; (Fe) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided ~~that~~ that, if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided further that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger or amalgamation (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition;; and (Gf) any customary fees and expenses related to any unsuccessful equity offering by ~~any Parent Company~~ Holdings directly attributable to the operations of the Lead Borrower and ~~its~~ any Restricted ~~Subsidiaries~~Subsidiary; (vii) reasonable and customary indemnities to directors, officers and employees of ~~any Parent Company~~ Holdings in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and ~~its~~ any Restricted ~~Subsidiaries~~Subsidiary; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings ~~(or subsequently paid to any other Parent Company)~~ for payment of ~~(x)~~ obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and ~~its~~ any Restricted ~~Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date~~Subsidiary; (ix) ~~any Dividend used to fund~~ payments made in respect of dissenting shares and in respect of the ~~Transaction~~Lead Borrower’s incentive stock or other equity based benefit plans, Director’s Compensation Plan and Nonqualified Savings Plan, including ~~Transaction Costs and the Special Dividend, and any Dividend from proceeds received~~ deferred accounts therein denominated in stock units in each case made in connection with ~~any working capital adjustment pursuant to~~ the Acquisition (as defined in the Existing Credit Agreement); (x) payments made in connection with the ~~Lead Borrower may pay cash Dividends~~ Ryerson 2014 Omnibus Plan up to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii)$20,000,000; (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or ~~the settlement or vesting of other~~ similar equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower ~~from any such Initial Public Offering~~and its Restricted Subsidiaries may consummate the transactions contemplated under the Restructuring Memo; (xiii) ~~on a Pro Forma Basis, if~~ the ~~Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00~~ Lead Borrower and ~~the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00,~~ each Restricted Subsidiary may pay any Dividends ~~to the extent the same are made solely with the Available Amount,~~ so long as at the ~~time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing~~Distribution Conditions are satisfied; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of ~~Investments~~ investments pursuant to Section 10.05(xvii), shall not exceed $~~5,000,000~~10,000,000; (xv) ~~the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000~~[Reserved]; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make ~~dividend~~ Dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such ~~dividend~~ Dividend or distribution; (xvii) the Lead Borrower and each Restricted Subsidiary may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by ~~any Parent Company~~Holdings, so long asas such payments are made substantially concurrently with such contribution and, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”;and (xviii) the Lead Borrower and any Restricted Subsidiary may pay ~~dividends~~ Dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) ~~any Dividends, so long as (x) at~~ the ~~time of, and after giving effect~~ Lead Borrower may make distributions to ~~such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis,~~ pay the ~~Consolidated Total Net Leverage Ratio does not exceed 3.25~~ remaining $10,000,000 management agreement termination fee payable to ~~1.00~~Platinum. In determining compliance with this Section ~~10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income)~~10.03, amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi).

Appears in 4 contracts

Sources: Credit Agreement (Ryerson Holding Corp), Credit Agreement (Ryerson Holding Corp), Credit Agreement (Ryerson Holding Corp)

Dividends. ~~The Lead Borrower~~ None of the Borrowers will, nor will ~~not, and will not~~ it permit any of its ~~Restricted~~ Subsidiaries to, authorize, declare or pay any Dividends with respect to ~~the Lead~~ such Borrower or any of its ~~Restricted~~ Subsidiaries, except that: (i) any ~~Restricted~~ Subsidiary of ~~the Lead Borrower~~ Silgan may pay any Dividends to Silgan or ~~return capital or make distributions and other similar payments with regard to its Equity Interests~~ a Wholly-Owned Subsidiary of Silgan so long as, in the case of non-cash Dividends, any security interests granted to the ~~Lead Borrower or to other Restricted Subsidiaries~~ Collateral Agent for the benefit of the ~~Lead Borrower which directly or indirectly own equity therein~~Secured Creditors pursuant to the applicable Security Documents in the assets so transferred shall remain in full force and effect and perfected (and with at least the same priority as in effect prior to such transfer); (ii) any non-Wholly-Owned Subsidiary of ~~the Lead Borrower~~ Silgan may ~~declare and~~ pay ~~cash~~ Dividends to its ~~shareholders~~ shareholders, partners or members generally so long as (x) the ~~Lead~~ respective Borrower or its ~~Restricted~~ respective Subsidiary which owns the ~~Equity Interests~~ equity interest or interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative ~~holding~~ holdings of the ~~Equity Interests~~ equity interest or interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of ~~Equity Interests of~~ equity interests in such Subsidiary)) and (y) no Dividends may be paid by any Subsidiary of Silgan pursuant to this clause (ii) at any time that a Default or an Event of Default exists and any intercompany loans are outstanding to such Subsidiary; (iii) Dividends made in connection with a Restructuring Transaction shall be permitted; and (iv) so long as no Default or Event of Default ~~exists at the time of the applicable Dividend, redemption or repurchase~~ has occurred and is continuing or would exist immediately after giving effect thereto, the Lead Borrower may pay cash Dividends to Holdings to allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of such Parent Company from current or former members of management, employees, consultants, officers and directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by the Lead Borrower to Holdings pursuant to this clause (iii), result therefrom and the ~~aggregate amount paid by Holdings~~ Borrowers are in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made compliance with the ~~cash proceeds described~~ financial covenants set forth in ~~the preceding clause~~ Sections 9.07 and 9.08 (~~I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management~~which, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed except with respect to the ~~Securities Act~~payment of regular quarterly Dividends in the same per share amount as paid in the immediately preceding fiscal quarter, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case shall be calculated without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable giving effect to the ~~taxable income~~ proviso of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii9.08) on a Pro Forma ~~Basis~~Basis for the Test Period most recently ended for which financial statements have been delivered to Administrative Agent pursuant to Section 8.01, ~~if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00~~ both immediately before and ~~the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and~~ immediately after giving effect to such ~~Dividend~~Dividends, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $5,000,000; (xv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary Silgan may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as (x) at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi).

Appears in 4 contracts

Sources: Credit Agreement (Silgan Holdings Inc), Credit Agreement (Silgan Holdings Inc), Credit Agreement (Silgan Holdings Inc)

Dividends. The ~~Lead~~ Borrower will not, and will not permit any of its Restricted Subsidiaries to, authorize, declare or pay any Dividends with respect to the ~~Lead~~ Borrower or any of its Restricted ~~Subsidiaries~~Subsidiaries on or after the Closing Date, except that: (i) any Restricted Subsidiary of the ~~Lead~~ Borrower may authorize, declare and pay Dividends or return capital or make distributions and other similar payments with regard to its Equity Interests to the ~~Lead~~ Borrower or to other Restricted Subsidiaries of the ~~Lead~~ Borrower which directly or indirectly own equity therein; (ii) any non-Wholly-Owned Subsidiary of the ~~Lead~~ Borrower may declare and pay cash Dividends to its shareholders generally so long as the ~~Lead~~ Borrower or its Restricted Subsidiary which owns the Equity Interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary); (iii) so long as no ~~Default or~~ Event of Default exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, the ~~Lead~~ Borrower may pay cash Dividends to Holdings to allow Holdings to pay cash dividends or make cash distributions to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of such Holdings or such other Parent Company from ~~current or former members of~~ management, employees~~, consultants~~, officers and directors (and their successors and assigns) of Holdings, such other Parent Company, the ~~Lead~~ Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by the ~~Lead~~ Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings or such other Parent Company in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings ~~(but in no event from any Initial Public Offering)~~ from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the ~~Lead~~ Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the ~~Lead~~ Borrower, the greater of $~~10,000,000~~ 50,000,000 and 10.0% of Consolidated EBITDA of the Borrower and its Restricted Subsidiaries for the most recently ended Test Period (measured at the time of such Dividend) (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the ~~Lead~~ Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of ~~Holdings~~Holdings or any Parent Company, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the ~~Lead~~ Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (~~b)(x)(ii~~a)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the ~~Lead~~ Borrower from ~~current or former~~ members of management, officers, directors, employees of the ~~Lead~~ Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of Holdings or any other Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the ~~Lead~~ Borrower may authorize, declare and pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the ~~Lead~~ Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the ~~Lead~~ Borrower or the relevant Restricted Subsidiary of the ~~Lead~~ Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the ~~Lead~~ Borrower may authorize, declare and pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the ~~Lead~~ Borrower may authorize, declare and pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their ~~existence~~existence to the extent such Taxes, fees and expenses are reasonably attributable to the operations of Holdings, the Borrower and its Restricted Subsidiaries; (B) with respect to any taxable ~~year (or portion thereof) ending after the Closing Date with respect to~~ period for which the ~~Lead~~ Borrower ~~(a) is treated as a corporation for U.S. federal, state,~~ and/or ~~local income tax purposes and (b) is a member~~ any of its Subsidiaries are members of a consolidated, combined or similar income tax group ~~(a “Tax Group”)~~ for U.S. federal and/or applicable state, local or foreign income or similar tax purposes of which ~~any Parent Company~~ a direct or ~~other entity~~ indirect parent of the Borrower is the common parent, the portion of any U.S. federal, ~~state~~ state, local and/or foreign income and ~~local income Taxes~~ similar taxes (including any alternative minimum ~~Taxes~~taxes) ~~(or franchise and similar Taxes imposed in lieu~~ of such ~~minimum Taxes)~~ tax group that ~~are~~ is attributable to the taxable income of the ~~Lead~~ Borrower ~~and its~~ and/or such Subsidiaries; provided (1) that ~~for each taxable period,~~ the amount of such payments made in respect of ~~such~~ any taxable period in the aggregate ~~shall~~ do not exceed the amount that the ~~Lead~~ Borrower ~~and its~~ and/or such Subsidiaries would have been required to pay as in respect of such taxable period had the Borrower and/or such Subsidiaries been a stand-alone ~~Tax Group; provided~~corporate taxpayer or tax group for all applicable taxable periods ending after the date hereof, ~~further,~~ (2) that the permitted payment pursuant to this clause (B) ~~with respect~~ attributable to ~~the Taxes of~~ any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the ~~Lead~~ Borrower or ~~its~~ any Restricted ~~Subsidiaries for~~ Subsidiary and (3) that with respect to any taxable period (or portion thereof) ending prior to the ~~purposes of paying~~ Closing Date, distributions otherwise permitted under this clause (B) shall be permitted only to the extent such ~~consolidated, combined or similar Taxes~~tax distribution relates to income tax audit adjustments that arise after the Closing Date; (C) customary salary, bonus and other ~~compensation and~~ benefits payable to ~~current and former officers, directors, consultants~~ officers and employees of any Parent Company to the extent such salaries, bonuses and other ~~compensation and~~ benefits are reasonably attributable to the ownership or operations of the ~~Lead~~ Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the ~~Lead~~ Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the ~~Lead~~ Borrower or any Parent Company; (F) the purchase or other acquisition by Holdings or any ~~parent~~ other Parent Company of the ~~Lead~~ Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the ~~Lead~~ Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the ~~Lead~~ Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the ~~Lead~~ Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the ~~Lead~~ Borrower and its Restricted Subsidiaries; and (H) without duplication of any other amounts permitted pursuant to Section 10.03(v) or this clause (vi), Public Company Costs; (vii) reasonable and customary indemnities to directors, officers and employees of Holdings or any other Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the ~~Lead~~ Borrower and its Restricted Subsidiaries; (viii) the ~~Lead~~ Borrower may authorize, declare and pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the ~~Lead~~ Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory ~~Agreement (as in effect on the Closing Date~~Agreement; (ix) any Dividend used to fund the ~~Transaction~~Transactions, including Transaction ~~Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement~~Costs; (x) the ~~Lead~~ Borrower may authorize, declare and pay cash Dividends to Holdings (who may subsequently authorize, declare and pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or ~~the settlement or vesting of other~~ similar equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock ~~following an Initial Public Offering of such common stock~~ after the Closing Date, ~~of up~~ not to exceed, in any fiscal year, 6% ~~per annum~~ of ~~the net cash proceeds contributed to the capital of the Lead Borrower from any~~ such ~~Initial Public Offering~~Parent Company’s Market Capitalization; (xiii) ~~on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00,~~ any Dividends to the extent the same are made solely with the Available Amount, so long as as, solely to the extent clause (a)(i)(B) of the definition of “Available Amount” is being utilized, at the time of, and after giving effect to such ~~Dividend~~Dividend on a Pro Forma Basis, (i) no Event of Default shall have occurred and be ~~continuing~~continuing and (ii) the Consolidated Total Net Leverage Ratio does not exceed 4.50 to 1.00; (xiv) purchases of minority interests in ~~non-~~Restricted Subsidiaries that are not Wholly-Owned Subsidiaries by the ~~Lead~~ Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed the greater of $~~5,000,000~~30,000,000 and 6.0% of Consolidated EBITDA of the Borrower and its Restricted Subsidiaries for the most recently ended Test Period (measured at the time of such purchase); (xv) the authorization, declaration and payment of ~~dividends~~ Dividends or the payment of other distributions by the ~~Lead~~ Borrower in an aggregate amount since the Closing Date not to exceed the greater of $~~35,000,000~~125,000,000 and 25.0% of Consolidated EBITDA of the Borrower and its Restricted Subsidiaries for the most recently ended Test Period (measured at the time of such Dividend); (xvi) the ~~Lead~~ Borrower and each Restricted Subsidiary may authorize, declare and make ~~dividend~~ Dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of ~~dividend~~ Dividend or other distribution by a Restricted Subsidiary, the ~~Lead~~ Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the ~~Lead~~ Borrower may ~~make payments~~ authorize, declare and pay Dividends with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (~~iii~~xvii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (~~b)(x)(ii~~a)(ii) of the definition of “Available Amount”” or the Contribution Amount; (xviii) the ~~Lead~~ Borrower and any Restricted Subsidiary may authorize, declare and pay ~~dividends and distributions~~ Dividends within 60 90 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03~~; and~~; (xix) any Dividends, so long as (x) at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00; (xx) the Borrower may authorize, declare and pay cash dividends or other distributions, or make loans or advances to, any Parent Company so long as (a) the proceeds thereof are used to make payments to minority shareholders pursuant to appraisal or dissenter’s rights with respect to shares in an Acquired Entity or Business held by such shareholders immediately prior to the acquisition and (b) such acquisition was made in compliance with Section 10.03(vi)(F); (xxi) any Dividend, payment or distribution to any Parent Company to fund payments required to be made by such Parent Company pursuant to the Tax Receivable Agreement. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) ~~shall~~ shall, to the extent such loan or advance remains unpaid, be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi).

Appears in 4 contracts

Sources: Term Loan Credit Agreement (Vertiv Holdings Co), Term Loan Credit Agreement (Vertiv Holdings Co), Term Loan Credit Agreement (Vertiv Holdings Co)

Dividends. ~~The Lead Borrower will not~~(a) In the event that a distribution with respect to the shares of CMR Common Stock permitted under the terms of this Agreement has a record date prior to the Merger Effective Time and has not been paid prior to the Closing Date, such distribution shall be paid to the holders of such shares of CMR Common Stock on the Closing Date immediately prior to the Merger Effective Time. In the event that a distribution with respect to the shares of capital stock of CCI permitted under the terms of this Agreement has a record date prior to the Merger Effective Time and ~~will~~ has not ~~permit any~~ been paid prior to the Closing Date, such distribution shall be paid to the holders of ~~its Restricted Subsidiaries to~~such shares of capital stock of CCI on the Closing Date immediately prior to the Merger Effective Time. CMR shall coordinate with CCI on the declaration, ~~authorize,~~ setting of record dates and payment dates of dividends on CMR Common Stock so that holders of CMR Common Stock (i) do not receive dividends on both CMR Common Stock and CCI Common Stock received in the REIT Merger in respect of a single distribution period or fail to receive a dividend on either CMR Common Stock or CCI Common Stock received in the REIT Merger in respect of a single distribution period or (ii) do not receive both a dividend permitted by the proviso to Section 6.2(b)(iii) on CCI Common Stock and a dividend permitted by the proviso to Section 6.1(b)(iii) on CMR Common Stock received in the REIT Merger or fail to receive either a dividend permitted by the proviso to Section 6.2(b)(iii) on CCI Common Stock or a dividend permitted by the proviso to Section 6.1(b)(iii) on CMR Common Stock received in the REIT Merger. (b) In the event that either CMR or CCI shall declare or pay any ~~Dividends with respect~~ dividend or other distribution that is expressly permitted pursuant to the ~~Lead Borrower~~ proviso at the end of Section 6.1(b)(iii) or ~~any of its Restricted Subsidiaries~~Section 6.2(b)(iii), ~~except that:~~ respectively, it shall notify the other Party at least 20 days prior to the Closing Date, and such other Party shall be entitled to declare a dividend per share payable (i) ~~any Restricted Subsidiary~~ in the case of ~~the Lead Borrower may pay Dividends or return capital or make distributions and other similar payments with regard~~ CMR, to ~~its Equity Interests~~ holders of CMR Common Stock, in an amount per share of CMR Common Stock equal to the ~~Lead Borrower or to other Restricted Subsidiaries~~ product of the Lead Borrower which directly or indirectly own equity therein; (ii) any non-Wholly-Owned Subsidiary of the Lead Borrower may declare and pay cash Dividends to its shareholders generally so long as the Lead Borrower or its Restricted Subsidiary which owns the Equity Interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary); (iii) so long as no Default or Event of Default exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, the Lead Borrower may pay cash Dividends to Holdings to allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of such Parent Company from current or former members of management, employees, consultants, officers and directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that (A) the ~~aggregate amount~~ dividend declared by CCI with respect to each share of ~~Dividends made~~ CCI Common Stock by the Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) ~~such amount in any calendar year may be increased by an amount not to exceed: (I)~~ the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of HoldingsExchange Ratio, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (Cii) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $5,000,000; (xv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of ~~dividend or other distribution by a Restricted Subsidiary~~CCI, ~~the Lead Borrower or a Restricted Subsidiary receives at least its pro rata~~ to holders of CCI Common Stock, in an amount per share of ~~such dividend or distribution;~~ CCI Common Stock equal to the quotient obtained by dividing (~~xvii~~A) the ~~Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance~~ dividend declared by ~~any Parent Company, so long as,~~ CMR with respect to ~~any such payments, no Event~~ each share of ~~Default shall have occurred~~ CMR Common Stock by (B) the Exchange Ratio. The record date and ~~be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized~~ time and payment date and time for any ~~Dividend under this clause (iii) will not be considered~~ dividend payable pursuant to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as (x) at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi7.8(b) shall be ~~deemed to be cash Dividends paid to Holdings~~ prior to the ~~extent provided in said Section 10.05(vi)~~Closing Date.

Appears in 4 contracts

Sources: Merger Agreement (Cottonwood Multifamily Reit Ii, Inc.), Merger Agreement (Cottonwood Communities, Inc.), Merger Agreement (Cottonwood Multifamily Reit I, Inc.)

Dividends. ~~The Lead~~ Subject to the following sentence, Borrower ~~will not~~may, and ~~will not~~ may permit ~~any of its Restricted Subsidiaries~~ Parent to, ~~authorize,~~ (i) make any distributions in redemption of any Capital Stock of the Borrower or the Parent and (ii) make or declare any dividends or ~~pay any Dividends~~ similar distributions with respect to the ~~Lead~~ Capital Stock of the Borrower or the Parent; provided that during the continuation of any ~~of its Restricted Subsidiaries~~Default, ~~except that:~~ the Borrower shall not (iand shall not permit Parent to) ~~any Restricted Subsidiary of the Lead Borrower may pay Dividends or return capital~~ declare or make any such dividends or distributions except that the Borrower and other similar payments with regard to its Equity Interests to the Lead Borrower or to other Restricted Subsidiaries of the Lead Borrower which directly or indirectly own equity therein; (ii) any non-Wholly-Owned Subsidiary of the Lead Borrower Parent may declare and ~~pay~~ make cash ~~Dividends~~ distributions to ~~its~~ their respective shareholders ~~generally so long as the Lead Borrower or its Restricted Subsidiary which owns the Equity Interests~~ in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary); (iii) so long as no Default or Event of Default exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, the Lead Borrower may pay cash Dividends to Holdings to allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of such Parent Company from current or former members of management, employees, consultants, officers and directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that (A) the an aggregate amount of Dividends made by the Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment greater of (x) ~~obligations~~ an amount equal to ninety percent (90%) of Parent’s real estate investment trust taxable income and (y) the minimum amount necessary for the Borrower to remain in compliance with Section 6.10 and to otherwise avoid the payment of any income and/or excise taxes imposed under the Code, provided, however, there shall not be any implied requirement that the Parent utilize the dividend deferral options in Section 857(b)(9) or Section 858(a) of the Internal Revenue Code. If a Default specified in Section 7.1, Section 7.6 or Section 7.7 shall exist, or if as a result of the occurrence of any other Default any of the Obligations have been accelerated pursuant to Section 8.1, the Borrower shall not, and shall not permit the Parent or any Subsidiary to, make any dividends or distributions to any Person other than the Borrower or a Subsidiary of the Borrower; provided that, in the case of a Subsidiary that is not a Wholly-Owned Subsidiary, such Subsidiary may make distributions to holders of Capital Stock in such Subsidiary ratably according to the holders’ respective holdings of the type of Capital Stock in respect of ~~director~~ which such distributions are being made and ~~officer insurance policies to~~ provided further that the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may ~~pay cash Dividends to Holdings~~ (~~who~~ and may ~~subsequently pay cash Dividends to any other~~ permit Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xviito), ~~shall not exceed $5,000,000; (xv) the declaration and payment of dividends or the payment of other~~ in all events, make cash distributions ~~by the Lead Borrower~~ to its shareholders in an aggregate amount ~~since~~ equal to the ~~Closing Date~~ minimum amount necessary for Borrower to remain in compliance with Section 6.10, provided, however, there shall not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of be any ~~equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided~~ implied requirement that the ~~amount of any such cash proceeds that are utilized for any Dividend under this clause (iii~~Parent utilize the dividend deferral options in Section 857(b)(9) ~~will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii~~or Section 858(a) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as (x) at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi)Internal Revenue Code.

Appears in 4 contracts

Sources: Credit Agreement (Kite Realty Group, L.P.), Term Loan Agreement (Kite Realty Group, L.P.), Credit Agreement (Kite Realty Group, L.P.)

Dividends. The ~~Lead Borrower~~ Parent will not, and will not permit any of its ~~Restricted~~ Subsidiaries to, authorize, declare or pay any Dividends with respect to the ~~Lead Borrower~~ Parent or any of its ~~Restricted~~ Subsidiaries, except that: (i) any Restricted Subsidiary of the Lead Borrower may pay Dividends or return capital or make distributions and other similar payments with regard to its Equity Interests to the Lead Borrower or to other Restricted Subsidiaries of the Lead Borrower which directly or indirectly own equity therein; (iiA) any ~~non-~~Wholly-Owned Subsidiary of the ~~Lead~~ Parent may pay Dividends to the Parent or any Wholly-Owned Subsidiary of the Parent, (B) any Subsidiary Guarantor may pay Dividends to the Borrower or any other Subsidiary Guarantor and (C) if the respective Subsidiary is not a Wholly-Owned Subsidiary of the Parent, such Subsidiary may ~~declare and~~ pay ~~cash~~ Dividends to its shareholders generally so long as the ~~Lead Borrower or~~ Parent and/or its ~~Restricted Subsidiary~~ respective Subsidiaries which ~~owns the~~ own Equity Interests in the Subsidiary paying such Dividends ~~receives~~ receive at least ~~its~~ their proportionate share thereof (based upon ~~its~~ their relative ~~holding~~ holdings of the Equity Interests in the Subsidiary paying such cash Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary); (~~iii~~ii) so long as no ~~Default or~~ Event of Default ~~exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately~~ (both before and after giving effect ~~thereto~~to the payment thereof) has occurred and is continuing, the ~~Lead Borrower~~ Parent may ~~pay cash Dividends to Holdings to allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend,~~ repurchase its outstanding Equity Interests (or options to purchase such equity) theretofore held by its or any of ~~such Parent Company from current or former members of management,~~ its Subsidiaries’ employees, ~~consultants~~officers or directors following the death, disability, retirement or termination of employment of employees, officers ~~and~~ or directors ~~(and their successors and assigns)~~ of the ~~Lead Borrower and~~ Parent or any of its ~~Restricted~~ Subsidiaries; , provided that ~~(A)~~ the aggregate amount expended to so repurchase equity of ~~Dividends made by~~ the ~~Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased~~ Parent shall not ~~(net of any cash proceeds received by Holdings (but~~ exceed $2,000,000 in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the ~~Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause~~ Parent; and (iii) ~~shall increase~~ after the ~~amount~~ Merger Effective Time, so long as no cash, Indebtedness or other property of ~~cash Dividends permitted~~ the Parent and its Subsidiaries is being paid by the Parent to ~~be paid~~ such employees, former employees, directors or former directors in ~~the succeeding two fiscal years pursuant to this clause~~ connection with such repurchase (~~iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I~~A) the ~~cash proceeds of key man life insurance policies received~~ Parent may repurchase its outstanding Equity Interests held by ~~the Lead Borrower~~ its or any of its ~~Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings~~Subsidiary’s employees, ~~in each case to members of management, managers~~former employees, directors and former directors pursuant to (i) that certain Stock Option Grant Agreement, dated as of July 8, 2014, by and between Navig8 and L. ▇▇▇▇▇▇▇ ▇▇▇▇▇, as amended, supplemented or ~~consultants of~~ modified from time to time, (ii) that certain General Maritime Corporation 2012 Equity Incentive Plan and (iii) any grants or awards issued under any future management incentive plan entered into by Parent ~~Company~~ or any of its ~~Subsidiaries that occurs after the Closing Date~~Subsidiaries, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in ~~the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management~~each case, ~~officers, directors, employees of the Lead Borrower or any of its Subsidiaries~~ in connection with ~~a repurchase of~~ any exercise by such employees, former employees, directors or former directors to purchase the Parent’s Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities Interest and ~~maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower,~~ (B) the Parent may repurchase its outstanding Equity Interests in ~~a prorated~~ an amount ~~of such expenses in proportion~~ equal to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations value of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares withholding taxes in connection with the ~~exercise~~ vesting of ~~warrants, options or other securities convertible into or exchangeable for~~ any Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $5,000,000; (xv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed granted to its ~~common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred~~ employees and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as (x) at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi)directors.

Appears in 4 contracts

Sources: Credit Agreement (Gener8 Maritime, Inc.), Credit Agreement (Gener8 Maritime, Inc.), Credit Agreement (Gener8 Maritime, Inc.)

Dividends. ~~The Lead~~ Borrower will not, and will not permit any of ~~its~~ the Restricted Subsidiaries to, authorize, declare or pay any Dividends with respect to ~~the Lead~~ Borrower or any of its Restricted Subsidiaries, except that: (i) any Restricted Subsidiary of ~~the Lead~~ Borrower may authorize, declare and pay Dividends or return capital or make distributions and other similar payments with regard to its Equity Interests to ~~the Lead~~ Borrower or to other Restricted Subsidiaries of ~~the Lead~~ Borrower which directly or indirectly own equity therein; (ii) any non-Wholly-Owned Subsidiary of ~~the Lead~~ Borrower may authorize, declare and pay cash Dividends to its shareholders generally so long as ~~the Lead~~ Borrower or its Restricted Subsidiary which owns the Equity Interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary); (iii) so long as no ~~Default or~~ Event of Default exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, ~~the Lead~~ Borrower may authorize, declare and pay cash Dividends to Holdings to allow Holdings to pay cash dividends or make cash distributions to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of Holdings or such other Parent Company from ~~current or former members of~~ management, employees~~, consultants~~, officers and directors (and their successors and assigns) of ~~the Lead~~ Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by ~~the Lead~~ Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings or such other Parent Company in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to ~~the Lead~~ Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of ~~the Lead~~ Borrower, (x) the greater of $~~10,000,000~~ 35,000,000 and 6.25% of Consolidated EBITDA of Borrower and its Restricted Subsidiaries for the most recently ended Test Period (measured at the time of such Dividend) or (y) subsequent to the consummation of any Initial Public Offering of common stock or other comparable equity interests of Borrower or any direct or indirect parent of Borrower, the greater of $55,000,000 and 10% of Consolidated EBITDA of Borrower and its Restricted Subsidiaries for the most recently ended Test Period (measured at the time of such Dividend) (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by ~~the Lead~~ Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to ~~the Lead~~ Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (~~b)(x)(ii~~a)(iii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to ~~the Lead~~ Borrower from ~~current or former~~ members of management, officers, directors, employees of ~~the Lead~~ Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of Holdings or any other Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) ~~the Lead~~ Borrower may authorize, declare and pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to ~~the Lead~~ Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to ~~the Lead~~ Borrower or the relevant Restricted Subsidiary of ~~the Lead~~ Borrower out of the proceeds of such offering promptly if such offering is completed; (v) ~~the Lead~~ Borrower may authorize, declare and pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with ~~applicable laws~~Requirements of Law, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the ~~Securities~~ Exchange Act or the respective rules and regulations promulgated thereunder; (vi) ~~the Lead~~ Borrower may authorize, declare and pay cash ~~dividends~~ Dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their ~~existence~~existence to the extent such Taxes, fees and expenses are reasonably attributable to the operations of Holdings, Borrower and its Restricted Subsidiaries; (B) with respect to any taxable ~~year (or portion thereof)~~ period ending after the Closing Date ~~with respect to~~ for which ~~the Lead~~ Borrower ~~(a) is treated as a corporation for U.S. federal, state,~~ and/or ~~local income tax purposes and (b) is a member~~ any of its Subsidiaries are members of a consolidated, combined or similar income tax group ~~(a “Tax Group”)~~ for U.S. federal and/or applicable state, local or foreign income or similar tax purposes of which ~~any Parent Company~~ a direct or ~~other entity~~ indirect parent of Borrower is the common parent, the portion of any such U.S. federal, ~~state~~ state, local and/or foreign income and ~~local income Taxes~~ similar taxes (including any alternative minimum ~~Taxes~~taxes) ~~(or franchise and similar Taxes imposed in lieu~~ of such ~~minimum Taxes)~~ tax group that is attributable to the taxable income of Borrower and its applicable Restricted Subsidiaries and, to the extent of the amount actually received for such purpose from its applicable Unrestricted Subsidiaries, in amounts required to pay any such taxes that are attributable to the taxable income of ~~the Lead Borrower and its~~ such Unrestricted Subsidiaries; provided that ~~for each taxable period,~~ the aggregate amount of such payments ~~made in~~ with respect to such period (regardless of ~~such taxable period in the aggregate~~ when paid) shall not exceed the aggregate amount of such Taxes that Borrower and/or its applicable Restricted Subsidiaries (and, subject to the ~~Lead Borrower and its~~ limitation described above, any applicable Unrestricted Subsidiaries of Borrower) would have been required to pay as with respect to such period were such entities stand-alone corporate taxpayers or a stand-alone ~~Tax Group; provided, further, that~~ corporate tax group for all applicable taxable periods ending after the ~~permitted payment pursuant~~ date hereof taking into account any applicable limitations on the ability to ~~this clause (B) with respect to~~ utilize net operating loss carryforwards and similar tax attributes under the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar TaxesCode; (C) customary salary, bonus and other ~~compensation and~~ benefits payable to ~~current and former officers,~~ directors, ~~consultants~~ officers and employees of any Parent Company to the extent such salaries, bonuses and other ~~compensation and~~ benefits are reasonably attributable to the ownership or operations of ~~the Lead~~ Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead ~~costs~~ costs, fees and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such ~~costs~~ costs, fees and expenses are reasonably attributable to the ownership or operations of ~~the Lead~~ Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of ~~the Lead~~ Borrower or any Parent Company; (F) the purchase or other acquisition by Holdings or any ~~parent~~ other Parent Company of ~~the Lead~~ Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by ~~the Lead~~ Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such ~~parent~~ Parent Company shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to ~~the Lead~~ Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into ~~the Lead~~ Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such ~~purchaser~~ purchase or other acquisition;; and (G) any customary fees and expenses related to any successful or unsuccessful debt or equity offering by any Parent Company directly attributable to the operations of ~~the Lead~~ Borrower and its Restricted Subsidiaries; (vii) Borrower and its Restricted Subsidiaries may give reasonable and customary indemnities to directors, officers and employees of Holdings or any other Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of ~~the Lead~~ Borrower and its Restricted Subsidiaries; (viii) ~~the Lead~~ Borrower may authorize, declare and pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of ~~the Lead~~ Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory ~~Agreement (as in effect on the Closing Date~~Agreement; (ix) any Dividend used (x) to fund the Transaction, including Transaction ~~Costs and the Special Dividend~~Costs, and (y) in order to satisfy deferred purchase price, earn-outs and contingent payments in respect of any ~~Dividend from proceeds received~~ amounts due and owing as provided for in ~~connection with any working capital adjustment pursuant to~~ the Acquisition Agreement; (x) ~~the Lead~~ Borrower may authorize, declare and pay cash Dividends to Holdings (who may subsequently authorize, declare and pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v), 10.06(vii) and ~~10.06(vii~~10.06(xii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or ~~the settlement or vesting of other~~ similar equity incentive awards; (xii) a Dividend (including to any Parent ~~Company~~ Company) to fund a payment of dividends on ~~such~~ Borrower’s or any Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, not to exceed, in any fiscal year, the sum of ~~up to 6~~(x) 6.0% ~~per annum~~ of the net cash proceeds received by or contributed to the capital of ~~the Lead~~ Borrower from any such Initial Public ~~Offering~~Offering and (y) 7.0% of Borrower’s (or any Parent Company’s) Market Capitalization; (xiii) ~~on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00,~~ any Dividends to the extent the same are made solely with the Available Amount, so long as as, solely to the extent clause (a)(ii) of the definition of “Available Amount” is being utilized, at the time of, and after giving effect to such ~~Dividend~~Dividend on a Pro Forma Basis, (i) no Event of Default shall have occurred and be ~~continuing~~continuing and (ii) the Consolidated First Lien Net Leverage Ratio, on a Pro Forma Basis as of the last day of the most recently ended Test Period, does not exceed 4.05:1.00; (xiv) purchases of minority interests in ~~non-~~Restricted Subsidiaries that are not Wholly-Owned Subsidiaries by ~~the Lead~~ Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed the greater of $~~5,000,000~~27,500,000 and 5.0% of Consolidated EBITDA of Borrower and its Restricted Subsidiaries for the most recently ended Test Period (measured at the time of such Dividend); (xv) the authorization, declaration and payment of ~~dividends~~ Dividends or the payment of other distributions by ~~the Lead~~ Borrower in an aggregate amount since the Closing Date not to exceed the greater of $~~35,000,000~~250,000,000 and 50.0% of Consolidated EBITDA of Borrower and its Restricted Subsidiaries for the most recently ended Test Period (measured at the time of such Dividend); (xvi) ~~the Lead~~ Borrower and each Restricted Subsidiary may authorize, declare and make ~~dividend~~ Dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of ~~dividend~~ Dividend or other distribution by a Restricted Subsidiary, ~~the Lead~~ Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) ~~the Lead~~ Borrower may ~~make payments~~ authorize, declare and pay Dividends with the cash proceeds contributed to its common equity (including from the net cash proceeds of any equity issuance by any Parent Company), so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (~~iii~~xvii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (~~b)(x)(ii~~a)(iii) of the definition of “Available Amount”; (xviii) ~~the Lead~~ Borrower and any Restricted Subsidiary may authorize, declare and pay ~~dividends and distributions~~ Dividends within 60 90 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03~~; and~~; (xix) any Dividends, so long as (x) at the time ~~of,~~ of and after giving effect to such Dividend, no Event of Default ~~shall have~~ has occurred and be is continuing and (y) on a Pro Forma Basis, as of the last day of the most recently ended Test Period, the Consolidated Total Net Leverage Ratio does not exceed ~~3.25~~ 4.30:1.00; (xx) so long as no Event of Default under Section 11.01 or 11.05 has occurred and is continuing or would result therefrom, Borrower and any Restricted Subsidiary may authorize, declare and pay Dividends with any Leverage Excess Proceeds; and (xxi) any payment that is intended to ~~1.00~~prevent any Indebtedness of Borrower from being treated as an “applicable high yield discount obligation” within the meaning of Section 163(i)(1) of the Code. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the ~~definition~~ definitions of “Consolidated ~~EBITDA~~ EBITDA” and “Consolidated Net Income”), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) ~~shall~~ shall, to the extent such loan or advance remains unpaid, be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi).

Appears in 4 contracts

Sources: Credit Agreement (McGraw Hill, Inc.), Credit Agreement (McGraw Hill, Inc.), Credit Agreement (McGraw Hill, Inc.)

Dividends. ~~The Lead~~ Borrower will not, and will not permit any of ~~its~~ the Restricted Subsidiaries to, authorize, declare or pay any Dividends with respect to ~~the Lead~~ Borrower or any of its Restricted Subsidiaries, except that: (i) any Restricted Subsidiary of ~~the Lead~~ Borrower may authorize, declare and pay Dividends or return capital or make distributions and other similar payments with regard to its Equity Interests to ~~the Lead~~ Borrower or to other Restricted Subsidiaries of ~~the Lead~~ Borrower which directly or indirectly own equity therein; (ii) any non-Wholly-Owned Subsidiary of ~~the Lead~~ Borrower may authorize, declare and pay cash Dividends to its shareholders generally so long as ~~the Lead~~ Borrower or its Restricted Subsidiary which owns the Equity Interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary); (iii) so long as no ~~Default or~~ Event of Default exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, ~~the Lead~~ Borrower may authorize, declare and pay cash Dividends to Holdings to allow Holdings to pay cash dividends or make cash distributions to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of Holdings or such other Parent Company from ~~current or former members of~~ management, employees~~, consultants~~, officers and directors (and their successors and assigns) of ~~the Lead~~ Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by ~~the Lead~~ Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings or such other Parent Company in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to ~~the Lead~~ Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of ~~the Lead~~ Borrower, (x) the greater of $~~10,000,000~~ 50,000,000 and 6.25% of Consolidated EBITDA of Borrower and its Restricted Subsidiaries for the most recently ended Test Period (measured at the time of such Dividend) or (y) subsequent to the consummation of any Initial Public Offering of common stock or other comparable equity interests of Borrower or any direct or indirect parent of Borrower, the greater of $80,000,000 and 10% of Consolidated EBITDA of Borrower and its Restricted Subsidiaries for the most recently ended Test Period (measured at the time of such Dividend) (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by ~~the Lead~~ Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to ~~the Lead~~ Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (~~b)(x)(ii~~a)(iii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to ~~the Lead~~ Borrower from ~~current or former~~ members of management, officers, directors, employees of ~~the Lead~~ Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of Holdings or any other Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) ~~the Lead~~ Borrower may authorize, declare and pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to ~~the Lead~~ Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to ~~the Lead~~ Borrower or the relevant Restricted Subsidiary of ~~the Lead~~ Borrower out of the proceeds of such offering promptly if such offering is completed; (v) ~~the Lead~~ Borrower may authorize, declare and pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with ~~applicable laws~~Requirements of Law, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the ~~Securities~~ Exchange Act or the respective rules and regulations promulgated thereunder; (vi) ~~the Lead~~ Borrower may authorize, declare and pay cash ~~dividends~~ Dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their ~~existence~~existence to the extent such Taxes, fees and expenses are reasonably attributable to the operations of Holdings, Borrower and its Restricted Subsidiaries; (B) with respect to any taxable ~~year (or portion thereof)~~ period ending after the Closing Date ~~with respect to~~ for which ~~the Lead~~ Borrower ~~(a) is treated as a corporation for U.S. federal, state,~~ and/or ~~local income tax purposes and (b) is a member~~ any of its Subsidiaries are members of a consolidated, combined or similar income tax group ~~(a “Tax Group”)~~ for U.S. federal and/or applicable state, local or foreign income or similar tax purposes of which ~~any Parent Company~~ a direct or ~~other entity~~ indirect parent of Borrower is the common parent, the portion of any such U.S. federal, ~~state~~ state, local and/or foreign income and ~~local income Taxes~~ similar taxes (including any alternative minimum ~~Taxes~~taxes) ~~(or franchise and similar Taxes imposed in lieu~~ of such ~~minimum Taxes)~~ tax group that is attributable to the taxable income of Borrower and its applicable Restricted Subsidiaries and, to the extent of the amount actually received for such purpose from its applicable Unrestricted Subsidiaries, in amounts required to pay any such taxes that are attributable to the taxable income of ~~the Lead Borrower and its~~ such Unrestricted Subsidiaries; provided that ~~for each taxable period,~~ the aggregate amount of such payments ~~made in~~ with respect to such period (regardless of ~~such taxable period in the aggregate~~ when paid) shall not exceed the aggregate amount of such Taxes that Borrower and/or its applicable Restricted Subsidiaries (and, subject to the ~~Lead Borrower and its~~ limitation described above, any applicable Unrestricted Subsidiaries of Borrower) would have been required to pay as with respect to such period were such entities stand-alone corporate taxpayers or a stand-alone ~~Tax Group; provided, further, that~~ corporate tax group for all applicable taxable periods ending after the ~~permitted payment pursuant~~ Closing Date taking into account any applicable limitations on the ability to ~~this clause (B) with respect to~~ utilize net operating loss carryforwards and similar tax attributes under the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar TaxesCode; (C) customary salary, bonus and other ~~compensation and~~ benefits payable to ~~current and former officers,~~ directors, ~~consultants~~ officers and employees of any Parent Company to the extent such salaries, bonuses and other ~~compensation and~~ benefits are reasonably attributable to the ownership or operations of ~~the Lead~~ Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead ~~costs~~ costs, fees and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such ~~costs~~ costs, fees and expenses are reasonably attributable to the ownership or operations of ~~the Lead~~ Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of ~~the Lead~~ Borrower or any Parent Company; (F) the purchase or other acquisition by Holdings or any ~~parent~~ other Parent Company of ~~the Lead~~ Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by ~~the Lead~~ Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such ~~parent~~ Parent Company shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to ~~the Lead~~ Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into ~~the Lead~~ Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such ~~purchaser~~ purchase or other acquisition;; and (G) any customary fees and expenses related to any successful or unsuccessful debt or equity offering by any Parent Company directly attributable to the operations of ~~the Lead~~ Borrower and its Restricted Subsidiaries; (vii) Borrower and its Restricted Subsidiaries may give reasonable and customary indemnities to directors, officers and employees of Holdings or any other Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of ~~the Lead~~ Borrower and its Restricted Subsidiaries; (viii) ~~the Lead~~ Borrower may authorize, declare and pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of ~~the Lead~~ Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory ~~Agreement (as in effect on the Closing Date~~Agreement; (ix) any Dividend used (x) to fund the Transaction, including Transaction ~~Costs and the Special Dividend~~Costs, and (y) in order to satisfy deferred purchase price, earn-outs and contingent payments in respect of any ~~Dividend from proceeds received~~ amounts due and owing as provided for in ~~connection with any working capital adjustment pursuant to~~ the Acquisition Agreement; (x) ~~the Lead~~ Borrower may authorize, declare and pay cash Dividends to Holdings (who may subsequently authorize, declare and pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v), 10.06(vii) and ~~10.06(vii~~10.06(xii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or ~~the settlement or vesting of other~~ similar equity incentive awards; (xii) a Dividend (including to any Parent ~~Company~~ Company) to fund a payment of dividends on ~~such~~ Borrower’s or any Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, not to exceed, in any fiscal year, the sum of ~~up to 6~~(x) 6.0% ~~per annum~~ of the net cash proceeds received by or contributed to the capital of ~~the Lead~~ Borrower from any such Initial Public ~~Offering~~Offering and (y) 7.0% of Borrower’s (or any Parent Company’s) Market Capitalization; (xiii) ~~on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00,~~ any Dividends to the extent the same are made solely with the Available Amount, so long as as, solely to the extent clause (a)(ii) of the definition of “Available Amount” is being utilized, at the time of, and after giving effect to such ~~Dividend~~Dividend on a Pro Forma Basis, (i) no Event of Default shall have occurred and be ~~continuing~~continuing and (ii) the Consolidated First Lien Net Leverage Ratio, on a Pro Forma Basis as of the last day of the most recently ended Test Period, does not exceed 4.05:1.00; (xiv) purchases of minority interests in ~~non-~~Restricted Subsidiaries that are not Wholly-Owned Subsidiaries by ~~the Lead~~ Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed the greater of $~~5,000,000~~40,000,000 and 5.0% of Consolidated EBITDA of Borrower and its Restricted Subsidiaries for the most recently ended Test Period (measured at the time of such Dividend); (xv) the authorization, declaration and payment of ~~dividends~~ Dividends or the payment of other distributions by ~~the Lead~~ Borrower in an aggregate amount since the Closing Date not to exceed the greater of $~~35,000,000~~400,000,000 and 50.0% of Consolidated EBITDA of Borrower and its Restricted Subsidiaries for the most recently ended Test Period (measured at the time of such Dividend); (xvi) ~~the Lead~~ Borrower and each Restricted Subsidiary may authorize, declare and make ~~dividend~~ Dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of ~~dividend~~ Dividend or other distribution by a Restricted Subsidiary, ~~the Lead~~ Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) ~~the Lead~~ Borrower may ~~make payments~~ authorize, declare and pay Dividends with the cash proceeds contributed to its common equity (including from the net cash proceeds of any equity issuance by any Parent Company), so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (~~iii~~xvii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (~~b)(x)(ii~~a)(iii) of the definition of “Available Amount”; (xviii) ~~the Lead~~ Borrower and any Restricted Subsidiary may authorize, declare and pay ~~dividends and distributions~~ Dividends within 60 90 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03~~; and~~; (xix) any Dividends, so long as (x) at the time ~~of,~~ of and after giving effect to such Dividend, no Event of Default ~~shall have~~ has occurred and be is continuing and (y) on a Pro Forma Basis, as of the last day of the most recently ended Test Period, the Consolidated Total Net Leverage Ratio does not exceed ~~3.25~~ 4.30:1.00; (xx) so long as no Event of Default under Section 11.01 or 11.05 has occurred and is continuing or would result therefrom, Borrower and any Restricted Subsidiary may authorize, declare and pay Dividends with any Leverage Excess Proceeds; and (xxi) any payment that is intended to ~~1.00~~prevent any Indebtedness of Borrower from being treated as an “applicable high yield discount obligation” within the meaning of Section 163(i)(1) of the Code. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the ~~definition~~ definitions of “Consolidated ~~EBITDA~~ EBITDA” and “Consolidated Net Income”), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) ~~shall~~ shall, to the extent such loan or advance remains unpaid, be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi).

Appears in 3 contracts

Sources: Credit Agreement (McGraw Hill, Inc.), Credit Agreement (McGraw Hill, Inc.), Credit Agreement (McGraw Hill, Inc.)

Dividends. ~~The Lead Borrower will not~~Declare or make, ~~and will not permit~~ directly or indirectly, any ~~of its Restricted Subsidiaries to~~Dividend, ~~authorize, declare~~ or ~~pay~~ incur any ~~Dividends with respect~~ obligation (contingent or otherwise) to ~~the Lead Borrower or any of its Restricted Subsidiaries~~do so, except that: (ia) ~~any~~ each Restricted Subsidiary ~~of the Lead Borrower~~ may pay Dividends ~~or return capital or make distributions and other similar payments with regard to its Equity Interests~~ to the ~~Lead Borrower or to other~~ Company, any Restricted Subsidiaries of the ~~Lead Borrower which directly or indirectly own equity therein; (ii)~~ Company that are Guarantors and any ~~non-Wholly-Owned Subsidiary~~ other Person that owns a direct Equity Interest in such Restricted Subsidiary, ratably according to their respective holdings of the Lead Borrower may declare and pay cash Dividends to its shareholders generally so long as the Lead Borrower or its Restricted Subsidiary which owns the Equity Interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes type of Equity Interests of such Subsidiary); (iii) so long as no Default or Event of Default exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, the Lead Borrower may pay cash Dividends to Holdings to allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of such Parent Company from current or former members of management, employees, consultants, officers and directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by the Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings Interest in respect of ~~all~~ which such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included Dividend is being made, or, in the ~~Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year~~ case of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower Company or any of its Restricted Subsidiaries ~~after~~ which owns the ~~Closing Date; plus (II) the net proceeds from the sale of~~ Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described Interest in the ~~preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management~~Restricted Subsidiary paying such Dividends, ~~officers, directors, employees of the Lead Borrower or any of~~ at least its ~~Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement~~proportionate share thereof; (ivb) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $5,000,000; (xv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the common stock or other common Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distributionPerson; (~~xvii~~c) the ~~Lead Borrower~~ Company and each Restricted Subsidiary may ~~make payments~~ purchase, redeem or otherwise acquire its common Equity Interests with the ~~cash~~ proceeds ~~contributed to its common equity~~ received from the ~~net cash proceeds~~ substantially concurrent issue of new common Equity Interests; (d) the Company may redeem, repurchase or otherwise acquire for value outstanding shares of Company Common Stock (or options, warrants or other rights to acquire such Company Common Stock) following the death, disability, retirement or termination of employment of officers, directors or employees of the Company or any ~~equity issuance by any Parent Company~~of its Restricted Subsidiaries, ~~so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom;~~ provided that (x) the aggregate amount of all such redemptions and repurchases pursuant to this Section 7.06(d) shall not exceed the greater of $5,000,000 and 1.50% of LTM Consolidated EBITDA (as of the date of the making of such Dividend) in any fiscal year of the Company (less the amount of any such redemption or repurchase effected by the forgiveness of Indebtedness owed to the Company by such officer, director or employee) and (y) at the time of any such redemption or repurchase permitted to be made pursuant to this Section 7.06(d), no Default or Event of Default shall then exist or result therefrom; (e) the Company may pay regularly scheduled Dividends on its Qualified Preferred Stock pursuant to the terms thereof solely through the issuance of additional shares of such Qualified Preferred Stock (but not in cash), provided that in lieu of issuing additional shares of such Qualified Preferred Stock as Dividends, the Company may increase the liquidation preference of the shares of Qualified Preferred Stock in respect of which such Dividends have accrued; (f) the Company may acquire shares of its Equity Interests in connection with the exercise of stock options or warrants to the extent such Equity Interests represent a portion of the exercise price of those stock options or warrants by way of cashless exercise; (g) the Company may make Dividends consisting of the issuance of equity rights convertible into Qualified Preferred Stock in connection with certain “anti-takeover” and “poison pill” arrangements approved by the board of directors of the Company; (h) the Company may make Dividends to directors, officers and employees of the Company and its Restricted Subsidiaries in connection with any incentive plans approved by the board of directors of the Company consisting of (i) shares of Company Common Stock (or options, warrants and other equity instruments in respect thereof), (ii) cash ~~proceeds that are utilized for any Dividend under this clause~~ incentive bonuses, and (iii) ~~will not be considered to be~~ stock appreciation rights or performance units, including any cash ~~proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”~~payments in connection therewith; (~~xviii~~i) upon any conversion of any Permitted Convertible Notes at maturity into shares of Company Common Stock, the Borrower may make Dividends consisting of the exercise of the applicable Call Spread Option relating to such Permitted Convertible Notes; (j) [reserved]; (k) so long as no Event of Default then exists or would result therefrom, Dividends in an aggregate amount on or after the Closing Date not to exceed, when taken together with the aggregate amount of prepayments, repayments, redemptions, repurchases or acquisitions of Indebtedness pursuant to Section 7.14(b) made on or after the Closing Date, the greater of $50,000,000 and 13.00% of LTM Consolidated EBITDA (as of the date of the making of such Dividend); and (l) additional Dividends so long as the Payment Conditions are satisfied; (m) the ~~Lead Borrower and~~ payment of any ~~Restricted Subsidiary may pay dividends and distributions~~ dividend within 60 days after the date of declaration thereof, if at the date of declaration ~~of such payment,~~ such payment would have complied with ~~another provision~~ the provisions of this Section 10.03; and (xix) any Dividends, so long as (x) at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi)Agreement.

Appears in 3 contracts

Sources: Abl Credit Agreement (Ciena Corp), Abl Credit Agreement (Ciena Corp), Abl Credit Agreement

Dividends. ~~The Lead~~ Borrower will not, ~~and~~ nor will ~~not~~ it permit any of its ~~Restricted~~ Subsidiaries to, authorize, declare or pay any Dividends with respect to ~~the Lead~~ Borrower or any of its ~~Restricted~~ Subsidiaries, except that: (ia) any ~~Restricted~~ Subsidiary of ~~the Lead~~ Borrower may (x) pay Dividends ~~or return capital or make distributions and other similar payments with regard~~ to ~~its Equity Interests to the Lead~~ Borrower or to ~~other Restricted Subsidiaries of the Lead Borrower which directly or indirectly own equity therein; (ii)~~ any ~~non-~~Wholly-Owned Subsidiary of ~~the Lead~~ Borrower ~~may declare~~ and (y) if such Subsidiary is not a Wholly-Owned Subsidiary of Borrower, pay ~~cash~~ Dividends to its ~~shareholders~~ shareholders, partners or members generally so long as ~~the Lead~~ Borrower or its ~~Restricted~~ respective Subsidiary which owns the ~~Equity Interests~~ equity interest or interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative ~~holding~~ holdings of ~~the Equity Interests~~ equity interests in the Subsidiary paying such Dividends and taking into account that the relative preferences, if any, of the various classes of ~~Equity Interests of~~ equity interests in such Subsidiary); (~~iii~~b) Borrower may pay or make Dividends so long as (i) no Default or Event of Default then exists ~~at the time of the applicable Dividend, redemption or repurchase~~ or would ~~exist immediately after giving effect thereto~~result therefrom, the Lead Borrower may pay cash Dividends to Holdings to allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of such Parent Company from current or former members of management, employees, consultants, officers and directors (~~and their successors and assigns~~ii) ~~of the Lead Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends~~ calculations are made by ~~the Lead~~ Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the ~~Securities Act~~financial covenants contained in Sections 9.08, ~~the Securities Exchange Act or~~ 9.09 and 9.10 for the respective ~~rules and regulations promulgated thereunder;~~ Calculation Period (vito the extent that such financial covenants are in effect for such Calculation Period) on Pro Forma Basis as if the ~~Lead Borrower may pay cash dividends~~ respective Dividend (as well as all other Dividends theretofore paid or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending made after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu first day of such ~~minimum Taxes~~Calculation Period) ~~that are attributable to~~ had occurred on the ~~taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount~~ first day of such ~~payments made in respect of~~ Calculation Period, and such ~~taxable period in the aggregate~~ calculations shall ~~not exceed the amount~~ show that ~~the Lead Borrower and its Subsidiaries~~ such financial covenants would have been ~~required to pay~~ complied with as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the ~~Lead Borrower~~ last day of such Calculation Period, and ~~its Restricted Subsidiaries;~~ (Diii) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the ~~exercise~~ payment or making of ~~warrants~~cash Dividends, ~~options or other securities convertible into or exchangeable~~ Borrower shall have delivered to Lender (with copies for ~~Equity Interests~~ Lender) a certificate executed by one of its Authorized Officers certifying compliance with the ~~Lead Borrower or any Parent Company;~~requirements of preceding clauses (i) through (ii), inclusive, and containing the calculations (in reasonable detail) required by preceding clause (ii). (Fc) ~~the purchase or other acquisition by any parent~~ For purposes of ~~the Lead Borrower~~ compliance with this Section 9.03, unless an Event of ~~all or substantially all of the property~~ Default has occurred and ~~assets or business of any Person~~is continuing, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $5,000,000; (xv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 45 days after the date of declaration thereof, if at the date of declaration ~~of such payment,~~ such payment would have complied with ~~another provision~~ the provisions of this Section 10.03; and (xix) any Dividends, so long as (x) at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi)Agreement.

Appears in 3 contracts

Sources: Credit Agreement (BOSTON OMAHA Corp), Credit Agreement (BOSTON OMAHA Corp), Credit Agreement (BOSTON OMAHA Corp)

Dividends. ~~The Lead Borrower will not~~Declare or pay, ~~and will not permit~~ directly or indirectly, any ~~of its Restricted Subsidiaries to~~dividends or make any other distribution, ~~authorize~~whether in cash, ~~declare~~ property, securities or ~~pay any Dividends~~ a combination thereof, with respect to ~~the Lead Borrower~~ (whether by reduction of capital or otherwise) any shares of capital stock (or any options, warrants, rights or other equity securities or agreements relating to any capital stock) of ~~its~~ the Borrower, or set apart any sum for the aforesaid purposes (collectively, “Restricted ~~Subsidiaries~~Payments”), except that: (i) any Restricted Subsidiary of the Lead Borrower may pay Dividends or return capital or make distributions and other similar payments with regard to its Equity Interests to the Lead Borrower or to other Restricted Subsidiaries of the Lead Borrower which directly or indirectly own equity therein; (ii) any non-Wholly-Owned Subsidiary of the Lead Borrower may declare and pay cash Dividends to its shareholders generally so So long as ~~the Lead Borrower or its Restricted Subsidiary which owns the Equity Interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof~~ (based upon its relative holding of the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary); (iiix) ~~so long as~~ no Default or Event of Default exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, the Lead Borrower may pay cash Dividends to Holdings to allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of such Parent Company from current or former members of management, employees, consultants, officers and directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by the Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $5,000,000; (xv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result ~~therefrom; provided that~~ therefrom and (y) after giving pro forma effect thereto, the ~~amount~~ Total Net Leverage Ratio on a pro forma basis as at the end of the trailing four Fiscal Quarters most recently ended immediately prior to the incurrence thereof, does not exceed 2.75:1.0, the Borrower may make Restricted Payments; (ii) to the extent constituting Restricted Payments, the Borrower may enter into and consummate any ~~such cash proceeds that are utilized for any Dividend~~ transactions permitted under ~~this clause~~ Section 5.02(d), (e) and (h); (iii) ~~will not be considered~~ the Borrower may make Restricted Payments in an amount up to ~~be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of~~ the ~~definition of “~~Available ~~Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof,~~ Amount Basket if at the ~~date of declaration of~~ time such ~~payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as (x) at the time of, and after giving effect to such Dividend~~Restricted Payment is made, no Default or Event of Default shall have occurred and be continuing and ~~(y)~~ after giving effect to such Restricted Payment on a ~~Pro Forma Basis~~pro forma basis, the ~~Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining~~ Borrower is in compliance with ~~this Section 10.03~~ the Financial Covenant; (~~and~~ iv) the Borrower may make Restricted Payments in ~~determining amounts paid~~ respect of any class of its Capital Stock so long as ~~Dividends pursuant hereto for purposes~~ such Restricted Payments are payable solely in shares of ~~the definition~~ such class of ~~Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi~~Capital Stock; and (v) ~~shall be deemed to be cash Dividends paid to Holdings~~ to the extent constituting Restricted Payments, the Borrower may (a) convert shares of its Preferred Interests into shares of common stock or other common Capital Stock or (b) refinance such Preferred Interests (including related premiums) with Debt, provided ~~in said~~ that such Debt is permitted to be incurred under Section ~~10.05(vi~~5.02(b).

Appears in 3 contracts

Sources: Credit and Guaranty Agreement (Dana Inc), Revolving Credit and Guaranty Agreement (Dana Inc), Revolving Credit and Guaranty Agreement (Dana Holding Corp)

Dividends. ~~The Lead Borrower will not, and will not permit any of its Restricted Subsidiaries to, authorize~~Authorize, declare or ~~pay~~ pay, directly or indirectly, any Dividends with respect to ~~the Lead Borrower or~~ any ~~of its Restricted Subsidiaries~~Company, except that: (a) any Subsidiary of Borrower (i) may pay cash Dividends to Borrower or any ~~Restricted~~ Wholly Owned Subsidiary of ~~the Lead~~ Borrower ~~may pay Dividends or return capital or make distributions~~ and ~~other similar payments with regard to its Equity Interests to the Lead Borrower or to other Restricted Subsidiaries of the Lead Borrower which directly or indirectly own equity therein;~~ (ii) ~~any non-Wholly-~~if such Subsidiary is not a Wholly Owned Subsidiary of ~~the Lead Borrower~~ Borrower, may ~~declare and~~ pay cash Dividends to its shareholders generally so long as ~~the Lead~~ Borrower or its ~~Restricted~~ Subsidiary which owns the ~~Equity Interests~~ equity interest or interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative ~~holding~~ holdings of ~~the Equity Interests~~ equity interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of ~~Equity Interests of~~ equity interests in such Subsidiary); (~~iii~~b) so long as no Default ~~or Event of Default~~ exists ~~at the time of the applicable Dividend, redemption or repurchase~~ or would ~~exist immediately after giving effect thereto~~result therefrom, ~~the Lead~~ Borrower may pay ~~cash~~ Dividends to ~~Holdings~~ Parent in order to ~~allow Holdings~~ enable Parent to ~~pay cash dividends~~ repurchase outstanding shares of its capital stock (or options to ~~any other Parent Company to redeem~~ purchase such capital stock) following the death, disability, retirement or ~~repurchase, contemporaneously with such Dividend, Equity Interests~~ termination of ~~such Parent Company from current or former members~~ employment of ~~management,~~ employees, ~~consultants,~~ officers ~~and~~ or directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by the Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased shall not (net of any ~~cash proceeds received~~ Company or upon the exercise by ~~Holdings (but in no event from~~ any ~~Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with~~ such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants person of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including put” right in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year such capital stock (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(viioptions); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of ~~such purchases~~Dividends paid by Borrower pursuant to this paragraph (b) shall not exceed an aggregate amount of $3.0 million (exclusive of any amounts repaid to Borrower concurrently therewith in respect of loans made pursuant to Section 6.03(i); (c) Borrower may pay cash Dividends to Parent, ~~when added~~ so long as all proceeds thereof are promptly used by Parent to pay its franchise taxes and operating expenses incurred in the ordinary course of business and other corporate overhead costs and expenses (including legal and accounting expenses and similar expenses and customary fees to non-officer directors of Parent); provided that the aggregate amount of ~~Investments~~ Dividends paid to Parent pursuant to ~~Section 10.05(xvii),~~ this clause (c) shall not exceed $~~5,000,000~~1.0 million in any fiscal year of Parent; (xvd) Borrower or any Subsidiary may pay cash Dividends to Parent in an amount not in excess of the ~~declaration~~ federal and ~~payment~~ state (in such states that permit consolidated or combined Tax Returns) income tax liability that Borrower and the Subsidiaries would have been liable for if any of ~~dividends~~ the Companies had filed their taxes on a stand-alone basis, for the purpose of paying such taxes; provided that such payments shall be made by Parent no earlier than five days prior to the date on which Parent is required to make its payments to the Internal Revenue Service or the ~~payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000~~applicable state tax authority, as applicable; (~~xvi~~e) Borrower may pay Dividends to Parent of capital stock of Parent to the ~~Lead~~ extent such capital stock of Parent is acquired by Borrower ~~and each Restricted Subsidiary may declare and make dividend payments or~~ as a result of a foreclosure action following a default on an advance, loan and/or other ~~distributions payable solely in the Equity Interests~~ extension of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distributioncredit permitted pursuant to Section 6.03(i); (~~xvii~~f) ~~the Lead~~ Borrower may pay Dividends to the extent permitted by Section 6.06(h); (g) Borrower may pay cash dividends or distributions, or make loans to, Parent in an amount not in excess of the amount required by Parent to enable it to make cash interest payments ~~with~~ in respect of the Permitted Parent Notes, which Dividends may be made not earlier than the fifth Business Day preceding the date on which such cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrominterest payments are due; provided that (i) if any Permitted Parent Hedge is in effect, (A) the amount permitted to be paid by Parent pursuant to the foregoing shall not be greater than (x) the Applicable Margin as defined in the Permitted Parent Notes as in effect on the date hereof times the principal amount of Permitted Parent Notes then outstanding plus (y) the amount of ~~any~~ Parent’s payment obligation under the Permitted Parent Hedge associated with such ~~cash proceeds that are utilized for any Dividend~~ interest payment (net of payments then due to Parent under ~~this clause~~ the Permitted Parent Hedge) and (~~iii~~B) ~~will not be considered~~ if Borrower has elected to ~~be cash proceeds~~ make payments of ~~Equity Interests for purposes~~ interest on the Permitted Parent Notes by the issuance of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereofadditional Permitted Parent Notes, ~~if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as~~ (x) at Borrower may pay cash dividends or distributions, or make loans to, Parent in an amount not in excess of the ~~time of~~amount required by Parent to enable it to make its payment obligation under the Permitted Parent Hedge associated with such interest payment (net of payments then due to Parent under the Permitted Parent Hedge) not earlier than the fifth Business Day preceding the date on which such payments are due and (y) if Parent receives a net payment under the Permitted Parent Hedge, ~~and~~ Parent shall contribute such payment as an equity contribution to Borrower or as repayment of any loan from Borrower pursuant to this Section 6.05(g), (ii) on a Pro Forma Basis after giving effect to such ~~Dividend~~dividend, distribution or loan and the payment of such interest or payment obligations (including any borrowing to fund such dividend, distribution or loan), Borrower shall be in compliance with the covenants set forth in Section 6.07 and no ~~Event of~~ Default shall ~~have occurred and be continuing~~ exist and (yiii) the amount of any Dividend or loans made under this clause (g) after the Closing Date shall reduce the Available Basket Amount, which reduction may be to an amount less than $0; (h) Borrower may pay cash dividends or distributions, or make loans to, Parent of up to $3,500,000 in the aggregate (the “Cash Collateral Basket”) to be used by Parent to provide cash collateral for the benefit of the counterparty to any Secured Permitted Parent Hedge; provided that (i) only up to $1,000,000 of the Cash Collateral Basket shall be dividended, distributed or loaned by Borrower for providing the initial cash collateral on the initial Secured Permitted Parent Hedge, (ii) on a Pro Forma ~~Basis~~Basis after giving effect to each such dividend, ~~the Consolidated Total Net Leverage Ratio does not exceed 3.25~~ distribution or loan (including any borrowing to ~~1.00. In determining~~ fund such dividend, distribution or loan), Borrower shall be in compliance with ~~this~~ the covenants set forth in Section ~~10.03~~ 6.07 and no Default shall exist, (~~and in determining amounts paid as Dividends pursuant hereto for purposes~~ iii) upon termination of a Secured Permitted Parent Hedge that is not replaced by another Secured Permitted Parent Hedge, any amount of the ~~definition~~ Cash Collateral Basket not paid or owing to such counterparty under the terms of ~~Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced~~ the master agreement relating to ~~Holdings pursuant to Section 10.05(vi)~~ such Secured Permitted Parent Hedge shall be ~~deemed~~ returned to ~~be cash Dividends paid to Holdings~~ Borrower (as an equity contribution to the extent that the payment to Parent was in the form of a dividend or distribution and as repayment of loan to the extent that the payment to Parent was in the form of a loan), (iv) if Parent enters into a Secured Permitted Parent Hedge after termination of a Secured Permitted Parent Hedge, any portion of the Cash Collateral Basket not already paid to a counterparty to a Secured Permitted Parent Hedge shall be available again as provided above and (v) the amount of any Dividend or loans made under this clause (h) after the Closing Date shall reduce the Available Basket Amount, which reduction may be to an amount less than $0; (i) Borrower may pay a cash dividend to Parent on the Closing Date (or during the sixty (60) day period thereafter) with the proceeds of a portion of the Term Loans, which proceeds shall be used by Parent to purchase or redeem a portion of the Parent Floating Rate Notes to effect the Refinancing and pay any premiums and fees and expenses in ~~said Section 10.05(vi)~~connection therewith; and (j) Borrower may pay Dividends in reliance on the Available Basket Amount.

Appears in 3 contracts

Sources: Credit Agreement (Cpi International, Inc.), Credit Agreement (Cpi International, Inc.), Credit Agreement (Cpi International, Inc.)

Dividends. ~~The Lead Borrower~~ Holdings will not, and will not permit any of ~~its~~ the Restricted Subsidiaries to, ~~authorize, declare or~~ pay any Dividends with respect to ~~the Lead Borrower~~ Holdings or any of ~~its~~ the Restricted Subsidiaries, except that: (i) any Restricted Subsidiary of ~~the Lead Borrower~~ Holdings may pay Dividends or return capital or make distributions and other similar payments with regard to its Equity Interests to ~~the Lead Borrower~~ Holdings or to other Restricted Subsidiaries of ~~the Lead Borrower~~ Holdings which directly or indirectly own equity therein; (ii) any non-Wholly-Owned Subsidiary of ~~the Lead Borrower~~ Holdings may declare and pay cash Dividends to its shareholders generally so long as ~~the Lead Borrower~~ Holdings or its Restricted Subsidiary which owns the Equity Interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary); (iii) so long as no Default or Event of Default exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, ~~the Lead Borrower~~ Holdings may pay cash Dividends to ~~Holdings to allow Holdings to pay cash dividends to~~ any ~~other~~ Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of such Parent Company from ~~current or former members of~~ management, employees~~, consultants~~, officers and directors (and their successors and assigns) of Holdings and the ~~Lead Borrower and its~~ Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by ~~the Lead Borrower to~~ Holdings pursuant to this clause (iii), and the aggregate amount paid by ~~Holdings~~ such Parent Company in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings ~~(but in no event from any Initial Public Offering)~~ from issuances of its Equity Interests (other than to the extent included in the Available Amount) ~~and contributed to the Lead Borrower~~ in connection with such redemption or repurchase), in either case, exceed during any fiscal year of Holdings, the ~~Lead Borrower,~~ greater of $~~10,000,000~~ 31,800,000 and 10.0% of LTM Consolidated EBITDA (measured at the time of such Dividend) (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by ~~the Lead Borrower~~ Holdings or any of ~~its~~ the Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings or of any Parent Company which net proceeds are contributed to Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date~~, where the net proceeds of such sale are received by or contributed to the Lead Borrower~~; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (~~b)(x)(ii~~a)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to ~~the Lead Borrower~~ Holdings from ~~current or former~~ members of management, officers, directors, employees of ~~the Lead Borrower~~ Holdings or any of its Subsidiaries in connection with a repurchase of Equity Interests of Holdings or any other Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) ~~the Lead Borrower~~ Holdings may pay cash Dividends to ~~Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to~~ any ~~other~~ Parent ~~Company)~~ Company to pay expenses incurred by ~~Holdings or~~ any ~~other~~ Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to ~~the Lead Borrower~~Holdings, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as ~~Holdings and any other~~ such Parent Company shall cause the amount of such expenses to be repaid to ~~the Lead Borrower~~ Holdings or the relevant Restricted Subsidiary of ~~the Lead Borrower~~ Holdings out of the proceeds of such offering promptly if such offering is completed; (v) ~~the Lead Borrower~~ Holdings may pay cash Dividends to ~~Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to~~ any ~~other~~ Parent ~~Company)~~ Company to pay costs (including all professional fees and expenses) incurred by ~~Holdings or any other~~ such Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) for any taxable period in which (a) Holdings and/or any of its Subsidiaries is a member of a consolidated, combined, unitary or similar U.S. federal, state, local and/or foreign income or similar tax group whose common parent is a Parent Company (a “Tax Group”) or (b) Holdings is a pass-through entity for U.S. federal income tax purposes that is owned by a Parent Company that is a corporation for U.S. federal income tax purposes (directly or indirectly through one or more corporate subsidiaries of such Parent Company (any such corporate subsidiaries, together with such Parent Company, the ~~Lead Borrower~~ “Corporate Owners”)), Holdings may make distributions to any Parent Company to pay any consolidated, combined, unitary or similar U.S. federal, state, local and/or foreign income or similar income Taxes of such Tax Group, as applicable, or to any Corporate Owner to pay the U.S. federal, state, local and/or foreign income or similar Taxes of such Corporate Owner, in each case that are attributable to the taxable income of Holdings and/or its applicable Subsidiaries, as applicable; provided, that, (A) the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount of such Taxes that Holdings and/or its applicable Subsidiaries would have been required to pay in respect of such taxable period if such entity(ies) were a stand-alone corporate taxpayer or stand-alone corporate tax group consisting only of Holdings and/or such Subsidiaries for all relevant taxable periods, (B) the portion of any payment otherwise permitted pursuant to this clause (vi) with respect to any Taxes attributable to the income of any Unrestricted Subsidiary shall be limited to the amount actually paid by such Unrestricted Subsidiary to Holdings or any Loan Party for the purposes of paying such Taxes, and (C) with respect to any taxable period (or portion thereof) ending prior to the Closing Date, payments pursuant to this clause (vi) shall be permitted only to the extent relating to Tax adjustments that arise after the Closing Date as a result of audits or other Tax proceedings; (vii) Holdings may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their ~~existence~~existence to the extent such Taxes, fees and expenses are reasonably attributable to the operations of Holdings and the Restricted Subsidiaries; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other ~~compensation and~~ benefits payable to ~~current and former officers, directors, consultants~~ officers and employees of any Parent Company to the extent such salaries, bonuses and other ~~compensation and~~ benefits are reasonably attributable to the ownership or operations of Holdings and the ~~Lead Borrower and its~~ Restricted Subsidiaries; (DC) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of Holdings and the ~~Lead Borrower~~ Restricted Subsidiaries (including, for the avoidance of doubt, administrative costs and ~~its Restricted Subsidiaries~~expenses of Syncom-Iridium Holdings Corp. and/or Iridium Blocker-B. Inc.); (ED) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of ~~the Lead Borrower~~ Holdings or any Parent Company; (FE) for the purchase or other acquisition by any ~~parent of the Lead Borrower~~ Parent Company of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that (1) if such purchase or other acquisition had been made by ~~the Lead Borrower~~Holdings, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14~~; provided that~~ , (A2) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B3) such ~~parent~~ Parent Company shall, immediately following the closing thereof, cause (1x) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to ~~the Lead Borrower~~ Holdings or any Restricted Subsidiary or (2y) the merger (to the extent permitted in Section 10.02) into ~~the Lead Borrower~~ Holdings or any Restricted Subsidiary of the Person formed or acquired in order to consummate such ~~purchaser~~ purchase or other acquisition;; and (GF) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company ~~directly~~ reasonably attributable to the operations of Holdings and the ~~Lead Borrower and its~~ Restricted Subsidiaries; provided that the aggregate amount of Dividends made pursuant to subclauses (B), (C) and (F) of this clause (vii) shall not exceed the greater of $31,800,000 and 10.0% of LTM Consolidated EBITDA (measured at the time of such Dividend) in any fiscal year; (~~vii~~viii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of Holdings and the ~~Lead Borrower and its~~ Restricted Subsidiaries; (~~viii~~ix) ~~the Lead Borrower~~ Holdings may pay cash Dividends to ~~Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to~~ any ~~other~~ Parent ~~Company)~~ Company for payment of ~~(x)~~ obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of Holdings and the ~~Lead Borrower and its~~ Restricted ~~Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date~~Subsidiaries; (ixx) any Dividend used to fund the Transaction, including Transaction ~~Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement~~Costs; (xxi) ~~the Lead Borrower~~ Holdings may pay cash Dividends to ~~Holdings (who may subsequently pay cash Dividends to~~ any ~~other~~ Parent ~~Company)~~ Company so long as the proceeds thereof are used to pay ~~the Sponsor or Sponsor Affiliate~~ fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections ~~10.06(v~~10.06(vii) and ~~10.06(vii~~10.06(xii); (xixii) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or ~~the settlement or vesting of other~~ similar equity incentive awards; (~~xii~~xiii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common ~~stock following an Initial Public Offering~~ stock, not to exceed, in any fiscal year, 5.0% of such ~~common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering~~Parent Company’s Market Capitalization; (~~xiii~~xiv) ~~on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00,~~ any Dividends to the extent the same are made solely with the Available Amount; provided that to the extent clause (a)(i)(B) of the definition of “Available Amount” is being utilized, ~~so long as~~ at the time of, and after giving effect to such ~~Dividend~~Dividend on a Pro Forma Basis, (x) no Event of Default under Section 11.01(a) or Section 11.01(e) shall have occurred and be ~~continuing~~continuing and (y) the Consolidated Total Net Leverage Ratio, on a Pro Forma Basis as of the last day of the most recently ended Test Period, does not exceed 5.50:1.00; (~~xiv~~xv) purchases of minority interests in ~~non-~~Restricted Subsidiaries that are not Wholly-Owned Subsidiaries by ~~the Lead Borrower and the Guarantors~~Credit Parties; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed the greater of $~~5,000,000~~31,800,000 and 10.0% of LTM Consolidated EBITDA (measured at the time of such Dividend); (xvxvi) the declaration and payment of ~~dividends~~ Dividends or the payment of other distributions by Holdings, so long as the ~~Lead Borrower in an aggregate amount since~~ Consolidated Total Net Leverage Ratio, on a Pro Forma Basis as of the ~~Closing Date~~ last day of the most recently ended Test Period, does not to exceed ~~$35,000,000~~4.00:1.00 and no Event of Default shall have occurred and be continuing or result therefrom; (~~xvi~~xvii) ~~the Lead Borrower~~ Holdings and each Restricted Subsidiary may declare and make ~~dividend~~ Dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of ~~dividend~~ Dividend or other distribution by a Restricted Subsidiary, ~~the Lead Borrower~~ Holdings or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (~~xvii~~xviii) ~~the Lead Borrower~~ Holdings may ~~make payments~~ pay Dividends with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent ~~Company~~Company completed after the Closing Date, so long as, with respect to any such payments, no Event of Default under Section 11.01(a) or 11.01(e) shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (~~iii~~xviii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (~~b)(x)(ii~~a)(ii) of the definition of “Available Amount”; (~~xviii~~xix) ~~the Lead Borrower~~ Holdings and any Restricted Subsidiary may pay ~~dividends and distributions~~ Dividends within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03~~; and~~; (~~xix~~xx) Holdings and any ~~Dividends~~Restricted Subsidiary may pay Dividends the proceeds of which are applied to make payments of scheduled coupon and principal, ~~so long~~ refinance, defease or discharge the Senior Notes; (xxi) Holdings and any Restricted Subsidiary may make payments and distributions to dissenting stockholders pursuant to applicable law pursuant to or in connection with a sale, consolidation, merger or transfer of Holdings and the Restricted Subsidiaries taken as a whole that complies with the terms of this Agreement, including Section 10.02 hereof; (xxxii) Holdings and any Restricted Subsidiary may declare and pay Dividends to holders of any class or series of Qualified Preferred Stock issued by a Parent Company after the Closing Date; provided that (A) the Consolidated Fixed Charge Coverage Ratio at the time ~~of, and after giving effect to~~ of the issuance of such ~~Dividend, no Event of Default shall have occurred and be continuing and~~ Qualified Preferred Stock (y) calculated on a Pro Forma Basis, ) is 2.00 to 1.00 or greater and (B) the ~~Consolidated Total Net Leverage Ratio~~ aggregate amount of Dividends declared and paid pursuant to this Section 10.03(xxii) does not exceed ~~3.25~~ the net cash proceeds received by the Parent Company and contributed to ~~1.00~~Holdings from any such sale of Qualified Preferred Stock issued after the Closing Date and contributed to Holdings; and (xxiii) Holdings and any Restricted Subsidiary may pay Dividends in an aggregate amount not to exceed the greater of $79,500,000 and 25% of LTM Consolidated EBITDA (measured at the time of such Dividend), which may, at the election of the Borrower (and without duplication), be reallocated to make Investments pursuant to Section 10.05(xix). In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the ~~definition~~ definitions of “Consolidated ~~EBITDA~~ EBITDA” and “Consolidated Net Income”), amounts loaned or advanced to ~~Holdings~~ any Parent Company pursuant to Section 10.05(vi) ~~shall~~ shall, to the extent such loan or advance remains unpaid, be deemed to be cash Dividends paid to ~~Holdings~~ such Parent Company to the extent provided in said Section 10.05(vi). For purposes of determining compliance with this Section 10.03, if the payment of Dividends would be permitted pursuant to one or more provisions described above, the Borrower, in its sole discretion, from time to time, may classify or reclassify or divide such payment of Dividends (or any portion thereof) in any manner that complies with this Section 10.03.

Appears in 3 contracts

Sources: Credit Agreement (Iridium Communications Inc.), Credit Agreement (Iridium Communications Inc.), Credit Agreement (Iridium Communications Inc.)

Dividends. ~~The Lead Borrower will not, and will not permit any of its Restricted Subsidiaries to, authorize, declare or pay~~ Pay any Dividends with respect to ~~the Lead Borrower or~~ any ~~of its Restricted Subsidiaries~~Company, except that: (a) any Subsidiary of Borrower (i) may pay cash Dividends to Borrower or any ~~Restricted~~ Wholly Owned Subsidiary of ~~the Lead~~ Borrower ~~may pay Dividends or return capital or make distributions~~ and ~~other similar payments with regard to its Equity Interests to the Lead Borrower or to other Restricted Subsidiaries of the Lead Borrower which directly or indirectly own equity therein;~~ (ii) ~~any non-Wholly-~~if such Subsidiary is not a Wholly Owned Subsidiary of ~~the Lead Borrower~~ Borrower, may ~~declare and~~ pay cash Dividends to its shareholders generally so long as ~~the Lead~~ Borrower or its ~~Restricted~~ Subsidiary ~~which~~ that owns the ~~Equity Interests~~ equity interest or interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative ~~holding~~ holdings of ~~the~~ Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of in such Subsidiary); (~~iii~~b) any Non-Guarantor Subsidiary (i) may pay cash Dividends to its parent and (ii) if such Non-Guarantor Subsidiary is not a Wholly Owned Subsidiary, may pay cash Dividends to its shareholders generally so long as the Subsidiary of Holdings that owns the Equity Interest in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holdings of Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests in such Subsidiary) (c) so long as no Default or Event of Default exists ~~at the time of the applicable Dividend, redemption or repurchase~~ or would ~~exist immediately after giving effect thereto~~result therefrom, ~~the Lead~~ Borrower and each Guarantor may pay ~~cash~~ Dividends for the purpose of enabling Holdings to, and Holdings may, repurchase outstanding shares of its capital stock (or options to ~~Holdings to allow Holdings to pay cash dividends to any other Parent Company to redeem~~ purchase such common stock) following the death, disability, retirement or ~~repurchase, contemporaneously with such Dividend, Equity Interests~~ termination of ~~such Parent Company from~~ employment of current or former employees, officers, distributors or directors of any Company; provided that, (i) all amounts used to effect such repurchases are obtained by Holdings from a substantially concurrent issuance of its capital stock (or exercise of options to purchase such capital stock) to other employees, members of management, ~~employees~~distributors, ~~consultants~~executive officers or directors of Holdings, ~~officers and directors (and their successors and assigns)~~ Borrower or any of ~~the Lead Borrower and~~ its ~~Restricted~~ Subsidiaries; ~~provided that~~ or (Aii) to the extent the proceeds used to effect any repurchase pursuant to this clause (ii) are not obtained as described in preceding clause (i), the aggregate amount of Dividends ~~made~~ paid by ~~the Lead Borrower to~~ Holdings pursuant to this Section 6.05(c) (exclusive of amounts paid as described pursuant to preceding clause (~~iii~~i)~~, and~~ ) shall not exceed $10.0 million in the aggregate on and after the Closing Date plus the amount ~~paid by Holdings in respect of all such Equity Interests so redeemed or repurchased shall not (net~~ of any ~~cash~~ key-man life insurance proceeds actually received ~~by Holdings (but~~ in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (ivd) ~~the Lead~~ so long as no Default or Event of Default exists or would result therefrom, Borrower and each Guarantor may pay cash Dividends ~~to Holdings~~ for the purpose of paying, so long as ~~the~~ all proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, each Loan Party’s operating expenses incurred in ~~each case without duplication: (A) franchise Taxes (~~the ordinary course of business and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate ~~operating and~~ overhead costs and expenses (including ~~administrative, legal,~~ legal and accounting expenses and similar ~~expenses~~ expenses); provided ~~by third parties~~that, the aggregate amount of Dividends paid pursuant to this Section 6.05(d) shall not exceed $150,000 in any fiscal year of ~~any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries~~Holdings; (Ee) ~~cash payments in lieu of issuing fractional shares in connection with the exercise of warrants~~so long as, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related after giving effect to any ~~unsuccessful equity offering by any Parent Company directly attributable to the operations~~ such cash Dividend on a pro forma basis, no Default or Event of ~~the Lead~~ Default exists or would result therefrom, Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower each Guarantor may pay cash Dividends for the purpose of enabling Holdings to ~~Holdings~~ pay (so long as ~~the~~ all proceeds thereof are ~~promptly~~ used by Holdings to pay) regularly scheduled payments of stated interest (and any applicable withholding tax gross-up payments or ~~subsequently paid to any~~ other ~~Parent Company) for payment of (x) obligations under or~~ tax indemnity payments in respect ~~of director~~ thereof) on, or the redemption price (including any premium required and ~~officer insurance policies~~ interest on amounts redeemed) in respect of, the Holdings Senior Notes (pursuant to the ~~extent reasonably attributable to the ownership or operation~~ terms of the ~~Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (~~Holdings Senior Note Documents as in effect on the Closing Date), so long as, until such time as the amount of cash Dividends made by Borrower pursuant to this Section 6.05(e) are applied to the payment of such regularly scheduled payments of stated interest (and any applicable withholding tax gross-up payments or other tax indemnity payments in respect thereof) on, or the redemption price (including any premium required and interest on amounts redeemed) in respect of, the Holdings Senior Notes, the Collateral Agent shall have a valid and perfected Lien on and security interest in such proceeds in accordance with Sections 5.11 and 5.12; (ixf) ~~any Dividend used to fund the Transaction~~so long as no Default or Event of Default exists or would result therefrom, ~~including Transaction Costs and the Special Dividend,~~ Holdings and any ~~Dividend from proceeds received~~ Subsidiary of Holdings may make Dividends in respect of any stock appreciation rights, plans, equity incentive or achievement plans or any similar plan, so long as such rights or similar plans are approved by the board of directors of Holdings (or a duly constituted committee thereof); (g) so long as no Default or Event of Default exists or would result therefrom, any Subsidiary of Holdings may purchase the capital stock of Holdings in connection with ~~any working~~ the exercise of stock option or similar arrangements by a director, officer or employee of such Subsidiary; provided, that such capital ~~adjustment pursuant~~ stock is immediately granted to the ~~Acquisition Agreement~~applicable director, officer or employee of such Subsidiary; (xh) ~~the Lead~~ Borrower and each Guarantor may pay cash Dividends to allow Holdings to pay cash Dividends so long as (~~who~~ i) no Default or Event of Default exists or would result therefrom and (ii) after giving effect to any such Dividend by Holdings the aggregate amount of Dividends paid by Holdings after the Closing Date pursuant to this Section 6.05(h) does not exceed the sum of (i) $300.0 million plus (ii) 50% of cumulative Consolidated Net Income of Holdings and its Subsidiaries for the period (taken as one accounting period) from the beginning of the first fiscal quarter of the 2007 fiscal year to the last day of the fiscal quarter most recently ended prior to the date of the Dividend to be made by Holdings for which financial statements are available; and (i) Borrower and its direct and indirect parent companies may ~~subsequently~~ pay cash Dividends to their respective parent companies (and such parent companies may pay cash Dividends) to the extent of U.S. federal and state income and other tax obligations of WH Capital to the extent that such U.S. federal and state income and tax obligations are reasonably attributable to income or operations of the Borrower and any ~~other Parent Company~~of its Subsidiaries. Any payments made pursuant to this Section 6.05(i) ~~so long as~~ shall, no later than the ~~proceeds thereof are~~ 30th day after receipt, either be used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such ~~Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed~~ obligations to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends applicable taxing authority or be remitted to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $5,000,000; (xv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as (x) at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi)Borrower.

Appears in 3 contracts

Sources: Credit Agreement (Herbalife Ltd.), Credit Agreement (Herbalife Ltd.), Credit Agreement (Herbalife Ltd.)

Dividends. ~~The Lead Borrower will not, and will not permit any of its Restricted Subsidiaries to, authorize~~Authorize, declare or ~~pay~~ pay, directly or indirectly, any Dividends with respect to ~~the Lead Borrower or~~ any ~~of its Restricted Subsidiaries~~Company, except ~~that~~that the following shall be permitted: (ia) any ~~Restricted~~ Subsidiary of the Lead Borrower may pay Dividends or return capital or make distributions and other similar payments with regard to its Equity Interests to the Lead Borrower or to other Restricted Subsidiaries of the Lead Borrower which directly or indirectly own equity therein; (ii) any non-Wholly-Owned Subsidiary of the Lead Borrower may declare and pay cash Dividends to its shareholders generally so long as the Lead Borrower or its Restricted Subsidiary which owns the Equity Interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary); (iii) so long as no Default or Event of Default exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, the Lead Borrower may pay cash Dividends to Borrower or any Guarantor that is a Wholly Owned Subsidiary of Borrower; (b) payments to Holdings to ~~allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase~~permit Holdings, ~~contemporaneously with such Dividend, Equity Interests~~ and the subsequent use of such ~~Parent Company from current~~ payments by Holdings, to repurchase or redeem Qualified Capital Stock of Holdings held by officers, directors or employees or former ~~members of management~~officers, ~~employees~~directors or employees (or their transferees, ~~consultants, officers and directors (and~~ estates or beneficiaries under their ~~successors and assigns~~estates) of ~~the Lead Borrower and its Restricted Subsidiaries~~any Company, upon their death, disability, retirement, severance or termination of employment or service or pay interest or principal in respect of Holdings Employee Notes; provided that ~~(A)~~ the aggregate ~~amount of Dividends made by the Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount~~ cash consideration paid ~~by Holdings in respect of~~ for all such ~~Equity Interests so redeemed or repurchased~~ redemptions and payments shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase)exceed, in ~~either case, exceed during~~ any ~~fiscal~~ calendar year the sum of ~~the Lead Borrower,~~ (x) $~~10,000,000~~ 3.0 million (~~provided that the amount~~ and up to 50% of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such ~~amount~~ $3 million not used in any calendar year may be ~~increased by an amount not~~ carried forward to ~~exceed:~~ the next succeeding (Ibut no other) calendar year), plus (y) the ~~cash proceeds~~ amount of ~~key man life insurance policies~~ any Net Cash Proceeds received by ~~the Lead~~ or contributed to Borrower ~~or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds~~ from the issuance and sale since the Issue Date of ~~Equity Interests~~ Qualified Capital Stock of ~~Holdings, in each case~~ Holdings to ~~members of management, managers~~officers, directors or ~~consultants~~ employees of ~~any Parent Company~~ Holdings or any of its Subsidiaries that ~~occurs after the Closing Date~~have not been used to make any repurchases, ~~where the net proceeds of such sale are received by~~ redemptions or ~~contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend~~ payments under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), ~~shall not exceed $5,000,000;~~ plus (xvz) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any ~~equity issuance by~~ "key-man" life insurance policies of Holdings, Borrower or any ~~Parent Company~~Subsidiary that have not been used to make any repurchases, ~~so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing~~ redemptions or ~~would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend~~ payments under this clause (~~iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”~~b); (~~xviii~~A) to the ~~Lead~~ extent actually used by Holdings or another direct or indirect parent company of Borrower to pay such taxes, costs and expenses, payments by Borrower to or on behalf of Holdings in an amount sufficient to pay franchise taxes and other fees required to maintain the legal existence of Holdings or another direct or indirect parent corporation of Borrower and (B) payments by Borrower to or on behalf of Holdings in an amount sufficient to pay out-of-pocket legal, accounting and filing costs and other expenses in the nature of overhead in the ordi- nary course of business of Holdings or another direct or indirect parent corporation of Borrower, in the case of clauses (A) and (B) in an aggregate amount not to exceed $750,000 in any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03calendar year; and (~~xix~~d) ~~any Dividends, so long as (x) at~~ the ~~time of~~making by Borrower of Dividends to Holdings constituting Permitted Tax Distributions, and ~~after giving effect to such Dividend, no Event~~ the subsequent distribution by Holdings of ~~Default shall have occurred and be continuing and (y) on~~ all or a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings portion thereof to the ~~extent provided in said Section 10.05(vi)~~its direct or indirect equity holders.

Appears in 3 contracts

Sources: Credit Agreement (Norcraft Companies Lp), Credit Agreement (Norcraft Companies Lp), Credit Agreement (Norcraft Companies Lp)

Dividends. ~~The Lead Borrower will not, and will not permit any of its Restricted Subsidiaries to, authorize~~Authorize, declare or pay any Dividends with respect to ~~the Lead Borrower~~ Holdings or any of its ~~Restricted~~ Subsidiaries, except that: (ia) any ~~Restricted~~ Subsidiary of the ~~Lead~~ Borrower (i) may pay cash Dividends ~~or return capital or make distributions and other similar payments with regard to its Equity Interests~~ to the ~~Lead~~ Borrower or ~~to other Restricted Subsidiaries~~ any Subsidiary of the ~~Lead~~ Borrower ~~which directly or indirectly own equity therein;~~ and (ii) ~~any non-Wholly-~~if such Subsidiary is not a Wholly Owned ~~Subsidiary of the Lead Borrower~~ Subsidiary, may ~~declare and~~ pay cash Dividends to its shareholders generally so long as the ~~Lead~~ Borrower or its ~~Restricted~~ respective Subsidiary which owns the ~~Equity Interests~~ equity interest or interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative ~~holding~~ holdings of ~~the Equity Interests~~ equity interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of ~~Equity Interests of~~ equity interests in such Subsidiary); (~~iii~~b) so long as there shall exist no Default or Event of Default ~~exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately~~ (both before and after giving effect ~~thereto~~to the payment thereof), ~~the Lead Borrower~~ Holdings may ~~pay cash Dividends to Holdings to allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend,~~ repurchase its outstanding Equity Interests (or options to purchase such Equity Interests) following the death, disability, retirement or termination of ~~such Parent Company from current or former members~~ employment of ~~management,~~ employees, ~~consultants,~~ officers ~~and~~ or directors ~~(and their successors and assigns)~~ of ~~the Lead Borrower and~~ Holdings or any of its ~~Restricted~~ Subsidiaries; provided that (Ai) all amounts used to effect such repurchases are obtained by Holdings from a substantially concurrent issuance of its Equity Interests (or options to purchase such Equity Interests) to other employees, members of management, executive officers or directors of Holdings or any of its Subsidiaries or (ii) to the extent the proceeds used to effect any repurchase pursuant to this clause (ii) are not obtained as described in preceding clause (i), the aggregate amount of Dividends ~~made~~ paid by ~~the Lead Borrower to~~ Holdings pursuant to this paragraph (b) (exclusive of amounts paid as described pursuant to preceding clause (~~iii~~i)~~, and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased~~ ) shall not ~~(net of any cash proceeds received by Holdings (but~~ exceed $4,000,000 in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of Holdings; provided that, in the ~~Lead Borrower, $10,000,000 (provided~~ event that the maximum amount ~~of cash Dividends~~ which is permitted to ~~be, but not, paid~~ be expended in respect of Dividends during any fiscal year pursuant to this clause (~~iii~~b)(ii) ~~shall increase~~ is not fully expended during such fiscal year, the maximum amount ~~of cash Dividends permitted to~~ which may be ~~paid in~~ expended during the immediately succeeding ~~two~~ fiscal ~~years~~ year pursuant to this clause (~~iii)); (B~~b)(ii) ~~such amount in any calendar year may~~ shall be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreementunutilized amount; (ivc) the ~~Lead~~ Borrower may pay cash Dividends to Holdings for the purpose of paying, so long as ~~the~~ all proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, its operating expenses incurred in ~~each case without duplication: (A) franchise Taxes (~~the ordinary course of business and other ~~fees~~ corporate overhead costs and ~~expenses) required to maintain their existence;~~ expenses (~~B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal~~including, ~~state~~without limitation, ~~and/or local income tax purposes~~ legal and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise accounting expenses and similar ~~Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries~~expenses); provided that ~~for each taxable period,~~ the aggregate amount of ~~such payments made in respect of such taxable period in~~ Dividends paid by the ~~aggregate shall not exceed the amount that the Lead~~ Borrower ~~and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment~~ pursuant to this clause (Bc) ~~with respect to the Taxes~~ shall not exceed $1,500,000 in any fiscal year of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar TaxesHoldings; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (Fd) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (~~who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor~~ whether or ~~Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid~~ not pursuant to ~~Sections 10.06(v~~a Tax Sharing Agreement) ~~and 10.06(vii); (xi) repurchases~~ for the purpose of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amountpaying, so long as ~~at the time of~~all proceeds thereof are promptly used by Holdings to pay, franchise taxes and ~~after giving effect to such Dividend~~Federal, ~~no Event of Default shall have occurred~~ state and ~~be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower~~ local income taxes and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $5,000,000; (xv) the declaration interest and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, penalties with respect ~~to any such payments~~thereto, ~~no Event of Default shall have occurred and be continuing or would result therefrom~~if any, payable by Holdings; ~~provided~~ provided, however, that the amount of any such ~~cash proceeds~~ payment shall not exceed the amount of taxes that ~~are utilized~~ the Borrower would have been liable for on a stand-alone basis; provided further, however, that any ~~Dividend under this clause (iii) will not~~ refund shall be ~~considered~~ promptly returned by Holdings to ~~be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of~~ the ~~definition of “Available Amount”~~Borrower; (~~xviii~~e) the ~~Lead~~ Borrower ~~and any Restricted Subsidiary~~ may pay ~~dividends and distributions within 60 days after~~ cash Dividends to Holdings for the ~~date~~ purpose of ~~declaration thereof~~enabling Holdings to pay the Dividends referred to in clause (b) above, ~~if at the date of declaration of~~ so long as all proceeds thereof are promptly used by Holdings to pay such ~~payment, such payment would have complied with another provision of this Section 10.03~~Dividends; and (~~xix~~f) ~~any Dividends, so long as (x) at~~ the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) Preferred Stock Redemption shall be ~~deemed to be cash Dividends paid~~ permitted and the Borrower may make a Dividend to Holdings to the extent ~~provided in said Section 10.05(vi)~~necessary to effect the Preferred Stock Redemption.

Appears in 3 contracts

Sources: Credit Agreement (Amis Holdings Inc), Credit Agreement (Amis Holdings Inc), Credit Agreement (Amis Holdings Inc)

Dividends. ~~The Lead Borrower~~ At any time that the Leverage Ratio equals or exceeds 6.00:1.00, the Company will not, and will not permit any of its ~~Restricted~~ Subsidiaries to, authorize, declare or pay any Dividends with respect to the ~~Lead Borrower~~ Company or any of its ~~Restricted~~ Subsidiaries, except that: (i) any ~~Restricted~~ Subsidiary of the ~~Lead Borrower~~ Company may pay cash Dividends ~~or return capital or make distributions and other similar payments with regard to its Equity Interests~~ to the ~~Lead Borrower~~ Company or to ~~other Restricted Subsidiaries~~ a Wholly-Owned Subsidiary of the ~~Lead Borrower which directly or indirectly own equity therein~~Company; (ii) any non-Wholly-Owned Subsidiary of the ~~Lead Borrower~~ Company may ~~declare and~~ pay cash Dividends to its ~~shareholders~~ shareholders, members or partners generally so long as the ~~Lead Borrower~~ Company or its ~~Restricted~~ respective Subsidiary which owns the ~~Equity Interests~~ equity interest or interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative ~~holding~~ holdings of ~~the Equity Interests~~ equity interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of ~~Equity Interests of~~ equity interests in such Subsidiary); provided, however, that this Section 7.11 shall not limit the redemption or repurchase of equity interests of a shareholder, member or partner of any non-Wholly-Owned Subsidiary of the Company if such redemption or repurchase is permitted pursuant to Section 7.10; (iii) so long as (x) no Specified Default or Event of Default then exists or would exist immediately after giving effect thereto and (y) HHRI qualifies, or has taken all other actions necessary to qualify, as a “real estate investment trust” under the Code during any calendar year of HHRI, the Company may pay quarterly cash Dividends (which may be based on estimates) to HHRI and all other holders of OP Units generally when and to the extent necessary for HHRI to distribute, and HHRI may so distribute, cash Dividends to its shareholders generally in an aggregate amount not to exceed the greater of (I) the greatest of (A) 100% of Cash Available for Distribution for such fiscal year, (B) 100% of Taxable Income, (C) the minimum amount reasonably estimated by the Company to be necessary for HHRI to maintain its tax status as a real estate investment trust (including the right but not the obligation to distribute 100% of net capital gain) under Sections 856 through 860 of the Internal Revenue Code and to satisfy the distributions required to be made pursuant to Treasury regulations issued under Section 337(d) of the Code by reason of HHRI making the election provided for therein, or, without duplication, to avoid income tax (unless HHRI decides to retain its net long-term capital gains) or excise tax under the Code or other state or local tax laws and regulations; provided, however, there shall not be any implied requirement that the Company utilize the dividend deferral options in Section 857(b)(9) or Section 858(a) of the Code and (II) at any time when, based upon the financial statements delivered pursuant to Section 6.11(a) or (b) and the Company’s estimation of the results of the current fiscal quarter, the Consolidated Interest Coverage Ratio is greater than 2.00:1:00 for any Test Period (determined as if such Test Period ended as of the last day of such current fiscal quarter), 85% of the Adjusted Funds From Operations for the current fiscal year; provided, however, that notwithstanding the existence of an Event of Default or the occurrence of an Event of Default immediately after giving effect thereto, the amounts described in clause (C) above may be paid so long as no Event of Default under Section 8.01(a) or Section 8.01(f) then exists or would exist immediately after giving effect thereto; (iv) the Company may pay cash Dividends to HHRI so long as the proceeds therefrom are promptly used by HHRI to pay (x) any Permitted Tax Payments at the time and to the extent actually due and payable (but without duplication of any tax payments permitted to be made pursuant to Section 7.11(a)(iii) above to satisfy the distribution required to be made pursuant to Treasury regulations issued under Section 337(d) of the Code) and (y) any general corporate and other overhead expenses and liabilities incurred by it to the extent not otherwise prohibited by this Agreement; (v) so long as no Specified Default or Event of Default then exists or would result therefrom, the Company may pay cash Dividends to HHRI in an aggregate amount not to exceed $10,000,000 for the Availability Period; (vi) the Company may pay cash Dividends to HHRI so long as HHRI promptly thereafter uses the proceeds of such Dividends to repurchase shares of its capital stock, and the Company may repurchase OP Units, in each case so long as (x) no Specified Default or Event of Default then exits or would result therefrom, (y) the aggregate amount of all repurchases and redemptions made pursuant to this Section 7.11(a)(vi) in any fiscal year of HHRI does not exceed an amount equal to 1% of Adjusted Total Assets determined at the time of declaration of the ~~applicable Dividend, redemption or repurchase~~ Dividend (with any unused Roll Forward Amount from one fiscal year increasing the amount available to be paid as a Dividend under this Section 7.11(a)(vi) in subsequent fiscal years); and (vii) so long as no Event of Default exists or would exist immediately after giving effect thereto, ~~the Lead Borrower may~~ pay cash Dividends to ~~Holdings~~ holders of Qualified Preferred Stock issued after February 9, 2021, or to ~~allow Holdings~~ HHRI so long as the proceeds therefrom are promptly used by HHRI to pay cash ~~dividends~~ Dividends to ~~any other Parent Company to redeem or repurchase~~holders of Qualified Preferred Stock issued after February 9, contemporaneously with such Dividend, Equity Interests of such Parent Company from current or former members of management, employees, consultants, officers and directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries2021; provided that ~~(A)~~ the aggregate ~~amount~~ Dividends paid in cash to holders of ~~Dividends made by the Lead Borrower to Holdings~~ such Qualified Preferred Stock pursuant to this clause (iii), and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offeringa)(vii) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $~~5,000,000; (xv)~~ 50,000,000 per annum. Dividends paid during a period when the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely Leverage Ratio is less than 6.00:1.00 shall, in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided event that the ~~amount of any such cash proceeds that are utilized~~ Leverage Ratio subsequently exceeds 6.00:1.00, be counted against the baskets provided for ~~any Dividend under~~ in this ~~clause~~ Section 7.11 (~~iii~~as applicable) ~~will not be considered to be cash proceeds of Equity Interests~~ for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as (x) at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi)basket availability only.

Appears in 2 contracts

Sources: Credit Agreement (Host Hotels & Resorts L.P.), Credit Agreement (Host Hotels & Resorts L.P.)

Dividends. ~~The Lead~~ Borrower will not, and will not permit any of ~~its~~ the Restricted Subsidiaries to, authorize, declare or pay any Dividends with respect to ~~the Lead~~ Borrower or any of its Restricted Subsidiaries, except that: (i) any Restricted Subsidiary of ~~the Lead~~ a Borrower may authorize, declare and pay Dividends or return capital or make distributions and other similar payments with regard to its Equity Interests to ~~the Lead~~ Borrower or to other Restricted Subsidiaries of ~~the Lead~~ Borrower which directly or indirectly own equity therein; (ii) any non-Wholly-Owned Subsidiary of ~~the Lead~~ Borrower may authorize, declare and pay cash Dividends to its shareholders generally so long as ~~the Lead~~ Borrower or its Restricted Subsidiary which owns the Equity Interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary); (iii) so long as no ~~Default or~~ Event of Default exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, ~~the Lead~~ Borrower may authorize, declare and pay cash Dividends to Holdings to allow Holdings to pay cash dividends or make cash distributions to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of Holdings or such other Parent Company from ~~current or former members of~~ management, employees~~, consultants~~, officers and directors (and their successors and assigns) of ~~the Lead~~ Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by ~~the Lead~~ Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings or such other Parent Company in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to ~~the Lead~~ Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of ~~the Lead~~ Borrower, (x) the greater of $~~10,000,000~~ 75,000,000 and 6.25% of Consolidated EBITDA of Borrower and its Restricted Subsidiaries for the most recently ended Test Period (measured at the time of such Dividend) or (y) subsequent to the consummation of any Initial Public Offering of common stock or other comparable equity interests of Borrower or any direct or indirect parent of Borrower, the greater of $120,000,000 and 10% of Consolidated EBITDA of Borrower and its Restricted Subsidiaries for the most recently ended Test Period (measured at the time of such Dividend) (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by ~~the Lead~~ Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to ~~the Lead~~ Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (~~b)(x)(ii~~a)(iii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to ~~the Lead~~ Borrower from ~~current or former~~ members of management, officers, directors, employees of ~~the Lead~~ Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of Holdings or any other Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) ~~the Lead~~ Borrower may authorize, declare and pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to ~~the Lead~~ Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to ~~the Lead~~ Borrower or the relevant Restricted Subsidiary of ~~the Lead~~ Borrower out of the proceeds of such offering promptly if such offering is completed; (v) ~~the Lead~~ Borrower may authorize, declare and pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with ~~applicable laws~~Requirements of Law, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) ~~the Lead~~ Borrower may authorize, declare and pay cash ~~dividends~~ Dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their ~~existence~~existence to the extent such Taxes, fees and expenses are reasonably attributable to the operations of Holdings, Borrower and its Restricted Subsidiaries; (B) with respect to any ~~taxable year (~~period where Borrower or ~~portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b)~~ any of its Subsidiaries is a member of a consolidated, combined or similar income ~~tax~~ Tax group ~~(a “~~for U.S. federal and/or applicable state, local or foreign income or similar Tax ~~Group”)~~ purposes of which ~~any Parent Company~~ a direct or ~~other entity~~ indirect parent of Borrower is the common ~~parent~~parent or other applicable taxpayer, the portion of any U.S. federal, ~~state~~ state, local and/or foreign income and ~~local income~~ similar Taxes (including any alternative minimum ~~Taxes~~taxes) ~~(or franchise and similar Taxes imposed in lieu~~ of such ~~minimum Taxes)~~ Tax group that is attributable to the taxable income of Borrower and/or its applicable Restricted Subsidiaries and, to the extent of the amount actually received from its Unrestricted Subsidiaries for such purpose, in amounts required to pay any such Taxes that are attributable to the taxable income of ~~the Lead Borrower and its~~ such Unrestricted Subsidiaries; provided that ~~for each taxable period,~~ the aggregate amount of such payments ~~made in~~ with respect to such period (regardless of ~~such taxable period in the aggregate~~ when paid) shall not exceed the aggregate amount of such Taxes that Borrower and/or its applicable Restricted Subsidiaries (and, subject to the ~~Lead Borrower and its~~ limitation described above, any applicable Unrestricted Subsidiaries of Borrower) would have been required to pay as with respect to such period were such entities stand-alone corporate taxpayers or a stand-alone ~~Tax Group; provided, further, that~~ corporate tax group for all applicable taxable periods ending after the ~~permitted payment pursuant~~ Closing Date taking into account any applicable limitations on the ability to ~~this clause (B) with respect to~~ utilize net operating loss carryforwards and similar tax attributes under the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar TaxesCode; (C) customary salary, bonus and other ~~compensation and~~ benefits payable to ~~current and former officers,~~ directors, ~~consultants~~ officers and employees of any Parent Company to the extent such salaries, bonuses and other ~~compensation and~~ benefits are reasonably attributable to the ownership or operations of ~~the Lead~~ Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of ~~the Lead~~ Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of ~~the Lead~~ Borrower or any Parent Company; (F) the purchase or other acquisition by Holdings or any ~~parent~~ other Parent Company of ~~the Lead~~ Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by ~~the Lead~~ Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such ~~parent~~ Parent Company shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to ~~the Lead~~ Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into ~~the Lead~~ Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such ~~purchaser~~ purchase or other acquisition;; and (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of ~~the Lead~~ Borrower and its Restricted Subsidiaries; (vii) Borrower and its Restricted Subsidiaries may give reasonable and customary indemnities to directors, officers and employees of Holdings or any other Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of ~~the Lead~~ Borrower and its Restricted Subsidiaries; (viii) ~~the Lead~~ Borrower may authorize, declare and pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of ~~the Lead~~ Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory ~~Agreement (as in effect on the Closing Date~~Agreement; (ix) any Dividend used (x) to fund the Transaction, including Transaction ~~Costs and the Special Dividend~~Costs, and (y) in order to satisfy deferred purchase price, earn-outs and contingent payments in respect of any ~~Dividend from proceeds received~~ amounts due and owing as provided for in ~~connection with any working capital adjustment pursuant to~~ the Acquisition Agreement; (x) ~~the Lead~~ Borrower may authorize, declare and pay cash Dividends to Holdings (who may subsequently authorize, declare and pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v), 10.06(vii) and ~~10.06(vii~~10.06(xii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or ~~the settlement or vesting of other~~ similar equity incentive awards; (xii) a Dividend (including to any Parent ~~Company~~ Company) to fund a payment of dividends on ~~such~~ Borrower’s or any Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, ~~of up~~ not to 6exceed, in any fiscal year, 6.0% ~~per annum~~ of the net cash proceeds contributed to the capital of ~~the Lead~~ Borrower from any such Initial Public Offering; (xiii) ~~on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00,~~ any Dividends to the extent the same are made solely with the Available Amount, so long as as, solely to the extent clause (a)(ii) of the definition of “Available Amount” is being utilized, at the time of, and after giving effect to such ~~Dividend~~Dividend on a Pro Forma Basis, (i) no Event of Default shall have occurred and be ~~continuing~~continuing and (ii) the Consolidated First Lien Net Leverage Ratio, on a Pro Forma Basis as of the last day of the most recently ended Test Period, does not exceed 3.10:1.00; (xiv) purchases of minority interests in ~~non-~~Restricted Subsidiaries that are not Wholly-Owned Subsidiaries by ~~the Lead~~ Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed the greater of $~~5,000,000~~60,000,000 and 5.0% of Consolidated EBITDA of Borrower and its Restricted Subsidiaries for the most recently ended Test Period (measured at the time of such Dividend); (xv) the authorization, declaration and payment of ~~dividends~~ Dividends or the payment of other distributions by ~~the Lead~~ Borrower in an aggregate amount since the Closing Date not to exceed the greater of $~~35,000,000~~250,000,000 and 25.0% of Consolidated EBITDA of Borrower and its Restricted Subsidiaries for the most recently ended Test Period (measured at the time of such Dividend); (xvi) ~~the Lead~~ Borrower and each Restricted Subsidiary may authorize, declare and make ~~dividend~~ Dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of ~~dividend~~ Dividend or other distribution by a Restricted Subsidiary, ~~the Lead~~ Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) ~~the Lead~~ Borrower may ~~make payments~~ authorize, declare and pay Dividends with the cash proceeds contributed to its common equity (including from the net cash proceeds of any equity issuance by any Parent Company), so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (~~iii~~xvii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (~~b)(x)(ii~~a)(iii) of the definition of “Available Amount”; (xviii) ~~the Lead~~ Borrower and any Restricted Subsidiary may authorize, declare and pay ~~dividends and distributions~~ Dividends within 60 90 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03~~; and~~; (xix) any Dividends, so long as (x) at the time ~~of,~~ of and after giving effect to such Dividend, no Event of Default ~~shall have~~ has occurred and be is continuing and (y) on a Pro Forma Basis, as of the last day of the most recently ended Test Period, the Consolidated ~~Total~~ First Lien Net Leverage Ratio does not exceed ~~3.25~~ 2.10:1.00; (xx) [reserved]; (xxi) any payment that is intended to ~~1.00~~prevent any Indebtedness of Borrower from being treated as an “applicable high yield discount obligation” within the meaning of Section 163(i)(1) of the Code; (xxii) [reserved]; and (xxiii) any Dividend or other distribution made with the net cash proceeds or other assets or property received from a disposition permitted pursuant to Section 10.02(xxix). In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the ~~definition~~ definitions of “Consolidated ~~EBITDA~~ EBITDA” and “Consolidated Net Income”), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) ~~shall~~ shall, to the extent such loan or advance remains unpaid, be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi). Notwithstanding anything to the contrary in this Section 10.03, Borrower and its Restricted Subsidiaries shall not, directly or indirectly, sell or otherwise transfer any Intellectual Property that is material to the operations of Borrower and its Subsidiaries taken as a whole to any Unrestricted Subsidiary.

Appears in 2 contracts

Sources: Term Loan Credit Agreement (Ingram Micro Holding Corp), Term Loan Credit Agreement (Ingram Micro Holding Corp)

Dividends. ~~The Lead~~ Borrower will not, and will not permit any of ~~its~~ the Restricted Subsidiaries to, authorize, declare or pay any Dividends with respect to ~~the Lead~~ Borrower or any of its Restricted Subsidiaries, except that: (i) any Restricted Subsidiary of ~~the Lead~~ a Borrower may authorize, declare and pay Dividends or return capital or make distributions and other similar payments with regard to its Equity Interests to ~~the Lead~~ Borrower or to other Restricted Subsidiaries of ~~the Lead~~ Borrower which directly or indirectly own equity therein; (ii) any non-Wholly-Owned Subsidiary of ~~the Lead~~ Borrower may authorize, declare and pay cash Dividends to its shareholders generally so long as ~~the Lead~~ Borrower or its Restricted Subsidiary which owns the Equity Interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary); (iii) so long as no ~~Default or~~ Event of Default exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, ~~the Lead~~ Borrower may authorize, declare and pay cash Dividends to Holdings to allow Holdings to pay cash dividends or make cash distributions to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of Holdings or such other Parent Company from ~~current or former members of~~ management, employees~~, consultants~~, officers and directors (and their successors and assigns) of ~~the Lead~~ Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by ~~the Lead~~ Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings or such other Parent Company in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to ~~the Lead~~ Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of ~~the Lead~~ Borrower, (x) the greater of $~~10,000,000~~ 75,000,000 and 6.25% of Consolidated EBITDA of Borrower and its Restricted Subsidiaries for the most recently ended Test Period (measured at the time of such Dividend) or (y) subsequent to the consummation of any Initial Public Offering of common stock or other comparable equity interests of Borrower or any direct or indirect parent of Borrower, the greater of $120,000,000 and 10% of Consolidated EBITDA of Borrower and its Restricted Subsidiaries for the most recently ended Test Period (measured at the time of such Dividend) (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by ~~the Lead~~ Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to ~~the Lead~~ Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (~~b)(x)(ii~~a)(iii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to ~~the Lead~~ Borrower from ~~current or former~~ members of management, officers, directors, employees of ~~the Lead~~ Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of Holdings or any other Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) ~~the Lead~~ Borrower may authorize, declare and pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to ~~the Lead~~ Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to ~~the Lead~~ Borrower or the relevant Restricted Subsidiary of ~~the Lead~~ Borrower out of the proceeds of such offering promptly if such offering is completed; (v) ~~the Lead~~ Borrower may authorize, declare and pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with ~~applicable laws~~Requirements of Law, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) ~~the Lead~~ Borrower may authorize, declare and pay cash ~~dividends~~ Dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their ~~existence~~existence to the extent such Taxes, fees and expenses are reasonably attributable to the operations of Holdings, Borrower and its Restricted Subsidiaries; (B) with respect to any ~~taxable year (~~period where Borrower or ~~portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b)~~ any of its Subsidiaries is a member of a consolidated, combined or similar income ~~tax~~ Tax group ~~(a “~~for U.S. federal and/or applicable state, local or foreign income or similar Tax ~~Group”)~~ purposes of which ~~any Parent Company~~ a direct or ~~other entity~~ indirect parent of Borrower is the common ~~parent~~parent or other applicable taxpayer, the portion of any U.S. federal, ~~state~~ state, local and/or foreign income and ~~local income~~ similar Taxes (including any alternative minimum ~~Taxes~~taxes) ~~(or franchise and similar Taxes imposed in lieu~~ of such ~~minimum Taxes)~~ Tax group that is attributable to the taxable income of Borrower and/or its applicable Restricted Subsidiaries and, to the extent of the amount actually received from its Unrestricted Subsidiaries for such purpose, in amounts required to pay any such Taxes that are attributable to the taxable income of ~~the Lead Borrower and its~~ such Unrestricted Subsidiaries; provided that ~~for each taxable period,~~ the aggregate amount of such payments ~~made in~~ with respect to such period (regardless of ~~such taxable period in the aggregate~~ when paid) shall not exceed the aggregate amount of such Taxes that Borrower and/or its applicable Restricted Subsidiaries (and, subject to the ~~Lead Borrower and its~~ limitation described above, any applicable Unrestricted Subsidiaries of Borrower) would have been required to pay as with respect to such period were such entities stand-alone corporate taxpayers or a stand-alone ~~Tax Group; provided, further, that~~ corporate tax group for all applicable taxable periods ending after the ~~permitted payment pursuant~~ date hereofClosing Date taking into account any applicable limitations on the ability to ~~this clause (B) with respect to~~ utilize net operating loss carryforwards and similar tax attributes under the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar TaxesCode; (C) customary salary, bonus and other ~~compensation and~~ benefits payable to ~~current and former officers,~~ directors, ~~consultants~~ officers and employees of any Parent Company to the extent such salaries, bonuses and other ~~compensation and~~ benefits are reasonably attributable to the ownership or operations of ~~the Lead~~ Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of ~~the Lead~~ Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of ~~the Lead~~ Borrower or any Parent Company; (F) the purchase or other acquisition by Holdings or any ~~parent~~ other Parent Company of ~~the Lead~~ Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by ~~the Lead~~ Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such ~~parent~~ Parent Company shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to ~~the Lead~~ Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into ~~the Lead~~ Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such ~~purchaser~~ purchase or other acquisition;; and (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of ~~the Lead~~ Borrower and its Restricted Subsidiaries; (vii) Borrower and its Restricted Subsidiaries may give reasonable and customary indemnities to directors, officers and employees of Holdings or any other Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of ~~the Lead~~ Borrower and its Restricted Subsidiaries; (viii) ~~the Lead~~ Borrower may authorize, declare and pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of ~~the Lead~~ Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory ~~Agreement (as in effect on the Closing Date~~Agreement; (ix) any Dividend used (x) to fund the Transaction, including Transaction ~~Costs and the Special Dividend~~Costs, and (y) in order to satisfy deferred purchase price, earn-outs and contingent payments in respect of any ~~Dividend from proceeds received~~ amounts due and owing as provided for in ~~connection with any working capital adjustment pursuant to~~ the Acquisition Agreement; (x) ~~the Lead~~ Borrower may authorize, declare and pay cash Dividends to Holdings (who may subsequently authorize, declare and pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v), 10.06(vii) and ~~10.06(vii~~10.06(xii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or ~~the settlement or vesting of other~~ similar equity incentive awards; (xii) a Dividend (including to any Parent ~~Company~~ Company) to fund a payment of dividends on ~~such~~ Borrower’s or any Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, ~~of up~~ not to 6exceed, in any fiscal year, 6.0% ~~per annum~~ of the net cash proceeds contributed to the capital of ~~the Lead~~ Borrower from any such Initial Public Offering; (xiii) ~~on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00,~~ any Dividends to the extent the same are made solely with the Available Amount, so long as as, solely to the extent clause (a)(ii) of the definition of “Available Amount” is being utilized, at the time of, and after giving effect to such ~~Dividend~~Dividend on a Pro Forma Basis, (i) no Event of Default shall have occurred and be ~~continuing~~continuing and (ii) the Consolidated First Lien Net Leverage Ratio, on a Pro Forma Basis as of the last day of the most recently ended Test Period, does not exceed 3.10:1.00; (xiv) purchases of minority interests in ~~non-~~Restricted Subsidiaries that are not Wholly-Owned Subsidiaries by ~~the Lead~~ Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed the greater of $~~5,000,000~~60,000,000 and 5.0% of Consolidated EBITDA of Borrower and its Restricted Subsidiaries for the most recently ended Test Period (measured at the time of such Dividend); (xv) the authorization, declaration and payment of ~~dividends~~ Dividends or the payment of other distributions by ~~the Lead~~ Borrower in an aggregate amount since the Closing Date not to exceed the greater of $~~35,000,000~~250,000,000 and 25.0% of Consolidated EBITDA of Borrower and its Restricted Subsidiaries for the most recently ended Test Period (measured at the time of such Dividend); (xvi) ~~the Lead~~ Borrower and each Restricted Subsidiary may authorize, declare and make ~~dividend~~ Dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of ~~dividend~~ Dividend or other distribution by a Restricted Subsidiary, ~~the Lead~~ Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) ~~the Lead~~ Borrower may ~~make payments~~ authorize, declare and pay Dividends with the cash proceeds contributed to its common equity (including from the net cash proceeds of any equity issuance by any Parent Company), so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (~~iii~~xvii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (~~b)(x)(ii~~a)(iii) of the definition of “Available Amount”; (xviii) ~~the Lead~~ Borrower and any Restricted Subsidiary may authorize, declare and pay ~~dividends and distributions~~ Dividends within 60 90 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03~~; and~~; (xix) any Dividends, so long as (x) at the time ~~of,~~ of and after giving effect to such Dividend, no Event of Default ~~shall have~~ has occurred and be is continuing and (y) on a Pro Forma Basis, as of the last day of the most recently ended Test Period, the Consolidated ~~Total~~ First Lien Net Leverage Ratio does not exceed ~~3.25~~ 2.10:1.00; (xx) [reserved]; (xxi) any payment that is intended to ~~1.00~~prevent any Indebtedness of Borrower from being treated as an “applicable high yield discount obligation” within the meaning of Section 163(i)(1) of the Code; (xxii) [reserved]; and (xxiii) any Dividend or other distribution made with the net cash proceeds or other assets or property received from a disposition permitted pursuant to Section 10.02(xxix). In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the ~~definition~~ definitions of “Consolidated ~~EBITDA~~ EBITDA” and “Consolidated Net Income”), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) ~~shall~~ shall, to the extent such loan or advance remains unpaid, be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi). Notwithstanding anything to the contrary in this Section 10.03, Borrower and its Restricted Subsidiaries shall not, directly or indirectly, sell or otherwise transfer any Intellectual Property that is material to the operations of Borrower and its Subsidiaries taken as a whole to any Unrestricted Subsidiary.

Appears in 2 contracts

Sources: Term Loan Credit Agreement (Ingram Micro Holding Corp), Term Loan Credit Agreement (Ingram Micro Holding Corp)

Dividends. ~~The Lead Borrower~~ Unless a Default has occurred and is continuing, each Pledgor will ~~not~~be entitled to receive any and all dividends and other forms of distribution on the Pledged Collateral of such Pledgor which it is otherwise entitled to receive, but any and ~~will not permit any~~ all stock and/or liquidating dividends, distributions of ~~its Restricted Subsidiaries to~~property, ~~authorize, declare or pay any Dividends with respect to the Lead Borrower or any~~ returns of ~~its Restricted Subsidiaries, except that: (i) any Restricted Subsidiary of the Lead Borrower may pay Dividends or return~~ capital or ~~make~~ other distributions and other similar payments with regard to its Equity Interests to the Lead Borrower or to other Restricted Subsidiaries of the Lead Borrower which directly or indirectly own equity therein; (ii) any non-Wholly-Owned Subsidiary of the Lead Borrower may declare and pay cash Dividends to its shareholders generally so long as the Lead Borrower or its Restricted Subsidiary which owns the Equity Interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary); (iii) so long as no Default or Event of Default exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, the Lead Borrower may pay cash Dividends to Holdings to allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of such Parent Company from current or former members of management, employees, consultants, officers and directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by the Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of ~~director and officer insurance policies to~~ the ~~extent reasonably attributable to the ownership~~ Pledged Collateral of such Pledgor, whether resulting from a subdivision, combination or ~~operation~~ reclassification of the ~~Lead Borrower and its Restricted Subsidiaries~~ outstanding capital stock of any Issuer or ~~(y) indemnification obligations owing~~ received in exchange for the Pledged Collateral of such Pledgor or any part thereof or as a result of any amalgamation, merger, consolidation, acquisition or other exchange of property to ~~the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix)~~ which any ~~Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend~~Issuer may be a party or otherwise, and any ~~Dividend from proceeds~~ and all cash and other property received in ~~connection~~ exchange for any Pledged Collateral of such Pledgor, will be and become part of the Pledged Collateral of such Pledgor subject to the Charges created by this Agreement and, if received by such Pledgor, unless otherwise applied by such Pledgor in a manner expressly permitted by the Administrative Agent, will immediately be delivered to the Administrative Agent or its nominee (accompanied, if appropriate, by proper and duly executed instruments of assignment or transfer in accordance with the Administrative Agent's instructions) to be held subject to the terms of this Agreement; and if any ~~working capital adjustment~~ of the Pledged Collateral of any such Pledgor has been registered in the name of the Administrative Agent or its nominee, the Administrative Agent will execute and deliver (or cause to be executed and delivered) to such Pledgor all such dividend orders and other instruments as such Pledgor may request for the purpose of enabling such Pledgor to receive the dividends or other payments which such Pledgor is authorized to receive and retain pursuant to this Section. If a Default has occurred and is continuing, all rights of any Pledgor pursuant to this Section will cease and the Administrative Agent will have the sole and exclusive right and authority to receive and retain the cash dividends and other forms of cash distribution which such Pledgor would otherwise be authorized to retain pursuant to this Section. Any money and other property paid over to or received by the Administrative Agent pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $5,000,000; (xv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision provisions of this Section ~~10.03; and (xix) any Dividends, so long~~ will be retained by the Administrative Agent as ~~(x) at~~ additional Pledged Collateral of the ~~time of, and after giving effect to such Dividend, no Event of Default shall have occurred~~ applicable Pledgor and be ~~continuing and (y) on a Pro Forma Basis,~~ applied in accordance with the ~~Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with~~ provisions of this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi)Agreement.

Appears in 2 contracts

Sources: Master Securities Pledge Agreement (Hollinger Inc), Master Securities Pledge Agreement (Hollinger Inc)

Dividends. ~~The Lead~~ Borrower will not, and will not permit any of ~~its~~ the Restricted Subsidiaries to, authorize, declare or pay any Dividends with respect to ~~the Lead~~ Borrower or any of its Restricted Subsidiaries, except that: (i) any Restricted Subsidiary of ~~the Lead~~ Borrower may authorize, declare and pay Dividends or return capital or make distributions and other similar payments with regard to its Equity Interests to ~~the Lead~~ Borrower or to other Restricted Subsidiaries of ~~the Lead~~ Borrower which directly or indirectly own equity therein; (ii) any non-Wholly-Owned Subsidiary of ~~the Lead~~ Borrower may authorize, declare and pay cash Dividends to its shareholders generally so long as ~~the Lead~~ Borrower or its Restricted Subsidiary which owns the Equity Interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary); (iii) so long as no ~~Default or~~ Event of Default exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, ~~the Lead~~ Borrower may authorize, declare and pay cash Dividends to Holdings to allow Holdings to pay cash dividends or make cash distributions to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of Holdings or such other Parent Company from ~~current or former members of~~ management, employees~~, consultants~~, officers and directors (and their successors and assigns) of ~~the Lead~~ Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by ~~the Lead~~ Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings or such other Parent Company in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to ~~the Lead~~ Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of ~~the Lead~~ Borrower, (x) the greater of $~~10,000,000~~ 35,000,00050,000,000 and 6.25% of Consolidated EBITDA of Borrower and its Restricted Subsidiaries for the most recently ended Test Period (measured at the time of such Dividend) or (y) subsequent to the consummation of any Initial Public Offering of common stock or other comparable equity interests of Borrower or any direct or indirect parent of Borrower, the greater of $55,000,00080,000,000 and 10% of Consolidated EBITDA of Borrower and its Restricted Subsidiaries for the most recently ended Test Period (measured at the time of such Dividend) (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by ~~the Lead~~ Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to ~~the Lead~~ Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (~~b)(x)(ii~~a)(iii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to ~~the Lead~~ Borrower from ~~current or former~~ members of management, officers, directors, employees of ~~the Lead~~ Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of Holdings or any other Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) ~~the Lead~~ Borrower may authorize, declare and pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to ~~the Lead~~ Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to ~~the Lead~~ Borrower or the relevant Restricted Subsidiary of ~~the Lead~~ Borrower out of the proceeds of such offering promptly if such offering is completed; (v) ~~the Lead~~ Borrower may authorize, declare and pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with ~~applicable laws~~Requirements of Law, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the ~~Securities~~ Exchange Act or the respective rules and regulations promulgated thereunder; (vi) ~~the Lead~~ Borrower may authorize, declare and pay cash ~~dividends~~ Dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their ~~existence~~existence to the extent such Taxes, fees and expenses are reasonably attributable to the operations of Holdings, Borrower and its Restricted Subsidiaries; (B) with respect to any taxable ~~year (or portion thereof)~~ period ending after the Closing Date ~~with respect to~~ for which ~~the Lead~~ Borrower ~~(a) is treated as a corporation for U.S. federal, state,~~ and/or ~~local income tax purposes and (b) is a member~~ any of its Subsidiaries are members of a consolidated, combined or similar income tax group ~~(a “Tax Group”)~~ for U.S. federal and/or applicable state, local or foreign income or similar tax purposes of which ~~any Parent Company~~ a direct or ~~other entity~~ indirect parent of Borrower is the common parent, the portion of any such U.S. federal, ~~state~~ state, local and/or foreign income and ~~local income Taxes~~ similar taxes (including any alternative minimum ~~Taxes~~taxes) ~~(or franchise and similar Taxes imposed in lieu~~ of such ~~minimum Taxes)~~ tax group that is attributable to the taxable income of Borrower and its applicable Restricted Subsidiaries and, to the extent of the amount actually received for such purpose from its applicable Unrestricted Subsidiaries, in amounts required to pay any such taxes that are attributable to the taxable income of ~~the Lead Borrower and its~~ such Unrestricted Subsidiaries; provided that ~~for each taxable period,~~ the aggregate amount of such payments ~~made in~~ with respect to such period (regardless of ~~such taxable period in the aggregate~~ when paid) shall not exceed the aggregate amount of such Taxes that Borrower and/or its applicable Restricted Subsidiaries (and, subject to the ~~Lead Borrower and its~~ limitation described above, any applicable Unrestricted Subsidiaries of Borrower) would have been required to pay as with respect to such period were such entities stand-alone corporate taxpayers or a stand-alone ~~Tax Group; provided, further, that~~ corporate tax group for all applicable taxable periods ending after the ~~permitted payment pursuant~~ Closing Date taking into account any applicable limitations on the ability to ~~this clause (B) with respect to~~ utilize net operating loss carryforwards and similar tax attributes under the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar TaxesCode; (C) customary salary, bonus and other ~~compensation and~~ benefits payable to ~~current and former officers,~~ directors, ~~consultants~~ officers and employees of any Parent Company to the extent such salaries, bonuses and other ~~compensation and~~ benefits are reasonably attributable to the ownership or operations of ~~the Lead~~ Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead ~~costs~~ costs, fees and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such ~~costs~~ costs, fees and expenses are reasonably attributable to the ownership or operations of ~~the Lead~~ Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of ~~the Lead~~ Borrower or any Parent Company; (F) the purchase or other acquisition by Holdings or any ~~parent~~ other Parent Company of ~~the Lead~~ Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by ~~the Lead~~ Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such ~~parent~~ Parent Company shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to ~~the Lead~~ Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into ~~the Lead~~ Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such ~~purchaser~~ purchase or other acquisition;; and (G) any customary fees and expenses related to any successful or unsuccessful debt or equity offering by any Parent Company directly attributable to the operations of ~~the Lead~~ Borrower and its Restricted Subsidiaries; (vii) Borrower and its Restricted Subsidiaries may give reasonable and customary indemnities to directors, officers and employees of Holdings or any other Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of ~~the Lead~~ Borrower and its Restricted Subsidiaries; (viii) ~~the Lead~~ Borrower may authorize, declare and pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of ~~the Lead~~ Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory ~~Agreement (as in effect on the Closing Date~~Agreement; (ix) any Dividend used (x) to fund the Transaction, including Transaction ~~Costs and the Special Dividend~~Costs, and (y) in order to satisfy deferred purchase price, earn-outs and contingent payments in respect of any ~~Dividend from proceeds received~~ amounts due and owing as provided for in ~~connection with any working capital adjustment pursuant to~~ the Acquisition Agreement; (x) ~~the Lead~~ Borrower may authorize, declare and pay cash Dividends to Holdings (who may subsequently authorize, declare and pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v), 10.06(vii) and ~~10.06(vii~~10.06(xii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or ~~the settlement or vesting of other~~ similar equity incentive awards; (xii) a Dividend (including to any Parent ~~Company~~ Company) to fund a payment of dividends on ~~such~~ Borrower’s or any Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, not to exceed, in any fiscal year, the sum of ~~up to 6~~(x) 6.0% ~~per annum~~ of the net cash proceeds received by or contributed to the capital of ~~the Lead~~ Borrower from any such Initial Public ~~Offering~~Offering and (y) 7.0% of Borrower’s (or any Parent Company’s) Market Capitalization; (xiii) ~~on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00,~~ any Dividends to the extent the same are made solely with the Available Amount, so long as as, solely to the extent clause (a)(ii) of the definition of “Available Amount” is being utilized, at the time of, and after giving effect to such ~~Dividend~~Dividend on a Pro Forma Basis, (i) no Event of Default shall have occurred and be ~~continuing~~continuing and (ii) the Consolidated First Lien Net Leverage Ratio, on a Pro Forma Basis as of the last day of the most recently ended Test Period, does not exceed 4.05:1.00; (xiv) purchases of minority interests in ~~non-~~Restricted Subsidiaries that are not Wholly-Owned Subsidiaries by ~~the Lead~~ Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed the greater of $~~5,000,000~~27,500,00040,000,000 and 5.0% of Consolidated EBITDA of Borrower and its Restricted Subsidiaries for the most recently ended Test Period (measured at the time of such Dividend); (xv) the authorization, declaration and payment of ~~dividends~~ Dividends or the payment of other distributions by ~~the Lead~~ Borrower in an aggregate amount since the Closing Date not to exceed the greater of $~~35,000,000~~250,000,000400,000,000 and 50.0% of Consolidated EBITDA of Borrower and its Restricted Subsidiaries for the most recently ended Test Period (measured at the time of such Dividend); (xvi) ~~the Lead~~ Borrower and each Restricted Subsidiary may authorize, declare and make ~~dividend~~ Dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of ~~dividend~~ Dividend or other distribution by a Restricted Subsidiary, ~~the Lead~~ Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) ~~the Lead~~ Borrower may ~~make payments~~ authorize, declare and pay Dividends with the cash proceeds contributed to its common equity (including from the net cash proceeds of any equity issuance by any Parent Company), so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (~~iii~~xvii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (~~b)(x)(ii~~a)(iii) of the definition of “Available Amount”; (xviii) ~~the Lead~~ Borrower and any Restricted Subsidiary may authorize, declare and pay ~~dividends and distributions~~ Dividends within 60 90 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03~~; and~~; (xix) any Dividends, so long as (x) at the time ~~of,~~ of and after giving effect to such Dividend, no Event of Default ~~shall have~~ has occurred and be is continuing and (y) on a Pro Forma Basis, as of the last day of the most recently ended Test Period, the Consolidated Total Net Leverage Ratio does not exceed ~~3.25~~ 4.30:1.00; (xx) so long as no Event of Default under Section 11.01 or 11.05 has occurred and is continuing or would result therefrom, Borrower and any Restricted Subsidiary may authorize, declare and pay Dividends with any Leverage Excess Proceeds; and (xxi) any payment that is intended to ~~1.00~~prevent any Indebtedness of Borrower from being treated as an “applicable high yield discount obligation” within the meaning of Section 163(i)(1) of the Code. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the ~~definition~~ definitions of “Consolidated ~~EBITDA~~ EBITDA” and “Consolidated Net Income”), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) ~~shall~~ shall, to the extent such loan or advance remains unpaid, be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi).

Appears in 2 contracts

Sources: Credit Agreement (McGraw Hill, Inc.), Credit Agreement (McGraw Hill, Inc.)

Appears in 2 contracts

Sources: Credit Agreement (Adesa Inc), Credit Agreement (Adesa Inc)

Dividends. ~~The Lead Borrower will not, and will not permit any of its Restricted Subsidiaries to, authorize~~Authorize, declare or ~~pay~~ pay, directly or indirectly, any Dividends with respect to any Group Member, except that the ~~Lead~~ following shall be permitted (subject to the provisos in each of Section 6.01(l) and Section 6.03(q)): (a) Dividends by any Group Member (x) to the Borrower or any Subsidiary Guarantor, (y) to any Subsidiary that is not a Guarantor; provided that any such Dividend under this clause (y) is either (I) paid only in Equity Interests of such Group Member (other than Disqualified Capital Stock) or (II) if paid in cash, is paid to all shareholders on a pro rata basis, and (z) to Holdings or Intermediate Holdings paid only in Equity Interests in kind; (b) so long as no Event of Default has occurred and is continuing or would immediately result therefrom, payments to Holdings or Intermediate Holdings (or any direct or indirect parent company of Holdings) to permit Holdings (or any such direct or indirect parent company of Holdings) to repurchase or redeem Qualified Capital Stock of Holdings (or any direct or indirect parent company of Holdings) held by current or former officers, directors or employees or former officers, directors or employees (or their transferees, spouses, ex-spouses, estates or beneficiaries under their estates) of any Group Member, including upon their death, disability, retirement, severance or termination of employment or service or to make payments on Indebtedness issued to buy such Qualified Capital Stock including upon their death, disability, retirement, severance or termination of employment or service; provided that the aggregate cash consideration (for the avoidance of doubt excluding cancellation of Indebtedness owed by such person) paid for all such redemptions and payments shall not exceed, in any fiscal year, the sum of (i) the greater of $1,125,0001,631,250 and 5% of Consolidated EBITDA for the most recently ended Test Period, plus (ii) the net cash proceeds of any “key-man” life insurance policies of any Group Member that have not been used to make any repurchases, redemptions or payments under this clause (b); provided, further, that any Dividends or payments permitted to be made (but not made) pursuant to subclause (i) of this clause (b) in a given fiscal year of Holdings may be carried forward and made in the immediately succeeding fiscal years of Holdings; provided, further, that during an Event of Default any payments described in this clause may accrue and shall be permitted to be paid upon such Event of Default no longer existing so long as no other Event of Default is continuing at such time; (c) the Borrower and any other Subsidiary of Holdings may make Dividends, directly or indirectly, to Holdings (and Holdings may pay to any direct or indirect parent company of Holdings) to permit Holdings (or any such direct or indirect parent company of Holdings) to pay for any taxable period for which Holdings, the Borrower or any Subsidiaries of Holdings are members of a consolidated, combined or similar income tax group for federal and/or applicable state or local income tax purposes or are entities treated as disregarded from any such members for U.S. federal income Tax purposes (a “Tax Group”) of which Holdings (or any direct or indirect parent company of Holdings) is the common parent, any consolidated, combined or similar income Taxes of such Tax Group that are due and payable by Holdings (or such direct or indirect parent company of Holdings) for such taxable period, but only to the extent attributable to the Borrower and/or other Subsidiaries of Holdings, provided that (x) the amount of such Dividends for any taxable period shall not exceed the amount of such Taxes that the Borrower and/or the applicable Subsidiaries of Holdings would have paid had the Borrower and/or such Subsidiaries of Holdings, as applicable, been a stand-alone corporate taxpayer (or a stand-alone corporate Tax Group) and (y) Dividends in respect of an Unrestricted Subsidiary shall be permitted only to the extent that Dividends were made by such Unrestricted Subsidiary to such Group Member or any of its ~~Restricted Subsidiaries~~Subsidiaries for such purpose; (d) repurchases of Equity Interests deemed to occur upon the exercise of stock options if the Equity Interests represent a portion of the exercise price thereof; (e) [reserved]; (f) the Group Members may make Dividends to Holdings, ~~except that:~~Intermediate Holdings or Holdings’ direct or indirect equity holders (i) on or after June 30, 2020 so long as (A) if such Dividend is made in connection with a Limited Condition Transaction, no Default or Event of Default under Section 8.01(a), (b), (d) (solely with respect to the failure to comply with Section 6.08), (g) or (h), or (B) in each other case, no Default or Event of Default, shall have occurred and be continuing at the time of the making of such Dividend or would immediately result therefrom and on a Pro Forma Basis, as of the Applicable Date of Determination and for the applicable Test Period, the Total Leverage Ratio shall not exceed 5.00 to 1.00 (and for the avoidance of doubt, no Dividend may be made in reliance on this clause (f)(i) prior to June 30, 2020), and (ii) using the Cumulative Amount so long as (A) if such Dividend is made in connection with a Limited Condition Transaction, no Default or Event of Default under Section 8.01(a), (b), (d) (solely with respect to the failure to comply with Section 6.08), (g) or (h)), or (B) in each other case, no Default or Event of Default, shall have occurred and be continuing at the time of the making of such Dividend or would immediately result therefrom and on a Pro Forma Basis, as of the Applicable Date of Determination and for the applicable Test Period, if such Test Period ends (i) prior to June 30, 2020, the LQA Recurring Revenue Leverage Ratio shall not exceed 2.00 to 1.00, or (ii) on or after June 30, 2020 the Total Leverage Ratio shall not exceed 6.00 to 1.00; (g) Dividends made solely in Equity Interests of Holdings (other than Disqualified Capital Stock); (h) Dividends to finance payments expressly permitted by Section 6.07(d) and payments for reasonable director fees and reasonable and documented director indemnities and expenses may be paid as a Dividend; (i) ~~any Restricted Subsidiary~~ so long as no Event of Default shall have occurred and be continuing or would immediately result therefrom, Dividends to the ~~Lead Borrower may pay~~ extent that payment for such Dividends ~~or return capital or make distributions and other similar payments~~ is made solely with ~~regard to its~~ cash contributions from the issuance of Equity Interests (other than Disqualified Capital Stock) of Holdings, which are contributed as cash common equity to ~~the Lead Borrower or~~ any Credit Party and Not Otherwise Applied; provided that such Equity Interest amounts used pursuant to ~~other Restricted Subsidiaries of the Lead Borrower which directly or indirectly own equity therein~~this clause (i) are not from Equity Cure Contributions; (ii) any non-Wholly-Owned Subsidiary of the Lead Borrower may declare and pay cash Dividends to its shareholders generally so long as the Lead Borrower or its Restricted Subsidiary which owns the Equity Interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary); (iiij) so long as no Default or Event of Default ~~exists at the time of the applicable Dividend, redemption or repurchase~~ shall have occurred and be continuing or would ~~exist~~ immediately ~~after giving effect thereto~~result therefrom, additional Dividends may be made to Holdings, Intermediate Holdings and/or (without duplication) any direct or indirect parent of Holdings in an aggregate amount not to exceed the ~~Lead Borrower may pay cash Dividends to Holdings to allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase~~greater of $5,000,0007,250,000 and 10% of Consolidated EBITDA for the most recently ended Test Period, ~~contemporaneously with such Dividend~~less, ~~Equity Interests of such Parent Company from current or former members of management~~in each case, ~~employees, consultants, officers and directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that (A)~~ the aggregate amount ~~of Dividends made~~ re-allocated to Section 6.03(y) by the ~~Lead~~ Borrower ~~to Holdings~~ pursuant to ~~this clause~~ Section 6.03(y) or reallocated to Section 6.09(a)(I) pursuant to Section 6.09(a)(I); (~~iii)~~k) distributions for (i) administrative, overhead and ~~the aggregate amount paid by~~ related expenses (including franchise and similar taxes required to maintain corporate existence and other legal, accounting and other overhead expenses) of Holdings, Intermediate Holdings ~~in respect~~ or any direct or indirect parent of ~~all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by~~ Holdings ~~(but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than~~ to the extent ~~included in the Available Amount) and contributed~~ directly attributable to the ~~Lead Borrower~~ operations or ownership of the Group Members and (ii) Public Company Costs of Holdings, Intermediate Holdings or any direct or indirect parent of Holdings to the extent directly attributable to the operations or ownership of the Group Members, if applicable; (l) so long as no Event of Default shall have occurred and be continuing or would immediately result therefrom, distributions to any of Holdings’ direct or indirect equity holders of any working capital adjustment or any other purchase price adjustment received in connection with ~~such redemption or repurchase), in either case, exceed during~~ any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings Permitted Acquisition or any other ~~Parent Company in connection with offerings~~Investment permitted under Section 6.03; provided that, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company Permitted Acquisition or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable periodInvestment, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period distribution shall be limited to the ~~amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes~~Equity Funded Portion thereof; (Cm) ~~customary salary, bonus and other compensation and benefits payable~~ Dividends by any Group Member to ~~current and former officers, directors, consultants and employees~~ any direct or indirect holder of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in ~~a Person; provided that if such purchase or other acquisition had been made by~~ the ~~Lead~~ Borrower~~, it would have constituted a Permitted Acquisition~~ : (i) to finance any Investment permitted to be made pursuant to Section ~~9.14~~6.03; provided that (A) such ~~dividend, distribution, loan or advance~~ Dividend shall be made substantially concurrently with the closing of such ~~purchase or other acquisition~~ Investment and (B) the Borrower or such parent shall, immediately following the closing thereof, cause (1) all property so acquired (whether assets or Equity Interests) ~~and any liabilities assumed~~ to be held by or contributed to the ~~Lead~~ Borrower or ~~any~~ a Restricted Subsidiary or (2) the merger (to the extent permitted in Section ~~10.02~~6.04) ~~into the Lead Borrower or any Restricted Subsidiary~~ of the Person formed or acquired into it or a Restricted Subsidiary in order to consummate such ~~purchaser or other acquisition~~Permitted Acquisition; (Gii) ~~any~~ the proceeds of which shall be used to pay customary costs, fees and expenses (other than to Affiliates) related to any successful or unsuccessful equity or debt offering permitted by ~~any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries;~~this Agreement; and (~~vii~~iii) ~~reasonable~~ the proceeds of which shall be used to pay customary salary, bonus and ~~customary indemnities~~ other benefits payable to ~~directors,~~ officers and employees of any ~~Parent Company in~~ direct or indirect parent company or partner of the ~~ordinary course of business,~~ Borrower to the extent ~~reasonably~~ such salaries, bonuses and other benefits are attributable to the ownership or operation of the ~~Lead~~ Borrower and its Restricted Subsidiaries;. (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Companyn) so long as ~~the proceeds thereof are used to pay the Sponsor~~ no Default or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $5,000,000; (xv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would immediately result therefrom~~; provided that~~ , Dividends in connection with a reorganization or other activity related to tax planning and, in the ~~amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii)~~ reasonable business judgment of the ~~definition~~ Borrower, upon giving effect to such reorganization or other activity, there is no material adverse impact on the value of ~~“Available Amount”;~~ the (~~xviii~~x) Collateral granted to the ~~Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after~~ Collateral Agent for the ~~date~~ benefit of ~~declaration thereof, if at~~ the ~~date~~ Lenders or (y) Guarantees in favor of ~~declaration of such payment, such payment would have complied with another provision of this Section 10.03~~the Lenders; and (~~xix~~o) ~~any Dividends~~following the consummation of an IPO, so long as ~~(x) at the time of, and after giving effect to such Dividend,~~ no Default or Event of Default shall have occurred and be continuing ~~and (y)~~ on ~~a Pro Forma Basis~~the date of declaration of any such Dividend or would result therefrom, the ~~Consolidated Total Net Leverage Ratio does not exceed 3.25~~ Borrower may (or may make Dividends to ~~1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes~~ Holdings or any parent company of the ~~definition~~ Borrower to enable it to) make Dividends with respect to any Equity Interest in any amount of ~~Consolidated EBITDA~~ up to 6% per annum of the market capitalization of Holdings (or the applicable public filing entity) and ~~Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi)~~its Subsidiaries.

Appears in 2 contracts

Sources: Amendment Agreement (Jamf Holding Corp.), Amendment Agreement (Juno Topco, Inc.)

Dividends. ~~The Lead Borrower~~ At any time that the Leverage Ratio equals or exceeds 6.00:1.00, the Company will not, and will not permit any of its ~~Restricted~~ Subsidiaries to, authorize, declare or pay any Dividends with respect to the ~~Lead Borrower~~ Company or any of its ~~Restricted~~ Subsidiaries, except that: (ia) any ~~Restricted~~ Subsidiary of the ~~Lead Borrower~~ Company may pay cash Dividends ~~or return capital or make distributions and other similar payments with regard to its Equity Interests~~ to the ~~Lead Borrower~~ Company or to ~~other Restricted Subsidiaries~~ a Wholly-Owned Subsidiary of the ~~Lead Borrower which directly or indirectly own equity therein~~Company; ~~(ii~~b) any non-Wholly-Owned Subsidiary of the ~~Lead Borrower~~ Company may ~~declare and~~ pay cash Dividends to its ~~shareholders~~ shareholders, members or partners generally so long as the ~~Lead Borrower~~ Company or its ~~Restricted~~ respective Subsidiary which owns the ~~Equity Interests~~ equity interest or interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative ~~holding~~ holdings of ~~the Equity Interests~~ equity interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of ~~Equity Interests of~~ equity interests in such Subsidiary); provided, however, that this Section 7.11 shall not limit the redemption or repurchase of equity interests of a shareholder, member or partner of any non-Wholly-Owned Subsidiary of the Company if such redemption or repurchase is permitted pursuant to Section 7.10; ~~(iii~~c) so long as (x) no Specified Default or Event of Default then exists ~~at the time of the applicable Dividend, redemption or repurchase~~ or would exist immediately after giving effect ~~thereto~~thereto and (y) HHRI qualifies, or has taken all other actions necessary to qualify, as a “real estate investment trust” under the Code during any fiscal year of HHRI, the ~~Lead Borrower~~ Company may pay quarterly cash Dividends (which may be based on estimates) to HHRI and all other holders of OP Units generally when and to the extent necessary for HHRI to distribute, and HHRI may so distribute, cash Dividends to its shareholders generally in an aggregate amount not to exceed the greater of (I) the greatest of (A) 100% of Cash Available for Distribution for such fiscal year, (B) 100% of Taxable Income and (C) the minimum amount necessary for HHRI to maintain its tax status as a real estate investment trust and to satisfy the distributions required to be made by Notice 88-19 under the Code (or Treasury regulations issued pursuant thereto) by reason of HHRI making the election provided for therein and (II) at any time when, based upon the financial statements delivered pursuant to Section 6.11(a) or (b) and the Company’s estimation of the results of the current fiscal quarter, the Consolidated Interest Coverage Ratio is greater than 2.00:1:00, 85% of the Adjusted Funds From Operations for the current fiscal year; d) so long as no Specified Default or Event of Default then exists or would result therefrom, the Company may pay cash Dividends to Holdings to allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of such Parent Company from current or former members of management, employees, consultants, officers and directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by the Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may pay cash Dividends to Holdings HHRI so long as the proceeds ~~thereof~~ therefrom are promptly used by ~~Holdings (or subsequently paid to any other Parent Company)~~ HHRI to pay ~~expenses incurred by Holdings or~~ (x) any ~~other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities~~ Permitted Tax Payments at the time and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent ~~such salaries, bonuses~~ actually due and ~~other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries;~~ payable (~~D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties)~~ but without duplication of any ~~Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash~~ tax payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section ~~9.14; provided that (A~~7.11(c) ~~such dividend, distribution, loan or advance shall~~ above to satisfy the distribution required to be made ~~concurrently with~~ by Notice 88-19 under the ~~closing of such purchase~~ Code (or ~~other acquisition~~ Treasury regulations issued pursuant thereto)) and (By) ~~such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests)~~ any general corporate and ~~any~~ other overhead expenses and liabilities ~~assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (~~incurred by it to the extent ~~permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition~~not otherwise prohibited by this Agreement; (Ge) ~~any customary fees and expenses related to any unsuccessful equity offering by any Parent~~ so long as no Specified Default or Event of Default then exists or would result therefrom, the Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to ~~Holdings so long as~~ HHRI in an aggregate amount not to exceed $10,000,000 for the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date;Availability Period; and (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (xf) the ~~Lead Borrower~~ Company may pay cash Dividends to ~~Holdings (who may subsequently pay cash Dividends to any other Parent Company)~~ HHRI so long as HHRI promptly thereafter uses the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such ~~common stock after the Closing Date~~Dividends to repurchase shares of its capital stock, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the ~~Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00~~Company may repurchase OP Units, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $5,000,000; (xv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each ~~Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the~~ case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as (x) no Specified Default or Event of Default then exits or would result therefrom, (y) the aggregate amount of all repurchases and redemptions made pursuant to this Section 7.11(f) in any fiscal year of HHRI does not exceed an amount equal to 1% of Adjusted Total Assets determined at the time ~~of, and after giving effect~~ of declaration of the Dividend (with any unused Roll Forward Amount from one fiscal year increasing the amount available to ~~such Dividend, no Event of Default shall have occurred and~~ be ~~continuing and (y~~paid as a Dividend under this Section 7.11(f) on in subsequent fiscal years). Dividends paid during a ~~Pro Forma Basis,~~ period when the ~~Consolidated Total Net~~ Leverage Ratio ~~does not exceed 3.25 to 1.00. In determining compliance with~~ is less than 6.00:1.00 shall, in the event that the Leverage Ratio subsequently exceeds 6.00:1.00, be counted against the baskets provided for in this Section ~~10.03~~ 7.11 (~~and in determining amounts paid~~ as ~~Dividends pursuant hereto~~ applicable) for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi)determining basket availability only.

Appears in 2 contracts

Sources: Credit Agreement (Host Hotels & Resorts L.P.), Credit Agreement (Host Hotels & Resorts L.P.)

Dividends. ~~The Lead~~ Subject to the following sentence, Borrower ~~will not~~may, and ~~will not~~ may permit ~~any of its Restricted Subsidiaries~~ Parent to, ~~authorize,~~ (i) make any distributions in redemption of any Capital Stock of the Borrower or the Parent and (ii) make or declare any dividends or ~~pay any Dividends~~ similar distributions with respect to its commonthe Capital Stock of the ~~Lead~~ Borrower or the Parent; provided that during the continuation of any ~~of its Restricted Subsidiaries~~Default, ~~except that:~~ the Borrower shall not (iand shall not permit Parent to) ~~any Restricted Subsidiary of the Lead Borrower may pay Dividends or return capital~~ declare or make any such dividends or distributions except that the Borrower and other similar payments with regard to its Equity Interests to the Lead Borrower or to other Restricted Subsidiaries of the Lead Borrower which directly or indirectly own equity therein; (ii) any non-Wholly-Owned Subsidiary of the Lead Borrower Parent may declare and ~~pay~~ make cash ~~Dividends~~ distributions to ~~its~~ itstheir respective shareholders ~~generally so long as the Lead Borrower or its Restricted Subsidiary which owns the Equity Interests~~ in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary); (iii) so long as no Default or Event of Default exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, the Lead Borrower may pay cash Dividends to Holdings to allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of such Parent Company from current or former members of management, employees, consultants, officers and directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that (A) the an aggregate amount of Dividends made by the Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment greater of (x) ~~obligations~~ an amount equal to ninety percent (90%) of BorrowerParent’s real estate investment trust taxable income and (y) the minimum amount necessary for the Borrower to remain in compliance with Section 6.10 and to otherwise avoid the payment of any income and/or excise taxes imposed under the Code, provided, however, there shall not be any implied requirement that the Parent utilize the dividend deferral options in Section 857(b)(9) or Section 858(a) of the Internal Revenue Code. If a Default specified in Section 7.1, Section 7.6 or Section 7.7 shall exist, or if as a result of the occurrence of any other Default any of the Obligations have been accelerated pursuant to Section 8.1, the Borrower shall not, and shall not permit the Parent or any Subsidiary to, make any dividends or distributions to any Person other than the Borrower or a Subsidiary of the Borrower; provided that, in the case of a Subsidiary that is not a Wholly-Owned Subsidiary, such Subsidiary may make distributions to holders of Capital Stock in such Subsidiary ratably according to the holders’ respective holdings of the type of Capital Stock in respect of ~~director~~ which such distributions are being made and ~~officer insurance policies to~~ provided further that the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may ~~pay cash Dividends to Holdings~~ (~~who~~ and may ~~subsequently pay cash Dividends to any other~~ permit Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xviito), ~~shall not exceed $5,000,000; (xv) the declaration and payment of dividends or the payment of other~~ in all events, make cash distributions ~~by the Lead Borrower~~ to its shareholders in an aggregate amount ~~since~~ equal to the ~~Closing Date~~ minimum amount necessary for Borrower to remain in compliance with Section 6.10, provided, however, there shall not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of be any ~~equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided~~ implied requirement that the ~~amount of any such cash proceeds that are utilized for any Dividend under this clause (iii~~Parent utilize the dividend deferral options in Section 857(b)(9) ~~will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii~~or Section 858(a) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as (x) at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi)Internal Revenue Code.

Appears in 2 contracts

Sources: Credit Agreement (Kite Realty Group, L.P.), Term Loan Agreement (Kite Realty Group, L.P.)

Dividends. The ~~Lead~~ Borrower will not, and the Borrower will not permit any of ~~its~~ the Restricted Subsidiaries to, directly or indirectly, authorize, declare or pay any Dividends with respect to the ~~Lead~~ Borrower or any ~~of its~~ Restricted ~~Subsidiaries~~Subsidiary, except that: (i) any Restricted Subsidiary ~~of the Lead Borrower~~ may pay Dividends ~~or return capital or make distributions and other similar payments with regard to its Equity Interests~~ to the ~~Lead~~ Borrower or to ~~other~~ any Wholly-Owned Domestic Restricted ~~Subsidiaries~~ Subsidiary and any Subsidiary of the ~~Lead~~ Borrower ~~which directly~~ that is not a Credit Party may pay Dividends to the Borrower or ~~indirectly own equity therein~~to any Wholly-Owned Restricted Subsidiary; (ii) any ~~non~~Non-Wholly-Owned Subsidiary ~~of the Lead Borrower~~ may ~~declare and~~ pay ~~cash~~ Dividends to its ~~shareholders~~ shareholders, members or partners generally so long as the ~~Lead~~ Borrower or ~~its~~ a Restricted Subsidiary which owns the Equity Interests in the Restricted Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Restricted Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Restricted Subsidiary); (iii) so long as no Default or Event of Default ~~exists at~~ shall have occurred and be continuing, the ~~time~~ Borrower may repurchase, retire or otherwise acquire or retire for value common Equity Interests (or options, warrants or other rights to acquire common Equity Interests) of the ~~applicable Dividend~~Borrower (or make payments to Holdings or any Person of which the Borrower constitutes a Subsidiary to permit distributions to repurchase common Equity Interests (or options, ~~redemption~~ warrants or ~~repurchase~~ other rights to acquire common Equity Interests thereof) of any such Person) from any future, current or ~~would exist immediately after giving effect thereto~~former officer, director, manager or employee (or any spouses, successors, executors, administrators, heirs or legatees of any of the foregoing) of the Borrower, any of its Subsidiaries, Holdings or any Person of which the Borrower constitutes a Subsidiary of the Borrower, in an aggregate amount for all such payments, together with all payments made pursuant to Section 6.04(xxii), not to exceed $10,000,000 plus the proceeds of “key-man” life insurance policies that are used to make such redemptions or repurchases; (iv) the Borrower or any of its Restricted Subsidiaries may pay Dividends on its Qualified Equity Interests solely through the issuance of additional shares of Qualified Equity Interests of the Borrower or such Restricted Subsidiary (but not in cash), provided that in lieu of issuing additional shares of Qualified Equity Interests as Dividends, the ~~Lead~~ Borrower or such Restricted Subsidiary may increase the liquidation preference of the shares of Qualified Equity Interests in respect of which such Dividends have accrued; (v) the Borrower may pay cash Dividends to Holdings to allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of such Parent Company from current or former members of management, employees, consultants, officers and directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that so long as (A) the aggregate amount of Dividends ~~made by the Lead Borrower to Holdings~~ paid pursuant to this clause (~~iii~~v), ~~and~~ plus the aggregate amount ~~paid by Holdings in respect~~ of ~~all~~ payments made pursuant to clause (x) of Section 6.15, does not exceed $25,000,000, (B) no Default or Event of Default then exists or would result therefrom, (C) after giving effect to the payment of such ~~Equity Interests so redeemed or repurchased~~ Dividend, the Total Asset Coverage Ratio shall not be less than 3.00:1.00 and the RC Asset Coverage Ratio shall not be less than 1.00:1.00, in each case, calculated on a Pro Forma Basis, and (D) prior to the payment of such Dividend, the Borrower shall have delivered to the Administrative Agent a certificate of an Authorized Officer of the Borrower certifying compliance with the preceding sub-clauses (A), (B) and (C) and containing the calculations (in reasonable detail) required to establish compliance with preceding sub-clause (C); (vi) Borrower may pay Permitted Tax Distributions; (vii) the Borrower may pay Dividends or consummate any irrevocable redemption within 60 days after the date of declaration of such Dividend or notice of such redemption if the Dividend or payment of the redemption price, as the case may be, would have been permitted on the date of declaration or notice hereunder; (viii) the Borrower may pay Dividends, either (i) through the application of net ~~of any~~ cash proceeds ~~received by Holdings (but in no event from any Initial Public Offering) from issuances~~ of ~~its Equity Interests~~ a substantially concurrent sale for cash (other than to ~~the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year~~ a Subsidiary of the ~~Lead~~ Borrower~~, $10,000,000~~ ) of shares of Qualified Equity Interests of the Borrower or (ii) through the application of a substantially concurrent cash capital contribution (other than by a Subsidiary of the Borrower) received by the Borrower from its equityholders in respect of Qualified Equity Interests; provided that (x) no Event of Default then exists or would result therefrom or (y) the aggregate amount of ~~cash~~ Dividends ~~permitted to be, but not,~~ paid ~~in any fiscal year~~ pursuant to this clause (~~iii~~viii) shall ~~increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause~~ not exceed $1,000,000; (~~iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I~~ix) the ~~cash proceeds~~ Borrower may pay Dividends on its Qualified Equity Interests by exchanging such Qualified Equity Interests for shares of ~~key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of~~ Qualified Equity Interests of ~~Holdings~~Holdings (but not, for the avoidance of doubt, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iiicash) ~~will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made~~ in accordance with the ~~cash proceeds described~~ exchange ratio for Class A units set forth in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent PNMAC Limited Liability Company ~~will not be deemed to constitute a Dividend for purposes of this~~ Agreement; (ivx) the ~~Lead~~ Borrower may ~~pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings~~ (~~or subsequently paid to any other Parent Company~~A) ~~to pay expenses incurred by Holdings or any other Parent Company~~ repurchase Equity Interests in connection with ~~offerings, registrations,~~ the exercise of stock options or ~~exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed~~ warrants to the ~~Lead Borrower,~~ extent such Equity Interests represent a portion of the exercise price of those stock options or warrants and (B) ~~in a prorated amount of such expenses in proportion~~ repurchase Equity Interests or options to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company purchase Equity Interests in connection with ~~reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations~~ the exercise of ~~any governmental, regulatory or self-regulatory body or~~ stock ~~exchange, including in respect of any reports filed with respect~~ options to the ~~Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder;~~extent necessary to pay applicable withholding taxes; and (vixi) the ~~Lead~~ Borrower may declare and pay ~~cash dividends or other distributions~~Dividends to, or make loans ~~or advances~~ to, Holdings or any ~~Parent Company or~~ Person of which the ~~equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof~~ Borrower constitutes a Subsidiary to pay, ~~in each case~~ without ~~duplication~~duplication as to amounts of: (A) franchise ~~Taxes (~~taxes and other ~~fees~~ similar fees, taxes and ~~expenses)~~ expenses required to maintain ~~their existence~~the existence of the Borrower, Holdings and any Person of which the Borrower constitutes a Subsidiary; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other ~~compensation and~~ benefits payable to ~~current and former officers, directors, consultants~~ officers and employees of Holdings or any ~~Parent Company~~ Person of which the Borrower constitutes a Subsidiary to the extent such salaries, bonuses and other ~~compensation and~~ benefits are ~~reasonably~~ attributable to the ownership or operations of the ~~Lead~~ Borrower and its Restricted Subsidiaries;; and (DC) general corporate ~~operating~~ overhead expenses and ~~overhead costs~~ other expenses incidental to being a public company (including, without limitation, audit, listing and ~~expenses (including administrative, legal, accounting and similar expenses provided by third parties~~legal expense) of Holdings or any ~~Parent Company~~ Person of which the Person constitutes a Subsidiary to the extent such ~~costs and~~ expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the ~~Lead Borrower~~ Person and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of ~~such purchases, when added to the aggregate amount of Investments~~ Dividends paid and loans made pursuant to ~~Section 10.05(xvii),~~ this clause (xi) shall not exceed $5,000,000; (xv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as (x) at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi)250,000.

Appears in 2 contracts

Sources: Credit Agreement (Pennymac Financial Services, Inc.), Credit Agreement (Pennymac Financial Services, Inc.)

Dividends. The ~~Lead Borrower~~ Borrowers will not, and will not permit any of its Restricted Subsidiaries to, authorize, declare or pay any Dividends with respect to ~~the~~ Lead Borrower or any of its Restricted Subsidiaries, except that: (i) any Restricted Subsidiary of ~~the Lead~~ a Borrower may pay Dividends or return capital or make distributions and other similar payments with regard to its Equity Interests to ~~the~~ Lead Borrower or to other Restricted Subsidiaries of ~~the~~ Lead Borrower which directly or indirectly own equity therein; (ii) any non-Wholly-Owned Subsidiary of ~~the~~ Lead Borrower may declare and pay cash Dividends to its shareholders generally so long as ~~the~~ Lead Borrower or its Restricted Subsidiary which owns the Equity Interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary); (iii) so long as no Default or Event of Default exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, ~~the~~ Lead Borrower may pay cash Dividends to Holdings to allow Holdings to pay cash dividends or make cash distributions to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of Holdings or such other Parent Company from ~~current or former members of~~ management, employees~~, consultants~~, officers and directors (and their successors and assigns) of ~~the~~ Lead Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by the ~~Lead Borrower~~ Borrowers to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings or such other Parent Company in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests ~~(other than to the extent included in the Available Amount)~~ and contributed to ~~the~~ Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of ~~the~~ Lead Borrower, the greater of $~~10,000,000~~ 11,250,000 and 1.00% of Consolidated Total Assets (measured at the time of such Dividend) (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by ~~the~~ Lead Borrower or any of ~~its~~ the Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to ~~the~~ Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to ~~the~~ Lead Borrower from ~~current or former~~ members of management, officers, directors, employees of ~~the~~ Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of Holdings or any other Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) ~~the Lead Borrower~~ Borrowers may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid (including as a Dividend by Holdings) to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to ~~the Lead~~ any Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to ~~the Lead~~ such Borrower or ~~the relevant~~ such Restricted Subsidiary ~~of the Lead Borrower~~ out of the proceeds of such offering promptly if such offering is completed; (v) ~~the Lead Borrower~~ Borrowers may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid (including as a Dividend by Holdings) to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) ~~the Lead Borrower~~ Borrowers may pay cash dividends or other distributions, or make loans or advances ~~to,~~ to any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their ~~existence~~existence to the extent such Taxes, fees and expenses are reasonably attributable to the operations of Holdings, Lead Borrower and its Restricted Subsidiaries; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which ~~the Lead~~ Holdings or any Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which Holdings or any other Parent Company ~~or other entity~~ is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of ~~the~~ Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that ~~the~~ Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to ~~the Lead~~ a Borrower or ~~its~~ the Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other ~~compensation and~~ benefits payable to ~~current and former officers, directors, consultants~~ officers and employees of any Parent Company to the extent such salaries, bonuses and other ~~compensation and~~ benefits are reasonably attributable to the ownership or operations of ~~the~~ Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of ~~the~~ Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of ~~the~~ Lead Borrower or any Parent Company; (F) the purchase or other acquisition by Holdings or any ~~parent~~ other Parent Company of ~~the~~ Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by ~~the~~ Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to ~~the~~ Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into ~~the~~ Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such ~~purchaser~~ purchase or other acquisition;; and (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of ~~the~~ Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of Holdings or any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of ~~the~~ Lead Borrower and ~~its~~ the Restricted Subsidiaries; (viii) ~~the Lead Borrower~~ Borrowers may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid (including as a Dividend by Holdings) to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of ~~the~~ Lead Borrower and ~~its~~ the Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory ~~Agreement (as in effect on the Closing Date~~Agreement; (ix) any Dividend used (i) to fund the Transaction, including Transaction ~~Costs and the Special Dividend~~Costs, and (ii) in order to satisfy deferred purchase price, earn-outs and contingent payments in respect of any ~~Dividend from proceeds received~~ amounts due and owing as provided for in ~~connection with any working capital adjustment pursuant to~~ the Acquisition Agreement; (x) ~~the Lead Borrower~~ Borrowers may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v), 10.06(vii) and ~~10.06(vii~~10.06(xii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or ~~the settlement or vesting of other~~ similar equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing ~~Date~~Date not to exceed, in any fiscal year, the greater of ~~up to~~ (x) 5% of such Parent Company’s market capitalization and (y) 6% ~~per annum~~ of the net cash proceeds contributed to the capital of ~~the Lead~~ any Borrower from any such Initial Public Offering; (xiii) the Borrowers may pay any Dividend so long as the Distribution Conditions are satisfied on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and Basis immediately after giving effect to such Dividend~~, no Event of Default shall have occurred and be continuing~~; (xiv) purchases of minority interests in ~~non-~~Restricted Subsidiaries that are not Wholly-Owned Subsidiaries by the ~~Lead Borrower~~ Borrowers and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed the greater of $~~5,000,000~~11,250,000 and 1.00% of Consolidated Total Assets (measured at the time of such Dividend); (xv) the declaration and payment of ~~dividends~~ Dividends or the payment of other distributions by the ~~Lead Borrower~~ Borrowers in an aggregate amount since the Closing Date not to exceed the greater of $~~35,000,000~~100,000,000 and 8.50% of Consolidated Total Assets (measured at the time of such Dividend); (xvi) ~~the~~ Lead Borrower and ~~each~~ its Restricted ~~Subsidiary~~ Subsidiaries may declare and make ~~dividend~~ Dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of ~~dividend~~ Dividend or other distribution by a Restricted Subsidiary, ~~the~~ Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) ~~the~~ Lead Borrower may ~~make payments~~ pay Dividends with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”;and (xviii) ~~the~~ Lead Borrower and ~~any~~ its Restricted ~~Subsidiary~~ Subsidiaries may pay ~~dividends and distributions~~ Dividends within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as (x) at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the ~~definition~~ definitions of “Consolidated ~~EBITDA~~ EBITDA” and “Consolidated Net Income”), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) ~~shall~~ shall, to the extent such loan or advance remains unpaid, be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi).

Appears in 2 contracts

Sources: Revolving Credit Agreement (VERRA MOBILITY Corp), Revolving Credit Agreement (VERRA MOBILITY Corp)

Dividends. The Lead Borrower will not, and will not permit any of its Restricted Subsidiaries to, authorize, declare or pay any Dividends with respect to the Lead Borrower or any of its Restricted Subsidiaries, except that: (a) It is agreed that (i) the Parties shall take such actions as are necessary to ensure that the timing of any ~~Restricted Subsidiary of~~ regular quarterly dividend paid to common stockholders by either the ~~Lead Borrower may pay Dividends~~ Company or ~~return capital or make distributions and other similar payments with regard to its Equity Interests~~ Parent prior to the Lead Borrower or to other Restricted Subsidiaries of the Lead Borrower which directly or indirectly own equity therein; (ii) any non-Wholly-Owned Subsidiary of the Lead Borrower may declare and pay cash Dividends to its shareholders generally Closing will be coordinated so long as the Lead Borrower or its Restricted Subsidiary which owns the Equity Interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferencesthat, if ~~any,~~ either the holders of Company Common Shares or the ~~various classes~~ holders of Equity Interests of such Subsidiary); (iii) so long as no Default or Event of Default exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, the Lead Borrower may pay cash Dividends Parent Common Stock receive a distribution for a particular calendar quarter prior to Holdings to allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of such Parent Company from current or former members of management, employees, consultants, officers and directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by the Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, ~~where~~ then the ~~net proceeds~~ holders of Parent Common Stock and the holders of Company Common Shares, respectively, shall also receive a distribution for such calendar quarter prior to the Closing Date and (ii) the Parties will coordinate such that any such quarterly distribution by the Company and Parent shall have the same record date and the same payment date, which shall be consistent with Parent’s historical record dates and payment dates unless otherwise agreed between the Parties, in order to ensure that the shareholders of the Company and the common stockholders of Parent receive the same number of such ~~sale are received by or contributed~~ dividends prior to the ~~Lead Borrower;~~ Effective Time (provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made quarterly dividend declared by the ~~Lead Borrower, it would have constituted a Permitted Acquisition permitted to~~ Company must be ~~made pursuant to~~ consistent with Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests4.1(b)(iv) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $5,000,000; (xv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such ~~cash proceeds~~ quarterly dividend declared by Parent must be consistent with Section 4.2(b)(iv)). For the avoidance of doubt, Parent shall be permitted to declare and pay dividends in respect of shares of Parent’s 5.125% Class L Cumulative Redeemable Preferred Stock and shares of Parent’s 5.25% Class M Cumulative Redeemable Preferred Stock, in each case pursuant to the terms thereof. (b) If the Company (in consultation with Parent) determines that ~~are utilized~~ it is necessary to declare a Special Company Distribution in accordance with Section 4.1(b)(iv), the Company shall notify Parent in writing at least 10 Business Days prior to the Company Shareholders Meeting and the Parent Stockholders Meeting, and the Merger Consideration shall be decreased by an amount equal to such Special Company Distribution, which shall be effected by reducing the Cash Consideration by an amount equal to the per share amount of the Special Company Distribution (it being understood that if the amount of the Special Company Distribution exceeds the amount of the Cash Consideration, the Stock Consideration shall also be appropriately reduced to reflect the full effect of the portion of the Special Company Distribution that exceeds the amount of the Cash Consideration). The record date and payment date for any ~~Dividend under this clause (iii) will not be considered~~ dividend payable pursuant to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as (x) at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi5.11(b) shall be ~~deemed to be cash Dividends paid to Holdings~~ the close of business on the last Business Day prior to the ~~extent provided~~ Closing Date. (c) If Parent (in ~~said~~ consultation with the Company) determines that it is necessary to declare a Special Parent Distribution in accordance with Section ~~10.05(vi~~4.2(b)(iv), Parent shall notify the Company in writing at least 10 Business Days prior to the Company Shareholders Meeting and the Parent Stockholders Meeting, and the Company shall be entitled to declare a dividend per share payable to holders of Company Common Shares, in an amount per share equal to the product of (i) the Special Parent Distribution declared by Parent with respect to each share of Parent Common Stock and (ii) the Exchange Ratio. The record date and payment date for any dividend payable pursuant to this Section 5.11(c) shall be the close of business on the last Business Day prior to the Closing Date. (d) In the event that a dividend or other distribution with respect to the Company Common Shares permitted under the terms of this Agreement has (i) a record date prior to the Effective Time and (ii) has not been paid as of the Effective Time, the holders of Company Common Shares shall be entitled to receive such dividend or other distribution pursuant to and in accordance with Section 2.2.

Appears in 2 contracts

Sources: Merger Agreement (Weingarten Realty Investors /Tx/), Merger Agreement (Kimco Realty Corp)

Dividends. The ~~Lead Borrower~~ Parent will not, and will not permit any of its ~~Restricted~~ Subsidiaries to, authorize, declare or pay any Dividends with respect to the ~~Lead Borrower~~ Parent or any of its ~~Restricted~~ Subsidiaries, except that: (i) any Restricted Subsidiary of the Lead Borrower may pay Dividends or return capital or make distributions and other similar payments with regard to its Equity Interests to the Lead Borrower or to other Restricted Subsidiaries of the Lead Borrower which directly or indirectly own equity therein; (iiA) any ~~non-~~Wholly-Owned Subsidiary of the ~~Lead~~ Parent may pay Dividends to the Parent or any Wholly-Owned Subsidiary of the Parent, (B) any Subsidiary Guarantor may pay Dividends to the Borrower or any other Subsidiary Guarantor and (C) if the respective Subsidiary is not a Wholly-Owned Subsidiary of the Parent, such Subsidiary may ~~declare and~~ pay ~~cash~~ Dividends to its shareholders generally so long as the ~~Lead Borrower or~~ Parent and/or its ~~Restricted Subsidiary~~ respective Subsidiaries which ~~owns the~~ own Equity Interests in the Subsidiary paying such Dividends ~~receives~~ receive at least ~~its~~ their proportionate share thereof (based upon ~~its~~ their relative ~~holding~~ holdings of the Equity Interests in the Subsidiary paying such cash Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary);; and (~~iii~~ii) so long as no ~~Default or~~ Event of Default ~~exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately~~ (both before and after giving effect ~~thereto~~to the payment thereof) has occurred and is continuing, the ~~Lead Borrower~~ Parent may ~~pay cash Dividends to Holdings to allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend,~~ repurchase its outstanding Equity Interests (or options to purchase such equity) theretofore held by its or any of ~~such Parent Company from current or former members of management,~~ its Subsidiaries’ employees, ~~consultants~~officers or directors following the death, disability, retirement or termination of employment of employees, officers ~~and~~ or directors ~~(and their successors and assigns)~~ of the ~~Lead Borrower and~~ Parent or any of its ~~Restricted~~ Subsidiaries; , provided that ~~(A)~~ the aggregate amount expended to so repurchase equity of ~~Dividends made by~~ the ~~Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased~~ Parent shall not ~~(net of any cash proceeds received by Holdings (but~~ exceed $2,000,000 in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $5,000,000; (xv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as (x) at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi)Parent.

Appears in 2 contracts

Sources: Credit Agreement (General Maritime Corp / MI), Credit Agreement (General Maritime Corp / MI)

Dividends. The ~~Lead~~ Borrower will not, and will not permit any of ~~its~~ the Restricted Subsidiaries to, directly or indirectly, authorize, declare or pay any Dividends with respect to the ~~Lead~~ Borrower or any ~~of its~~ Restricted ~~Subsidiaries~~Subsidiary, except that: (i) any Restricted Subsidiary ~~of the Lead Borrower~~ may pay Dividends ~~or return capital or make distributions and other similar payments with regard to its Equity Interests~~ to the ~~Lead~~ Borrower or to ~~other~~ any Wholly-Owned Domestic Restricted ~~Subsidiaries~~ Subsidiary and any Subsidiary of the ~~Lead~~ Borrower ~~which directly or indirectly own equity therein~~that is not a Credit Party may pay Dividends to any Wholly-Owned Restricted Subsidiary; (ii) any ~~non~~Non-Wholly-Owned Restricted Subsidiary ~~of the Lead Borrower~~ may ~~declare and~~ pay ~~cash~~ Dividends to its ~~shareholders~~ shareholders, members or partners generally so long as the ~~Lead~~ Borrower or ~~its~~ a Restricted Subsidiary which owns the Equity Interests in the Restricted Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Restricted Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Restricted Subsidiary); (iii) ~~so long as no Default~~ the Borrower may redeem, repurchase or ~~Event~~ otherwise acquire for value, outstanding shares of ~~Default exists at~~ its Qualified Equity Interests (or options or warrants to purchase its Qualified Equity Interests) following the ~~time~~ death, disability or termination of employment of officers, directors or employees of the ~~applicable Dividend~~Borrower or any Restricted Subsidiary, redemption or repurchase or would exist immediately after giving effect thereto, the Lead Borrower may pay cash Dividends to Holdings to allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of such Parent Company from current or former members of management, employees, consultants, officers and directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that (Ax) the aggregate amount of all Dividends paid or made by pursuant to this clause (iii) shall not exceed $10,000,000 in any fiscal year of the ~~Lead~~ Borrower and (y) at the time of any Dividend permitted to ~~Holdings~~ be made pursuant to this clause (iii), ~~and the aggregate amount paid by Holdings in respect~~ no Default or Event of ~~all such Equity Interests so redeemed~~ Default shall then exist or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreementwould result therefrom; (iv) the ~~Lead~~ Borrower may pay ~~cash~~ Dividends ~~to Holdings so long as~~ on its Qualified Equity Interests solely through the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings issuance of ~~equity or debt securities and maintenance~~ additional shares of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary Qualified Equity Interests of the ~~Lead~~ Borrower ~~out~~ (but not in cash), provided that in lieu of issuing additional shares of Qualified Equity Interests as Dividends, the Borrower may increase the liquidation preference of the ~~proceeds~~ shares of Qualified Equity Interests in respect of which such ~~offering promptly if such offering is completed~~Dividends have accrued; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder;[reserved]; and (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $5,000,000; (xv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as (x) at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi)[reserved].

Appears in 2 contracts

Sources: Credit Agreement (Walter Investment Management Corp), Credit Agreement (Walter Investment Management Corp)

Dividends. ~~The Lead Borrower~~ VHS Holdco I will not, and will not permit any of its ~~Restricted~~ Subsidiaries to, authorize, declare or pay any Dividends with respect to ~~the Lead Borrower~~ VHS Holdco I or any of its ~~Restricted~~ Subsidiaries, except that: (i) any ~~Restricted~~ Subsidiary of the ~~Lead~~ Borrower may pay Dividends ~~or return capital or make distributions and other similar payments with regard to its Equity Interests~~ to the ~~Lead~~ Borrower or to ~~other Restricted Subsidiaries~~ a Wholly-Owned Subsidiary of the ~~Lead Borrower which directly or indirectly own equity therein~~Borrower; (ii) VHS Holdco I may redeem or repurchase (and the Borrower and its Subsidiaries may declare and pay Dividends to VHS Holdco I, the proceeds of which are used to so redeem or repurchase) Equity Interests of VHS Holdco I (or any direct or indirect parent thereof) (including related stock appreciation rights or similar securities) from present or former officers, consultants, employees and directors (or their trusts or estates) of Vanguard or VHS Holdco I or any direct or indirect parent of VHS Holdco I, or any of its Subsidiaries upon the death, disability, retirement or termination of employment of any such Person or otherwise in accordance with any stock option plan, any employee stock ownership plan or any Shareholders’ Agreement, provided that the aggregate amount of all cash paid in respect of all such shares so redeemed or repurchased in any calendar year does not exceed the sum of (A) $15,000,000 plus (B) all amounts obtained by VHS Holdco I during such calendar year from the sale of such Equity Interests to other present or former officers, consultants, employees and directors in connection with any permitted compensation and incentive arrangements, which, if not used in any calendar year, may be carried forward to any subsequent calendar year plus (C) all amounts obtained from any key-man life insurance policies recorded during such calendar year; (iii) so long as there shall exist no Default or Event of Default at the time of or immediately after giving effect thereto, VHS Holdco I may effect redemptions or repurchases (and the Borrower and its Subsidiaries may declare and pay Dividends to VHS Holdco I, the proceeds of which are used to effect such redemptions or repurchases) of its Equity Interests from any present or former officer, consultant, employee or director (or his or her trust or estate) of Vanguard or VHS Holdco I or any direct or indirect parent of VHS Holdco I, or any of its Subsidiaries upon the death, disability, retirement or termination of employment of such Person so long as the aggregate amount of such redemptions or repurchases does not exceed $35,000,000; (iv) so long as there shall exist no Default under Section 10A.01 or Event of Default (both before and after giving effect to the payment thereof) any non-Wholly-Owned Subsidiary of the ~~Lead~~ Borrower may ~~declare and~~ pay ~~cash~~ Dividends to its shareholders or partners generally in the form of cash, Cash Equivalents, common stock and preferred stock permitted to be issued pursuant to Section 9.12(b), so long as the ~~Lead~~ Borrower or its ~~Restricted~~ respective Subsidiary which owns the Equity Interest or Interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative ~~holding~~ holdings of ~~the~~ Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of in such Subsidiary); (A) VHS Holdco I may make, or may make Dividends to allow any direct or indirect parent to make, noncash repurchases of Equity Interests of VHS Holdco I or any direct or indirect parent, deemed to have occurred upon the exercise of stock options if such Equity Interests represent a portion of the exercise price of such options and (B) VHS Holdco I may purchase, or may make Dividends to allow any direct or indirect parent to purchase, common Equity Interests of VHS Holdco I or any direct or indirect parent, at fair market value from officers, employees and directors of Vanguard, VHS Holdco I or any direct or indirect parent of VHS Holdco I, or any of their Subsidiaries to the extent necessary to cover the exercise price of options and income tax withholding, provided that the aggregate amount of cash paid in respect of all such shares so repurchased pursuant to this clause (B) in any calendar year does not, when added to the aggregate amount of all Dividends made in such calendar year pursuant to clauses (vi) and (vii) below, exceed $10,000,000; (vi) VHS Holdco I may make, or may make Dividends to any direct or indirect parent to make, cash payments to officers, employees and directors of Vanguard, VHS Holdco I or any direct or indirect parent of VHS Holdco I, or any of their Subsidiaries in respect of stock appreciation rights issued pursuant to a compensation plan approved by the board of directors of VHS Holdco I or by the compensation committee thereof, provided that the aggregate amount of cash paid pursuant to this clause (vi) in any calendar year does not, when added to the aggregate amount of all Dividends made in such calendar year pursuant to clause (v)(B) above and clauses (vii) below, exceed $10,000,000; (vii) the Borrower and its Subsidiaries may purchase Equity Interests in their respective non-Wholly-Owned Subsidiaries, and non-Wholly-Owned Subsidiaries of the Borrower and Health Care Joint Ventures may repurchase their respective outstanding Equity Interests, provided that the aggregate amount of cash paid pursuant to all purchases and repurchases under this clause (vii) in any calendar year does not, when added to the aggregate amount of Dividends made in such calendar year pursuant to clauses (v)(B) and (vi) above, exceed $10,000,000; (viii) the Borrower and VHS Holdco I may pay cash Dividends to VHS Holdco I or any direct or indirect parent so long as the proceeds thereof are promptly used by VHS Holdco I or such parent (w) to pay operating expenses incurred in the ordinary course of business (including, without limitation, outside directors and professional fees, expenses and indemnities) and other similar overhead costs, expenses and tax liabilities (other than income taxes) of VHS Holdco I or, to the extent primarily attributable to the operations of VHS Holdco I and its Subsidiaries, of such parent, (x) to pay Dividends to VHS Holdings LLC for the payment of costs, expenses and tax liabilities (other than income taxes) incurred by VHS Holdings LLC that are of a similar nature as those described in preceding clause (w) and are primarily attributable to the operations of VHS Holdco I and its Subsidiaries, (y) to pay fees and expenses relating to any offering, investment or acquisition by VHS Holdco I or any of its Subsidiaries permitted hereunder (whether or not successful) and other fees and expenses incidental to the maintenance of the existence of VHS Holdco I or such parent (in each case to the extent primarily attributable to the operations of VHS Holdco I and its Subsidiaries) and the ownership by each of such entities of, as applicable, the Borrower, Vanguard and VHS Holdco I and Subsidiaries of VHS Holdco I and (z) to make payments permitted by Section 9.06 (other than clause (i) thereof); (ix) the Borrower may pay Dividends to VHS Holdco I which in turn may pay Dividends directly or indirectly to Vanguard for the purpose of enabling VHS Holdco I or Vanguard to pay federal and state income taxes imposed directly on (through an entity treated as a disregarded entity for applicable income tax purposes) or allocated to (through an entity treated as a partnership for applicable income tax purposes) VHS Holdco I or Vanguard or which are due and payable by VHS Holdco I or Vanguard as part of a consolidated group (or enabling Vanguard to pay Dividends to VHS Holdings LLC should such taxes be imposed directly on or allocated to VHS Holdings LLC), to the extent such taxes are attributable to the operations of VHS Holdco I and its Subsidiaries (or, in the case of Dividends from the Borrower, to the extent such taxes are attributable to the operations of the Borrower and its Subsidiaries), and so long as (x) such Dividends are only paid at the time that VHS Holdco I, Vanguard, or VHS Holdings LLC (as the case may be) is otherwise required to make such federal, state or local income tax payments (including estimated tax payments), (y) any refunds received by VHS Holdco I, Vanguard, or VHS Holdings LLC (as the case may be) in respect of such federal, state or local income tax obligations are promptly returned to the Borrower as an equity contribution or series of equity contributions and (z) the amount of such payments in respect of any tax year does not exceed the amount that VHS Holdco I and its Subsidiaries (or, in the case of Dividends from the Borrower, the Borrower and its Subsidiaries) would have been required to pay in respect of such federal or state income taxes (as the case may be) in respect of such year if VHS Holdco I and its Subsidiaries (or the Borrower and its Subsidiaries) paid taxes directly as a stand-alone taxpayer (or stand-alone group); (x) the Borrower may pay cash Dividends to VHS Holdco I so long as the proceeds thereof are promptly used by VHS Holdco I to make Dividends permitted pursuant to clause (iii), (v)(B), (vi) or (xiii) of this Section 9.03; (xi) VHS Holdco I may pay cash Dividends to any direct or indirect parent for the purposes of such parent making Dividends of the type described in clause (ii), (iii), (v)(B) and (vi) of this Section 9.03 with respect to officers, consultants, employees and directors of Vanguard to the extent same are primarily employed, appointed or engaged, as the case may be, in connection with the operations of VHS Holdco I and its Subsidiaries; (xii) the Borrower and VHS Holdco I may pay cash Dividends to effect the Distribution and the Refinancing; and (xiii) so long as no Default or Event of Default ~~exists at the time of the applicable Dividend, redemption or repurchase~~ is then in existence or would ~~exist immediately after giving effect thereto~~arise therefrom, the ~~Lead~~ Borrower and VHS Holdco I may pay cash Dividends to Holdings to allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of such Parent Company from current or former members of management, employees, consultants, officers and directors not otherwise permitted in clauses (~~and their successors and assigns~~i) ~~of the Lead Borrower and its Restricted Subsidiaries; provided that~~ through (Axii) ~~the aggregate amount of Dividends made by the Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings~~ above in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to ~~exceed:~~ exceed $25,000,000 in the aggregate (Ior if the Adjusted Consolidated Net Leverage at such time determined on a Post-Test Period Pro Forma Basis is less than 5.0:1.0, $50,000,000 at any time) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that minus the amount applied to make prepayments of ~~any such net proceeds that are utilized for any Dividend under this clause (iii~~subordinated Indebtedness pursuant to Section 9.10(i) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrowerplus, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) Adjusted Consolidated Leverage Ratio on a ~~Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering~~ Post-Test Period Pro Forma Basis as of such ~~common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering;~~ date (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such ~~Dividend, no Event of Default shall have occurred and be continuing; (xiv~~Dividends) ~~purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added~~ is less than 4.5 to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $5,000,000; (xv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary1.0, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as (x) at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi)Cumulative Credit.

Appears in 2 contracts

Sources: Credit Agreement (Vanguard Health Systems Inc), Credit Agreement (Vanguard Health Systems Inc)

Dividends. ~~The Lead Borrower will not, and will not permit any of its Restricted Subsidiaries to, authorize~~Authorize, declare or ~~pay~~ pay, directly or indirectly, any Dividends with respect to ~~the Lead Borrower or~~ any ~~of its Restricted Subsidiaries~~Company, except that: (a) any Subsidiary of a Borrower (i) may pay cash Dividends to a Borrower or any ~~Restricted~~ Wholly Owned Subsidiary of ~~the Lead~~ a Borrower ~~may pay Dividends or return capital or make distributions~~ and ~~other similar payments with regard to its Equity Interests to the Lead Borrower or to other Restricted Subsidiaries of the Lead Borrower which directly or indirectly own equity therein;~~ (ii) ~~any non-Wholly-~~if such Subsidiary is not a Wholly Owned Subsidiary of ~~the Lead Borrower~~ a Borrower, may ~~declare and~~ pay cash Dividends to its shareholders generally so long as the ~~Lead~~ Borrower or its ~~Restricted~~ Subsidiary which owns the ~~Equity Interests~~ equity interest or interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative ~~holding~~ holdings of ~~the Equity Interests~~ equity interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of ~~Equity Interests of~~ equity interests in such Subsidiary); (~~iii~~b) so long as no Default ~~or Event of Default~~ exists ~~at the time of the applicable Dividend, redemption or repurchase~~ or would ~~exist immediately after giving~~ result therefrom, BearingPoint may repurchase outstanding shares of its common stock (or options to purchase such common stock) following the death, disability, retirement or termination of employment of employees, officers or directors of any Company; provided that (i) all amounts used to effect ~~thereto~~such repurchases are obtained by BearingPoint from a substantially concurrent issuance of its common stock (or options to purchase such common stock) to other employees, the Lead Borrower may pay cash Dividends to Holdings to allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of such Parent Company from current or former members of management, ~~employees~~executive officers or directors of any Company or (ii) to the extent the proceeds used to effect any repurchase pursuant to this clause (ii) are not obtained as described in preceding clause (i), ~~consultants~~(x) Borrowing Availability for the 60 days prior to the date that any such Dividend is paid shall be not less than $25.0 million, ~~officers~~ (y) projected Borrowing Availability for the 60 days after the date that any such Dividend is paid shall be not less than $25.0 million based on projections presented by BearingPoint to the Administrative Agent and ~~directors~~ reasonably satisfactory to the Administrative Agent and (~~and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that (A~~z) the aggregate amount of Dividends ~~made~~ paid by ~~the Lead Borrower to Holdings~~ BearingPoint pursuant to this paragraph (b) (exclusive of amounts paid as described pursuant to preceding clause (~~iii~~i)~~, and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased~~ ) shall not exceed $1.0 million in any fiscal year of BearingPoint; (~~net of any cash proceeds received by Holdings (but in~~ c) so long as no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption Default exists or ~~repurchase)~~would result therefrom, BearingPoint may pay Dividends, in ~~either case,~~ an amount not to exceed during any fiscal ~~year of the Lead Borrower~~year, $~~10,000,000 (provided that the amount of cash Dividends permitted to be, but not,~~ 5.0 million less any amounts paid ~~in any~~ during such fiscal year pursuant to ~~this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years~~ Section 6.06(e), pursuant to ~~this clause~~ and in accordance with stock option plans or other benefit plans or arrangements for directors, officers or employees of BearingPoint or its Subsidiaries; (~~iii));~~ d) so long as no Default exists or would result therefrom, BearingPoint may repurchase its capital stock upon exercise of options or warrants solely to the extent that shares of such capital stock represent a portion of the exercise price of such options or warrants and no cash is tendered or paid by BearingPoint in connection therewith; (Be) ~~such amount~~ so long as no Default exists or would result therefrom, BearingPoint may make cash payments, in ~~any calendar year may be increased by~~ an amount not to ~~exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or~~ exceed during any ~~of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings~~fiscal year, ~~in each case~~ $5.0 million less any amounts paid during such fiscal year pursuant to ~~members of management~~Section 6.06(c), managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of ~~such minimum Taxes) that are attributable to~~ the ~~taxable income~~ issuance of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of ~~the Lead Borrower or any Parent Company~~BearingPoint; (Ff) (i) after such time as the Foreign Cash Repatriation shall have occurred, (ii) after such time as BearingPoint shall have made the Satisfactory Public Filings other than its Form 10-Q filing for the quarter ended September 30, 2005, (iii) after the Closing Date and prior to January 1, 2006, (iv) so long as no Default exists or would result therefrom, and (v) as long as Consolidated EBITDA for the month of July 2005 is equal to at least $13.4 million and Consolidated EBITDA for the month of August 2005 is equal to at least $31.5 million (in each case, such calculation of Consolidated EBITDA to be certified by delivery of an Officer’s Certificate to the Administrative Agent with such accompanying detail as to such calculation as the Administrative Agent shall reasonably request), BearingPoint may make cash payments after the Closing Date and prior to January 1, 2006 to repurchase its capital stock or to repurchase and retire outstanding Indebtedness in an amount not to exceed (x) the ~~purchase or other acquisition by any parent~~ lower of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) ~~such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition~~ $5.0 million and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary 50% of the ~~Person formed or acquired~~ amount of cash in ~~order~~ excess of $65.0 million that has been repatriated by Foreign Subsidiaries to ~~consummate such purchaser or other acquisition; (G) any customary fees and expenses related~~ deposit accounts subject to ~~any unsuccessful equity offering by any Parent Company directly attributable to the operations~~ a Deposit Account Control Agreement of ~~the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company~~ BearingPoint in the ~~ordinary course of business~~United States after the Closing Date and prior to January 1, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or 2006, less (y) ~~indemnification obligations owing~~ the amount of Indebtedness which is incurred by Foreign Subsidiaries from the Loan Parties pursuant to Section 6.01(f)(iv), less (z) the ~~Sponsor and Sponsor Affiliates under~~ amount of equity Investments made by the ~~Advisory Agreement (as~~ Loan Parties in ~~effect on the Closing Date;~~Foreign Subsidiaries pursuant to Section 6.04(q)(ii); and (ixg) ~~any Dividend used to fund~~ (i) after such time as the ~~Transaction~~Foreign Cash Repatriation shall have occurred, ~~including Transaction Costs and~~ (ii) after such time as BearingPoint shall have made the ~~Special Dividend~~Satisfactory Public Filings, ~~and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement;~~ (xiii) ~~the Lead Borrower may pay cash Dividends to Holdings~~ after December 31, 2005, (~~who may subsequently pay cash Dividends to any other Parent Company~~iv) so long as no Default exists or would result therefrom, and (v) as long as the ~~proceeds thereof are used~~ Consolidated Fixed Charge Coverage Ratio for BearingPoint shall be greater than 1.25 to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend 1.0 as to any ~~Parent Company~~ payment made prior to ~~fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date~~September 1, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of2006, and greater than 1.50 to 1.0 as to any payment made on or after September 1, 2006, both before giving effect thereto and pro forma after giving effect ~~to such Dividend~~thereto, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $5,000,000; (xv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower BearingPoint may make cash payments in an aggregate amount ~~since the Closing Date~~ not to exceed $~~35,000,000; (xvi)~~ 35,000,000 during the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision term of this ~~Section 10.03; and (xix) any Dividends, so long as (x) at the time of,~~ Agreement to repurchase its capital stock or to repurchase and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi)retire outstanding Indebtedness.

Appears in 2 contracts

Sources: Credit Agreement (Bearingpoint Inc), Credit Agreement (Bearingpoint Inc)

Dividends. The ~~Lead~~ Borrower will not, and will not permit any of its ~~Restricted~~ Subsidiaries to, authorize, declare or pay any ~~Dividends with respect to the Lead Borrower or any of its Restricted Subsidiaries~~Dividends, except that: (i) any ~~Restricted~~ Subsidiary of the ~~Lead~~ Borrower may pay cash Dividends ~~or return capital or make distributions and other similar payments with regard to its Equity Interests~~ to the ~~Lead~~ Borrower or to ~~other Restricted Subsidiaries~~ any Wholly-Owned Domestic Subsidiary of the ~~Lead~~ Borrower ~~which directly or indirectly own equity therein~~and any Foreign Subsidiary of the Borrower also may pay cash Dividends to any Wholly-Owned Foreign Subsidiary of the Borrower; (ii) any ~~non~~Non-~~Wholly-~~Wholly Owned Subsidiary of the ~~Lead~~ Borrower may ~~declare and~~ pay cash Dividends to its ~~shareholders generally~~ shareholders, members or partners generally, so long as the ~~Lead~~ Borrower or its ~~Restricted~~ respective Subsidiary which owns the Equity ~~Interests~~ Interest in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity ~~Interests~~ Interest in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary); (iii) ~~so long as no Default or Event of Default exists at~~ the ~~time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, the Lead~~ Borrower may pay cash Dividends to Holdings to allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of such Parent Company from current or former members of management, employees, consultants, officers and directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by the Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of purchase its Equity Interests ~~(other than to the extent included~~ in the ~~Available Amount) and contributed~~ open market pursuant to its stock repurchase plan as in effect on the ~~Lead Borrower in connection~~ Effective Date, or pursuant to an open market purchase plan the terms of which are consistent with such ~~redemption or repurchase)~~plan, in either case, exceed during any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an aggregate amount not to ~~exceed:~~ exceed $50.0 million; (Iiv) a Wholly-Owned Subsidiary may repurchase its Equity Interests; (v) the ~~cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale~~ repurchase of Equity Interests of ~~Holdings, in each case~~ the Borrower deemed to ~~members~~ occur upon (a) the exercise of ~~management, managers, directors or consultants~~ stock options to the extent such Equity Interests represent a portion of ~~any Parent Company or any~~ the exercise price of ~~its Subsidiaries that occurs after~~ those stock options and (b) the ~~Closing Date, where the net proceeds~~ withholding of a portion of such ~~sale are received by or contributed~~ Equity Interests to pay Taxes associated therewith, and the ~~Lead Borrower; provided that the amount~~ purchase of ~~any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds~~ fractional shares of Equity Interests ~~for purposes of clause (b)(x)(ii)~~ of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower arising out of ~~the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (~~stock dividends, splits or ~~subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings~~ combinations or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunderbusiness combination; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends ~~to Holdings~~ or purchase its Equity Interests in the open market or otherwise at any time with the Available Amount at such time so long as immediately after such Dividend or purchase and any related transaction or borrowing the ~~proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to~~ Borrower satisfies the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date;Liquidity Test; and (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (xvii) the ~~Lead~~ Borrower may ~~pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor~~ repurchase its Equity Interests, or ~~Sponsor Affiliate fees~~warrants, ~~expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock~~ puts, options or ~~warrants~~ rights to purchase or otherwise acquire an Equity Interest in the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any ~~such Initial Public Offering;~~ present or former officer, director or employee or consultant of the Borrower or any of its Subsidiaries pursuant to an agreement (~~xiii~~including an employment agreement) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests or plan approved in ~~non-Wholly-Owned Subsidiaries~~ good faith by the ~~Lead~~ board of directors of the Borrower ~~and the Guarantors; provided that the aggregate amount of~~ or such ~~purchases~~Subsidiary under which such Person purchases or sells or is granted an option to purchase or sell such Equity Interests, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $5,000,000; (xv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an ~~aggregate~~ amount ~~since the Closing Date~~ not to exceed $~~35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely~~ 3.0 million in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as (x) at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi)fiscal year.

Appears in 2 contracts

Sources: Credit Agreement (Shuffle Master Inc), Credit Agreement (Shuffle Master Inc)

Dividends. The ~~Lead Borrower~~ Borrowers will not, and will not permit any of ~~its~~ the Restricted Subsidiaries to, authorize, declare or pay any Dividends with respect to the Lead Borrower or any of its Restricted Subsidiaries, except that: (i) any Restricted Subsidiary of the Lead Borrower may authorize, declare and pay Dividends or return capital or make distributions and other similar payments with regard to its Equity Interests to the Lead Borrower or to other Restricted Subsidiaries of the Lead Borrower which directly or indirectly own equity therein; (ii) any non-Wholly-Owned Subsidiary of the Lead Borrower may authorize, declare and pay cash Dividends to its shareholders generally so long as the Lead Borrower or its Restricted Subsidiary which owns the Equity Interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary); (iii) so long as no ~~Default or~~ Event of Default exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, the Lead Borrower may authorize, declare and pay cash Dividends to Holdings to allow Holdings to pay cash dividends or make cash distributions to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of Holdings or such other Parent Company from ~~current or former members of~~ management, employees~~, consultants~~, officers and directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by the Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings or such other Parent Company in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests ~~(other than to the extent included in the Available Amount)~~ and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, (x) the greater of $~~10,000,000~~ 35,000,000 and 6.25% of Consolidated EBITDA of the Lead Borrower and its Restricted Subsidiaries for the most recently ended Test Period (measured at the time of such Dividend) or (y) subsequent to the consummation of any Initial Public Offering of common stock or other comparable equity interests of Lead Borrower or any direct or indirect parent of Lead Borrower, the greater of $55,000,000 and 10.0% of Consolidated EBITDA of the Lead Borrower and its Restricted Subsidiaries for the most recently ended Test Period (measured at the time of such Dividend) (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from ~~current or former~~ members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of Holdings or any other Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may authorize, declare and pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may authorize, declare and pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with ~~applicable laws~~Requirements of Law, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may authorize, declare and pay cash ~~dividends~~ Dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their ~~existence~~existence to the extent such Taxes, fees and expenses are reasonably attributable to the operations of Holdings, the Lead Borrower and its Restricted Subsidiaries; (B) with respect to any taxable ~~year (or portion thereof)~~ period ending after the Closing Date ~~with respect to~~ for which ~~the~~ Lead Borrower ~~(a) is treated as a corporation for U.S. federal, state,~~ and/or ~~local income tax purposes and (b) is a member~~ any of its Subsidiaries are members of a consolidated, combined or similar income tax group ~~(a “Tax Group”)~~ for U.S. federal and/or applicable state, local or foreign income or similar tax purposes of which ~~any Parent Company~~ a direct or ~~other entity~~ indirect parent of Lead Borrower is the common parent, the portion of any such U.S. federal, ~~state~~ state, local and/or foreign income and ~~local income Taxes~~ similar taxes (including any alternative minimum ~~Taxes~~taxes) ~~(or franchise and similar Taxes imposed in lieu~~ of such ~~minimum Taxes)~~ tax group that is attributable to the taxable income of Lead Borrower and its applicable Restricted Subsidiaries and, to the extent of the amount actually received for such purpose from its applicable Unrestricted Subsidiaries, in amounts required to pay any such taxes that are attributable to the taxable income of ~~the Lead Borrower and its~~ such Unrestricted Subsidiaries; provided that ~~for each taxable period,~~ the aggregate amount of such payments ~~made in~~ with respect to such period (regardless of ~~such taxable period in the aggregate~~ when paid) shall not exceed the aggregate amount of such Taxes that ~~the~~ Lead Borrower ~~and~~ and/or its applicable Restricted Subsidiaries (and, subject to the limitation described above, any applicable Unrestricted Subsidiaries of Lead Borrower) would have been required to pay as with respect to such period were such entities stand-alone corporate taxpayers or a stand-alone ~~Tax Group; provided, further, that~~ corporate tax group for all applicable taxable periods ending after the ~~permitted payment pursuant~~ date hereof taking into account any applicable limitations on the ability to ~~this clause (B) with respect to~~ utilize net operating loss carryforwards and similar tax attributes under the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar TaxesCode; (C) payments under any domination and/or profit and loss pooling agreements; (D) customary salary, bonus and other ~~compensation and~~ benefits payable to ~~current and former officers,~~ directors, ~~consultants~~ officers and employees of any Parent Company to the extent such salaries, bonuses and other ~~compensation and~~ benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (DE) general corporate operating and overhead ~~costs~~ costs, fees and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such ~~costs~~ costs, fees and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (EF) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (FG) the purchase or other acquisition by Holdings or any ~~parent~~ other Parent Company of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such ~~parent~~ Parent Company shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger or amalgamation (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such ~~purchaser~~ purchase or other acquisition;; and (GH) any customary fees and expenses related to any successful or unsuccessful debt or equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) the Lead Borrower and its Restricted Subsidiaries may give reasonable and customary indemnities to directors, officers and employees of Holdings or any other Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may authorize, declare and pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory ~~Agreement (as in effect on the Closing Date~~Agreement; (ix) any Dividend used (x) to fund the Transaction, including Transaction ~~Costs and the Special Dividend~~Costs, and (y) in order to satisfy deferred purchase price, earn-outs and contingent payments in respect of any ~~Dividend from proceeds received~~ amounts due and owing as provided for in ~~connection with any working capital adjustment pursuant to~~ the Acquisition Agreement; (x) the Lead Borrower may authorize, declare and pay cash Dividends to Holdings (who may subsequently authorize, declare and pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v), 10.06(vii) and ~~10.06(vii~~10.06(xii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or ~~the settlement or vesting of other~~ similar equity incentive awards; (xii) a Dividend (including to any Parent ~~Company~~ Company) to fund a payment of dividends on ~~such~~ the Lead Borrower’s or any Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, not to exceed, in any fiscal year, the sum of ~~up to 6~~(x) 6.0% ~~per annum~~ of the net cash proceeds received by or contributed to the capital of the Lead Borrower from any such Initial Public ~~Offering~~Offering and (y) 7.0% of the Lead Borrower’s (or any Parent Company’s) Market Capitalization; (xiii) the Lead Borrower may pay any Dividends so long as the Distribution Conditions are satisfied on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and Basis immediately after giving effect to such ~~Dividend, no Event of Default shall have occurred and be continuing~~Dividends; (xiv) purchases of minority interests in ~~non-~~Restricted Subsidiaries that are not Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed the greater of $~~5,000,000~~27,500,000 and 5.0% of Consolidated EBITDA of the Lead Borrower and its Restricted Subsidiaries for the most recently ended Test Period (measured at the time of such Dividend); (xv) the authorization, declaration and payment of ~~dividends~~ Dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing ~~Date~~ Date, not to exceed the greater of $~~35,000,000~~250,000,000 and 50.0% of Consolidated EBITDA of the Lead Borrower and its Restricted Subsidiaries for the most recently ended Test Period (measured at the time of such Dividend); (xvi) the Lead Borrower and each Restricted Subsidiary may authorize, declare and make ~~dividend~~ Dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of ~~dividend~~ Dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may ~~make payments~~ authorize, declare and pay Dividends with the cash proceeds contributed to its common equity (including from the net cash proceeds of any equity issuance by any Parent Company), so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may authorize, declare and pay ~~dividends and distributions~~ Dividends within 60 90 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; (xix) so long as no Event of Default under Section 11.01 or 11.05 has occurred and is continuing or would result therefrom, Lead Borrower and any Restricted Subsidiary may authorize, declare and pay Dividends with any Leverage Excess Proceeds (as defined in the Cash Flow Credit Agreement as in effect on the date hereof) promptly upon the receipt thereof; and (~~xix~~xx) any ~~Dividends, so long~~ payment that is intended to prevent any Indebtedness of the Lead Borrower from being treated as (xan “applicable high yield discount obligation” within the meaning of Section 163(i)(1) at of the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00Code. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the ~~definition~~ definitions of “Consolidated ~~EBITDA and~~ EBITDA”, “Consolidated Net Income” and “Consolidated Fixed Charge Coverage Ratio”), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) ~~shall~~ shall, to the extent such loan or advance remains unpaid, be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi).

Appears in 2 contracts

Sources: Revolving Credit Agreement (McGraw Hill, Inc.), Revolving Credit Agreement (McGraw Hill, Inc.)

Dividends. ~~The Lead Borrower~~ Parent will not, and will not permit any of its ~~Restricted~~ Subsidiaries to, authorize, declare or pay any Dividends with respect to ~~the Lead Borrower~~ Parent or any of its ~~Restricted~~ Subsidiaries, except that: (i) any ~~Restricted~~ Subsidiary of ~~the Lead~~ each Borrower may pay cash Dividends ~~or return capital or make distributions and other similar payments with regard~~ to ~~its Equity Interests to the Lead~~ such Borrower or to ~~other Restricted Subsidiaries~~ any Wholly-Owned Domestic Subsidiary of ~~the Lead~~ such Borrower ~~which directly~~ and any Foreign Subsidiary of each Borrower also may pay cash Dividends to any Wholly-Owned Foreign Subsidiary of such Borrower; provided that no such Dividends shall be paid to 1623739 Alberta Ltd. (Alberta) or ~~indirectly own equity therein~~to 1623753 Alberta Ltd. (Alberta); (ii) provided that a Material Contract Termination Event shall not have occurred and be continuing, any ~~non~~direct Non-Wholly-Owned Subsidiary of ~~the Lead~~ each Borrower may ~~declare and~~ pay cash Dividends to its ~~shareholders generally~~ shareholders, members or partners generally, so long as the ~~Lead~~ Borrower or its ~~Restricted~~ respective Subsidiary which owns the Equity ~~Interests~~ Interest in ~~the~~ such Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity ~~Interests~~ Interest in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary); (iii) ~~so long as no Default or Event of Default exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto~~SAE, the ~~Lead~~ Delaware Subsidiary Borrower and the Alaskan Subsidiary Borrower may pay cash Dividends to ~~Holdings to allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase~~Parent, contemporaneously with such Dividend, Equity Interests of such Parent Company from current or former members of management, employees, consultants, officers and directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by the Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by ~~Holdings (or subsequently paid to any other~~ Parent ~~Company)~~ to pay operating expenses incurred ~~by Holdings or any~~ in the ordinary course of business (including, without limitation, outside directors and professional fees, expenses and indemnities) and other ~~Parent Company in connection with offerings~~similar corporate overhead costs and expenses, ~~registrations, or exchange listings of equity or debt securities and maintenance of same (A) where~~ provided that the ~~net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated~~ aggregate amount of ~~such expenses~~ all cash Dividends paid pursuant to this clause (iii) shall not exceed $100,000 in ~~proportion to the amount~~ any fiscal year of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completedParent; (viv) SAE, the ~~Lead~~ Delaware Subsidiary Borrower and the Alaskan Subsidiary Borrower may pay cash Dividends to ~~Holdings so long as~~ Parent at the ~~proceeds thereof are promptly used by Holdings (or subsequently paid~~ times and in the amounts necessary to ~~any other~~ enable Parent ~~Company)~~ to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income its tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiariesobligations; provided that ~~for each taxable period,~~ (x) the amount of ~~such payments made in respect of such taxable period in the aggregate~~ cash Dividends paid pursuant to this clause (iv) to enable Parent to pay Federal and state income taxes at any time shall not exceed the amount ~~that~~ of such Federal and state income taxes actually owing by Parent at such time for the ~~Lead Borrower~~ respective period and ~~its Subsidiaries would have been required~~ (y) any refunds received by Parent shall promptly be returned by Parent to ~~pay as a stand-alone Tax Group; provided~~SAE, ~~further, that~~ the ~~permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted~~ Delaware Subsidiary ~~for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead~~ Borrower or ~~its Restricted Subsidiaries for~~ the ~~purposes of paying such consolidated~~Alaskan Subsidiary Borrower, ~~combined or similar Taxes~~as applicable; (Cv) ~~customary salary~~provided that a Material Contract Termination Event shall not have occurred and be continuing, ~~bonus~~ SAE, the Delaware Subsidiary Borrower and ~~other compensation~~ the Alaskan Subsidiary Borrower may pay cash Dividends to Parent in an aggregate amount for all such Dividends not to exceed $500,000 (although no more than $250,000 of such Dividends may be paid in any fiscal year of Parent) for the purpose of enabling Parent to redeem, repurchase or otherwise acquire for value, and ~~benefits payable~~ Parent may redeem, repurchase or otherwise acquire for value, outstanding shares of Parent Common Stock (or options or warrants to ~~current and former~~ purchases Parent Common Stock) following the death, disability or termination of employment of officers, ~~directors, consultants and~~ directors or employees of Parent or any of its Subsidiaries, provided that (x) the only consideration paid by Parent ~~Company to~~ in respect of such redemptions or purchases shall be cash and Shareholder Subordinated Notes, (y) the ~~extent~~ sum of (I) the aggregate amount paid by Parent in cash in respect of all such ~~salaries~~redemptions or purchases plus (II) the aggregate amount of all cash payments made on all Shareholder Subordinated Notes shall not exceed $500,000 in respect of all such redemptions, ~~bonuses~~ purchases and ~~other compensation~~ payments (although no more than $500,000 of such redemptions, purchases and ~~benefits are reasonably attributable to~~ payments may be made in any fiscal year of Parent) and (z) at the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) time of any ~~Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E)~~ cash ~~payments in lieu of issuing fractional shares in connection with the exercise of warrants~~Dividend, ~~options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the~~ purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition payment permitted to be made pursuant to this Section ~~9.14; provided that (A) such dividend~~8.03(v), ~~distribution~~including any cash payment made under a Shareholder Subordinated Note, ~~loan~~ no Default or ~~advance~~ Event of Default shall ~~be made concurrently with the closing of such purchase~~ then exist or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisitionresult therefrom; (Gvi) ~~any customary fees and expenses related to any unsuccessful equity offering by any~~ Parent ~~Company directly attributable~~ may pay regularly scheduled Dividends on its Qualified Preferred Stock pursuant to the ~~operations~~ terms thereof solely through the issuance of additional shares of such Qualified Preferred Stock (but not in cash), provided that in lieu of issuing additional shares of such Qualified Preferred Stock as Dividends, Parent may increase the liquidation preference of the ~~Lead Borrower and its Restricted Subsidiaries~~shares of Qualified Preferred Stock in respect of which such Dividends have accrued; (vii) ~~reasonable and customary indemnities~~ SAE may pay regularly scheduled Dividends to ~~directors~~Parent on its Qualified Preferred Stock pursuant to the terms thereof, ~~officers and employees of any~~ provided that Parent ~~Company~~ must make an immediate corresponding cash contribution to SAE in the ~~ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries~~same amount as any such Dividend paid in cash; (viii) ~~the Lead Borrower~~ Parent may pay ~~cash~~ Dividends in an aggregate amount not to ~~Holdings so long~~ exceed 50% of the Net Cash Proceeds of all issuances of Equity Interests by Parent (other than sales or issuances of Parent Common Stock to employees, officers and/or directors of Parent and its Subsidiaries (including as a result of the ~~proceeds thereof are promptly used by Holdings~~ exercise of any options with respect thereto) following the Funding Date, provided that (~~or subsequently paid to any other Parent Company~~a) ~~for payment of (x) obligations under or~~ all mandatory prepayments in respect of ~~director and officer insurance policies to the extent reasonably attributable to the ownership~~ such issuance shall have been completed in accordance with Section 4.02, (b) no Default or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred ~~and~~ or could reasonably be ~~continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added~~ expected to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $5,000,000; (xv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity result from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as (x) at the time of, and after giving effect to such Dividend, (c) no Material Contract Termination Event ~~of Default~~ shall have occurred and be continuing and (d) the aggregate amount of cash and Cash Equivalents held by Parent and its Subsidiaries (without giving effect to the receipt of any such Net Cash Proceeds) immediately after giving effect to the payment of such Dividend shall be equal to or greater than the aggregate amount of cash and Cash Equivalents held by Parent and its Subsidiaries (without giving effect to the receipt of any such Net Cash Proceeds) immediately prior to the payment of such Dividend; (ix) Parent may pay a Dividend in an aggregate amount not to exceed $15,000,000 prior to December 31, 2012, provided that all of the proceeds of such Dividend are immediately applied by the recipients thereof to purchase Shareholder Subordinated Notes (which, for the avoidance of doubt, shall be issued on terms and conditions satisfactory to the Administrative Agent); and (x) provided that a Material Contract Termination Event shall not have occurred and be continuing, SAE, the Delaware Subsidiary Borrower and the Alaskan Subsidiary Borrower may pay cash Dividends to Parent in an aggregate amount not to exceed $1,750,000; provided that (x) Parent must use such funds to make the loans and advances as set forth in Section 8.05(xvi) and (y) ~~on a Pro Forma Basis~~any repayment received by Parent shall promptly be returned by Parent to SAE, the ~~Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid~~ Delaware Subsidiary Borrower or the Alaskan Subsidiary Borrower, as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi)applicable.

Appears in 2 contracts

Sources: Credit Agreement (SAExploration Holdings, Inc.), Credit Agreement (SAExploration Holdings, Inc.)

Dividends. ~~The Lead Borrower will~~ Prior to the Second Closing (as defined in the Investment Agreement)4, the Company shall not, and ~~will~~ shall not permit any ~~of its Restricted Subsidiaries~~ Subsidiary to, ~~authorize~~declare any dividends on any shares of any class of Capital Shares, ~~declare~~ or ~~pay~~ make any ~~Dividends with~~ payment on account of, or set apart assets for a sinking or other analogous fund for, the purchase, redemption, retirement or other acquisition of any shares of any class of Capital Shares, or any warrants or options to purchase such Capital Shares, whether now or hereafter outstanding, or make any other distribution in respect to thereof, either directly or indirectly, whether in cash or property or in obligations of the ~~Lead Borrower~~ Company or any of its ~~Restricted~~ Subsidiaries, ; except that: (ia) any Restricted Subsidiary of the Lead Borrower may pay Dividends or return capital or make distributions and other similar payments with regard to its Equity Interests to the Lead Borrower or to other Restricted Subsidiaries of the ~~Lead Borrower~~ Company may pay dividends to the Company or to Domestic Subsidiaries of the Company which are directly or indirectly ~~own equity therein;~~ wholly owned by the Company (~~ii) any non-Wholly-Owned Subsidiary~~ or, in case of Foreign Subsidiaries, to the Company or to Subsidiaries of the ~~Lead Borrower may declare and pay cash Dividends to its shareholders generally so long as~~ Company which are directly or indirectly wholly owned by the Lead Borrower or its Restricted Subsidiary which owns the Equity Interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such SubsidiaryCompany); (~~iii~~b) ~~so long as no Default~~ the Company and its Subsidiaries may pay or ~~Event~~ make dividends or distributions to any holder of ~~Default exists at~~ its Capital Shares in the ~~time~~ form of additional Capital Shares of the ~~applicable Dividend, redemption~~ same class and type (provided that if any such Subsidiary has shareholders other than the Company or repurchase or would exist immediately after giving effect thereto, the Lead Borrower may pay cash Dividends to Holdings to allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of such Parent Company from current or former members of management, employees, consultants, officers and directors (and their successors and assigns) another wholly owned Subsidiary of the ~~Lead Borrower~~ Company, such dividends or distributions shall be paid to such Person on a pro rata basis or on a basis that is more favorable to the Company and its ~~Restricted Subsidiaries~~Subsidiaries than pro rata); (c) the Company may repurchase Capital Shares of the Company owned by retired or deceased employees of the Company or any of its Subsidiaries or their assigns, estates and heirs; provided that (Ai) the aggregate amount of ~~Dividends made by the Lead Borrower to Holdings~~ such repurchases pursuant to this clause (~~iii), and~~ c) shall not in the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed $3,000,000 during any fiscal year of the ~~Lead Borrower, $10,000,000~~ Company and (~~provided that~~ ii) no Event of Default has occurred and is continuing at the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds time of such ~~sale are received by~~ dividends or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current distributions or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreementimmediately after giving effect thereto; (ivd) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries ~~would have been required to pay as a stand~~may make non-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of ~~Equity Interests~~ Capital Shares deemed to occur upon exercise of stock options ~~or warrants or~~ if such Capital Shares represent a portion of the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering exercise price of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $5,000,000; (xv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03options; and (xix) any Dividends, so long as (x) at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi).

Appears in 2 contracts

Sources: Investment Agreement, Investment Agreement (Consolidated Communications Holdings, Inc.)

Dividends. ~~The Lead Borrower will not, and will not permit any of its Restricted Subsidiaries to, authorize~~Authorize, declare or ~~pay~~ pay, directly or indirectly, any Dividends with respect to ~~the Lead Borrower or~~ any ~~of its Restricted Subsidiaries~~Company, except that: (a) any Subsidiary of a Borrower (i) may pay cash Dividends to such Borrower or any ~~Restricted~~ Wholly Owned Subsidiary of ~~the Lead~~ such Borrower ~~may pay Dividends or return capital or make distributions~~ and ~~other similar payments with regard to its Equity Interests to the Lead Borrower or to other Restricted Subsidiaries of the Lead Borrower which directly or indirectly own equity therein;~~ (ii) ~~any non-Wholly-~~if such Subsidiary is not a Wholly Owned Subsidiary of ~~the Lead Borrower~~ such Borrower, may ~~declare and~~ pay cash Dividends to its shareholders generally so long as ~~the Lead~~ such Borrower or its ~~Restricted~~ Subsidiary which owns the ~~Equity Interests~~ equity interest or interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative ~~holding~~ holdings of ~~the Equity Interests~~ equity interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of ~~Equity Interests of~~ equity interests in such Subsidiary); (~~iii~~b) so long as no Default ~~or Event of Default~~ exists ~~at the time of the applicable Dividend, redemption or repurchase~~ or would ~~exist immediately after giving~~ result therefrom, Borrowers may pay Dividends to Holdings for the purpose of enabling Holdings to, and Holdings may, repurchase outstanding shares of its common stock (or options to purchase such common stock) following the death, disability, retirement or termination of employment of employees, officers or directors of any Company; provided that (i) all amounts used to effect ~~thereto~~such repurchases are obtained by Holdings from a substantially concurrent issuance of its common stock (or options to purchase such common stock) to other employees, members of management, executive officers or directors of any Company or (ii) to the extent the proceeds used to effect any repurchase pursuant to this clause (ii) are not obtained as described in preceding clause (i), the ~~Lead Borrower~~ aggregate amount of Dividends paid by Holdings to its stockholders pursuant to this paragraph (b) (exclusive of amounts paid as described pursuant to preceding clause (i)) shall not exceed $1.0 million in any fiscal year of Holdings; (c) Borrowers may pay cash Dividends to Holdings ~~to allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase~~for the purpose of paying, contemporaneously with such Dividend, Equity Interests of such Parent Company from current or former members of management, employees, consultants, officers and directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by the Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may pay cash Dividends to Holdings so long as ~~the~~ all proceeds thereof are promptly used by Holdings ~~(or subsequently paid~~ to ~~any other Parent Company) to pay~~ pay, its franchise taxes and operating expenses incurred ~~by Holdings or any~~ in the ordinary course of business and other ~~Parent Company in connection with offerings, registrations, or exchange listings~~ corporate overhead costs and expenses (including legal and accounting expenses and similar expenses and customary fees to non-officer directors of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed;Holdings); and (vd) ~~the Lead Borrower~~ Borrowers and Subsidiaries may pay cash Dividends to Holdings for the purpose of paying, so long as ~~the~~ all proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local its income tax ~~purposes~~ when and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $5,000,000; (xv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as (x) at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi)due.

Appears in 2 contracts

Sources: Revolving Credit Agreement (Lenox Group Inc), Term Loan Credit Agreement (Lenox Group Inc)

Dividends. ~~The Lead Borrower~~ It will not, and will not permit any of its ~~Restricted~~ Subsidiaries to~~, authorize~~, declare or pay any ~~Dividends with respect to the Lead Borrower or any of its Restricted Subsidiaries, except that: (i) any Restricted Subsidiary of the Lead Borrower may pay Dividends or return capital~~ dividends or make distributions ~~and~~ (other ~~similar payments with regard to its Equity Interests to the Lead Borrower~~ than dividends or to other Restricted Subsidiaries of the Lead Borrower which directly or indirectly own equity therein; (ii) any non-Wholly-Owned Subsidiary of the Lead Borrower may declare and pay cash Dividends to its shareholders generally so long as the Lead Borrower or its Restricted Subsidiary which owns the Equity Interests distributions payable solely in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary); (iii) so long as no Default or Event of Default exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, the Lead Borrower may pay cash Dividends to Holdings to allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of such Parent Company from current or former members of management, employees, consultants, officers and directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by the Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than Disqualified Equity Interests)) or return any capital to ~~the extent included in the Available Amount) and contributed~~ its equity holders or make any other distribution, payment or delivery of property or cash to ~~the Lead Borrower in connection with such redemption~~ its equity holders as such, or ~~repurchase)~~redeem, ~~in either case~~retire, ~~exceed during any fiscal year of the Lead Borrower~~purchase or otherwise acquire, ~~$10,000,000 (provided that the amount of cash Dividends permitted to be~~directly or indirectly, ~~but not~~for consideration, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its ~~Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of~~ Equity Interests or Equity Interests of ~~Holdings~~any direct or indirect parent thereof now or hereafter outstanding, ~~in each case to members~~ or set aside any funds for any of ~~management~~the foregoing purposes, ~~managers, directors~~ or ~~consultants of any Parent Company or~~ permit any of its Subsidiaries ~~that occurs after the Closing Date, where the net proceeds of such sale are received by~~ to purchase or ~~contributed to the Lead Borrower; provided that the amount of~~ otherwise acquire for consideration any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of ~~any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement;~~ KCMH, now or hereafter outstanding (iv) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the ~~property and assets or business of any Person~~foregoing, ~~or of assets constituting a business unit~~“dividends”), ~~a line of business or division of such Person, or of all of the Equity Interests in a Person;~~ provided that KCMH and any Subsidiary may pay dividends if ~~such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that~~ (Ax) immediately before and after paying such dividend, ~~distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause~~ no (1) ~~all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary~~ Default or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $5,000,000; (xv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as (x) at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) ~~on a Pro Forma Basis~~the Debt to Equity Ratio is less than or equal to [**] to 1.00 after giving pro forma effect thereto. The limitations set forth in the immediately preceding sentence (other than subclause (x)(2) in the proviso thereto) shall not apply to any of the following items so long as KCMH is in compliance with Section 6.03 after giving pro forma effect thereto: (i) it may (or may pay dividends to permit any direct or indirect parent thereof to) redeem in whole or in part any of its Equity Interests for another class of its (or such parent’s) Equity Interests (other than Disqualified Equity Interests) or with proceeds from substantially concurrent equity contributions or issuances of new Equity Interests (other than Disqualified Equity Interests), provided that such new Equity Interests contain terms and provisions at least as advantageous to the Lenders in all respects material to their interests as those contained in the Equity Interests redeemed thereby; (ii) it may pay dividends, the ~~Consolidated Total Net Leverage Ratio does not exceed 3.25~~ proceeds of which will be used to ~~1.00. In determining compliance~~ pay (or to pay dividends to allow any direct or indirect parent of KCMH to pay (including to the individual owners of any direct or indirect parent of KCMH)) the tax liability of such parent and the individual owners of any direct or indirect parent, determined at the highest rate combined federal, state and local income tax rate applicable to an individual resident in New York City, attributable to KCMH or its Subsidiaries determined as if KCMH and its Subsidiaries filed separately; (iii) it or any of its Subsidiaries may (i) pay cash in lieu of fractional Equity Interests in connection with ~~this Section 10.03~~ any dividend, split or combination thereof and (ii) honor any conversion request by a holder of convertible Indebtedness and make cash payments in ~~determining amounts~~ lieu of fractional shares in connection with any such conversion; and (iv) any Subsidiary of KCMH may pay dividends to its direct parent; provided that if any such dividends are paid ~~as Dividends pursuant hereto~~ by a non-Wholly-Owned Subsidiary, such dividends shall be made ratably based on the equity holder’s interests therein (or any other amount more favorable to KCMH), provided further that if the proceeds of any outstanding Loans or Letters of Credit have been used for ~~purposes~~ an Investment in such non-Wholly-Owned Subsidiary, any cash dividends paid to such parent shall be applied to prepay such Loans or cash collateralize such Letters of Credit if no Loans are outstanding, at the option of the ~~definition~~ Administrative Agent, without application of ~~Consolidated EBITDA~~ Section 3.12 or at the end of the next Interest Period(s). [**] = Certain information contained in this document, marked by “[**]” has been excluded because it is both (i) not material and ~~Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi~~(ii) ~~shall be deemed to be cash Dividends paid to Holdings~~ would likely cause competitive harm to the ~~extent provided in said Section 10.05(vi)~~registrant if publicly disclosed.

Appears in 2 contracts

Sources: 364 Day Revolving Credit Agreement (KKR & Co. Inc.), Revolving Credit Agreement (KKR & Co. Inc.)

Dividends. The ~~Lead Borrower~~ Company will not, ~~and~~ nor will ~~not~~ it permit any ~~of its Restricted Subsidiaries~~ Subsidiary to~~, authorize~~, declare or pay any ~~Dividends with respect to the Lead Borrower or any of its Restricted Subsidiaries~~Dividends, except that: (ia) any Restricted Subsidiary of the Lead Borrower may pay Dividends or return capital or make distributions and other similar payments with regard to its Equity Interests to the Lead Borrower or to other Restricted Subsidiaries of the Lead Borrower which directly or indirectly own equity therein; (ii) any non-Any Wholly-Owned Subsidiary of the ~~Lead Borrower~~ Company may ~~declare~~ pay Dividends to the Company or any Wholly-Owned Subsidiary of the Company and (b) any Subsidiary that is not a Wholly-Owned Subsidiary may pay ~~cash~~ Dividends to its shareholders generally so long as the ~~Lead Borrower~~ Company or its ~~Restricted~~ respective Subsidiary which owns the Equity ~~Interests~~ Interest in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative ~~holding~~ holdings of ~~the~~ Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of in such Subsidiary);. (~~iii~~ii) so So long as there shall exist no Default or ~~Event of~~ Unmatured Default ~~exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately~~ (both before and after giving effect ~~thereto~~to the payment thereof), the ~~Lead Borrower~~ Company may ~~pay cash Dividends~~ repurchase outstanding shares of its common stock (or options to ~~Holdings to allow Holdings to pay cash dividends to any other Parent Company to redeem~~ purchase such common stock) following the death, disability, retirement or ~~repurchase, contemporaneously with such Dividend, Equity Interests~~ termination of ~~such Parent Company from current or former members~~ employment of ~~management,~~ employees, ~~consultants,~~ officers ~~and~~ or directors ~~(and their successors and assigns)~~ of the ~~Lead Borrower and~~ Company or any of its ~~Restricted~~ Subsidiaries; provided that (Aa) all amounts used to effect such repurchases are obtained by the Company from a substantially concurrent issuance of its common stock (or options to purchase such common stock) to other employees, members of management, executive officers or directors of the Company or any of its Subsidiaries or (b) to the extent the proceeds used to effect any repurchase are not obtained as described in preceding clause (a), the aggregate amount of Dividends ~~made~~ paid by the ~~Lead Borrower to Holdings~~ Company pursuant to this Section 6.10(ii) (exclusive of amounts paid as described pursuant to preceding clause (~~iii~~a)~~, and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased~~ ) shall not ~~(net of any cash proceeds received by Holdings (but~~ exceed $1,000,000 in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the ~~Lead Borrower~~Company; provided that, ~~$10,000,000 (provided~~ in the event that the maximum amount ~~of cash Dividends~~ which is permitted to ~~be, but not, paid~~ be expended in respect of Dividends during any fiscal year pursuant to this clause (~~iii~~b) ~~shall increase~~ is not fully expended during such fiscal year, the maximum amount ~~of cash Dividends permitted to~~ which may be ~~paid in~~ expended during the immediately succeeding ~~two~~ fiscal ~~years~~ year pursuant to this clause (~~iii)); (B~~b) ~~such amount in any calendar year may~~ shall be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such ~~sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause~~ unutilized amount. (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may pay cash Dividends to Holdings so So long as ~~the proceeds thereof are promptly used by Holdings~~ there shall exist no Default or Unmatured Default (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, both before and after giving effect to ~~such Dividend~~the payment thereof), ~~no Event~~ the Company may repurchase outstanding shares of ~~Default shall have occurred and be continuing; (xiv) purchases~~ its common stock or equivalents thereof or rights to purchase any of ~~minority interests~~ the foregoing issued in ~~non-Wholly-Owned Subsidiaries by~~ connection with the ~~Lead Borrower and the Guarantors~~Company’s directors compensation plan; provided that the aggregate amount of ~~such purchases, when added~~ shares repurchased paid by the Company pursuant to ~~the aggregate amount~~ this Section 6.10(iii) (exclusive of ~~Investments~~ amounts paid as described pursuant to Section ~~10.05(xvii~~6.10(ii), ) shall not exceed $~~5,000,000;~~750,000 in any fiscal year and shall not exceed a maximum of $1,750,000 for all such repurchases made on or after the Closing Date. (xviv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so So long as ~~in the case of dividend~~ there shall exist no Default or ~~other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution;~~ Unmatured Default (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as (x) at the time of, both before and after giving effect to ~~such Dividend~~the declaration and payment thereof), the Company may pay Dividends with respect to its outstanding common stock, provided that (i) no ~~Event~~ Dividend shall be declared or paid during any fiscal year unless the Senior Leverage Ratio, determined as of ~~Default shall have occurred and be continuing~~ the end of the immediately preceding fiscal year, was less than 2.50 to 1, and (yii) ~~on a Pro Forma Basis,~~ the ~~Consolidated Total Net Leverage Ratio does~~ aggregate amount of such Dividends declared or paid during any fiscal year shall not exceed ~~3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes~~ 25% of the ~~definition of Consolidated EBITDA and~~ positive Consolidated Net ~~Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to~~ Income of the ~~extent provided in said Section 10.05(vi)~~Company and its Subsidiaries for the immediately preceding fiscal year.

Appears in 2 contracts

Sources: Credit Agreement (Actuant Corp), Credit Agreement (Actuant Corp)

Dividends. The ~~Lead~~ Borrower will not, and will not permit any of its ~~Restricted~~ Subsidiaries to, authorize, declare or pay any ~~Dividends with respect to the Lead Borrower or any of its Restricted Subsidiaries~~Dividends, except that: (i) (x) any ~~Restricted~~ Subsidiary of the ~~Lead~~ Borrower which is not a Subsidiary Guarantor may pay Dividends ~~or return capital or make distributions and other similar payments with regard to its Equity Interests~~ to the ~~Lead~~ Borrower or ~~to other Restricted Subsidiaries of the Lead Borrower which directly or indirectly own equity therein; (ii)~~ any ~~non-~~Wholly-Owned Subsidiary of the ~~Lead~~ Borrower, (y) any Subsidiary Guarantor may pay Dividends to the Borrower or any other Subsidiary Guarantor and (z) if the respective Subsidiary is not a Wholly-Owned Subsidiary of the Borrower, such Subsidiary may ~~declare and~~ pay ~~cash~~ Dividends to its shareholders generally so long as the ~~Lead~~ Borrower or and/or its ~~Restricted Subsidiary~~ respective Subsidiaries which ~~owns the Equity Interests~~ own equity interests in the Subsidiary paying such Dividends ~~receives~~ receive at least ~~its~~ their proportionate share thereof (based upon ~~its~~ their relative ~~holding~~ holdings of the ~~Equity Interests~~ equity interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of ~~Equity Interests~~ equity interests of such Subsidiary); (~~iii~~ii) ~~so long as no Default or Event of Default exists at~~ the ~~time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, the Lead~~ Borrower may make, pay or declare cash Dividends to Holdings to allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of such Parent Company from current or former members of management, employees, consultants, officers and directors (and their successors and assigns) of the Lead Borrower and its Restricted SubsidiariesDividends; provided ~~that (A) the aggregate amount of~~ that, for all Dividends ~~made by the Lead Borrower to Holdings~~ paid pursuant to this clause (~~iii~~ii), ~~and the aggregate amount~~ (A) Dividends shall be paid by Holdings in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year within 90 days of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii))declaration thereof; (B) ~~such amount~~ Dividends paid in ~~any calendar year may~~ respect of a fiscal quarter shall only be ~~increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries~~ paid after the ~~Closing Date; plus~~ date of delivery of quarterly or annual financial statements for such fiscal quarter pursuant to Sections 8.01(a) and (~~II)~~ b), as the ~~net proceeds from the sale of Equity Interests of Holdings~~case may be, ~~in each case~~ and on or prior to ~~members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs~~ 45 days after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) last day of the ~~definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and~~ immediately succeeding fiscal quarter, (C) ~~cancellation of Indebtedness owing to the Lead Borrower from current~~ no Default or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $5,000,000; (xv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as (x) at the time ofof declaration, ~~and after giving effect to such Dividend,~~ (D) no Default or Event of Default shall have occurred and be continuing (or would arise after giving effect thereto) at the time of payment, and (yE) on or prior to the declaration and payment of a ~~Pro Forma Basis~~Dividend, the ~~Consolidated Total Net Leverage Ratio does not exceed 3.25~~ Borrower shall deliver to ~~1.00. In determining compliance with~~ the Administrative Agent an officer’s certificate signed by the senior financial officer of the Borrower, certifying that the requirements set forth in preceding clauses (A) through (D) are satisfied; (iii) the Borrower may purchase or redeem shares of common stock of the Borrower in market purchases under Rule 10b-18 or other purchases approved by the Borrower’s Board of Directors, any committee thereof or any authorized officer; provided that (A) no Default or Event of Default shall have occurred and be continuing at the time of any such purchases, (B) no Default or Event of Default shall arise after giving effect to any such purchases and (C) the Borrower in the exercise of its rights under this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi9.03(iii) shall not be ~~deemed~~ permitted to ~~be cash Dividends paid to Holdings to~~ purchase or redeem shares beneficially owned directly or indirectly by P▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇; and (iv) the ~~extent provided~~ Borrower may authorize, declare and distribute a dividend of Rights (as such term is defined and which are convertible into other securities as set forth in ~~said Section 10.05(vi)~~the Shareholder Rights Agreement) as contemplated by the Shareholder Rights Agreement.

Appears in 2 contracts

Sources: Credit Agreement (Baltic Trading LTD), Credit Agreement (Baltic Trading LTD)

Dividends. The ~~Lead~~ Borrower will not, and will not permit any of its Restricted Subsidiaries to, authorize, declare or pay any Dividends with respect to the ~~Lead~~ Borrower or any of its Restricted Subsidiaries, except that: (i) any Restricted Subsidiary of the ~~Lead~~ Borrower may pay Dividends or return capital or make distributions and other similar payments with regard to its Equity Interests to the ~~Lead~~ Borrower or to other Restricted Subsidiaries of the ~~Lead~~ Borrower which directly or indirectly own equity therein; (ii) any non-Wholly-Owned Subsidiary of the ~~Lead~~ Borrower may declare and pay cash Dividends to its shareholders generally so long as the ~~Lead~~ Borrower or its Restricted Subsidiary which owns the Equity Interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary); (iii) so long as no Default or Event of Default exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, the ~~Lead~~ Borrower may pay cash Dividends to Holdings to allow Holdings to pay cash dividends or make cash distributions to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of such Holdings or such other Parent Company from ~~current or former members of~~ management, employees~~, consultants~~, officers and directors (and their successors and assigns) of the ~~Lead~~ Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by the ~~Lead~~ Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings or such other Parent Company in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the ~~Lead~~ Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the ~~Lead~~ Borrower, $~~10,000,000~~ 30,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the ~~Lead~~ Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the ~~Lead~~ Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (~~b)(x)(ii~~a)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the ~~Lead~~ Borrower from ~~current or former~~ members of management, officers, directors, employees of the ~~Lead~~ Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of Holdings or any other Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the ~~Lead~~ Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the ~~Lead~~ Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the ~~Lead~~ Borrower or the relevant Restricted Subsidiary of the ~~Lead~~ Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the ~~Lead~~ Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the ~~Lead~~ Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their ~~existence~~existence to the extent such Taxes, fees and expenses are reasonably attributable to the operations of Holdings, the Borrower and its Restricted Subsidiaries; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the ~~Lead~~ Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company ~~or other entity~~ is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the ~~Lead~~ Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the ~~Lead~~ Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the ~~Lead~~ Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other ~~compensation and~~ benefits payable to ~~current and former officers, directors, consultants~~ officers and employees of any Parent Company to the extent such salaries, bonuses and other ~~compensation and~~ benefits are reasonably attributable to the ownership or operations of the ~~Lead~~ Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the ~~Lead~~ Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the ~~Lead~~ Borrower or any Parent Company; (F) the purchase or other acquisition by Holdings or any ~~parent~~ other Parent Company of the ~~Lead~~ Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the ~~Lead~~ Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the ~~Lead~~ Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the ~~Lead~~ Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the ~~Lead~~ Borrower and its Restricted Subsidiaries; provided that the aggregate amount of Dividends made pursuant to subclauses (C), (D) and (G) of this clause (vi) shall not exceed $30,000,000 in any fiscal year; (vii) reasonable and customary indemnities to directors, officers and employees of Holdings or any other Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the ~~Lead~~ Borrower and its Restricted Subsidiaries; (viii) the ~~Lead~~ Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the ~~Lead~~ Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory ~~Agreement (as in effect on the Closing Date~~Agreement; (ix) any Dividend used (i) to fund the Transaction, including Transaction ~~Costs and the Special Dividend~~Costs, and ~~any Dividend from proceeds received~~ (ii) in ~~connection with any working capital adjustment pursuant~~ order to satisfy indemnity and other similar obligations under the Acquisition Agreement; (x) the ~~Lead~~ Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v), 10.06(vii) and ~~10.06(vii~~10.06(xii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or ~~the settlement or vesting of other~~ similar equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the ~~Lead~~ Borrower from any such Initial Public Offering; (xiii) ~~on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00,~~ any Dividends to the extent the same are made solely with the Available Amount, so long as as, solely to the extent clause (i)(B) of the definition of “Available Amount” is being utilized, at the time of, and after giving effect to such ~~Dividend~~Dividend on a Pro Forma Basis, (i) no Event of Default shall have occurred and be ~~continuing~~continuing and (ii) the Consolidated Total Net Leverage Ratio does not exceed 4.50 to 1.00; (xiv) purchases of minority interests in ~~non-~~Restricted Subsidiaries that are not Wholly-Owned Subsidiaries by the ~~Lead~~ Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $~~5,000,000~~30,000,000; (xv) the declaration and payment of ~~dividends~~ Dividends or the payment of other distributions by the ~~Lead~~ Borrower in an aggregate amount since the Closing ~~Date~~ Date, when aggregated with the amount expended in reliance on 10.07(a)(B)(iii), not to exceed $~~35,000,000~~75,000,000; (xvi) the ~~Lead~~ Borrower and each Restricted Subsidiary may declare and make ~~dividend~~ Dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of ~~dividend~~ Dividend or other distribution by a Restricted Subsidiary, the ~~Lead~~ Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the ~~Lead~~ Borrower may ~~make payments~~ pay Dividends with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (~~iii~~xvii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (~~b)(x)(ii~~a)(ii) of the definition of “Available Amount”; (xviii) the ~~Lead~~ Borrower and any Restricted Subsidiary may pay ~~dividends and distributions~~ Dividends within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as (x) at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) ~~shall~~ shall, to the extent such loan or advance remains unpaid, be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi).

Appears in 2 contracts

Sources: Term Loan Credit Agreement (Vertiv Holdings Co), Term Loan Credit Agreement (Vertiv Holdings Co)

Dividends. ~~The Lead Borrower will not~~Declare, ~~and will not permit any of its Restricted Subsidiaries to, authorize, declare~~ make or pay any ~~Dividends with respect to the Lead Borrower~~ Dividend Payments on any shares of any class of Equity Interests, either directly or ~~any of its Restricted Subsidiaries~~indirectly, except that: (ia) ~~any Restricted Subsidiary~~ Subsidiaries of ~~the Lead Borrower~~ Holdco may pay ~~Dividends or return capital or make distributions and other similar payments with regard~~ Dividend Payments pro rata to ~~its~~ the holders of their Equity Interests (giving effect to ~~the Lead Borrower or to other Restricted Subsidiaries of the Lead Borrower which directly or indirectly own equity therein~~relative preferences and priorities); (iib) each of Borrower, Holdco and any ~~non-Wholly-Owned Subsidiary~~ of ~~the Lead Borrower~~ its Subsidiaries may ~~declare and~~ pay ~~cash Dividends~~ or make Dividend Payments or distributions to any holder of its ~~shareholders generally so long as the Lead Borrower or its Restricted Subsidiary which owns the~~ Equity Interests in the ~~Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding~~ form of ~~the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes~~ additional shares of Equity Interests of the same class and type; provided that in the case of Subsidiaries, such ~~Subsidiary)~~Dividend Payments or distributions are made to the holders of such Equity Interests on a pro rata basis; (~~iii~~c) ~~so long as no Default or Event of Default exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, the Lead~~ Borrower may ~~pay cash Dividends~~ make Dividend Payments to Holdings to allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of such Parent Company from current or former members of management, employees, consultants, officers and directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by the Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may pay cash Dividends to Holdings Holdco so long as the proceeds thereof ~~are promptly~~ shall ultimately be used by ~~Holdings~~ Holdco (~~or subsequently paid to any other Parent Company~~and Holdco shall be entitled) to ~~pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings~~ repurchase shares of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of ~~the Lead~~ Holdco or its parent companies owned by former, present or future employees, officers and directors of Holdco, Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees their assigns, estates and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantorsheirs; provided that the aggregate amount of ~~such purchases, when added~~ Dividend Payments made by Borrower pursuant to this paragraph (c) shall not in the aggregate exceed the sum of (i) $20,000,000 during the term of this Agreement plus (ii) the amount of ~~Investments pursuant~~ net cash proceeds received by or contributed to ~~Section 10.05(xvii)~~Borrower from the issuance and sale of Equity Interests of Holdco or Borrower, to officers, directors or employees of Holdco or any Subsidiary (it being understood that the discharge of any Indebtedness owing from any officer, director or employee to Holdco or Borrower in exchange for the redemption of Equity Interests owned by such officer, director or employee shall not ~~exceed $5,000,000~~constitute a Dividend Payment) plus (iii) the proceeds of any key man life insurance policies; provided, however, that for the avoidance of doubt, an “employee” shall include each person who would be so classified but for such person’s holding an Equity Interest; (xvd) (i) to the ~~declaration~~ extent actually used by such parent to pay such taxes, costs and ~~payment~~ expenses, Holdco may make payments to or on behalf of ~~dividends~~ its parent in an amount sufficient to pay franchise taxes and other fees required to maintain the legal existence of Holdco and (ii) Holdco may make payments to or on behalf of its parent in an amount sufficient to pay out-of-pocket legal, accounting and filing costs and other expenses and liabilities in the ~~payment~~ nature of ~~other distributions by~~ overhead in the ~~Lead Borrower~~ ordinary course of business of such parent, in the case of clause (ii) in an aggregate amount ~~since the Closing Date~~ not to exceed such $~~35,000,000~~1,000,000 in any Fiscal Year; (~~xvi~~i) ~~the Lead~~ Borrower ~~and each Restricted Subsidiary~~ may ~~declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person~~ distribute amounts equal to Permitted Tax Distributions to Holdco, so long as Holdco uses funds therefrom to pay its taxes or applies such funds in accordance with the ~~case~~ following clause (ii), and (ii) Holdco may make Permitted Tax Distributions to the holders of ~~dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least~~ its ~~pro rata share of such dividend or distribution~~Equity Interest; (~~xvii~~f) to the ~~Lead Borrower may make payments with~~ extent constituting Dividend Payments, the ~~cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance~~ transactions permitted by ~~any Parent Company, so long as, with respect to any such payments,~~ Section 6.12; and (g) provided no Event of Default ~~shall have occurred and be~~ is continuing or would result therefrom~~; provided that~~ , Borrower may make Dividend Payments to Holdco and Holdco may make Dividend Payments to the holders of its Equity Interest in an aggregate amount ~~of any such cash proceeds that are utilized for any Dividend under this clause~~ not to exceed (~~iii~~x) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends$25,000,000, so long as ~~(x) at~~ the ~~time of,~~ Total Leverage Ratio before and after giving effect to such ~~Dividend~~Dividend Payment is less than or equal to 4.00 to 1.00 and (y) $50,000,000, so long as the Total Leverage Ratio before and after giving effect to such Dividend Payment is less than or equal to 3.00 to 1.00; and (h) provided no Event of Default ~~shall have occurred~~ is continuing or would result therefrom, Borrower may make Dividend Payments to Holdco and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings Holdco may make Dividend Payments to the ~~extent provided~~ holders of its Equity Interest in ~~said Section 10.05(vi)~~an aggregate amount not to exceed $5,000,000.

Appears in 2 contracts

Sources: First Lien Credit Agreement (Emdeon Inc.), First Lien Credit Agreement (Emdeon Inc.)

Dividends. The ~~Lead Borrower~~ Borrowers will not, and will not permit any of its Restricted Subsidiaries to, authorize, declare or pay any Dividends with respect to ~~the~~ Lead Borrower or any of its Restricted Subsidiaries, except that: (i) any Restricted Subsidiary of ~~the Lead~~ a Borrower may pay Dividends or return capital or make distributions and other similar payments with regard to its Equity Interests to ~~the~~ Lead Borrower or to other Restricted Subsidiaries of ~~the~~ Lead Borrower which directly or indirectly own equity therein; (ii) any non-Wholly-Owned Subsidiary of ~~the~~ Lead Borrower may declare and pay cash Dividends to its shareholders generally so long as ~~the~~ Lead Borrower or its Restricted Subsidiary which owns the Equity Interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary); (iii) so long as no Default or Event of Default exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, ~~the~~ Lead Borrower may pay cash Dividends to Holdings to allow Holdings to pay cash dividends or make cash distributions to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of Holdings or such other Parent Company from ~~current or former members of~~ management, employees~~, consultants~~, officers and directors (and their successors and assigns) of ~~the~~ Lead Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by the ~~Lead Borrower~~ Borrowers to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings or such other Parent Company in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests ~~(other than to the extent included in the Available Amount)~~ and contributed to ~~the~~ Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of ~~the~~ Lead Borrower, the greater of $~~10,000,000~~ 11,250,000 and 1.00% of Consolidated Total Assets (measured at the time of such Dividend) (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by ~~the~~ Lead Borrower or any of ~~its~~ the Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to ~~the~~ Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to ~~the~~ Lead Borrower from ~~current or former~~ members of management, officers, directors, employees of ~~the~~ Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of Holdings or any other Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) ~~the Lead Borrower~~ Borrowers may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid (including as a Dividend by Holdings) to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to ~~the Lead~~ any Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to ~~the Lead~~ such Borrower or ~~the relevant~~ such Restricted Subsidiary ~~of the Lead Borrower~~ out of the proceeds of such offering promptly if such offering is completed; (v) ~~the Lead Borrower~~ Borrowers may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid (including as a Dividend by Holdings) to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) ~~the Lead Borrower~~ Borrowers may pay cash dividends or other distributions, or make loans or advances ~~to,~~ to any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their ~~existence~~existence to the extent such Taxes, fees and expenses are reasonably attributable to the operations of Holdings, Lead Borrower and its Restricted Subsidiaries; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which ~~the Lead~~ Holdings or any Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which Holdings or any other Parent Company ~~or other entity~~ is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of ~~the~~ Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that ~~the~~ Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to ~~the Lead~~ a Borrower or ~~its~~ the Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other ~~compensation and~~ benefits payable to ~~current and former officers, directors, consultants~~ officers and employees of any Parent Company to the extent such salaries, bonuses and other ~~compensation and~~ benefits are reasonably attributable to the ownership or operations of ~~the~~ Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of ~~the~~ Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of ~~the~~ Lead Borrower or any Parent Company; (F) the purchase or other acquisition by Holdings or any ~~parent~~ other Parent Company of ~~the~~ Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by ~~the~~ Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to ~~the~~ Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into ~~the~~ Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such ~~purchaser~~ purchase or other acquisition;; and (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of ~~the~~ Lead Borrower and its Restricted Subsidiaries; provided that the aggregate amount of Dividends made pursuant to subclauses (C), (D) and (G) of this clause (vi) shall not exceed the greater of $11,250,000 and 1.00% of Consolidated Total Assets (measured at the time of such Dividend) in any fiscal year; (vii) reasonable and customary indemnities to directors, officers and employees of Holdings or any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of ~~the~~ Lead Borrower and ~~its~~ the Restricted Subsidiaries; (viii) ~~the Lead Borrower~~ Borrowers may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid (including as a Dividend by Holdings) to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of ~~the~~ Lead Borrower and ~~its~~ the Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory ~~Agreement (as in effect on the Closing Date~~Agreement; (ix) any Dividend used (i) to fund the Transaction, including Transaction ~~Costs and the Special Dividend~~Costs, and (ii) in order to satisfy deferred purchase price, earn-outs and contingent payments in respect of any ~~Dividend from proceeds received~~ amounts due and owing as provided for in ~~connection with any working capital adjustment pursuant to~~ the Acquisition Agreement; (x) ~~the Lead Borrower~~ Borrowers may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v), 10.06(vii) and ~~10.06(vii~~10.06(xii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or ~~the settlement or vesting of other~~ similar equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing ~~Date~~Date not to exceed, in any fiscal year, the greater of ~~up to~~ (x) 5% of such Parent Company’s market capitalization and (y) 6% ~~per annum~~ of the net cash proceeds contributed to the capital of ~~the Lead~~ any Borrower from any such Initial Public Offering; (xiii) the Borrowers may pay any Dividend so long as the Distribution Conditions are satisfied on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and Basis immediately after giving effect to such Dividend~~, no Event of Default shall have occurred and be continuing~~; (xiv) purchases of minority interests in ~~non-~~Restricted Subsidiaries that are not Wholly-Owned Subsidiaries by the ~~Lead Borrower~~ Borrowers and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed the greater of $~~5,000,000~~11,250,000 and 1.00% of Consolidated Total Assets (measured at the time of such Dividend); (xv) the declaration and payment of ~~dividends~~ Dividends or the payment of other distributions by the ~~Lead Borrower~~ Borrowers in an aggregate amount since the Closing Date not to exceed the greater of $~~35,000,000~~100,000,000 and 8.50% of Consolidated Total Assets (measured at the time of such Dividend); (xvi) ~~the~~ Lead Borrower and ~~each~~ its Restricted ~~Subsidiary~~ Subsidiaries may declare and make ~~dividend~~ Dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of ~~dividend~~ Dividend or other distribution by a Restricted Subsidiary, ~~the~~ Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) ~~the~~ Lead Borrower may ~~make payments~~ pay Dividends with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”;and (xviii) ~~the~~ Lead Borrower and ~~any~~ its Restricted ~~Subsidiary~~ Subsidiaries may pay ~~dividends and distributions~~ Dividends within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as (x) at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the ~~definition~~ definitions of “Consolidated ~~EBITDA~~ EBITDA” and “Consolidated Net Income”), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) ~~shall~~ shall, to the extent such loan or advance remains unpaid, be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi).

Appears in 2 contracts

Sources: Revolving Credit Agreement (VERRA MOBILITY Corp), Revolving Credit Agreement (VERRA MOBILITY Corp)

Dividends. The ~~Lead Borrower~~ Borrowers will not, and will not permit any of ~~its~~ the Restricted Subsidiaries to, authorize, declare or pay any Dividends with respect to the Lead Borrower or any of its Restricted Subsidiaries, except that: (i) any Restricted Subsidiary of the Lead Borrower may authorize, declare and pay Dividends or return capital or make distributions and other similar payments with regard to its Equity Interests to the Lead Borrower or to other Restricted Subsidiaries of the Lead Borrower which directly or indirectly own equity therein; (ii) any non-Wholly-Owned Subsidiary of the Lead Borrower may authorize, declare and pay cash Dividends to its shareholders generally so long as the Lead Borrower or its Restricted Subsidiary which owns the Equity Interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary); (iii) so long as no ~~Default or~~ Event of Default exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, the Lead Borrower may authorize, declare and pay cash Dividends to Holdings to allow Holdings to pay cash dividends or make cash distributions to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of Holdings or such other Parent Company from ~~current or former members of~~ management, employees~~, consultants~~, officers and directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by the Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings or such other Parent Company in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests ~~(other than to the extent included in the Available Amount)~~ and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, (x) the greater of $~~10,000,000~~ 35,000,00050,000,000 and 6.25% of Consolidated EBITDA of the Lead Borrower and its Restricted Subsidiaries for the most recently ended Test Period (measured at the time of such Dividend) or (y) subsequent to the consummation of any Initial Public Offering of common stock or other comparable equity interests of the Lead Borrower or any direct or indirect parent of the Lead Borrower, the greater of $55,000,00080,000,000 and 10.0% of Consolidated EBITDA of the Lead Borrower and its Restricted Subsidiaries for the most recently ended Test Period (measured at the time of such Dividend) (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from ~~current or former~~ members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of Holdings or any other Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may authorize, declare and pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may authorize, declare and pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with ~~applicable laws~~Requirements of Law, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may authorize, declare and pay cash ~~dividends~~ Dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their ~~existence~~existence to the extent such Taxes, fees and expenses are reasonably attributable to the operations of Holdings, the Lead Borrower and its Restricted Subsidiaries; (B) with respect to any taxable ~~year (or portion thereof)~~ period ending after the Closing Date ~~with respect to~~ for which the Lead Borrower ~~(a) is treated as a corporation for U.S. federal, state,~~ and/or ~~local income tax purposes and (b) is a member~~ any of its Subsidiaries are members of a consolidated, combined or similar income tax group ~~(a “Tax Group”)~~ for U.S. federal and/or applicable state, local or foreign income or similar tax purposes of which ~~any Parent Company~~ a direct or ~~other entity~~ indirect parent of the Lead Borrower is the common parent, the portion of any such U.S. federal, ~~state~~ state, local and/or foreign income and ~~local income Taxes~~ similar taxes (including any alternative minimum ~~Taxes~~taxes) ~~(or franchise and similar Taxes imposed in lieu~~ of such ~~minimum Taxes)~~ tax group that ~~are~~ is attributable to the taxable income of the Lead Borrower and its applicable Restricted Subsidiaries and, to the extent of the amount actually received for such purpose from its applicable Unrestricted Subsidiaries, in amounts required to pay any such taxes that are attributable to the taxable income of such Unrestricted Subsidiaries; provided that ~~for each taxable period,~~ the aggregate amount of such payments ~~made in~~ with respect to such period (regardless of ~~such taxable period in the aggregate~~ when paid) shall not exceed the aggregate amount of such Taxes that the Lead Borrower ~~and~~ and/or its applicable Restricted Subsidiaries (and, subject to the limitation described above, any applicable Unrestricted Subsidiaries of the Lead Borrower) would have been required to pay as with respect to such period were such entities stand-alone corporate taxpayers or a stand-alone ~~Tax Group; provided, further, that~~ corporate tax group for all applicable taxable periods ending after the ~~permitted payment pursuant~~ date hereof taking into account any applicable limitations on the ability to ~~this clause (B) with respect to~~ utilize net operating loss carryforwards and similar tax attributes under the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar TaxesCode; (C) payments under any domination and/or profit and loss pooling agreements; (D) customary salary, bonus and other ~~compensation and~~ benefits payable to ~~current and former officers,~~ directors, ~~consultants~~ officers and employees of any Parent Company to the extent such salaries, bonuses and other ~~compensation and~~ benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (DE) general corporate operating and overhead ~~costs~~ costs, fees and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such ~~costs~~ costs, fees and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (EF) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (FG) the purchase or other acquisition by Holdings or any ~~parent~~ other Parent Company of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such ~~parent~~ Parent Company shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger or amalgamation (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such ~~purchaser~~ purchase or other acquisition;; and (GH) any customary fees and expenses related to any successful or unsuccessful debt or equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) the Lead Borrower and its Restricted Subsidiaries may give reasonable and customary indemnities to directors, officers and employees of Holdings or any other Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may authorize, declare and pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory ~~Agreement (as in effect on the Closing Date~~Agreement; (ix) any Dividend used (x) to fund the Transaction, including Transaction ~~Costs and the Special Dividend~~Costs, and (y) in order to satisfy deferred purchase price, earn-outs and contingent payments in respect of any ~~Dividend from proceeds received~~ amounts due and owing as provided for in ~~connection with any working capital adjustment pursuant to~~ the Acquisition Agreement; (x) the Lead Borrower may authorize, declare and pay cash Dividends to Holdings (who may subsequently authorize, declare and pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v), 10.06(vii) and ~~10.06(vii~~10.06(xii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or ~~the settlement or vesting of other~~ similar equity incentive awards; (xii) a Dividend (including to any Parent ~~Company~~ Company) to fund a payment of dividends on ~~such~~ the Lead Borrower’s or any Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, not to exceed, in any fiscal year, the sum of ~~up to 6~~(x) 6.0% ~~per annum~~ of the net cash proceeds received by or contributed to the capital of the Lead Borrower from any such Initial Public ~~Offering~~Offering and (y) 7.0% of the Lead Borrower’s (or any Parent Company’s) Market Capitalization; (xiii) the Lead Borrower may pay any Dividends so long as the Distribution Conditions are satisfied on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and Basis immediately after giving effect to such ~~Dividend, no Event of Default shall have occurred and be continuing~~Dividends; (xiv) purchases of minority interests in ~~non-~~Restricted Subsidiaries that are not Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed the greater of $~~5,000,000~~27,500,00040,000,000 and 5.0% of Consolidated EBITDA of the Lead Borrower and its Restricted Subsidiaries for the most recently ended Test Period (measured at the time of such Dividend); (xv) the authorization, declaration and payment of ~~dividends~~ Dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing ~~Date~~ Date, not to exceed the greater of $~~35,000,000~~250,000,000400,000,000 and 50.0% of Consolidated EBITDA of the Lead Borrower and its Restricted Subsidiaries for the most recently ended Test Period (measured at the time of such Dividend); (xvi) the Lead Borrower and each Restricted Subsidiary may authorize, declare and make ~~dividend~~ Dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of ~~dividend~~ Dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may ~~make payments~~ authorize, declare and pay Dividends with the cash proceeds contributed to its common equity (including from the net cash proceeds of any equity issuance by any Parent Company), so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may authorize, declare and pay ~~dividends and distributions~~ Dividends within 60 90 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; (xix) so long as no Event of Default under Section 11.01 or 11.05 has occurred and is continuing or would result therefrom, Lead Borrower and any Restricted Subsidiary may authorize, declare and pay Dividends with any Leverage Excess Proceeds (as defined in the Cash Flow Credit Agreement as in effect on the ClosingAmendment No. 3 Effective Date) promptly upon the receipt thereof; and (~~xix~~xx) any ~~Dividends, so long~~ payment that is intended to prevent any Indebtedness of the Lead Borrower from being treated as (xan “applicable high yield discount obligation” within the meaning of Section 163(i)(1) at of the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00Code. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the ~~definition~~ definitions of “Consolidated ~~EBITDA and~~ EBITDA”, “Consolidated Net Income” and “Consolidated Fixed Charge Coverage Ratio”), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) ~~shall~~ shall, to the extent such loan or advance remains unpaid, be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi).

Appears in 2 contracts

Sources: Revolving Credit Agreement (McGraw Hill, Inc.), Revolving Credit Agreement (McGraw Hill, Inc.)

Dividends. ~~The Lead Borrower will not, and will not permit any of its Restricted Subsidiaries to, authorize~~Authorize, declare or ~~pay~~ pay, directly or indirectly, any Dividends with respect to any Company, except that the ~~Lead~~ following shall be permitted: (a) Dividends by any Company to Borrower or any ~~of its Restricted Subsidiaries, except that: (i) any Restricted~~ Guarantor that is a Wholly Owned Subsidiary of Borrower or, in the ~~Lead Borrower may pay Dividends or return capital or make distributions and other similar payments with regard to its Equity Interests to the Lead Borrower or to other Restricted Subsidiaries~~ case of ~~the Lead Borrower which directly or indirectly own equity therein; (ii) any non-~~a Subsidiary that is not a Wholly-Owned ~~Subsidiary~~ Subsidiary, Dividends pro rata to the holders of ~~the Lead Borrower may declare and pay cash Dividends to its shareholders generally so long as the Lead Borrower or its Restricted Subsidiary which owns the~~ such Subsidiary’s Equity ~~Interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Subsidiary paying such Dividends and~~ Interests, taking into account the relative preferences, if any, of on the various classes of Equity Interests of such Subsidiary); (~~iii~~b) ~~so long as no Default~~ payments, dividends or ~~Event of Default exists at the time of the applicable Dividend~~distributions, ~~redemption~~ directly or ~~repurchase or would exist immediately after giving effect thereto~~indirectly, ~~the Lead Borrower may pay cash Dividends~~ to Holdings to ~~allow~~ permit Holdings, and the subsequent use of such payments by Holdings, to repurchase or redeem Qualified Capital Stock of Holdings or a direct or indirect parent of Holdings (including through the subsequent dividend or distribution directly or indirectly to such parent) held by active or former officers, directors, employees or consultants (or their transferees, estates or beneficiaries under their estates) of any Company or to make payment on promissory notes issued to pay ~~cash dividends~~ the purchase price with respect to ~~any other Parent Company to redeem~~ such repurchases or ~~repurchase~~redemptions, ~~contemporaneously with such Dividend~~upon their death, ~~Equity Interests~~ disability, retirement, severance or termination of ~~such Parent Company from current~~ employment or ~~former members of management, employees, consultants, officers and directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries~~service; provided that ~~(A)~~ the aggregate ~~amount of Dividends made by the Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount~~ cash consideration paid ~~by Holdings in respect of~~ for all such ~~Equity Interests so redeemed or repurchased~~ redemptions and payments shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase)exceed, in ~~either case, exceed during~~ any fiscal ~~year~~ year, the sum of ~~the Lead Borrower,~~ (w) $~~10,000,000~~ 3.0 million (~~provided that the~~ plus any amount ~~of cash Dividends permitted to be, but not, paid~~ not used in any fiscal year ~~pursuant~~ may be carried forward to ~~this clause~~ the next three succeeding fiscal years), plus (~~iii~~x) ~~shall increase~~ the amount of ~~cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in~~ any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are Net Cash Proceeds received by or contributed to Borrower from the ~~Lead Borrower; provided~~ issuance and sale since the issue date of Qualified Capital Stock of Holdings to officers, directors or employees of Holdings or any Company that ~~the amount of~~ have not been used to make any ~~such net proceeds that are utilized for any Dividend~~ repurchases, redemptions or payments under this clause (~~iii~~b), plus (y) ~~will not be considered to be~~ the net cash proceeds of ~~Equity Interests for purposes~~ any “key-man” life insurance policies of any Company that have not been used to make any repurchases, redemptions or payments under this clause (~~b)(x)(ii~~b) ~~of the definition of “Available Amount”; less~~ plus (~~III~~z) ~~the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing~~ amounts that are contemporaneously repaid to ~~the Lead Borrower from current or former members of management, officers, directors, employees of the Lead~~ Borrower or ~~any~~ a Subsidiary in respect of ~~its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed~~ loans made pursuant to ~~constitute a Dividend for purposes of this Agreement~~Section 6.04(e); (ivA) to the ~~Lead~~ extent actually used by Holdings or any direct or indirect parent of Holdings to pay such taxes, costs and expenses, payments, dividends or distributions, directly or indirectly, by Borrower ~~may~~ to or on behalf of Holdings (or its direct or indirect parents) in an amount sufficient to permit Holdings to pay ~~cash Dividends~~ (or to dividend to its direct or indirect parents to pay) franchise taxes and other fees required to maintain the legal existence of Holdings (and its direct and indirect parents) and (B) to the extent actually used by Holdings (or a direct or indirect parent) to pay such costs and expenses, payments, dividends or distributions, directly or indirectly, by Borrower to or on behalf of Holdings in an amount sufficient to pay (or dividend to its direct or indirect parents to pay) out-of-pocket legal, accounting and filing costs and other expenses in the nature of overhead in the ordinary course of business of Holdings (or its direct or indirect parents), in the case of clauses (A) and (B) in an aggregate amount not to exceed $1.0 million in any fiscal year; (d) Permitted Tax Distributions by Borrower to Holdings so long as ~~the proceeds thereof are promptly used by~~ Holdings (or ~~subsequently paid~~ to ~~any other Parent Company~~its direct or indirect parents) uses such distributions to pay ~~expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where~~ the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completedapplicable taxes; (ve) payments resulting from the ~~Lead Borrower may pay cash Dividends to Holdings so long as~~ cashless exercise of options and warrants on the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations Equity Interests of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunderCompany permitted hereunder; (vif) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income payment of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares consideration in connection with the ~~exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of~~ Acquisition and the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect Merger on the Closing Date; (ixg) ~~any Dividend used to fund~~ Holdings may make Restricted Payments with the ~~Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement;~~ Net Cash Proceeds of Excluded Issuances (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent ~~the same~~ any such proceeds are ~~made solely with the Available Amount, so long as at the time of, and after giving effect~~ not otherwise contributed to ~~such Dividend, no Event of Default shall have occurred and~~ (or required to be ~~continuing;~~contributed to) Borrower); and (~~xiv~~h) ~~purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases~~Holdings, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $5,000,000; (xv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each ~~Restricted~~ Subsidiary may declare and make ~~dividend payments or other distributions~~ Dividends payable solely in the Equity Interests (other than Disqualified Capital Stock not otherwise permitted by Section 7.01) of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as (x) at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi)Person.

Appears in 2 contracts

Sources: Credit Agreement (Mattress Firm Holding Corp.), Credit Agreement (Mattress Firm Holding Corp.)

Dividends. ~~The Lead Borrower will not, and will not permit any of its Restricted Subsidiaries to, authorize~~Authorize, declare or ~~pay~~ pay, directly or indirectly, any Dividends with respect to any Company, except that the ~~Lead~~ following shall be permitted: (a) Dividends by any Subsidiary to Borrower or any other Subsidiary (and, in the case of Dividends by a non-wholly owned Subsidiary, to the Borrower and any of its ~~Restricted Subsidiaries, except that: (i) any Restricted Subsidiary of the Lead Borrower may pay Dividends or return capital or make distributions~~ other Subsidiaries and to each other similar payments with regard to its Equity Interests to the Lead Borrower or to other Restricted Subsidiaries of the Lead Borrower which directly or indirectly own equity therein; (ii) any non-Wholly-Owned Subsidiary of the Lead Borrower may declare and pay cash Dividends to its shareholders generally so long as the Lead Borrower or its Restricted Subsidiary which owns the Equity Interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes owner of Equity Interests of such ~~Subsidiary~~Subsidiary based on their relative ownership interests of the relevant class of Equity Interests); (iii) so long as no Default or Event of Default exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, the Lead Borrower may pay cash Dividends to Holdings to allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of such Parent Company from current or former members of management, employees, consultants, officers and directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by the Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) ~~is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent~~ Any Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $5,000,000; (xv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests (other than Disqualified Capital Stock not otherwise permitted by Section 6.01) of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distributionperson; (~~xvii~~c) ~~the Lead Borrower may~~ payments to Intermediate Holdings to permit Intermediate Holdings to make payments to Pubco or any other direct or indirect parent entity of Intermediate Holdings, and the subsequent use of such payments by Pubco or any other such direct or indirect parent of Intermediate Holdings, to repurchase or redeem Qualified Capital Stock of Intermediate Holdings or any other such direct or indirect parent held by officers, directors or employees or former officers, directors or employees (or their transferees, estates or beneficiaries under their estates) of any Company, upon their death, disability, retirement, severance or termination of employment or service or pay interest in respect of Holdings Employee Notes and to pay withholding or similar tax payments that are expected to be payable in connection therewith; provided that the aggregate cash consideration paid for all such redemptions and payments of any kind or nature shall not exceed, in any fiscal year, the sum of (x) $1,500,000 (with unused amounts in any fiscal year being carried over to the ~~cash proceeds contributed~~ next succeeding fiscal year but not to ~~its common equity from~~ any fiscal year thereafter), plus (y) the net cash proceeds of any ~~equity issuance~~ “key-man” life insurance policies of any Company that have not been used to make any repurchases, redemptions or payments under this clause (c); provided, further, that such amount may further be increased by ~~any Parent Company, so long as, with respect~~ an amount not to ~~any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that~~ exceed the amount of any ~~such cash proceeds~~ Net Cash Proceeds received by or contributed to Borrower from the issuance and sale since the Closing Date of Qualified Capital Stock of Intermediate Holdings or any other direct or indirect parent of Intermediate Holdings to officers, directors or employees of any Company that ~~are utilized for~~ have not been used to make any ~~Dividend~~ repurchases, redemptions or payments under this clause (~~iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”~~c); (~~xviii~~d) direct or indirect payments, Dividends or distributions to Intermediate Holdings in an amount sufficient for Intermediate Holdings to pay, or to make Dividends or distributions to any direct or indirect parent of Intermediate Holdings to pay, (A) franchise taxes and other fees required to maintain the ~~Lead Borrower~~ legal existence of Intermediate Holdings (and any ~~Restricted Subsidiary~~ direct or indirect parent thereof) and (B) out-of-pocket legal, accounting and filing costs and other expenses and obligations in the ordinary course of business, or otherwise arising pursuant to arrangements related to the IPO or in connection with the IPO, of Intermediate Holdings (and any direct or indirect parent thereof), including overhead but excluding obligations payable to a party to the Tax Receivable Agreements pursuant to such Tax Receivable Agreements (but, for clarity, Pubco may ~~pay dividends and distributions within 60 days after~~ make payments to any such party pursuant to the ~~date of declaration thereof, if at~~ Tax Receivable Agreements with amounts received directly or indirectly pursuant to the ~~date of declaration of such payment, such payment would have complied with another provision~~ other clauses of this Section 10.03; and (xix) any Dividends, so long as (x) at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income6.07)~~, amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi).~~;

Appears in 2 contracts

Sources: Credit Agreement (Norcraft Companies, Inc.), Credit Agreement (Norcraft Companies Lp)

Dividends. The ~~Lead Borrower~~ Parent will not, and will not permit any of its ~~Restricted~~ Subsidiaries to, authorize, declare or pay any Dividends with respect to the ~~Lead Borrower~~ Parent or any of its ~~Restricted~~ Subsidiaries, except that: (i) ~~any Restricted Subsidiary~~ Subsidiaries of the ~~Lead Borrower~~ Parent may pay Dividends to another member of the NCLC Group; provided that the Borrower shall procure that any Dividends or ~~return capital or make~~ other distributions and interest paid or payable in connection with such Dividends or other ~~similar payments with regard~~ distributions to ~~its Equity Interests to~~ NCL International, Ltd., NCL America Holdings, LLC or Arrasas Limited shall be received promptly by the ~~Lead Borrower or to other Restricted Subsidiaries of the Lead Borrower which~~ Parent directly or indirectly ~~own equity therein~~by way of Dividend; (ii) ~~any non-Wholly-Owned Subsidiary of~~ the Lead Borrower may declare and pay cash Dividends to its shareholders generally so long as the Lead Borrower or its Restricted Subsidiary which owns the Equity Interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary); (iii) so long as no Default or Event of Default exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, the Lead Borrower Parent may pay ~~cash~~ Dividends to Holdings to allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of such Parent Company from current or former members of management, employees, consultants, officers and directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by the Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than the tax liability to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including jurisdiction in respect of ~~any reports filed~~ consolidated, combined, unitary or affiliated tax returns for each relevant jurisdiction of the NCLC Group or holder of the Parent’s Capital Stock with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any income taxable ~~year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated~~ as a ~~corporation~~ result of any member of the NCLC Group being taxed as a pass-through entity for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federalFederal, state and local income ~~Taxes (including minimum Taxes) (~~tax purposes or ~~franchise and similar Taxes imposed in lieu of such minimum Taxes) that are~~ attributable to ~~the taxable income~~ any member of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax NCLC Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $5,000,000; (xv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (~~xix~~iii) at any ~~Dividends~~time following the listing of the ordinary Capital Stock of the Parent on an Approved Stock Exchange, the Parent may pay Dividends in an amount not to exceed 50% of Consolidated Net Income of the Parent and its Subsidiaries for the period (taken as one period) commencing on January 1, 2010 and ending on the date prior to such Dividend for which financial statements are available so long as (x) no Default or Event or Default exists or would result from such Dividend and (y) at the time ~~of,~~ of such Dividend and after giving effect ~~to such Dividend, no Event~~ thereto the ratio of ~~Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated~~ Total Net ~~Leverage Ratio does not exceed 3.25~~ Funded Debt to ~~1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of~~ Consolidated EBITDA ~~and Consolidated Net Income), amounts loaned or advanced~~ for the four consecutive fiscal quarters last ended for which financial statements have been provided to ~~Holdings~~ the Facility Agent pursuant to Section ~~10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi)~~9.01 is less than 5.50:1.00.

Appears in 2 contracts

Sources: Credit Agreement (NCL CORP Ltd.), Credit Agreement (NCL CORP Ltd.)

Dividends. ~~The Lead~~ (a) At any time that the Leverage Ratio equals or exceeds 6.00:1.00, the U.S. Borrower will not, and will not permit any of its ~~Restricted~~ Subsidiaries to, authorize, declare or pay any Dividends with respect to the ~~Lead~~ U.S. Borrower or any of its ~~Restricted~~ Subsidiaries, except that: (i) any ~~Restricted~~ Subsidiary of the ~~Lead~~ U.S. Borrower may pay cash Dividends ~~or return capital or make distributions and other similar payments with regard to its Equity Interests~~ to the ~~Lead~~ U.S. Borrower or to ~~other Restricted Subsidiaries~~ a Wholly-Owned Subsidiary of the ~~Lead Borrower which directly or indirectly own equity therein~~U.S. Borrower; (ii) any non-Wholly-Owned Subsidiary of the ~~Lead~~ U.S. Borrower may ~~declare and~~ pay cash Dividends to its ~~shareholders~~ shareholders, members or partners generally so long as the ~~Lead~~ U.S. Borrower or its ~~Restricted~~ respective Subsidiary which owns the ~~Equity Interests~~ equity interest or interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative ~~holding~~ holdings of ~~the Equity Interests~~ equity interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of ~~Equity Interests of~~ equity interests in such Subsidiary); (iii) so long as (x) no Specified Default or Event of Default then exists ~~at the time of the applicable Dividend, redemption or repurchase~~ or would exist immediately after giving effect ~~thereto~~thereto and (y) HMC qualifies, or has taken all other actions necessary to qualify, as a “real estate investment trust” under the Code during any fiscal year of HMC, the ~~Lead~~ U.S. Borrower may pay quarterly cash Dividends (which may be based on estimates) to HMC and all other holders of OP Units generally when and to the extent necessary for HMC to distribute, and HMC may so distribute, cash Dividends to its shareholders generally in an aggregate amount not to exceed the greater of (I) the greatest of (A) 100% of Cash Available for Distribution for such fiscal year, (B) 100% of Taxable Income and (C) the minimum amount necessary for HMC to maintain its tax status as a real estate investment trust and to satisfy the distributions required to be made by Notice 88-19 under the Code (or Treasury regulations issued pursuant thereto) by reason of HMC making the election provided for therein and (II) at any time when, based upon the financial statements delivered pursuant to Section 10.11(a) or (b) and the U.S. Borrower’s estimation of the results of the current fiscal quarter, the Consolidated Interest Coverage Ratio is greater than 2.00:1:00, 85% of the Adjusted Funds From Operations for the current fiscal year; (iv) so long as no Specified Default or Event of Default then exists or would result therefrom, the U.S. Borrower may pay cash Dividends to Holdings to allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of such Parent Company from current or former members of management, employees, consultants, officers and directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by the Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may pay cash Dividends to Holdings HMC so long as the proceeds ~~thereof~~ therefrom are promptly used by ~~Holdings (or subsequently paid to any other Parent Company)~~ HMC to pay ~~expenses incurred by Holdings or~~ (x) any ~~other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities~~ Permitted Tax Payments at the time and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent ~~such salaries, bonuses~~ actually due and ~~other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries;~~ payable (~~D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties)~~ but without duplication of any ~~Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash~~ tax payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section ~~9.14; provided that (A~~11.11(a)(iii) ~~such dividend, distribution, loan or advance shall~~ above to satisfy the distribution required to be made ~~concurrently with~~ by Notice 88-19 under the ~~closing of such purchase~~ Code (or ~~other acquisition~~ Treasury regulations issued pursuant thereto)) and (By) ~~such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests)~~ any general corporate and ~~any~~ other overhead expenses and liabilities ~~assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (~~incurred by it to the extent ~~permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition~~not otherwise prohibited by this Agreement; (Gv) ~~any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to~~ so long as no Specified Default or Event of Default then exists or would result therefrom, the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead U.S. Borrower may pay cash Dividends to ~~Holdings so long as~~ HMC in an aggregate amount not to exceed $10,000,000 for the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date;Revolving Credit Period; and (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (xvi) the ~~Lead~~ U.S. Borrower may pay cash Dividends to ~~Holdings (who may subsequently pay cash Dividends to any other Parent Company)~~ HMC so long as HMC promptly thereafter uses the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such ~~common~~ Dividends to repurchase shares of its capital stock ~~after~~ and/or the ~~Closing Date~~QUIPs and/or redeem the QUIPs Debt, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the ~~Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00~~Borrower may repurchase OP Units, ~~any Dividends to the extent the same are made solely with the Available Amount,~~ in each case so long as ~~at the time of, and after giving effect to such Dividend,~~ (i) no Specified Default or Event of Default ~~shall have occurred and be continuing;~~ then exits or would result therefrom, (~~xiv~~ii) ~~purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that~~ the aggregate amount of ~~such purchases, when added to the aggregate amount of Investments~~ all repurchases and redemptions made pursuant to this Section ~~10.05(xvii), shall~~ 11.11(a)(vi) in any fiscal year of HMC does not exceed ~~$5,000,000;~~ an amount equal to 1% of Adjusted Total Assets determined at the time of declaration of the Dividend (xv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with ~~the cash proceeds contributed to its common equity~~ any unused Roll Forward Amount from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that one fiscal year increasing the amount ~~of any such cash proceeds that are utilized for any~~ available to be paid as a Dividend under this ~~clause~~ Section 11.11(a)(vi) in subsequent fiscal years). Dividends paid during a period when the Leverage Ratio is less than 6.00:1.00 shall, in the event that the Leverage Ratio subsequently exceeds 6.00:1.00, be counted against the baskets provided for in this Section 11.11(a) (~~iii~~as applicable) ~~will not be considered to be cash proceeds of Equity Interests~~ for purposes of ~~clause (b)(x)(ii) of the definition of “Available Amount”;~~determining basket availability only. (~~xviii~~b) At any time that the ~~Lead~~ Leverage Ratio is less than 6.00:1.00, the U.S. Borrower and ~~any Restricted Subsidiary may pay dividends and distributions within 60 days after~~ the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as (x) at the time ofGuarantors will not, and ~~after giving effect to such Dividend~~will not permit any of their Restricted Subsidiaries to, ~~no Event of Default shall have occurred and be continuing and (y) on~~ directly or indirectly, authorize, declare, or pay any Dividends that would constitute a ~~Pro Forma Basis,~~ Restricted Payment that is prohibited under the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi)Governing Senior Note Indenture.

Appears in 2 contracts

Sources: Credit Agreement (Host Marriott L P), Credit Agreement (Host Marriott Corp/)

Dividends. The ~~Lead Borrower~~ Parent will not, and will not permit any of its ~~Restricted~~ Subsidiaries to, authorize, declare or pay any Dividends with respect to the ~~Lead Borrower~~ Parent or any of its ~~Restricted~~ Subsidiaries, except that: (i) ~~any Restricted Subsidiary~~ Subsidiaries of the ~~Lead Borrower~~ Parent may pay Dividends to another member of the NCLC Group; provided that the Borrower shall procure that any Dividends or ~~return capital or make~~ other distributions and interest paid or payable in connection with such Dividends or other ~~similar payments with regard~~ distributions to ~~its Equity Interests to~~ NCL International, Ltd., NCL America Holdings, LLC or Arrasas Limited shall be received promptly by the ~~Lead Borrower or to other Restricted Subsidiaries of the Lead Borrower which~~ Parent directly or indirectly ~~own equity therein~~by way of Dividend; (ii) ~~any non-Wholly-Owned Subsidiary of~~ the Lead Borrower may declare and pay cash Dividends to its shareholders generally so long as the Lead Borrower or its Restricted Subsidiary which owns the Equity Interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary); (iii) so long as no Default or Event of Default exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, the Lead Borrower Parent may pay ~~cash~~ Dividends to Holdings to allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of such Parent Company from current or former members of management, employees, consultants, officers and directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by the Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than the tax liability to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including jurisdiction in respect of ~~any reports filed~~ consolidated, combined, unitary or affiliated tax returns for each relevant jurisdiction of the NCLC Group or holder of the Parent’s Capital Stock with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any income taxable ~~year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated~~ as a ~~corporation~~ result of any member of the NCLC Group being taxed as a pass-through entity for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federalFederal, state and local income ~~Taxes (including minimum Taxes) (~~tax purposes or ~~franchise and similar Taxes imposed in lieu of such minimum Taxes) that are~~ attributable to ~~the taxable income~~ any member of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax NCLC Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $5,000,000; (xv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (~~xix~~iii) at any ~~Dividends~~time following the listing of the ordinary Capital Stock of the Parent on an Approved Stock Exchange, the Parent may pay Dividends in an amount not to exceed 50% of Consolidated Net Income of the Parent and its Subsidiaries for the period (taken as one period) commencing on January 1, 2010 and ending on the date prior to such Dividend for which financial statements are available so long as (x) no Default or Event or Default exists or would result from such Dividend and (y) at the time ~~of,~~ of such Dividend and after giving effect ~~to such Dividend, no Event~~ thereto the ratio of ~~Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated~~ Total Net ~~Leverage Ratio does not exceed 3.25~~ Funded Debt to ~~1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of~~ Consolidated EBITDA ~~and Consolidated Net Income), amounts loaned or advanced~~ for the four consecutive fiscal quarters last ended for which financial statements have been provided to ~~Holdings~~ the Facility Agent pursuant to Section ~~10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi)~~9.01 is less than [*].

Appears in 2 contracts

Sources: Credit Agreement (NCL CORP Ltd.), Credit Agreement (NCL CORP Ltd.)

Dividends. The ~~Lead~~ Borrower will not, and will not permit any of its ~~Restricted~~ Subsidiaries to, authorize, declare or pay any Dividends with respect to the ~~Lead~~ Borrower or any of its ~~Restricted~~ Subsidiaries, except that: (i) any ~~Restricted~~ Subsidiary of the ~~Lead~~ Borrower may pay cash Dividends ~~or return capital or make distributions and other similar payments with regard to its Equity Interests~~ to the ~~Lead~~ Borrower or to any other ~~Restricted Subsidiaries~~ Wholly-Owned Subsidiary of the ~~Lead~~ Borrower which ~~directly or indirectly own equity therein~~is a Credit Party and any Subsidiary of the Borrower which is not a Guarantor also may pay cash Dividends to a Wholly-Owned Subsidiary of the Borrower; (ii) any non-Wholly-Owned Subsidiary of the ~~Lead~~ Borrower may ~~declare and~~ pay cash Dividends to its shareholders generally so long as the ~~Lead~~ Borrower or its ~~Restricted~~ respective Subsidiary which owns the ~~Equity Interests~~ equity interest in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the ~~Equity Interests~~ equity interest in ~~the~~ such Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of ~~Equity Interests~~ equity interests of such Subsidiary); (iii) ~~so long as~~ the Borrower may pay Dividends on its Qualified Preferred Interests solely through the issuance of additional shares of its Qualified Preferred Interests but not in cash; and (iv) the Borrower may pay Dividends, provided that (x) no Default or Event of Default exists at the time of ~~the applicable Dividend, redemption~~ payment thereof or ~~repurchase or would exist immediately~~ after giving effect thereto, the Lead Borrower may pay cash Dividends to Holdings to allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of such Parent Company from current or former members of management, employees, consultants, officers thereto and ~~directors~~ (~~and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that (A~~y) the aggregate amount of Dividends ~~made by the Lead Borrower to Holdings~~ paid pursuant to this clause (iii), and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed an amount equal to 50% of the ~~amount that~~ Consolidated Net Income of the ~~Lead~~ Borrower for the period commencing on January 1, 2008 and ~~its Subsidiaries would~~ ending on the last day of the fiscal quarter ended prior to the date of payment for which financial statements have been ~~required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect~~ provided to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made Administrative Agent pursuant to Section ~~9.14; provided that (A~~9.01(a) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $5,000,000; (xv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as (x) at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vib).

Appears in 2 contracts

Sources: Credit Agreement (Trico Marine Services Inc), Credit Agreement (Trico Marine Services Inc)

Dividends. The ~~Lead~~ U.S. Borrower will not, and will not permit any of its ~~Restricted~~ Subsidiaries to, authorize, declare or pay any Dividends with respect to the ~~Lead~~ U.S. Borrower or any of its ~~Restricted~~ Subsidiaries, except that: (i) any ~~Restricted~~ Subsidiary of the ~~Lead~~ U.S. Borrower may pay cash Dividends ~~or return capital or make distributions and other similar payments with regard to its Equity Interests~~ to the ~~Lead~~ U.S. Borrower or to ~~other Restricted Subsidiaries~~ any Wholly-Owned Domestic Subsidiary of the ~~Lead~~ U.S. Borrower ~~which directly~~ and any Subsidiary of any Canadian Borrower may pay cash Dividends to the U.S. Borrower or ~~indirectly own equity therein~~any Wholly-Owned Subsidiary of the U.S. Borrower; (ii) any ~~non~~Non-Wholly-Owned Subsidiary of the ~~Lead~~ U.S. Borrower may ~~declare and~~ pay cash Dividends to its ~~shareholders generally~~ shareholders, members or partners generally, so long as the ~~Lead~~ U.S. Borrower or its ~~Restricted~~ respective Subsidiary which owns the Equity ~~Interests~~ Interest in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity ~~Interests~~ Interest in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary); (iii) the U.S. Borrower and any of its Subsidiaries may pay cash Dividends in an amount not to exceed the Cumulative Retained Excess Cash Flow Amount as in effect immediately before the respective Dividend so long as no Default or Event of Default exists ~~at the time of the applicable Dividend, redemption or repurchase~~ or would ~~exist immediately after giving effect thereto,~~ result therefrom; (iv) the ~~Lead~~ U.S. Borrower may pay cash Dividends on the U.S. Borrower Common Stock at the end of each Fiscal Quarter in an aggregate amount not to ~~Holdings~~ exceed (x) if the Senior Secured Leverage Ratio is greater than 4.50:1.00 for the Test Period most recently ended for which financial statements have been delivered to ~~allow Holdings~~ the Lenders pursuant to ~~pay cash dividends to any other Parent Company to redeem~~ Section 9.01(a) or ~~repurchase~~(b), ~~contemporaneously with such Dividend~~as applicable, ~~Equity Interests~~ the lesser of ~~such Parent Company from current or former members of management, employees, consultants, officers and directors~~ (~~and their successors and assigns~~I) $0.01 per each share of the ~~Lead Borrower~~ U.S. Borrower’s Common Stock issued and ~~its Restricted Subsidiaries; provided that~~ outstanding at such time and (AII) $35,000,000 less the aggregate amount of cash Dividends ~~made by the Lead Borrower to Holdings~~ paid pursuant to this ~~clause~~ Section 10.03(iv) during the Fiscal Year of which such Fiscal Quarter is a part and (~~iii~~y) if the Senior Secured Leverage Ratio is less than or equal to 4.50:1.00 for the Test Period most recently ended for which financial statements have been delivered to the Lenders pursuant to Section 9.01(a) or (b), ~~and~~ as applicable, $35,000,000 less the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends ~~permitted to be, but not,~~ paid ~~in any fiscal year~~ pursuant to this ~~clause~~ Section 10.03(iv) during the Fiscal Year of which such Fiscal Quarter is a part; provided that, in each case, no Default or Event of Default then exists or would result therefrom; (~~iii~~v) ~~shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in~~ any ~~calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead~~ Canadian Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants Subsidiary of any ~~Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed~~ Canadian Borrower may pay Dividends to the ~~Lead Borrower; provided that~~ U.S. Borrower as are necessary to reimburse the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead U.S. Borrower or any of its Subsidiaries ~~in connection with~~ for expenses directly attributable to a ~~repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead~~ Canadian Borrower ~~may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings~~ or any ~~other Parent Company in connection with offerings, registrations, or exchange listings~~ of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the its respective ~~rules and regulations promulgated thereunder~~Subsidiaries; (vi) the ~~Lead~~ Dividends listed on Schedule 10.03(vi); and (vii) the U.S. Borrower and any of its Subsidiaries may pay ~~cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof~~ Dividends not otherwise permitted hereto in ~~amounts required for any Parent Company or the equity interest holders thereof~~ an aggregate amount not to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14$20,000,000; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) ~~obligations under~~ no Default or ~~in respect~~ Event of ~~director~~ Default then exists or would result therefrom, and ~~officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or~~ (y) ~~indemnification obligations owing to~~ the ~~Sponsor and Sponsor Affiliates under~~ U.S. Borrower is in compliance with the ~~Advisory Agreement~~ financial covenant set forth in Section 10.08 (as whether or not then in ~~effect on the Closing Date; (ix) any Dividend used to fund the Transaction~~effect), including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) determined on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long Basis as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $5,000,000; (xv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as (x) at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes last day of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi)Calculation Period most recently ended.

Appears in 2 contracts

Sources: Credit Agreement (Walter Energy, Inc.), Credit Agreement (Walter Energy, Inc.)

Dividends. ~~The Lead Borrower~~ Holdings will not, and will not permit any of its ~~Restricted~~ Subsidiaries to, authorize, declare or pay any Dividends with respect to ~~the Lead Borrower~~ Holdings or any of its ~~Restricted~~ Subsidiaries, except that: (i) any ~~Restricted~~ Subsidiary of the Lead Borrower may pay Dividends or return capital or make distributions and other similar payments with regard to its Equity Interests to the Lead Borrower or to other Restricted Subsidiaries of the Lead Borrower which directly or indirectly own equity therein; (ii) any non-Wholly-Owned Subsidiary of the Lead Borrower may declare and pay cash Dividends to its shareholders generally so long as the Lead Borrower or its Restricted Subsidiary which owns the Equity Interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary); (iii) so long as no Default or Event of Default exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, the Lead Term Borrower may pay cash Dividends to ~~Holdings~~ the Term Borrower or to ~~allow Holdings to~~ any Wholly-Owned Domestic Subsidiary of the Term Borrower and any Foreign Subsidiary of the Term Borrower also may pay cash ~~dividends~~ Dividends to the Term Borrower, any ~~other Parent Company to redeem~~ Subsidiary Guarantor or repurchase, contemporaneously with such Dividend, Equity Interests of such Parent Company from current or former members of management, employees, consultants, officers and directors (and their successors and assigns) any Wholly-Owned Foreign Subsidiary of the Lead Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by the Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Term Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (ivii) the ~~Lead~~ Term Borrower may pay cash Dividends to Holdings, and Holdings may pay cash Dividends to its direct or indirect parent, , including the Sponsor or Affiliates of Sponsor, so long as the proceeds thereof are promptly used by Holdings (or ~~subsequently paid to any other Parent Company)~~ Holdings’ direct or indirect parent, including the Sponsor or Affiliates of Sponsor, to pay operating expenses incurred by in the Ordinary Course of Business (including, without limitation, outside directors and professional fees, expenses and indemnities, and any franchise and other taxes necessary to maintain Holdings ~~or any~~ corporate existence) and other ~~Parent Company in connection with offerings~~similar corporate overhead costs and expenses, ~~registrations, or exchange listings of equity or debt securities and maintenance of same (A) where~~ provided that the ~~net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated~~ aggregate amount of ~~such expenses~~ all cash Dividends paid pursuant to this clause (ii) shall not exceed $500,000 in ~~proportion to the amount~~ any fiscal year of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completedHoldings; (viii) if the ~~Lead~~ Term Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (and is classified as a ~~“Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local~~ corporation for federal income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable periodtax purposes, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Term Borrower may pay cash Dividends to Holdings (~~who~~ or any other Person that is the parent of a consolidated, combined or similar income tax group of which the Term Borrower is a member) at the times and in the amounts necessary to pay the portion of any consolidated, combined or similar income tax liability attributable to the income of the Term Borrower or its Subsidiaries; provided that (x) the amount of cash Dividends paid pursuant to this clause (iii) at any time shall not exceed the tax liability that would have been imposed on the Term Borrower and/or the applicable Subsidiaries had such entity(ies) filed on a stand-alone basis at such time for the respective period and Holdings had been classified as a corporation for federal income tax purposes and (y) any refunds of such taxes received by the applicable taxpayer shall promptly be returned by such taxpayer to the Term Borrower; (iv) the Term Borrower may ~~subsequently~~ pay cash Dividends to Holdings, and Holdings may pay cash Dividends to its direct or indirect parent, for the purpose of enabling Holdings and Holdings’ direct or indirect parent to redeem, repurchase or otherwise acquire for value, and Holdings and Holdings’ direct or indirect parent may redeem, repurchase or otherwise acquire for value, outstanding shares of Holdings common Equity Interests (or options or warrants to purchases Holdings common Equity Interests) held by former officers, directors, members of management or employees of Holdings or Holdings’ direct or indirect parent or any ~~other Parent Company~~of its or their Subsidiaries, provided that (x) ~~so long~~ the aggregate amount of all such Dividends shall not exceed $1,500,000 (or such additional amounts as may be reasonably agreed to by the Agents) plus an amount equal to cash proceeds ~~thereof are used to pay~~ from the ~~Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases~~ sale of Equity Interests ~~deemed~~ to ~~occur upon exercise~~ directors, officers, members of ~~stock options~~ management, or ~~warrants~~ employees or other equityholders of Holdings or Holdings’ direct or indirect parent, (y) on the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from date any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are Dividend is made ~~solely with the Available Amount, so long as at the time of,~~ and after giving effect to the payment of such Dividend, no Default or Event of Default shall exist or have occurred and be continuing, and (z) on the date any such Dividend is made and after giving effect to the payment of such Dividend, Availability shall be at least $2,000,000; (~~xiv~~v) ~~purchases of minority interests in non-Wholly-Owned Subsidiaries by~~ the ~~Lead~~ Term Borrower and Holdings may pay the ~~Guarantors~~Closing Date Distribution on the Closing Date; (vi) the Term Borrower may pay any Dividends not otherwise described in this Section 11.03 in an aggregate amount not to exceed the Available Amount; provided that (v) Holdings has delivered to the Agent certified unqualified audited consolidated financial statements of Holdings and its Subsidiaries for Holdings’ fiscal year ending December 31, 2017, (w) Holdings shall be in compliance with a Total Net Leverage Ratio of 2.25:1.00 on a Pro Forma Basis after giving effect to the proposed Dividend, (x) the average aggregate amount of available cash on the balance sheet in the 10 days prior to the date any such Dividend is made shall be at least $30,000,000 on a Pro Forma Basis after giving effect to the proposed Dividend, (y) no Default or Event of Default shall exist or have occurred and be continuing and (z) the aggregate amount of all such ~~purchases, when added to the aggregate amount of Investments~~ Dividends paid pursuant to ~~Section 10.05(xvii),~~ this clause (vi) shall not exceed $~~5,000,000~~10,000,000; (xvvii) [Reserved]; and (viii) the ~~declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead~~ Term Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower Holdings may make payments of the fees specified in the Management Agreement in accordance with the ~~cash proceeds contributed~~ terms of the Management Agreement and with respect to ~~its common equity from~~ indemnities and out-of-pocket expenses provided for in the ~~net cash proceeds of any equity issuance by any Parent Company,~~ Management Agreement so long as, with respect to ~~any~~ all such ~~payments~~payments other than the actual out-of-pocket expenses of the Sponsor directly related to the management of the Credit Parties, (a) no Event of Default ~~shall have~~ pursuant to Section 12.01 or Section 12.05 has occurred ~~and be~~ or is continuing or would result therefrom~~; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause~~ , (~~iii~~b) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after on the date ~~of declaration thereof, if at the date of declaration of~~ any such payment, ~~such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as (x) at the time of,~~ dividend or distribution is made and after giving effect to such ~~Dividend~~payment, ~~no Event~~ dividend or distribution, Availability shall be at least $2,000,000 and (c) such payments, shall not exceed an aggregate amount in any fiscal year of ~~Default shall have occurred and be continuing~~ 1.5% of the sum of (x) the amount paid by Parent pursuant to the Merger Agreement and (y) ~~on a Pro Forma Basis,~~ the ~~Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes~~ aggregate amount of ~~the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced~~ capital contributed to Holdings ~~pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi)~~by Parent, Sponsor or any of their respective Affiliates after February 1, 2017.

Appears in 2 contracts

Sources: Credit Agreement (International Money Express, Inc.), Credit Agreement (Fintech Acquisition Corp. II)

Dividends. ~~The Lead Borrower~~ a) At any time that the Leverage Ratio equals or exceeds 6.00:1.00, the Company will not, and will not permit any of its ~~Restricted~~ Subsidiaries to, authorize, declare or pay any Dividends with respect to the ~~Lead Borrower~~ Company or any of its ~~Restricted~~ Subsidiaries, except that: (i) any ~~Restricted~~ Subsidiary of the ~~Lead Borrower~~ Company may pay cash Dividends ~~or return capital or make distributions and other similar payments with regard to its Equity Interests~~ to the ~~Lead Borrower~~ Company or to ~~other Restricted Subsidiaries~~ a Wholly-Owned Subsidiary of the ~~Lead Borrower which directly or indirectly own equity therein~~Company; (ii) any non-Wholly-Owned Subsidiary of the ~~Lead Borrower~~ Company may ~~declare and~~ pay cash Dividends to its ~~shareholders~~ shareholders, members or partners generally so long as the ~~Lead Borrower~~ Company or its ~~Restricted~~ respective Subsidiary which owns the ~~Equity Interests~~ equity interest or interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative ~~holding~~ holdings of ~~the Equity Interests~~ equity interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of ~~Equity Interests of~~ equity interests in such Subsidiary); provided, however, that this Section 7.11 shall not limit the redemption or repurchase of equity interests of a shareholder, member or partner of any non-Wholly-Owned Subsidiary of the Company if such redemption or repurchase is permitted pursuant to Section 7.10; (iii) so long as (x) no Specified Default or Event of Default then exists ~~at the time of the applicable Dividend, redemption or repurchase~~ or would exist immediately after giving effect ~~thereto~~thereto and (y) HHRI qualifies, or has taken all other actions necessary to qualify, as a “real estate investment trust” under the Code during any fiscal year of HHRI, the ~~Lead Borrower~~ Company may pay quarterly cash Dividends (which may be based on estimates) to HHRI and all other holders of OP Units generally when and to the extent necessary for HHRI to distribute, and HHRI may so distribute, cash Dividends to its shareholders generally in an aggregate amount not to exceed the greater of (I) the greatest of (A) 100% of Cash Available for Distribution for such fiscal year, (B) 100% of Taxable Income and (C) the minimum amount necessary for HHRI to maintain its tax status as a real estate investment trust and to satisfy the distributions required to be made by Notice 88-19 under the Code (or Treasury regulations issued pursuant thereto) by reason of HHRI making the election provided for therein and (II) at any time when, based upon the financial statements delivered pursuant to Section 6.11(a) or (b) and the Company’s estimation of the results of the current fiscal quarter, the Consolidated Interest Coverage Ratio is greater than 2.00:1:00, 85% of the Adjusted Funds From Operations for the current fiscal year; (iv) so long as no Specified Default or Event of Default then exists or would result therefrom, the Company may pay cash Dividends to Holdings to allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of such Parent Company from current or former members of management, employees, consultants, officers and directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by the Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may pay cash Dividends to Holdings HHRI so long as the proceeds ~~thereof~~ therefrom are promptly used by ~~Holdings (or subsequently paid to any other Parent Company)~~ HHRI to pay ~~expenses incurred by Holdings or~~ (x) any ~~other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities~~ Permitted Tax Payments at the time and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent ~~such salaries, bonuses~~ actually due and ~~other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries;~~ payable (~~D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties)~~ but without duplication of any ~~Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash~~ tax payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section ~~9.14; provided that (A~~7.11(a)(iii) ~~such dividend, distribution, loan or advance shall~~ above to satisfy the distribution required to be made ~~concurrently with~~ by Notice 88-19 under the ~~closing of such purchase~~ Code (or ~~other acquisition~~ Treasury regulations issued pursuant thereto)) and (By) ~~such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests)~~ any general corporate and ~~any~~ other overhead expenses and liabilities ~~assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (~~incurred by it to the extent ~~permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition~~not otherwise prohibited by this Agreement; (Gv) ~~any customary fees and expenses related to any unsuccessful equity offering by any Parent~~ so long as no Specified Default or Event of Default then exists or would result therefrom, the Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to ~~Holdings so long as~~ HHRI in an aggregate amount not to exceed $10,000,000 for the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date;Availability Period; and (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (xvi) the ~~Lead Borrower~~ Company may pay cash Dividends to ~~Holdings (who may subsequently pay cash Dividends to any other Parent Company)~~ HHRI so long as HHRI promptly thereafter uses the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such ~~common stock after the Closing Date~~Dividends to repurchase shares of its capital stock, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the ~~Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00~~Company may repurchase OP Units, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $5,000,000; (xv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each ~~Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the~~ case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as (x) no Specified Default or Event of Default then exits or would result therefrom, (y) the aggregate amount of all repurchases and redemptions made pursuant to this Section 7.11a)(v) in any fiscal year of HHRI does not exceed an amount equal to 1% of Adjusted Total Assets determined at the time ~~of, and after giving effect~~ of declaration of the Dividend (with any unused Roll Forward Amount from one fiscal year increasing the amount available to ~~such Dividend, no Event of Default shall have occurred and~~ be ~~continuing and (y~~paid as a Dividend under this Section 7.11(a)(vi) on in subsequent fiscal years). Dividends paid during a ~~Pro Forma Basis,~~ period when the ~~Consolidated Total Net~~ Leverage Ratio ~~does not exceed 3.25 to 1.00. In determining compliance with~~ is less than 6.00:1.00 shall, in the event that the Leverage Ratio subsequently exceeds 6.00:1.00, be counted against the baskets provided for in this Section ~~10.03~~ 7.11(a) (~~and in determining amounts paid~~ as ~~Dividends pursuant hereto~~ applicable) for purposes of determining basket availability only. b) At any time that the ~~definition~~ Leverage Ratio is less than 6.00:1.00, the Company and the Guarantors will not, and will not permit any of ~~Consolidated EBITDA and Consolidated Net Income)~~their Restricted Subsidiaries to, ~~amounts loaned~~ directly or ~~advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash~~ indirectly, authorize, declare, or pay any Dividends ~~paid to Holdings to~~ that would constitute a Restricted Payment that is prohibited under the ~~extent provided in said Section 10.05(vi)~~Governing Senior Note Indenture.

Appears in 2 contracts

Sources: Credit Agreement (Host Hotels & Resorts, Inc.), Credit Agreement (Host Hotels & Resorts, Inc.)

Appears in 2 contracts

Sources: Credit Agreement (Navisite Inc), Credit Agreement (Navisite Inc)

Dividends. ~~The Lead Borrower~~ No Credit Party will, or will ~~not, and will not~~ permit any of its ~~Restricted~~ Subsidiaries to, ~~authorize, declare or~~ pay any Dividends ~~with respect to the Lead Borrower or any of its Restricted Subsidiaries,~~ except that: (i) ~~any Restricted Subsidiary of the Lead Borrower~~ Aleris may declare and pay ~~Dividends or return capital~~ dividends or make other distributions ~~and other similar payments~~ with ~~regard~~ respect to its Equity Interests ~~to the Lead Borrower or to other Restricted Subsidiaries~~ payable solely in additional shares of ~~the Lead Borrower which directly or indirectly own equity therein~~its Equity Interests; provided, that such Equity Interests are Qualified Equity Interests; (ii) ~~any non-Wholly-Owned Subsidiary~~ Subsidiaries of ~~the Lead Borrower~~ Aleris may declare and pay ~~cash Dividends~~ dividends or make other distributions ratably with respect to ~~its shareholders generally so long as the Lead Borrower or its Restricted Subsidiary which owns the~~ their Equity Interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary)Interests; (iii) ~~so long as no Default~~ Aleris and its Subsidiaries may, or ~~Event of Default exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, the Lead Borrower~~ may pay ~~cash~~ Dividends to Holdings ~~to allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase~~the proceeds of which are used to, ~~contemporaneously with such Dividend,~~ (i) repurchase Equity Interests of ~~such Parent Company from current or former members of management, employees, consultants, officers and directors~~ Aleris (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by the Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any ~~of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors~~ direct or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion indirect parent thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of ~~warrants~~stock options (including for purposes of paying tax withholding applicable to stock option exercises) granted to officers, ~~options~~ directors, consultants or ~~other securities convertible into~~ employees of Aleris, its Subsidiaries or ~~exchangeable~~ any direct or indirect parent thereof and (ii) redeem, repurchase or otherwise acquire for value, outstanding Equity Interests of ~~the Lead Borrower~~ Aleris, or any ~~Parent Company~~direct or indirect parent thereof, (including related stock appreciation rights or similar securities) following the death, disability, retirement or termination of employment of officers, directors, consultants or employees of Aleris, any of its Subsidiaries, or any direct or indirect parent thereof or under the terms of any plan or any other agreement under which such Equity Interests or related rights were issued, in each case so long as (x) the aggregate amount paid by Aleris in cash in respect of all such redemptions or purchases pursuant to preceding clauses (i) and (ii) shall not exceed $5,000,000 in respect of all such redemptions, purchases and payments made in any Fiscal Year (plus the amount of net proceeds (x) received by Aleris during such Fiscal Year from sales of Equity Interests of Aleris or, to the extent contributed to Aleris, any of Aleris’ direct or indirect parents, to directors, consultants, officers or employees of Aleris, any of its Subsidiaries or any direct or indirect parent of Aleris in connection with permitted employee compensation and incentive arrangements and (y) of any key-man life insurance policies received during such Fiscal Year); provided that to the extent that any portion of such annual limit on such redemptions, purchases and payments is not utilized in any Fiscal Year, such unused portion will increase the annual limit applicable to the immediately subsequent Fiscal Year; (Fiv) Aleris and its Subsidiaries may make non-cash repurchases of Equity Interests deemed to occur upon the ~~purchase~~ exercise of stock options or ~~other acquisition~~ warrants if such Equity Interests represent a portion of the exercise price of such options or warrants; (v) [Reserved]; (vi) to the extent constituting Dividends, Aleris and its Subsidiaries may enter into and consummate transactions expressly permitted by any ~~parent~~ provision of ~~the Lead Borrower of all~~ Sections 10.02 or ~~substantially all of the property~~ 10.06(xi), (xii) and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition (xiv); (vii) Aleris and its Subsidiaries may pay Dividends to Holdings to finance investments permitted ~~to be made~~ pursuant to Section ~~9.14~~10.05; ~~provided~~ provided, that (A) any such ~~dividend, distribution, loan or advance~~ Dividend shall be made substantially concurrently with the closing of such ~~purchase or other acquisition~~ investment and (B) ~~such parent~~ Holdings shall, immediately following the closing thereof, cause (1i) all property acquired (whether assets or Equity Interests) ~~and any liabilities assumed~~ to be contributed to ~~the Lead Borrower~~ Aleris or ~~any Restricted Subsidiary~~ its Subsidiaries or (2ii) the merger (to the extent permitted in Section 10.02) ~~into the Lead Borrower or any Restricted Subsidiary~~ of the Person formed or acquired into Aleris or its Subsidiaries in order to consummate such ~~purchaser or other acquisition~~investment; (Gviii) ~~any customary fees~~ Aleris may pay Dividends (including in cash), so long as (a) the Distribution Conditions are satisfied (both before and ~~expenses related~~ after giving effect to any ~~unsuccessful equity offering~~ such Dividends), or (b) such Dividends are made with the proceeds of any substantially contemporaneous issuance of Qualified Equity Interests by Aleris or any ~~Parent Company directly attributable~~ direct or indirect parent of Aleris to the ~~operations of the Lead Borrower and its Restricted Subsidiaries~~extent such proceeds shall have actually been received by Aleris; (~~vii~~ix) ~~reasonable~~ Aleris and ~~customary indemnities~~ its Subsidiaries may pay Dividends to ~~directors~~Holdings and any other direct or indirect parent of Aleris (x) in an amount (together with loans or advances made pursuant to Section 10.05(xix)) not to exceed $1,500,000 in any Fiscal Year, ~~officers~~ to the extent necessary to pay (or allow any direct or indirect parent of Holdings to pay) general corporate and ~~employees of~~ overhead expenses incurred by Holdings (or any ~~Parent Company~~ direct or indirect parent thereof) in the ordinary course of business, to plus the ~~extent reasonably attributable to the ownership~~ amount of any reasonable and customary indemnification claims made by any director or ~~operation~~ officer of ~~the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by~~ Holdings (or ~~subsequently paid~~ any direct or indirect parent thereof), (y) to pay franchise taxes and other fees, taxes and expenses required to maintain its (or any ~~other Parent Company~~of its direct or indirect parents’) ~~for payment~~ corporate existence and (z) in an amount necessary to pay the tax liabilities of Holdings (xor any such direct or indirect parent) ~~obligations under~~ attributable to (or arising as a result of) the operations of Aleris and its Subsidiaries; provided, however, that in the case of clause (z), the amount of such dividends shall not exceed the amount that Aleris and its Subsidiaries would be required to pay in respect of ~~director~~ federal, state and ~~officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower~~ local taxes and ~~its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix)~~ any ~~Dividend used to fund the Transaction, including Transaction Costs~~ other taxes were Aleris and the ~~Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant~~ Subsidiaries to ~~the Acquisition Agreement;~~pay such taxes as stand alone taxpayers; and (x) ~~the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company)~~ so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default ~~shall have occurred and be continuing; (xiv) purchases of minority interests~~ is in ~~non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases~~existence or would exist immediately after giving effect thereto, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $5,000,000; (xv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower Aleris may pay additional Dividends in an ~~aggregate~~ amount ~~since the Closing Date~~ not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of 30,000,000 during any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as (x) at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi)calendar year.

Appears in 2 contracts

Sources: Credit Agreement (Aleris Ohio Management, Inc.), Credit Agreement (Aleris International, Inc.)

Dividends. ~~The Lead Borrower will not, and will not permit any of its Restricted Subsidiaries to, authorize~~Authorize, declare or ~~pay~~ pay, directly or indirectly, any Dividends with respect to ~~the Lead Borrower or~~ any ~~of its Restricted Subsidiaries~~Company, except that: (a) any Subsidiary of Borrower (i) may pay cash Dividends to Borrower or any ~~Restricted~~ Wholly Owned Subsidiary of ~~the Lead~~ Borrower ~~may pay Dividends or return capital or make distributions~~ and ~~other similar payments with regard to its Equity Interests to the Lead Borrower or to other Restricted Subsidiaries of the Lead Borrower which directly or indirectly own equity therein;~~ (ii) ~~any non-Wholly-~~if such Subsidiary is not a Wholly Owned Subsidiary of ~~the Lead Borrower~~ Borrower, may ~~declare and~~ pay cash Dividends to its shareholders generally so long as ~~the Lead~~ Borrower or its ~~Restricted~~ Subsidiary which owns the ~~Equity Interests~~ equity interest or interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative ~~holding~~ holdings of ~~the Equity Interests~~ equity interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of ~~Equity Interests of~~ equity interests in such Subsidiary); (~~iii~~b) so long as no Default ~~or Event of Default~~ exists ~~at the time of the applicable Dividend, redemption or repurchase~~ or would ~~exist immediately after giving effect thereto~~result therefrom, ~~the Lead~~ Borrower may pay ~~cash~~ Dividends to ~~Holdings~~ Parent in order to ~~allow Holdings~~ enable Parent to ~~pay cash dividends~~ repurchase outstanding shares of its capital stock (or options to ~~any other Parent Company to redeem~~ purchase such capital stock) following the death, disability, retirement or ~~repurchase, contemporaneously with such Dividend, Equity Interests~~ termination of ~~such Parent Company from current or former members~~ employment of ~~management,~~ employees, ~~consultants,~~ officers ~~and~~ or directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by the Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased shall not (net of any ~~cash proceeds received~~ Company or upon the exercise by ~~Holdings (but in no event from~~ any ~~Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with~~ such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants person of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including put” right in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year such capital stock (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(viioptions); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of ~~such purchases~~Dividends paid by Borrower pursuant to this paragraph (b) shall not exceed an aggregate amount of $3.0 million (exclusive of any amounts repaid to Borrower concurrently therewith in respect of loans made pursuant to Section 6.03(j); (c) Borrower may pay cash Dividends to Parent, ~~when added~~ so long as all proceeds thereof are promptly used by Parent to pay its franchise taxes and operating expenses incurred in the ordinary course of business and other corporate overhead costs and expenses (including legal and accounting expenses and similar expenses and customary fees to non-officer directors of Parent); provided that the aggregate amount of ~~Investments~~ Dividends paid to Parent pursuant to ~~Section 10.05(xvii),~~ this clause (c) shall not exceed $~~5,000,000~~1.0 million in any fiscal year of Parent; (xvd) ~~the declaration and payment of dividends~~ Borrower or ~~the payment of other distributions by the Lead Borrower~~ any Subsidiary may pay cash Dividends to Parent in an ~~aggregate~~ amount ~~since~~ not in excess of the ~~Closing Date not~~ federal and state (in such states that permit consolidated or combined tax returns) income tax liability that Borrower and the Subsidiaries would have been liable for if any of the Companies had filed their taxes on a stand-alone basis, for the purpose of paying such taxes; provided that such payments shall be made by Parent no earlier than five days prior to ~~exceed $35,000,000~~the date on which Parent is required to make its payments to the Internal Revenue Service, as applicable; (~~xvi~~e) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may ~~make payments with~~ pay Dividends to Parent of capital stock of Parent to the ~~cash proceeds contributed~~ extent such capital stock of Parent is acquired by Borrower as a result of a foreclosure action following a default on an advance, loan and/or other extension of credit permitted pursuant to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section ~~10.03~~6.03(j); and (~~xix~~f) any Dividends, so long as (x) at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Borrower may pay Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent ~~provided in said~~ permitted by Section ~~10.05(vi~~6.06(h).

Appears in 2 contracts

Sources: Credit Agreement (Cpi International, Inc.), Credit Agreement (Cpi International, Inc.)

Dividends. ~~The Lead Borrower~~ At any time that the Leverage Ratio equals or exceeds 6.00:1.00, the Company will not, and will not permit any of its ~~Restricted~~ Subsidiaries to, authorize, declare or pay any Dividends with respect to the ~~Lead Borrower~~ Company or any of its ~~Restricted~~ Subsidiaries, except that: (ia) any ~~Restricted~~ Subsidiary of the ~~Lead Borrower~~ Company may pay cash Dividends ~~or return capital or make distributions and other similar payments with regard to its Equity Interests~~ to the ~~Lead Borrower~~ Company or to ~~other Restricted Subsidiaries~~ a Wholly-Owned Subsidiary of the ~~Lead Borrower which directly or indirectly own equity therein~~Company; (iib) any non-Wholly-Owned Subsidiary of the ~~Lead Borrower~~ Company may ~~declare and~~ pay cash Dividends to its ~~shareholders~~ shareholders, members or partners generally so long as the ~~Lead Borrower~~ Company or its ~~Restricted~~ respective Subsidiary which owns the ~~Equity Interests~~ equity interest or interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative ~~holding~~ holdings of ~~the Equity Interests~~ equity interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of ~~Equity Interests of~~ equity interests in such Subsidiary); provided, however, that this Section 7.11 shall not limit the redemption or repurchase of equity interests of a shareholder, member or partner of any non-Wholly-Owned Subsidiary of the Company if such redemption or repurchase is permitted pursuant to Section 7.10; (~~iii~~c) so long as (x) no Specified Default or Event of Default then exists at or would exist immediately after giving effect thereto and (y) HHRI qualifies, or has taken all other actions necessary to qualify, as a “real estate investment trust” under the ~~time~~ Code during any fiscal year of HHRI, the Company may pay quarterly cash Dividends (which may be based on estimates) to HHRI and all other holders of OP Units generally when and to the extent necessary for HHRI to distribute, and HHRI may so distribute, cash Dividends to its shareholders generally in an aggregate amount not to exceed the greater of (I) the greatest of (A) 100% of Cash Available for Distribution for such fiscal year, (B) 100% of Taxable Income, (C) the minimum amount necessary for HHRI to maintain its tax status as a real estate investment trust and to satisfy the distributions required to be made pursuant to Treasury regulations issued under Section 337(d) of the ~~applicable Dividend~~Code by reason of HHRI making the election provided for therein and (D) the amount necessary for HHRI to avoid income or excise tax under the Code and (II) at any time when, ~~redemption~~ based upon the financial statements delivered pursuant to Section 6.11(a) or ~~repurchase~~ (b) and the Company’s estimation of the results of the current fiscal quarter, the Consolidated Interest Coverage Ratio is greater than 2.00:1:00, 85% of the Adjusted Funds From Operations for the current fiscal year; provided, however, that notwithstanding the existence of an Event of Default or the occurrence of an Event of Default immediately after giving effect thereto, the amounts described in clause (C) above may be paid so long as no Event of Default under Section 8.01(a) or Section 8.01(f) then exists or would exist immediately after giving effect thereto, ; (d) the ~~Lead Borrower~~ Company may pay cash Dividends to Holdings to allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of such Parent Company from current or former members of management, employees, consultants, officers and directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by the Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may pay cash Dividends to Holdings HHRI so long as the proceeds ~~thereof~~ therefrom are promptly used by ~~Holdings (or subsequently paid to any other Parent Company)~~ HHRI to pay ~~expenses incurred by Holdings or~~ (x) any ~~other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities~~ Permitted Tax Payments at the time and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent ~~such salaries, bonuses~~ actually due and ~~other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries;~~ payable (~~D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties)~~ but without duplication of any ~~Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash~~ tax payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section ~~9.14; provided that (A~~7.11(c) ~~such dividend, distribution, loan or advance shall~~ above to satisfy the distribution required to be made ~~concurrently with~~ pursuant to Treasury regulations issued under Section 337(d) of the ~~closing of such purchase or other acquisition~~ Code) and (By) ~~such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests)~~ any general corporate and ~~any~~ other overhead expenses and liabilities ~~assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (~~incurred by it to the extent ~~permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition~~not otherwise prohibited by this Agreement; (Ge) ~~any customary fees and expenses related to any unsuccessful equity offering by any Parent~~ so long as no Specified Default or Event of Default then exists or would result therefrom, the Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to ~~Holdings so long as~~ HHRI in an aggregate amount not to exceed $10,000,000 for the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date;Availability Period; and (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (xf) the ~~Lead Borrower~~ Company may pay cash Dividends to ~~Holdings (who may subsequently pay cash Dividends to any other Parent Company)~~ HHRI so long as HHRI promptly thereafter uses the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such ~~common stock after the Closing Date~~Dividends to repurchase shares of its capital stock, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the ~~Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00~~Company may repurchase OP Units, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $5,000,000; (xv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each ~~Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the~~ case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as (x) no Specified Default or Event of Default then exits or would result therefrom, (y) the aggregate amount of all repurchases and redemptions made pursuant to this Section 7.11(f) in any fiscal year of HHRI does not exceed an amount equal to 1% of Adjusted Total Assets determined at the time ~~of, and after giving effect~~ of declaration of the Dividend (with any unused Roll Forward Amount from one fiscal year increasing the amount available to ~~such Dividend, no Event of Default shall have occurred and~~ be ~~continuing and (y~~paid as a Dividend under this Section 7.11(f) on in subsequent fiscal years). Dividends paid during a ~~Pro Forma Basis,~~ period when the ~~Consolidated Total Net~~ Leverage Ratio ~~does not exceed 3.25 to 1.00. In determining compliance with~~ is less than 6.00:1.00 shall, in the event that the Leverage Ratio subsequently exceeds 6.00:1.00, be counted against the baskets provided for in this Section ~~10.03~~ 7.11 (~~and in determining amounts paid~~ as ~~Dividends pursuant hereto~~ applicable) for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi)determining basket availability only.

Appears in 2 contracts

Sources: Credit Agreement (Host Hotels & Resorts L.P.), Credit Agreement (Host Hotels & Resorts, Inc.)

Dividends. ~~The Lead Borrower will not, and will not permit any of its Restricted Subsidiaries to, authorize, declare~~ Declare or pay such dividend (other than --------- dividends payable solely in (i) common stock of the Person making such dividend or (ii) the same class of Equity Ownership Interest of the Person making such dividend on which such dividend is being declared or paid) on, or make any ~~Dividends with respect to~~ payment on account of, or set apart assets for a sinking or other analogous fund for, the ~~Lead~~ purchase, redemption, defeasance, retirement or other acquisition of, any Equity Ownership Interest of the Borrower or any Subsidiary, whether now or hereafter outstanding, or make any other distribution in respect thereof, either directly or indirectly, whether in cash or assets, or in obligations of the Borrower or any Subsidiary or enter into or incur any Derivatives Obligations or other transaction with any financial institution, commodities or stock exchange (a "Derivatives Counterparty") obligating it to make payments to such Derivatives Counterparty as a result of any change in market value of its ~~Restricted Subsidiaries~~Equity Ownership Interests (collectively, "Dividends"), except that: (ia) any Subsidiary may make Restricted ~~Subsidiary of the Lead Borrower may pay Dividends or return capital or make distributions and other similar payments with regard to its Equity Interests~~ Payments to the ~~Lead~~ Borrower or ~~to other Restricted Subsidiaries of the Lead Borrower which directly or indirectly own equity therein~~any Subsidiary Guarantor; (b) so long as no Default under Sections 7.01 and 7.05 or Event of Default exists or would result therefrom, the Borrower may (i) pay regularly accruing cash Dividends on the New Preferred Stock not to exceed $29,250,000 per fiscal year of the Borrower, with such Dividends to be paid in accordance with the terms of the certificate of designation therefor, (ii) redeem up to $300 million of New Preferred Stock at the stated amount thereof plus accrued but unpaid dividends thereon with the excess proceeds of a rights offering of additional shares of New Preferred Stock, plus pay an associated premium of up to 2%, and (iii) redeem New Preferred Stock with the proceeds of Asset Dispositions of Arcadian Hotels in accordance with the requirements of the Securities Purchase Agreement; (c) any non-Wholly-Owned Subsidiary of the ~~Lead~~ Borrower may ~~declare and~~ pay cash Dividends to the holders of its ~~shareholders generally~~ Equity Ownership Interests generally, so long as the ~~Lead~~ Borrower or its ~~Restricted~~ respective Subsidiary which owns the Equity ~~Interests~~ Ownership Interest in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative ~~holding~~ economic holdings of ~~the Equity Interests~~ equity interest in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of ~~Equity Interests~~ equity interests in such Subsidiary or the terms of ~~such Subsidiary~~any agreements applicable thereto); (~~iii~~d) so long as no Default or Event of Default exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, the Lead Borrower may pay cash Dividends to Holdings to allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of such Parent Company from current or former members of management, employees, consultants, officers and directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by the Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing~~; (xiv) purchases~~ , the Borrower may purchase the Borrower's common stock or common stock options from present or former officers or employees of ~~minority interests in non-Wholly-Owned Subsidiaries by~~ the ~~Lead~~ Borrower ~~and~~ or any Subsidiary upon the ~~Guarantors; provided~~ death, disability or termination of employment of such officer or employee, provided, that the aggregate amount -------- of ~~such purchases, when added to~~ payments under this paragraph (d) after the ~~aggregate amount~~ date hereof (net of ~~Investments pursuant to Section 10.05(xvii),~~ any proceeds received by the Borrower after the date hereof in connection with resales of any common stock or common stock options so purchased) shall not exceed $~~5,000,000;~~1,000,000; and (xve) ~~the declaration~~ Patriot OP and ~~payment of dividends or the payment of other distributions by the Lead Borrower~~ Wyndham Partnership may redeem outstanding OP Units, provided that any such redemptions to be made in ~~an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary~~ cash may ~~declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person~~ only be made so long as ~~in the case of dividend~~ no Default under Sections 7.01 or ~~other distribution by a Restricted Subsidiary, the Lead Borrower~~ 7.05 or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default ~~shall have occurred and be continuing~~ exists or would result therefrom~~; provided that~~ . Notwithstanding the ~~amount~~ foregoing, any payments made in respect of ~~any such cash proceeds that are utilized for any Dividend under this clause (iii) will~~ indemnity obligations, purchase price adjustments and other similar payments pursuant to the Securities Purchase Agreement shall not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as (x) at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi).

Appears in 2 contracts

Sources: Increasing Rate Note Purchase and Loan Agreement (Wyndham International Inc), Credit Agreement (Wyndham International Inc)

Dividends. The ~~Lead Borrower~~ Borrowers will not, and will not permit any of ~~its~~ the Restricted Subsidiaries to, authorize, declare or pay any Dividends with respect to the Lead Borrower or any of its Restricted Subsidiaries, except that: (i) any Restricted Subsidiary of the Lead Borrower may authorize, declare and pay Dividends or return capital or make distributions and other similar payments with regard to its Equity Interests to the Lead Borrower or to other Restricted Subsidiaries of the Lead Borrower which directly or indirectly own equity therein; (ii) any non-Wholly-Owned Subsidiary of the Lead Borrower may authorize, declare and pay cash Dividends to its shareholders generally so long as the Lead Borrower or its Restricted Subsidiary which owns the Equity Interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary); (iii) so long as no ~~Default or~~ Event of Default exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, the Lead Borrower may authorize, declare and pay cash Dividends to Holdings to allow Holdings to pay cash dividends or make cash distributions to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of Holdings or such other Parent Company from ~~current or former members of~~ management, employees~~, consultants~~, officers and directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by the Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings or such other Parent Company in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests ~~(other than to the extent included in the Available Amount)~~ and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, (x) the greater of $~~10,000,000~~ 35,000,000 and 6.25% of Consolidated EBITDA of the Lead Borrower and its Restricted Subsidiaries for the most recently ended Test Period (measured at the time of such Dividend) or (y) subsequent to the consummation of any Initial Public Offering of common stock or other comparable equity interests of the Lead Borrower or any direct or indirect parent of the Lead Borrower, the greater of $55,000,000 and 10.0% of Consolidated EBITDA of the Lead Borrower and its Restricted Subsidiaries for the most recently ended Test Period (measured at the time of such Dividend) (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from ~~current or former~~ members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of Holdings or any other Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may authorize, declare and pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may authorize, declare and pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with ~~applicable laws~~Requirements of Law, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may authorize, declare and pay cash ~~dividends~~ Dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their ~~existence~~existence to the extent such Taxes, fees and expenses are reasonably attributable to the operations of Holdings, the Lead Borrower and its Restricted Subsidiaries; (B) with respect to any taxable ~~year (or portion thereof)~~ period ending after the Closing Date ~~with respect to~~ for which the Lead Borrower ~~(a) is treated as a corporation for U.S. federal, state,~~ and/or ~~local income tax purposes and (b) is a member~~ any of its Subsidiaries are members of a consolidated, combined or similar income tax group ~~(a “Tax Group”)~~ for U.S. federal and/or applicable state, local or foreign income or similar tax purposes of which ~~any Parent Company~~ a direct or ~~other entity~~ indirect parent of the Lead Borrower is the common parent, the portion of any such U.S. federal, ~~state~~ state, local and/or foreign income and ~~local income Taxes~~ similar taxes (including any alternative minimum ~~Taxes~~taxes) ~~(or franchise and similar Taxes imposed in lieu~~ of such ~~minimum Taxes)~~ tax group that ~~are~~ is attributable to the taxable income of the Lead Borrower and its applicable Restricted Subsidiaries and, to the extent of the amount actually received for such purpose from its applicable Unrestricted Subsidiaries, in amounts required to pay any such taxes that are attributable to the taxable income of such Unrestricted Subsidiaries; provided that ~~for each taxable period,~~ the aggregate amount of such payments ~~made in~~ with respect to such period (regardless of ~~such taxable period in the aggregate~~ when paid) shall not exceed the aggregate amount of such Taxes that the Lead Borrower ~~and~~ and/or its applicable Restricted Subsidiaries (and, subject to the limitation described above, any applicable Unrestricted Subsidiaries of the Lead Borrower) would have been required to pay as with respect to such period were such entities stand-alone corporate taxpayers or a stand-alone ~~Tax Group; provided, further, that~~ corporate tax group for all applicable taxable periods ending after the ~~permitted payment pursuant~~ date hereof taking into account any applicable limitations on the ability to ~~this clause (B) with respect to~~ utilize net operating loss carryforwards and similar tax attributes under the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar TaxesCode; (C) payments under any domination and/or profit and loss pooling agreements; (D) customary salary, bonus and other ~~compensation and~~ benefits payable to ~~current and former officers,~~ directors, ~~consultants~~ officers and employees of any Parent Company to the extent such salaries, bonuses and other ~~compensation and~~ benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (DE) general corporate operating and overhead ~~costs~~ costs, fees and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such ~~costs~~ costs, fees and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (EF) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (FG) the purchase or other acquisition by Holdings or any ~~parent~~ other Parent Company of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such ~~parent~~ Parent Company shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger or amalgamation (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such ~~purchaser~~ purchase or other acquisition;; and (GH) any customary fees and expenses related to any successful or unsuccessful debt or equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) the Lead Borrower and its Restricted Subsidiaries may give reasonable and customary indemnities to directors, officers and employees of Holdings or any other Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may authorize, declare and pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory ~~Agreement (as in effect on the Closing Date~~Agreement; (ix) any Dividend used (x) to fund the Transaction, including Transaction ~~Costs and the Special Dividend~~Costs, and (y) in order to satisfy deferred purchase price, earn-outs and contingent payments in respect of any ~~Dividend from proceeds received~~ amounts due and owing as provided for in ~~connection with any working capital adjustment pursuant to~~ the Acquisition Agreement; (x) the Lead Borrower may authorize, declare and pay cash Dividends to Holdings (who may subsequently authorize, declare and pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v), 10.06(vii) and ~~10.06(vii~~10.06(xii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or ~~the settlement or vesting of other~~ similar equity incentive awards; (xii) a Dividend (including to any Parent ~~Company~~ Company) to fund a payment of dividends on ~~such~~ the Lead Borrower’s or any Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, not to exceed, in any fiscal year, the sum of ~~up to 6~~(x) 6.0% ~~per annum~~ of the net cash proceeds received by or contributed to the capital of the Lead Borrower from any such Initial Public ~~Offering~~Offering and (y) 7.0% of the Lead Borrower’s (or any Parent Company’s) Market Capitalization; (xiii) the Lead Borrower may pay any Dividends so long as the Distribution Conditions are satisfied on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and Basis immediately after giving effect to such ~~Dividend, no Event of Default shall have occurred and be continuing~~Dividends; (xiv) purchases of minority interests in ~~non-~~Restricted Subsidiaries that are not Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed the greater of $~~5,000,000~~27,500,000 and 5.0% of Consolidated EBITDA of the Lead Borrower and its Restricted Subsidiaries for the most recently ended Test Period (measured at the time of such Dividend); (xv) the authorization, declaration and payment of ~~dividends~~ Dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing ~~Date~~ Date, not to exceed the greater of $~~35,000,000~~250,000,000 and 50.0% of Consolidated EBITDA of the Lead Borrower and its Restricted Subsidiaries for the most recently ended Test Period (measured at the time of such Dividend); (xvi) the Lead Borrower and each Restricted Subsidiary may authorize, declare and make ~~dividend~~ Dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of ~~dividend~~ Dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may ~~make payments~~ authorize, declare and pay Dividends with the cash proceeds contributed to its common equity (including from the net cash proceeds of any equity issuance by any Parent Company), so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may authorize, declare and pay ~~dividends and distributions~~ Dividends within 60 90 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; (xix) so long as no Event of Default under Section 11.01 or 11.05 has occurred and is continuing or would result therefrom, Lead Borrower and any Restricted Subsidiary may authorize, declare and pay Dividends with any Leverage Excess Proceeds (as defined in the Cash Flow Credit Agreement as in effect on the Closing Date) promptly upon the receipt thereof; and (~~xix~~xx) any ~~Dividends, so long~~ payment that is intended to prevent any Indebtedness of the Lead Borrower from being treated as (xan “applicable high yield discount obligation” within the meaning of Section 163(i)(1) at of the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00Code. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the ~~definition~~ definitions of “Consolidated ~~EBITDA and~~ EBITDA”, “Consolidated Net Income” and “Consolidated Fixed Charge Coverage Ratio”), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) ~~shall~~ shall, to the extent such loan or advance remains unpaid, be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi).

Appears in 2 contracts

Sources: Revolving Credit Agreement (McGraw Hill, Inc.), Revolving Credit Agreement (McGraw Hill, Inc.)

Dividends. The ~~Lead Borrower~~ Parent will not, ~~and~~ nor will ~~not~~ the Parent permit any of its ~~Restricted~~ Subsidiaries to~~, authorize~~, declare or pay any Dividends with respect to the ~~Lead Borrower~~ Parent or any of its ~~Restricted~~ Subsidiaries, except ~~that:~~ that (i) any ~~Restricted~~ Subsidiary of the ~~Lead~~ Borrower may pay Dividends ~~or return capital or make distributions and other similar payments with regard to its Equity Interests~~ to the ~~Lead~~ Borrower or ~~to other Restricted Subsidiaries of the Lead Borrower which directly or indirectly own equity therein; (ii)~~ any ~~non-~~Wholly-Owned Subsidiary of the ~~Lead~~ Borrower, (ii) the Parent may pay regularly accruing Dividends with respect to Seller Preferred Stock through the issuance of additional shares of Seller Preferred Stock (but not in cash) in accordance with the terms of the documentation governing the same, (iii) the Parent may pay regularly accruing Dividends with respect to the PIK Preferred Stock (whether outstanding on the Third Restatement Effective Date or issued thereafter in accordance with the requirements of this clause (iii)) through the issuance of additional shares of PIK Preferred Stock (or, alternatively, through an increase in the aggregate liquidation preference of the outstanding PIK Preferred Stock by the amount of the accumulated dividends thereunder) (but not in cash) in accordance with the terms of the PIK Preferred Stock Documents, (iv) the Borrower may ~~declare~~ pay cash Dividends to the Parent, so long as (x) there shall exist no Default or Event of Default (both before and immediately after giving effect to the payment thereof), (y) the proceeds thereof are promptly used by Parent to pay operating expenses and other similar corporate overhead costs and expenses (but excluding in any event any costs, expenses or losses relating to the Development Assets) and (z) the aggregate amount of Dividends paid by the Borrower in any fiscal year of Parent pursuant to this clause (iv) does not exceed $100,000, (v) the Borrower may pay cash Dividends to the Parent in the amounts and at the times of any payment by the Parent in respect of taxes, provided that (x) the amount of cash Dividends paid pursuant to this clause (v) to enable the Parent to pay federal income taxes at any time shall not exceed the lesser of (A) the amount of such federal income taxes owing by the Parent at such time for the respective period and (B) the amount of such federal income taxes that would be owing by the Borrower and its Subsidiaries on a consolidated basis for such period if determined without regard to the Parent's ownership of the Borrower and (y) any refunds shall promptly be returned by the Parent to the Borrower and (vi) any Subsidiary of the Borrower that is not a Wholly-Owned Subsidiary may pay cash Dividends to its shareholders ~~generally~~ or partners generally, so long as the ~~Lead~~ Borrower or its ~~Restricted~~ respective Subsidiary which owns the ~~Equity Interests~~ equity interest or interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative ~~holding~~ holdings of ~~the Equity Interests~~ equity interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of ~~Equity Interests of~~ equity interests in such ~~Subsidiary); (iii) so long as no Default~~ Subsidiary or ~~Event of Default exists at~~ the time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, the Lead Borrower may pay cash Dividends to Holdings to allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of such Parent Company from current or former members of management, employees, consultants, officers and directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by the Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased shall not (net terms of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with agreements applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $5,000,000; (xv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as (x) at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vithereto).

Appears in 2 contracts

Sources: Credit Agreement (Hq Global Holdings Inc), Credit Agreement (Frontline Capital Group)

Dividends. ~~The Lead Borrower will~~ Holdings shall not, and ~~will~~ shall not permit any of its ~~Restricted~~ Subsidiaries to, authorize, declare or pay any Dividends with respect to ~~the Lead Borrower~~ Holdings or any of its ~~Restricted~~ Subsidiaries, except that: (i) any ~~Restricted~~ Subsidiary of the ~~Lead~~ Borrower (x) may pay cash Dividends ~~or return capital or make distributions and other similar payments with regard to its Equity Interests~~ to the ~~Lead~~ Borrower or ~~to other Restricted Subsidiaries of the Lead Borrower which directly or indirectly own equity therein; (ii)~~ any ~~non-~~Wholly-Owned Subsidiary of the ~~Lead~~ Borrower and (y) if such Subsidiary is not a Wholly-Owned Subsidiary, may ~~declare and~~ pay cash Dividends to its shareholders generally so long as the ~~Lead~~ Borrower or its ~~Restricted~~ respective Subsidiary which owns the ~~Equity Interests~~ equity interest or interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative ~~holding~~ holdings of ~~the Equity Interests~~ equity interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of ~~Equity Interests of~~ equity interests in such Subsidiary); (~~iii~~ii) so long as there shall exist no Default or Event of Default ~~exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately~~ (both before and after giving effect ~~thereto~~to the payment thereof), Holdings may repurchase outstanding shares of its common stock (or options to purchase such common stock) following the ~~Lead Borrower may pay cash Dividends~~ death, disability, retirement or termination of employment of employees, officers or directors of Holdings or any of its Subsidiaries, provided that (x) all amounts used to effect such repurchases are obtained by Holdings from a substantially concurrent issuance of its common stock (or options to ~~allow Holdings~~ purchase such common stock) to ~~pay cash dividends to any~~ other ~~Parent Company to redeem or repurchase~~employees, ~~contemporaneously with such Dividend, Equity Interests of such Parent Company from current or former~~ members of management, ~~employees~~executive officers or directors of Holdings or any of its Subsidiaries or (y) to the extent the proceeds used to effect any repurchase pursuant to this clause (y) are not obtained as described in preceding clause (x), ~~consultants, officers and directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that (A)~~ the aggregate amount of Dividends ~~made~~ paid by ~~the Lead Borrower to~~ Holdings pursuant to this clause (~~iii~~ii) (exclusive of amounts paid as described pursuant to preceding clause (x)~~, and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased~~ ) shall not ~~(net of any cash proceeds received by Holdings (but~~ exceed $1,000,000 in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of Holdings, provided that, in the ~~Lead Borrower, $10,000,000 (provided~~ event that the maximum amount ~~of cash Dividends~~ which is permitted to ~~be, but not, paid~~ be expended in respect of Dividends during any fiscal year pursuant to this clause (~~iii~~ii)(y) ~~shall increase~~ is not fully expended during such fiscal year, the maximum amount ~~of cash Dividends permitted to~~ which may be ~~paid in~~ expended during the immediately succeeding ~~two~~ fiscal ~~years~~ year pursuant to this clause (~~iii)); (B~~ii)(y) ~~such amount in any calendar year may~~ shall be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such ~~sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause~~ unutilized amount; (iii) ~~will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of~~ the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may pay cash Dividends to Holdings for the purpose of paying, so long as ~~the~~ all proceeds thereof are promptly used by Holdings ~~(or subsequently paid~~ to ~~any other Parent Company) to pay~~ pay, its operating expenses incurred in the ordinary course of business and other corporate overhead costs and expenses (including, without limitation, legal and accounting expenses and similar expenses), provided that the aggregate amount of Dividends paid by Holdings or pursuant to this clause (iii) shall not exceed $500,000 in any ~~other Parent Company in connection with offerings, registrations, or exchange listings~~ fiscal year of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completedHoldings; (viv) the ~~Lead~~ Borrower may pay cash Dividends to Holdings for the purpose of paying, so long as ~~the~~ all proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, ~~in each case without duplication: (A)~~ franchise ~~Taxes (~~taxes and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income ~~Taxes (including minimum Taxes) (or franchise~~ taxes and ~~similar Taxes imposed in lieu of such minimum Taxes)~~ interest and penalties with respect thereto, if any, payable by Holdings, provided that ~~are attributable~~ any refund shall be promptly returned by Holdings to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar TaxesBorrower; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (Fv) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings for the purpose of enabling Holdings to pay the Dividends referred to in clause (ii) above, so long as ~~the~~ all proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $5,000,000; (xv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03Dividends; and (~~xix~~vi) ~~any Dividends~~the exchange of Holdings Junior Subordinated Debentures for Holdings Series A Preferred Stock, so long as (x) at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent permitted as provided in ~~said~~ Section ~~10.05(vi~~9.04(xv), shall be permitted.

Appears in 2 contracts

Sources: Credit Agreement (Fairchild Semiconductor Corp), Credit Agreement (FSC Semiconductor Corp)

Dividends. ~~The Lead Borrower~~ Holdings will not, and will not permit any of its ~~Restricted~~ Subsidiaries to, authorize, declare or pay any Dividends with respect to ~~the Lead Borrower~~ Holdings or any of its ~~Restricted~~ Subsidiaries, except that: (i) (x) any ~~Restricted~~ Subsidiary of the ~~Lead~~ Borrower may pay cash Dividends ~~or return capital or make distributions and other similar payments with regard to its Equity Interests~~ to the ~~Lead~~ Borrower or to ~~other Restricted Subsidiaries~~ any Wholly-Owned Subsidiary of the ~~Lead~~ Borrower ~~which directly~~ and (y) so long as no Default or ~~indirectly own equity therein; (ii)~~ Event of Default then exist or would result therefrom, any non-Wholly-Owned Subsidiary of the ~~Lead~~ Borrower may ~~declare and~~ pay cash Dividends to its shareholders generally so long as the ~~Lead~~ Borrower or its ~~Restricted~~ respective Subsidiary which owns the ~~Equity Interests~~ equity interest or interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative ~~holding~~ holdings of ~~the Equity Interests~~ equity in interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of ~~Equity Interests of~~ equity interests in such Subsidiary); (ii) so long as there shall exist no Default or Event of Default (both before and after giving effect to the payment thereof), Holdings may repurchase outstanding shares of its stock (or options to purchase such stock) following the death, disability, retirement or termination of employment of employees of Holdings or any of its Subsidiaries, provided that (x) the only consideration paid by Holdings in respect of such repurchases shall be cash, forgiveness of debt owed by such employee to Holdings and/or Holdings Shareholder Subordinated Notes and (y) the sum of (1) the aggregate amount of cash paid by Holdings in respect of all such repurchases plus (2) the aggregate amount of all repurchases of all Holdings Junior Subordinated Notes pursuant to Section 8.11(iii) plus (3) the aggregate amount of all payments made on all Holdings Shareholder Subordinated Notes pursuant to Section 8.11(iv) shall not exceed $1,000,000 in any fiscal year of Holdings, provided that any unused amount thereof may be carried forward and utilized for such purposes in the immediately succeeding fiscal year of Holdings; (iii) so long as no Default or Event of Default then exists ~~at the time of the applicable Dividend, redemption or repurchase~~ or would ~~exist immediately after giving effect thereto~~result therefrom, the ~~Lead~~ Borrower may pay cash Dividends to Holdings ~~to allow~~ so long as Holdings ~~to pay cash dividends to any other Parent Company to redeem or repurchase, contemporaneously with~~ promptly uses such ~~Dividend, Equity Interests of such Parent Company from current or former members of management, employees, consultants, officers and directors~~ proceeds for the purposes described in clause (~~and their successors and assigns~~ii) of this Section 8.03 or Section 8.11(iii); (iv) so long as there shall exist no Default or Event of Default (both before and after giving effect to the ~~Lead Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by the Lead Borrower to Holdings pursuant to this clause (iii~~payment thereof), ~~and~~ Holdings may repurchase outstanding shares of its stock (or options to purchase such stock) held by officers or employees of Holdings or any of its Subsidiaries with the ~~aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased shall not (~~net ~~of any~~ cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the substantially concurrent sale of ~~Equity Interests of Holdings~~Holdings Common Stock, Holdings Preferred Stock and/or Holdings Junior Subordinated Notes in each case to ~~members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries~~ the extent that ~~occurs after~~ such proceeds utilize the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Retained Equity ~~Interests for purposes of clause (b)(x)(ii) of the definition of “Available~~ Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (ivv) the ~~Lead~~ Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings ~~(or subsequently paid to any other Parent Company)~~ to pay operating expenses ~~incurred by~~ in the ordinary course of business (including, without limitation, outside directors and professional fees, expenses and indemnities) and other similar corporate overhead costs and expenses, provided that the aggregate amount of cash Dividends paid pursuant to this clause (v) shall not exceed $1,000,000 in any fiscal year of Holdings; (vi) Holdings ~~or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where~~ may pay regularly scheduled Dividends on the ~~net proceeds of such offering are to be received by or contributed~~ Holdings Preferred Stock pursuant to the ~~Lead Borrower~~terms thereof solely through the issuance of additional shares of Holdings Preferred Stock, provided that in lieu of issuing additional shares of Holdings Preferred Stock as Dividends, Holdings may increase the liquidation preference of the shares of the Holdings Preferred Stock in respect of which such Dividends have accrued; (Bvii) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as ~~Holdings~~ there shall exist no Default or Event of Default (both before and ~~any other Parent Company shall cause the amount of such expenses to be repaid~~ after giving effect to the ~~Lead Borrower or~~ payment thereof), from and after January 31, 2004 the ~~relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead~~ Borrower may pay cash Dividends to Holdings ~~so long as~~ at the ~~proceeds thereof are promptly used by~~ times, and in the amounts, necessary to enable Holdings ~~(or subsequently paid~~ to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay make regularly scheduled cash ~~dividends or other distributions, or make loans or advances to, any Parent Company or the equity~~ interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) payments that are ~~attributable to~~ due on the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted SubsidiariesHoldings Senior Discount Notes; (viii) at the ~~Lead~~ time of the issuance of the Holdings Senior Discount Notes, the Borrower may pay a cash Dividend to Holdings in an amount not to exceed $1,000,000 the proceeds of which are used by Holdings to pay fees and expenses in connection with the issuance thereof or to repay any Holdings Junior Subordinated Notes which are not repaid with the proceeds from the Holdings Senior Discount Notes; (ix) the Recapitalization shall be permitted and the Borrower may pay a cash Dividend to Holdings to effectuate the same; and (x) the Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with ~~any working capital adjustment pursuant to~~ amounts owing by it under the ~~Acquisition~~ Holdings Tax Sharing Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $5,000,000; (xv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as (x) at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi).

Appears in 2 contracts

Sources: Credit Agreement (Globe Manufacturing Corp), Credit Agreement (Globe Manufacturing Corp)

Dividends. ~~The Lead Borrower will not, and will not permit any of its Restricted Subsidiaries to, authorize~~Authorize, declare or ~~pay~~ pay, directly or indirectly, any Dividends with respect to ~~the Lead Borrower or~~ any ~~of its Restricted Subsidiaries~~Company, except that: (a) any Subsidiary of a Borrower (i) may pay cash Dividends to such Borrower or any ~~Restricted~~ Wholly Owned Subsidiary of ~~the Lead~~ such Borrower ~~may pay Dividends or return capital or make distributions~~ and ~~other similar payments with regard to its Equity Interests to the Lead Borrower or to other Restricted Subsidiaries of the Lead Borrower which directly or indirectly own equity therein;~~ (ii) ~~any non-Wholly-~~if such Subsidiary is not a Wholly Owned Subsidiary of ~~the Lead Borrower~~ such Borrower, may ~~declare and~~ pay cash Dividends to its shareholders generally so long as ~~the Lead~~ such Borrower or its ~~Restricted~~ Subsidiary which owns the ~~Equity Interests~~ equity interest or interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative ~~holding~~ holdings of ~~the Equity Interests~~ equity interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of ~~Equity Interests of~~ equity interests in such Subsidiary); (~~iii~~b) so long as no Default ~~or Event of Default~~ exists ~~at the time of the applicable Dividend, redemption or repurchase~~ or would ~~exist immediately after giving~~ result therefrom, Borrowers may pay Dividends to Holdings for the purpose of enabling Holdings to, and Holdings may, repurchase outstanding shares of its common stock (or options to purchase such common stock) following the death, disability, retirement or termination of employment of employees, officers or directors of any Company; provided that (i) all amounts used to effect ~~thereto~~such repurchases are obtained by Holdings from a substantially concurrent issuance of its common stock (or options to purchase such common stock) to other employees, members of management, executive officers or directors of any Company or (ii) to the extent the proceeds used to effect any repurchase pursuant to this clause (ii) are not obtained as described in preceding clause (i), the ~~Lead Borrower~~ aggregate amount of Dividends paid by Holdings to its stockholders pursuant to this paragraph (b) (exclusive of amounts paid as described pursuant to preceding clause (i)) shall not exceed $1.0 million in any fiscal year of Holdings; (c) Borrowers may pay cash Dividends to Holdings ~~to allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase~~for the purpose of paying, contemporaneously with such Dividend, Equity Interests of such Parent Company from current or former members of management, employees, consultants, officers and directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by the Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may pay cash Dividends to Holdings so long as ~~the~~ all proceeds thereof are promptly used by Holdings ~~(or subsequently paid~~ to ~~any other Parent Company) to pay~~ pay, its franchise taxes and operating expenses incurred ~~by Holdings or any~~ in the ordinary course of business and other ~~Parent Company in connection with offerings, registrations, or exchange listings~~ corporate overhead costs and expenses (including legal and accounting expenses and similar expenses and customary fees to non-officer directors of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completedHoldings); (vd) ~~the Lead Borrower~~ Borrowers and Subsidiaries may pay cash Dividends to Holdings for the purpose of paying, so long as ~~the~~ all proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, ~~in each case without duplication:~~its income tax when and as due; and (Ae) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after On the Closing Date, ~~of up to 6% per annum of the net~~ D 56 may pay a cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests Dividend in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $5,000,000; (xv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of ~~any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered~~ the Acquisition Consideration to ~~be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of~~ effect the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as (x) at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi)Acquisition.

Appears in 2 contracts

Sources: Term Loan Credit Agreement (Department 56 Inc), Revolving Credit Agreement (Department 56 Inc)

Dividends. The ~~Lead Borrower~~ Borrowers will not, and will not permit any of ~~its~~ the Restricted Subsidiaries to, authorize, declare or pay any Dividends with respect to ~~the~~ Lead Borrower or any of its Restricted Subsidiaries, except that: (i) any Restricted Subsidiary of ~~the Lead~~ a Borrower may pay Dividends or return capital or make distributions and other similar payments with regard to its Equity Interests to ~~the~~ Lead Borrower or to other Restricted Subsidiaries of ~~the~~ Lead Borrower which directly or indirectly own equity therein; (ii) any non-Wholly-Owned Subsidiary of ~~the~~ Lead Borrower may declare and pay cash Dividends to its shareholders generally so long as ~~the~~ Lead Borrower or its Restricted Subsidiary which owns the Equity Interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary); (iii) so long as no Default or Event of Default exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, ~~the~~ Lead Borrower may pay cash Dividends to Holdings to allow Holdings to pay cash dividends or make cash distributions to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of Holdings or such other Parent Company from ~~current or former members of~~ management, employees~~, consultants~~, officers and directors (and their successors and assigns) of ~~the~~ Lead Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by ~~the~~ Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings or such other Parent Company in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to ~~the~~ Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of ~~the~~ Lead Borrower, the greater of $~~10,000,000~~ 11,250,000 and 1.00% of Consolidated Total Assets (measured at the time of such Dividend) (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by ~~the~~ Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to ~~the~~ Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (~~b)(x)(ii~~a)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to ~~the~~ Lead Borrower from ~~current or former~~ members of management, officers, directors, employees of ~~the~~ Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of Holdings or any other Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) ~~the~~ Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to ~~the~~ Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to ~~the~~ Lead Borrower or the relevant Restricted Subsidiary of ~~the~~ Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) ~~the~~ Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) ~~the~~ Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their ~~existence~~existence to the extent such Taxes, fees and expenses are reasonably attributable to the operations of Holdings, Lead Borrower and its Restricted Subsidiaries; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which ~~the Lead~~ any Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which Holdings or any other Parent Company ~~or other entity~~ is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of ~~the~~ Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that ~~the~~ Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to ~~the Lead~~ a Borrower or ~~its~~ the Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other ~~compensation and~~ benefits payable to ~~current and former officers, directors, consultants~~ officers and employees of any Parent Company to the extent such salaries, bonuses and other ~~compensation and~~ benefits are reasonably attributable to the ownership or operations of ~~the~~ Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of ~~the~~ Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of ~~the~~ Lead Borrower or any Parent Company; (F) the purchase or other acquisition by Holdings or any ~~parent~~ other Parent Company of ~~the~~ Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by ~~the~~ Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to ~~the~~ Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into ~~the~~ Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such ~~purchaser~~ purchase or other acquisition;; and (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of ~~the~~ Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of Holdings or any other Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of ~~the~~ Lead Borrower and its Restricted Subsidiaries; (viii) ~~the~~ Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of ~~the~~ Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory ~~Agreement (as in effect on the Closing Date~~Agreement; (ix) any Dividend used (i) to fund the Transaction, including Transaction ~~Costs and the Special Dividend~~Costs, and (ii) in order to satisfy deferred purchase price, earn-outs and contingent payments in respect of any ~~Dividend from proceeds received~~ amounts due and owing as provided for in ~~connection with any working capital adjustment pursuant to~~ the Acquisition Agreement; (x) ~~the~~ Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v), 10.06(vii) and ~~10.06(vii~~10.06(xii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or ~~the settlement or vesting of other~~ similar equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, not to exceed, in any fiscal year, the greater of ~~up to~~ (x) 5% of such Parent Company’s market capitalization and (y) 6% ~~per annum~~ of the net cash proceeds contributed to the capital of ~~the~~ Lead Borrower from any such Initial Public Offering; (xiii) ~~on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00,~~ any Dividends to the extent the same are made solely with the Available Amount, so long as as, solely to the extent clause (a)(i)(B) of the definition of “Available Amount” is being utilized, at the time of, and after giving effect to such ~~Dividend~~Dividend on a Pro Forma Basis, (i) no Event of Default shall have occurred and be ~~continuing~~continuing and (ii) the Consolidated Total Net Leverage Ratio, on a Pro Forma Basis as of the last day of the most recently ended Test Period, does not exceed 5.20:1.00; (xiv) purchases of minority interests in ~~non-~~Restricted Subsidiaries that are not Wholly-Owned Subsidiaries by ~~the~~ Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed the greater of $~~5,000,000~~11,250,000 and 1.00% of Consolidated Total Assets (measured at the time of such Dividend); (xv) the declaration and payment of ~~dividends~~ Dividends or the payment of other distributions by ~~the~~ Lead Borrower in an aggregate amount since the Closing Date not to exceed the greater of $~~35,000,000~~100,000,000 and 8.50% of Consolidated Total Assets (measured at the time of such Dividend); (xvi) ~~the~~ Lead Borrower and each Restricted Subsidiary may declare and make ~~dividend~~ Dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of ~~dividend~~ Dividend or other distribution by a Restricted Subsidiary, ~~the~~ Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) ~~the~~ Lead Borrower may ~~make payments~~ pay Dividends with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (~~iii~~xvii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (~~b)(x)(ii~~a)(ii) of the definition of “Available Amount”; (xviii) ~~the~~ Lead Borrower and any Restricted Subsidiary may pay ~~dividends and distributions~~ Dividends within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as ~~(x) at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y)~~ on a Pro Forma Basis, as of the last day of the most recently ended Test Period, the Consolidated Total Net Leverage Ratio does not exceed ~~3.25 to 1.00~~3.70:1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the ~~definition~~ definitions of “Consolidated ~~EBITDA~~ EBITDA” and “Consolidated Net Income”), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) ~~shall~~ shall, to the extent such loan or advance remains unpaid, be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi).

Appears in 2 contracts

Sources: First Lien Term Loan Credit Agreement (VERRA MOBILITY Corp), First Lien Term Loan Credit Agreement (VERRA MOBILITY Corp)

Dividends. ~~The Lead Borrower~~ No Credit Party will, or will ~~not, and will not~~ permit any of its ~~Restricted~~ Subsidiaries to, ~~authorize, declare or~~ pay any Dividends ~~with respect to the Lead Borrower or any of its Restricted Subsidiaries,~~ except that: (i) ~~any Restricted Subsidiary of the Lead Borrower~~ Aleris may declare and pay ~~Dividends or return capital~~ dividends or make other distributions ~~and other similar payments~~ with ~~regard~~ respect to its Equity Interests ~~to the Lead Borrower or to other Restricted Subsidiaries~~ payable solely in additional shares of ~~the Lead Borrower which directly or indirectly own equity therein~~its Equity Interests; provided, that such Equity Interests are Qualified Equity Interests; (ii) ~~any non-Wholly-Owned Subsidiary~~ Subsidiaries of ~~the Lead Borrower~~ Aleris may declare and pay ~~cash Dividends~~ dividends or make other distributions ratably with respect to ~~its shareholders generally so long as the Lead Borrower or its Restricted Subsidiary which owns the~~ their Equity Interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary)Interests; (iii) ~~so long as no Default~~ Aleris and its Subsidiaries may, or ~~Event of Default exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, the Lead Borrower~~ may pay ~~cash~~ Dividends to Holdings ~~to allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase~~the proceeds of which are used to, ~~contemporaneously with such Dividend,~~ (i) repurchase Equity Interests of ~~such Parent Company from current or former members of management, employees, consultants, officers and directors~~ Aleris (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by the Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any ~~of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors~~ direct or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion indirect parent thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of ~~warrants~~stock options (including for purposes of paying tax withholding applicable to stock option exercises) granted to officers, ~~options~~ directors, consultants or ~~other securities convertible into~~ employees of Aleris, its Subsidiaries or ~~exchangeable~~ any direct or indirect parent thereof and (ii) redeem, repurchase or otherwise acquire for value, outstanding Equity Interests of ~~the Lead Borrower~~ Aleris, or any ~~Parent Company~~direct or indirect parent thereof, (including related stock appreciation rights or similar securities) following the death, disability, retirement or termination of employment of officers, directors, consultants or employees of Aleris, any of its Subsidiaries, or any direct or indirect parent thereof or under the terms of any plan or any other agreement under which such Equity Interests or related rights were issued, in each case so long as (x) the aggregate amount paid by Aleris in cash in respect of all such redemptions or purchases pursuant to preceding clauses (i) and (ii) shall not exceed $5,000,000 in respect of all such redemptions, purchases and payments made in any Fiscal Year (plus the amount of net proceeds (x) received by Aleris during such Fiscal Year from sales of Equity Interests of Aleris or, to the extent contributed to Aleris, any of Aleris’ direct or indirect parents, to directors, consultants, officers or employees of Aleris, any of its Subsidiaries or any direct or indirect parent of Aleris in connection with permitted employee compensation and incentive arrangements and (y) of any key-man life insurance policies received during such Fiscal Year); provided that to the extent that any portion of such annual limit on such redemptions, purchases and payments is not utilized in any Fiscal Year, such unused portion will increase the annual limit applicable to the immediately subsequent Fiscal Year; (Fiv) Aleris and its Subsidiaries may make non-cash repurchases of Equity Interests deemed to occur upon the ~~purchase~~ exercise of stock options or ~~other acquisition~~ warrants if such Equity Interests represent a portion of the exercise price of such options or warrants; (v) Aleris and its Subsidiaries may pay Dividends on the Closing Date to consummate the Transaction; (vi) to the extent constituting Dividends, Aleris and its Subsidiaries may enter into and consummate transactions expressly permitted by any ~~parent~~ provision of ~~the Lead Borrower of all~~ Sections 10.02 or ~~substantially all of the property~~ 10.06(xi), (xii) and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition (xiv); (vii) Aleris and its Subsidiaries may pay Dividends to Holdings to finance investments permitted ~~to be made~~ pursuant to Section ~~9.14~~10.05; ~~provided~~ provided, that (A) any such ~~dividend, distribution, loan or advance~~ Dividend shall be made substantially concurrently with the closing of such ~~purchase or other acquisition~~ investment and (B) ~~such parent~~ Holdings shall, immediately following the closing thereof, cause (1i) all property acquired (whether assets or Equity Interests) ~~and any liabilities assumed~~ to be contributed to ~~the Lead Borrower~~ Aleris or ~~any Restricted Subsidiary~~ its Subsidiaries or (2ii) the merger (to the extent permitted in Section 10.02) ~~into the Lead Borrower or any Restricted Subsidiary~~ of the Person formed or acquired into Aleris or its Subsidiaries in order to consummate such ~~purchaser or other acquisition~~investment; (Gviii) ~~any customary fees~~ Aleris may pay Dividends (including in cash), so long as (a) the Distribution Conditions are satisfied (both before and ~~expenses related~~ after giving effect to any ~~unsuccessful equity offering~~ such Dividends) or (b) such Dividends are made with the proceeds of any substantially contemporaneous issuance of Qualified Equity Interests by Aleris or any ~~Parent Company directly attributable~~ direct or indirect parent of Aleris to the ~~operations of the Lead Borrower and its Restricted Subsidiaries~~extent such proceeds shall have actually been received by Aleris; (~~vii~~ix) ~~reasonable~~ Aleris and ~~customary indemnities~~ its Subsidiaries may pay Dividends to ~~directors~~Holdings and any other direct or indirect parent of Aleris (x) in an amount (together with loans or advances made pursuant to Section 10.05(xix)) not to exceed $1,500,000 in any Fiscal Year, ~~officers~~ to the extent necessary to pay (or allow any direct or indirect parent of Holdings to pay) general corporate and ~~employees of~~ overhead expenses incurred by Holdings (or any ~~Parent Company~~ direct or indirect parent thereof) in the ordinary course of business, to plus the ~~extent reasonably attributable to the ownership~~ amount of any reasonable and customary indemnification claims made by any director or ~~operation~~ officer of ~~the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by~~ Holdings (or ~~subsequently paid~~ any direct or indirect parent thereof), (y) to pay franchise taxes and other fees, taxes and expenses required to maintain its (or any ~~other Parent Company~~of its direct or indirect parents’) ~~for payment~~ corporate existence and (z) in an amount necessary to pay the tax liabilities of Holdings (xor any such direct or indirect parent) ~~obligations under~~ attributable to (or arising as a result of) the operations of Aleris and its Subsidiaries; provided, however, that in the case of clause (z), the amount of such dividends shall not exceed the amount that Aleris and its Subsidiaries would be required to pay in respect of ~~director~~ federal, state and ~~officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower~~ local taxes and ~~its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix)~~ any ~~Dividend used to fund the Transaction, including Transaction Costs~~ other taxes were Aleris and the ~~Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant~~ Subsidiaries to ~~the Acquisition Agreement;~~pay such taxes as stand alone taxpayers; and (x) ~~the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company)~~ so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default ~~shall have occurred and be continuing;~~is in existence or would exist immediately after giving effect thereto, Aleris may pay additional Dividends in an amount not to exceed $40,000,000 in the aggregate since the Closing Date (subject to the last sentence of Section 9.13(a)), less the sum of (~~xiv~~i) ~~purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to~~ the aggregate amount of Investments previously actually made by Aleris or any of their Subsidiaries pursuant to Section ~~10.05(xvii), shall not exceed $5,000,000; (xv~~10.05(xvi) ~~the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount~~ since the Closing Date (determined as the amount originally advanced, loaned or otherwise invested (without giving effect to any write-downs or write-offs thereof), less any returns on the respective investment not to exceed ~~$35,000,000;~~ the original amount invested), (~~xvi~~ii) the ~~Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests~~ aggregate amount of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, ~~no Event~~ prepayments and redemptions of ~~Default shall have occurred~~ Indebtedness actually made by Aleris or any of its Subsidiaries pursuant to Section 10.08(i)(y) since the Closing Date and ~~be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause~~ (iii) ~~will not be considered to be cash proceeds~~ the aggregate amount of ~~Equity Interests for purposes~~ Permitted Acquisitions previously made by Aleris or any of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as (x) at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings its Subsidiaries pursuant to Section ~~10.05(vi~~9.13(a)(iii) ~~shall be deemed to be cash Dividends paid to Holdings to~~ since the ~~extent provided in said Section 10.05(vi)~~Closing Date.

Appears in 2 contracts

Sources: Credit Agreement (Aleris Ohio Management, Inc.), Credit Agreement (Aleris Ohio Management, Inc.)

Dividends. The ~~Lead~~ Borrower will not, and will not permit any of ~~its~~ the Restricted Subsidiaries to, directly or indirectly, authorize, declare or pay any Dividends with respect to the ~~Lead~~ Borrower or any ~~of its~~ Restricted ~~Subsidiaries~~Subsidiary, except that: (i) any Restricted Subsidiary ~~of the Lead Borrower~~ may pay Dividends ~~or return capital or make distributions and other similar payments with regard to its Equity Interests~~ to the ~~Lead~~ Borrower or to ~~other~~ any Wholly-Owned Domestic Restricted ~~Subsidiaries~~ Subsidiary and any Subsidiary of the ~~Lead~~ Borrower ~~which directly or indirectly own equity therein~~that is not a Credit Party may pay Dividends to any Wholly-Owned Restricted Subsidiary; (ii) any ~~non~~Non-Wholly-Owned Restricted Subsidiary ~~of the Lead Borrower~~ may ~~declare and~~ pay ~~cash~~ Dividends to its ~~shareholders~~ shareholders, members or partners generally so long as the ~~Lead~~ Borrower or ~~its~~ a Restricted Subsidiary which owns the Equity Interests in the Restricted Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Restricted Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Restricted Subsidiary); (iii) ~~so long as no Default~~ the Borrower may redeem, repurchase or ~~Event~~ otherwise acquire for value, outstanding shares of ~~Default exists at~~ its Qualified Equity Interests (or options or warrants to purchase its Qualified Equity Interests) following the ~~time~~ death, disability or termination of employment of officers, directors or employees of the ~~applicable Dividend~~Borrower or any Restricted Subsidiary, redemption or repurchase or would exist immediately after giving effect thereto, the Lead Borrower may pay cash Dividends to Holdings to allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of such Parent Company from current or former members of management, employees, consultants, officers and directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that (Ax) the aggregate amount of all Dividends paid or made by pursuant to this clause (iii) shall not exceed $10,000,000 in any fiscal year of the ~~Lead~~ Borrower and (y) at the time of any Dividend permitted to ~~Holdings~~ be made pursuant to this clause (iii), ~~and the aggregate amount paid by Holdings in respect~~ no Default or Event of ~~all such Equity Interests so redeemed~~ Default shall then exist or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreementwould result therefrom; (iv) the ~~Lead~~ Borrower may pay ~~cash~~ Dividends ~~to Holdings so long as~~ on its Qualified Equity Interests solely through the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings issuance of ~~equity or debt securities and maintenance~~ additional shares of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary Qualified Equity Interests of the ~~Lead~~ Borrower ~~out~~ (but not in cash), provided that in lieu of issuing additional shares of Qualified Equity Interests as Dividends, the Borrower may increase the liquidation preference of the ~~proceeds~~ shares of Qualified Equity Interests in respect of which such ~~offering promptly if such offering is completed~~Dividends have accrued; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a ~~business unit~~Dividend, ~~a line of business or division of such Person, or of all of~~ the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries ~~or (y) indemnification obligations owing to~~ may consummate the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $5,000,000; (xv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03Transactions; and (~~xix~~vi) any Dividends, so long as (x) at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent ~~provided~~ constituting a Dividend, the making of any Dividends on or after the Closing Date as required by the Plan of Reorganization, the Confirmation Order or any documents, instruments or agreements contemplated thereby, including any Dividend in ~~said Section 10.05(vi)~~connection with (A) the conversion of the Convertible Preferred Stock and (B) the exercise of the Closing Date Warrants.

Appears in 2 contracts

Sources: Credit Agreement (Walter Investment Management Corp), Credit Agreement (Walter Investment Management Corp)

Dividends. ~~The Lead Borrower will not~~Declare, ~~and will not permit any of its Restricted Subsidiaries to, authorize, declare~~ make or pay any ~~Dividends with respect to the Lead Borrower~~ Dividend Payments on any shares of any class of Equity Interests, either directly or ~~any of its Restricted Subsidiaries~~indirectly, except that: (ia) ~~any Restricted Subsidiary~~ Subsidiaries of ~~the Lead Borrower~~ Holdco may pay ~~Dividends or return capital or make distributions and other similar payments with regard~~ Dividend Payments pro rata to ~~its~~ the holders of their Equity Interests (giving effect to ~~the Lead Borrower or to other Restricted Subsidiaries of the Lead Borrower which directly or indirectly own equity therein~~relative preferences and priorities); (iib) each of Borrower, Holdco and any ~~non-Wholly-Owned Subsidiary~~ of ~~the Lead Borrower~~ its Subsidiaries may ~~declare and~~ pay ~~cash Dividends~~ or make Dividend Payments or distributions to any holder of its ~~shareholders generally so long as the Lead Borrower or its Restricted Subsidiary which owns the~~ Equity Interests in the ~~Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding~~ form of ~~the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes~~ additional shares of Equity Interests of the same class and type; provided that in the case of Subsidiaries, such ~~Subsidiary)~~Dividend Payments or distributions are made to the holders of such Equity Interests on a pro rata basis; (~~iii~~c) ~~so long as no Default or Event of Default exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, the Lead~~ Borrower may ~~pay cash Dividends~~ make Dividend Payments to Holdings to allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of such Parent Company from current or former members of management, employees, consultants, officers and directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by the Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may pay cash Dividends to Holdings Holdco so long as the proceeds thereof ~~are promptly~~ shall ultimately be used by ~~Holdings~~ Holdco (~~or subsequently paid to any other Parent Company~~and Holdco shall be entitled) to ~~pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings~~ repurchase shares of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of ~~the Lead~~ Holdco or its parent companies owned by former, present or future employees, officers and directors of Holdco, Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees their assigns, estates and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantorsheirs; provided that the aggregate amount of ~~such purchases, when added~~ Dividend Payments made by Borrower pursuant to this paragraph (c) shall not in the aggregate exceed the sum of (i) $25,000,000 during the term of this Agreement plus (ii) the amount of ~~Investments pursuant~~ net cash proceeds received by or contributed to ~~Section 10.05(xvii)~~Borrower from the issuance and sale of Equity Interests of Holdco or Borrower, to officers, directors or employees of Holdco or any Subsidiary (it being understood that the discharge of any Indebtedness owing from any officer, director or employee to Holdco or Borrower in exchange for the redemption of Equity Interests owned by such officer, director or employee shall not ~~exceed $5,000,000~~constitute a Dividend Payment) plus (iii) the proceeds of any key man life insurance policies; provided, however, that for the avoidance of doubt, an “employee” shall include each person who would be so classified but for such person’s holding an Equity Interest; (xvd) (i) to the ~~declaration~~ extent actually used by such parent to pay such taxes, costs and ~~payment~~ expenses, Holdco may make payments to or on behalf of ~~dividends~~ its parent in an amount sufficient to pay franchise taxes and other fees required to maintain the legal existence of Holdco and (ii) Holdco may make payments to or on behalf of its parent in an amount sufficient to pay out-of-pocket legal, accounting and filing costs and other expenses and liabilities in the ~~payment~~ nature of ~~other distributions by~~ overhead in the ~~Lead Borrower~~ ordinary course of business of such parent, in the case of clause (ii) in an aggregate amount ~~since the Closing Date~~ not to exceed such $~~35,000,000~~1,000,000 in any Fiscal Year; (~~xvi~~i) ~~the Lead~~ Borrower ~~and each Restricted Subsidiary~~ may ~~declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person~~ distribute amounts equal to Permitted Tax Distributions to Holdco, so long as Holdco uses funds therefrom to pay its taxes or applies such funds in accordance with the ~~case~~ following clause (ii), and (ii) Holdco may make Permitted Tax Distributions to the holders of ~~dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least~~ its ~~pro rata share of such dividend or distribution~~Equity Interest; (~~xvii~~f) to the ~~Lead Borrower may make payments with~~ extent constituting Dividend Payments, the ~~cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance~~ transactions permitted by ~~any Parent Company, so long as, with respect to any such payments,~~ Section 6.12; and (g) provided no Event of Default ~~shall have occurred and be~~ is continuing or would result therefrom~~; provided that~~ , Borrower may make Dividend Payments to Holdco and Holdco may make Dividend Payments to the holders of its Equity Interest in an aggregate amount ~~of any such cash proceeds that are utilized for any Dividend under this clause~~ not to exceed (~~iii~~x) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends$30,000,000, so long as ~~(x) at~~ the ~~time of,~~ Total Leverage Ratio before and after giving effect to such ~~Dividend~~Dividend Payment is less than or equal to 4.00 to 1.00 and (y) $60,000,000, so long as the Total Leverage Ratio before and after giving effect to such Dividend Payment is less than or equal to 3.00 to 1.00; and (h) provided no Event of Default ~~shall have occurred~~ is continuing or would result therefrom, Borrower may make Dividend Payments to Holdco and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings Holdco may make Dividend Payments to the ~~extent provided~~ holders of its Equity Interest in ~~said Section 10.05(vi)~~an aggregate amount not to exceed $18,000,000.

Appears in 2 contracts

Sources: Second Lien Credit Agreement (Emdeon Inc.), Second Lien Credit Agreement (Emdeon Inc.)

Dividends. ~~The Lead Borrower will not~~Declare, ~~and will not permit any of its Restricted Subsidiaries to, authorize, declare~~ make or pay any ~~Dividends with respect to the Lead Borrower~~ Dividend Payments on any shares of any class of Capital Stock, either directly or ~~any of its Restricted Subsidiaries~~indirectly, except that: (ia) ~~any Restricted Subsidiary of the Lead Borrower~~ Qualified Subsidiaries may pay ~~Dividends or return capital or make distributions and other similar payments with regard to its Equity Interests~~ Dividend Payments pro rata to the ~~Lead Borrower or~~ holders of their Capital Stock (giving effect to ~~other Restricted Subsidiaries of the Lead Borrower which directly or indirectly own equity therein~~relative preferences and priorities); (iib) Borrower and its Qualified Subsidiaries may pay or make Dividend Payments or distributions to any ~~non-Wholly-Owned Subsidiary~~ holder of its Capital Stock in the form of additional shares of Capital Stock of the ~~Lead~~ same class and type; (c) Borrower and Holdings may ~~declare and pay cash Dividends to its shareholders generally~~ make Dividend Payments so long as the ~~Lead~~ proceeds thereof shall ultimately be used by Parent to make repurchase shares of Capital Stock of Parent owned by former, present or future employees of Borrower or its ~~Restricted Subsidiary which owns~~ Qualified Subsidiaries or their assigns, estates and heirs; provided that the ~~Equity Interests~~ aggregate amount of Dividend Payments made by Borrower or Holdings pursuant to this paragraph (c) shall not in the ~~Subsidiary paying such Dividends receives at least its proportionate share thereof~~ aggregate exceed (~~based upon its relative holding~~ i) $1,000,000 in any fiscal year or (ii) $5,000,000 during the term of ~~the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences~~this Agreement, ~~if any,~~ plus any amounts contributed to Borrower as a result of ~~the various classes of Equity Interests~~ resales of such ~~Subsidiary)~~repurchased shares of Capital Stock; (~~iii~~d) so long as no Default or Event of Default exists and is continuing at the time of ~~the applicable Dividend~~such Dividend Payments or distributions, redemption or repurchase or would exist immediately after giving effect thereto, the Lead Borrower may pay cash Dividends to Holdings to allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of such Parent Company from current or former members of management, employees, consultants, officers and directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by the Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased shall not ~~(net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other~~ less than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs six months after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); Holdings and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may pay ~~cash Dividends~~ or make Dividend Payments or distributions to enable Holdings ~~so long as the proceeds thereof are promptly used by Holdings (~~II to repay, in whole or ~~subsequently paid~~ in part, up to ~~any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company~~ $30.0 million in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated aggregate principal amount of ~~such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned~~Redeemable Common Equity, or plus interest thereon (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable lawsor, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such ~~minimum Taxes) that are attributable~~ interest and without duplication, the aggregate outstanding amount of any line of credit linked to and representing the ~~taxable income~~ fees and interest rollup component of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(viiRedeemable Common Equity); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such ~~purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii),~~ Dividend Payments or distributions shall not exceed ~~$5,000,000; (xv)~~ the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefromRetained Amount; provided further that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if ~~at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as (x) at the time of, and~~ on a Pro Forma Basis after giving effect to such ~~Dividend~~Dividend Payments or distributions the Total Leverage Ratio is less than or equal to 5.00 to 1.00, ~~no Event~~ then such Dividend Payments or distributions may exceed the Retained Amount so long as, after giving effect to such Dividend Payments or distributions, the amount of ~~Default shall have occurred and be continuing and (y)~~ the Available Revolving Credit Commitments is not less than $15,000,000; provided further that on a Pro Forma ~~Basis~~Basis after giving effect to such Dividend Payments or distributions, Holdings would be in compliance with subsections 8.9(A) and (B); (e) Holdings and its Subsidiaries may pay or make Dividend Payments or distributions to one or more indirect parent companies to enable them to pay expenses incurred in the ~~Consolidated Total Net Leverage Ratio does~~ ordinary course of business; provided the aggregate amount of all Dividend Payments or distributions made pursuant to this subsection 8.11(e) shall not exceed ~~3.25 to 1.00. In determining compliance with this Section 10.03~~ $1,000,000 in any fiscal year; (~~and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned~~ f) Borrower may pay or ~~advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid~~ make Dividend Payments or distributions to Holdings to enable Holdings to make interest payments on Holdings High Yield Notes and, following the ~~extent~~ fifth anniversary of the issue date thereof, the Senior Discount Notes, in each case as required; provided that on a Pro Forma Basis after giving effect to such Dividend Payments or distributions, Holdings would, in ~~said Section 10.05(vi~~each case, be in compliance with subsections 8.9(A) and (B); provided, further, that, in each case, no Default or Event of Default exists and is continuing at the time of such Dividend Payments or distributions; (g) Borrower may pay or make payments of Merger Consideration (as defined in the Merger Agreement); and (h) Borrower may make or pay Dividend Payments to Holdings to enable Holdings to (i) pay its consolidated, combined or unitary Taxes or (ii) to make or pay Dividend Payments to Holdings II to enable Holdings II to pay its consolidated, combined or unitary Taxes.

Appears in 2 contracts

Sources: Credit Agreement (Language Line Costa Rica, LLC), Credit Agreement (Language Line Holdings, Inc.)

Dividends. The ~~Lead Borrower~~ Borrowers will not, and will not permit any of ~~its~~ the Restricted Subsidiaries to, authorize, declare or pay any Dividends with respect to the Lead Borrower or any of its Restricted Subsidiaries, except that: (i) any Restricted Subsidiary of the Lead Borrower may authorize, declare and pay Dividends or return capital or make distributions and other similar payments with regard to its Equity Interests to the Lead Borrower or to other Restricted Subsidiaries of the Lead Borrower which directly or indirectly own equity therein; (ii) any non-Wholly-Owned Subsidiary of the Lead Borrower may authorize, declare and pay cash Dividends to its shareholders generally so long as the Lead Borrower or its Restricted Subsidiary which owns the Equity Interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary); (iii) so long as no ~~Default or~~ Event of Default exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, the Lead Borrower may authorize, declare and pay cash Dividends to Holdings to allow Holdings to pay cash dividends or make cash distributions to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of Holdings or such other Parent Company from ~~current or former members of~~ management, employees~~, consultants~~, officers and directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by the Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings or such other Parent Company in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests ~~(other than to the extent included in the Available Amount)~~ and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, (x) the greater of $~~10,000,000~~ 35,000,000 and 6.25% of Consolidated EBITDA of the Lead Borrower and its Restricted Subsidiaries for the most recently ended Test Period (measured at the time of such Dividend) or (y) subsequent to the consummation of any Initial Public Offering of common stock or other comparable equity interests of the Lead Borrower or any direct or indirect parent of the Lead Borrower, the greater of $55,000,000 and 10.0% of Consolidated EBITDA of the Lead Borrower and its Restricted Subsidiaries for the most recently ended Test Period (measured at the time of such Dividend) (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from ~~current or former~~ members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of Holdings or any other Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may authorize, declare and pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may authorize, declare and pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with ~~applicable laws~~Requirements of Law, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may authorize, declare and pay cash ~~dividends~~ Dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their ~~existence~~existence to the extent such Taxes, fees and expenses are reasonably attributable to the operations of Holdings, the Lead Borrower and its Restricted Subsidiaries; (B) with respect to any taxable ~~year (or portion thereof)~~ period ending after the Closing Date ~~with respect to~~ for which the Lead Borrower ~~(a) is treated as a corporation for U.S. federal, state,~~ and/or ~~local income tax purposes and (b) is a member~~ any of its Subsidiaries are members of a consolidated, combined or similar income tax group ~~(a “Tax Group”)~~ for U.S. federal and/or applicable state, local or foreign income or similar tax purposes of which ~~any Parent Company~~ a direct or ~~other entity~~ indirect parent of the Lead Borrower is the common parent, the portion of any such U.S. federal, ~~state~~ state, local and/or foreign income and ~~local income Taxes~~ similar taxes (including any alternative minimum ~~Taxes~~taxes) ~~(or franchise and similar Taxes imposed in lieu~~ of such ~~minimum Taxes)~~ tax group that ~~are~~ is attributable to the taxable income of the Lead Borrower and its applicable Restricted Subsidiaries and, to the extent of the amount actually received for such purpose from its applicable Unrestricted Subsidiaries, in amounts required to pay any such taxes that are attributable to the taxable income of such Unrestricted Subsidiaries; provided that ~~for each taxable period,~~ the aggregate amount of such payments ~~made in~~ with respect to such period (regardless of ~~such taxable period in the aggregate~~ when paid) shall not exceed the aggregate amount of such Taxes that the Lead Borrower ~~and~~ and/or its applicable Restricted Subsidiaries (and, subject to the limitation described above, any applicable Unrestricted Subsidiaries of the Lead Borrower) would have been required to pay as with respect to such period were such entities stand-alone corporate taxpayers or a stand-alone ~~Tax Group; provided, further, that~~ corporate tax group for all applicable taxable periods ending after the ~~permitted payment pursuant~~ date hereof taking into account any applicable limitations on the ability to ~~this clause (B) with respect to~~ utilize net operating loss carryforwards and similar tax attributes under the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar TaxesCode; (C) payments under any domination and/or profit and loss pooling agreements; (D) customary salary, bonus and other ~~compensation and~~ benefits payable to ~~current and former officers,~~ directors, ~~consultants~~ officers and employees of any Parent Company to the extent such salaries, bonuses and other ~~compensation and~~ benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (DE) general corporate operating and overhead ~~costs~~ costs, fees and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such ~~costs~~ costs, fees and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (EF) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (FG) the purchase or other acquisition by Holdings or any ~~parent~~ other Parent Company of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such ~~parent~~ Parent Company shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger or amalgamation (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such ~~purchaser~~ purchase or other acquisition;; and (GH) any customary fees and expenses related to any successful or unsuccessful debt or equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) the Lead Borrower and its Restricted Subsidiaries may give reasonable and customary indemnities to directors, officers and employees of Holdings or any other Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may authorize, declare and pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory ~~Agreement (as in effect on the Closing Date~~Agreement; (ix) any Dividend used (x) to fund the Transaction, including Transaction ~~Costs and the Special Dividend~~Costs, and (y) in order to satisfy deferred purchase price, earn-outs and contingent payments in respect of any ~~Dividend from proceeds received~~ amounts due and owing as provided for in ~~connection with any working capital adjustment pursuant to~~ the Acquisition Agreement; (x) the Lead Borrower may authorize, declare and pay cash Dividends to Holdings (who may subsequently authorize, declare and pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v), 10.06(vii) and ~~10.06(vii~~10.06(xii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or ~~the settlement or vesting of other~~ similar equity incentive awards; (xii) a Dividend (including to any Parent ~~Company~~ Company) to fund a payment of dividends on ~~such~~ the Lead Borrower’s or any Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, not to exceed, in any fiscal year, the sum of ~~up to 6~~(x) 6.0% ~~per annum~~ of the net cash proceeds received by or contributed to the capital of the Lead Borrower from any such Initial Public ~~Offering~~Offering and (y) 7.0% of the Lead Borrower’s (or any Parent Company’s) Market Capitalization; (xiii) the Lead Borrower may pay any Dividends so long as the Distribution Conditions are satisfied on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and Basis immediately after giving effect to such ~~Dividend, no Event of Default shall have occurred and be continuing~~Dividends; (xiv) purchases of minority interests in ~~non-~~Restricted Subsidiaries that are not Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed the greater of $~~5,000,000~~27,500,000 and 5.0% of Consolidated EBITDA of the Lead Borrower and its Restricted Subsidiaries for the most recently ended Test Period (measured at the time of such Dividend); (xv) the authorization, declaration and payment of ~~dividends~~ Dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing ~~Date~~ Date, not to exceed the greater of $~~35,000,000~~250,000,000 and 50.0% of Consolidated EBITDA of the Lead Borrower and its Restricted Subsidiaries for the most recently ended Test Period (measured at the time of such Dividend); (xvi) the Lead Borrower and each Restricted Subsidiary may authorize, declare and make ~~dividend~~ Dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of ~~dividend~~ Dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may ~~make payments~~ authorize, declare and pay Dividends with the cash proceeds contributed to its common equity (including from the net cash proceeds of any equity issuance by any Parent Company), so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may authorize, declare and pay ~~dividends and distributions~~ Dividends within 60 90 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; (xix) so long as no Event of Default under Section 11.01 or 11.05 has occurred and is continuing or would result therefrom, Lead Borrower and any Restricted Subsidiary may authorize, declare and pay Dividends with any Leverage Excess Proceeds (as defined in the Cash Flow Credit Agreement as in effect on the date hereofClosing Date) promptly upon the receipt thereof; and (~~xix~~xx) any ~~Dividends, so long~~ payment that is intended to prevent any Indebtedness of the Lead Borrower from being treated as (xan “applicable high yield discount obligation” within the meaning of Section 163(i)(1) at of the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00Code. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the ~~definition~~ definitions of “Consolidated ~~EBITDA and~~ EBITDA”, “Consolidated Net Income” and “Consolidated Fixed Charge Coverage Ratio”), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) ~~shall~~ shall, to the extent such loan or advance remains unpaid, be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi).

Appears in 2 contracts

Sources: Revolving Credit Agreement (McGraw Hill, Inc.), Revolving Credit Agreement (McGraw Hill, Inc.)

Dividends. ~~The Lead~~ Without the prior written consent of the Required Lenders, Borrower ~~will not, and will~~ shall not take or permit any Subsidiary to take any of ~~its Restricted Subsidiaries to, authorize,~~ the following actions: (a) declare or pay any ~~Dividends with respect~~ dividends, (b) purchase, redeem, retire or otherwise acquire for value any of its capital stock now or hereafter outstanding, or make any distribution of assets to its stockholders as such whether in cash, assets or in obligations of the ~~Lead~~ Borrower or any Subsidiary, (c) allocate or otherwise set apart any sum for the payment of any dividend or distribution on, or for the purchase, redemption or retirement of any shares of its ~~Restricted Subsidiaries~~capital stock, or (d) make any other distribution by reduction or return of capital or otherwise in respect of any shares of its capital stock or permit any Subsidiary to purchase or otherwise acquire for value any stock of the Borrower or another Subsidiary, except that: (i) ~~any Restricted Subsidiary of the Lead~~ Borrower may ~~pay Dividends or return capital or~~ declare and deliver dividends and make distributions ~~and other similar payments with regard~~ (A) in an amount not to ~~its Equity Interests to~~ exceed $6,000,000 in the ~~Lead Borrower~~ aggregate in any fiscal year (the “Dividend Limit”) and/or (B) payable solely in common stock of Borrower; provided that, in each case, no Event of Default or ~~to other Restricted Subsidiaries~~ Potential Default shall occur as a result of, or exist immediately following the payment of ~~the Lead Borrower which directly~~ any dividends or ~~indirectly own equity therein~~distributions under this clause (i); (ii) ~~any non-Wholly-Owned Subsidiary of the Lead~~ Borrower may ~~declare~~ repurchase or otherwise acquire shares of its capital stock, provided that (A) each such repurchase is at a price not exceeding the then current market price and ~~pay cash Dividends to its shareholders generally so long as~~ (B) the ~~Lead Borrower or its Restricted Subsidiary which owns~~ aggregate number of shares repurchased shall not exceed 5,700,000 from the ~~Equity Interests in~~ Closing Date through the ~~Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of~~ Revolving Credit Loan Maturity Date, with the ~~Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests~~ balance of such ~~Subsidiary)~~amount concurrently adjusted for any stock splits, reverse stock splits and similar events and (C) no Event of Default or Potential Default shall occur as a result of, or exist immediately following, such repurchase or acquisition; (iii) ~~so long as no Default~~ Any Subsidiary may declare and deliver dividends or Event of Default exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, the Lead Borrower may pay cash Dividends to Holdings to allow Holdings to pay cash dividends other distributions directly to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of such Parent Company from current or former members of management, employees, consultants, officers and directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by the Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (Loan Party other than ~~to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during~~ any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii))Inactive Subsidiary; (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement;and (iv) ~~the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to~~ any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Foreign Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $5,000,000; (xv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary CTG Europe may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed deliver dividends to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as (x) at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi)CTG Europe.

Appears in 2 contracts

Sources: Loan Agreement (Computer Task Group Inc), Loan Agreement (Computer Task Group Inc)

Dividends. ~~The Lead Borrower~~ Holdings will not, and will not permit any of ~~its~~ the Restricted Subsidiaries to, ~~authorize, declare or~~ pay any Dividends with respect to ~~the Lead Borrower~~ Holdings or any of ~~its~~ the Restricted Subsidiaries, except that: (i) any Restricted Subsidiary of ~~the Lead Borrower~~ Holdings may pay Dividends or return capital or make distributions and other similar payments with regard to its Equity Interests to ~~the Lead Borrower~~ Holdings or to other Restricted Subsidiaries of ~~the Lead Borrower~~ Holdings which directly or indirectly own equity therein; (ii) any non-Wholly-Owned Subsidiary of ~~the Lead Borrower~~ Holdings may declare and pay cash Dividends to its shareholders generally so long as ~~the Lead Borrower~~ Holdings or its Restricted Subsidiary which owns the Equity Interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary); (iii) so long as no Default or Event of Default exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, ~~the Lead Borrower~~ Holdings may pay cash Dividends to ~~Holdings to allow Holdings to pay cash dividends to~~ any ~~other~~ Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of such Parent Company from ~~current or former members of~~ management, employees~~, consultants~~, officers and directors (and their successors and assigns) of Holdings and the ~~Lead Borrower and its~~ Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by ~~the Lead Borrower to~~ Holdings pursuant to this clause (iii), and the aggregate amount paid by ~~Holdings~~ such Parent Company in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings ~~(but in no event from any Initial Public Offering)~~ from issuances of its Equity Interests (other than to the extent included in the Available Amount) ~~and contributed to the Lead Borrower~~ in connection with such redemption or repurchase), in either case, exceed during any fiscal year of Holdings, the ~~Lead Borrower,~~ greater of $~~10,000,000~~ 44,300,000 and 10.0% of LTM Consolidated EBITDA (measured at the time of such Dividend) (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two (2) fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by ~~the Lead Borrower~~ Holdings or any of ~~its~~ the Restricted Subsidiaries after the ~~Closing~~ Amendment and Restatement Effective Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings or of any Parent Company which net proceeds are contributed to Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the ~~Closing~~ Amendment and Restatement Effective Date~~, where the net proceeds of such sale are received by or contributed to the Lead Borrower~~; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (~~b)(x)(ii~~a)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to ~~the Lead Borrower~~ Holdings from ~~current or former~~ members of management, officers, directors, employees of ~~the Lead Borrower~~ Holdings or any of its Subsidiaries in connection with a repurchase of Equity Interests of Holdings or any other Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) ~~the Lead Borrower~~ Holdings may pay cash Dividends to ~~Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to~~ any ~~other~~ Parent ~~Company)~~ Company to pay expenses incurred by ~~Holdings or~~ any ~~other~~ Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to ~~the Lead Borrower~~Holdings, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as ~~Holdings and any other~~ such Parent Company shall cause the amount of such expenses to be repaid to ~~the Lead Borrower~~ Holdings or the relevant Restricted Subsidiary of ~~the Lead Borrower~~ Holdings out of the proceeds of such offering promptly if such offering is completed; (v) ~~the Lead Borrower~~ Holdings may pay cash Dividends to ~~Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to~~ any ~~other~~ Parent ~~Company)~~ Company to pay costs (including all professional fees and expenses) incurred by ~~Holdings or any other~~ such Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) for any taxable period in which (a) Holdings and/or any of its Subsidiaries is a member of a consolidated, combined, unitary or similar U.S. federal, state, local and/or foreign income or similar tax group whose common parent is a Parent Company (a “Tax Group”) or (b) Holdings is a pass-through entity for U.S. federal income tax purposes that is owned by a Parent Company that is a corporation for U.S. federal income tax purposes (directly or indirectly through one or more corporate subsidiaries of such Parent Company (any such corporate subsidiaries, together with such Parent Company, the ~~Lead Borrower~~ “Corporate Owners”)), Holdings may make distributions to any Parent Company to pay any consolidated, combined, unitary or similar U.S. federal, state, local and/or foreign income or similar income Taxes of such Tax Group, as applicable, or to any Corporate Owner to pay the U.S. federal, state, local and/or foreign income or similar Taxes of such Corporate Owner, in each case that are attributable to the taxable income of Holdings and/or its applicable Subsidiaries, as applicable; provided that (A) the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount of such Taxes that Holdings and/or its applicable Subsidiaries would have been required to pay in respect of such taxable period if such entity(ies) were a stand-alone corporate taxpayer or stand-alone corporate tax group consisting only of Holdings and/or such Subsidiaries for all relevant taxable periods, (B) the portion of any payment otherwise permitted pursuant to this clause (vi) with respect to any Taxes attributable to the income of any Unrestricted Subsidiary shall be limited to the amount actually paid by such Unrestricted Subsidiary to Holdings or any Credit Party for the purposes of paying such Taxes, and (C) with respect to any taxable period (or portion thereof) ending prior to the Amendment and Restatement Effective Date, payments pursuant to this clause (vi) shall be permitted only to the extent relating to Tax adjustments that arise after the Amendment and Restatement Effective Date as a result of audits or other Tax proceedings; (vii) Holdings may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their ~~existence~~existence to the extent such Taxes, fees and expenses are reasonably attributable to the operations of Holdings and the Restricted Subsidiaries; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other ~~compensation and~~ benefits payable to ~~current and former officers, directors, consultants~~ officers and employees of any Parent Company to the extent such salaries, bonuses and other ~~compensation and~~ benefits are reasonably attributable to the ownership or operations of Holdings and the ~~Lead Borrower and its~~ Restricted Subsidiaries; (DC) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of Holdings and the ~~Lead Borrower~~ Restricted Subsidiaries (including, for the avoidance of doubt, administrative costs and ~~its Restricted Subsidiaries~~expenses of Satelles, Inc., Syncom-Iridium Holdings Corp. and/or Iridium Blocker-B. Inc.); (ED) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of ~~the Lead Borrower~~ Holdings or any Parent Company; (FE) for the purchase or other acquisition by any ~~parent of the Lead Borrower~~ Parent Company of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that (1) if such purchase or other acquisition had been made by ~~the Lead Borrower~~Holdings, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14~~; provided that~~ , (A2) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B3) such ~~parent~~ Parent Company shall, immediately following the closing thereof, cause (1x) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to ~~the Lead Borrower~~ Holdings or any Restricted Subsidiary or (2y) the merger (to the extent permitted in Section 10.02) into ~~the Lead Borrower~~ Holdings or any Restricted Subsidiary of the Person formed or acquired in order to consummate such ~~purchaser~~ purchase or other acquisition;; and (GF) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company ~~directly~~ reasonably attributable to the operations of Holdings and the ~~Lead Borrower and its~~ Restricted Subsidiaries; provided that the aggregate amount of Dividends made pursuant to subclauses (B), (C) and (F) of this clause (vii) shall not exceed the greater of $44,300,000 and 10.0% of LTM Consolidated EBITDA (measured at the time of such Dividend) in any fiscal year; (~~vii~~viii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of Holdings and the ~~Lead Borrower and its~~ Restricted Subsidiaries; (~~viii~~ix) ~~the Lead Borrower~~ Holdings may pay cash Dividends to ~~Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to~~ any ~~other~~ Parent ~~Company)~~ Company for payment of ~~(x)~~ obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs Holdings and the ~~Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement~~Restricted Subsidiaries; (x) ~~the Lead Borrower~~ [reserved]; (xi) Holdings may pay cash Dividends to ~~Holdings (who may subsequently pay cash Dividends to~~ any ~~other~~ Parent ~~Company)~~ Company so long as the proceeds thereof are used to pay ~~the Sponsor or Sponsor Affiliate~~ fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections ~~10.06(v~~10.06(vii) and ~~10.06(vii~~10.06(xii); (xixii) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or ~~the settlement or vesting of other~~ similar equity incentive awards; (~~xii~~xiii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common ~~stock following an Initial Public Offering~~ stock, not to exceed, in any fiscal year, 5.0% of such ~~common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering~~Parent Company’s Market Capitalization; (~~xiii~~xiv) ~~on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00,~~ any Dividends to the extent the same are made solely with the Available Amount; provided that to the extent clause (a)(i)(B) of the definition of “Available Amount” is being utilized, ~~so long as~~ at the time of, and after giving effect to such ~~Dividend~~Dividend on a Pro Forma Basis, (x) no Event of Default under Section 11.01(a) or Section 11.01(e) shall have occurred and be ~~continuing~~continuing and (y) the Consolidated Total Net Leverage Ratio, on a Pro Forma Basis as of the last day of the most recently ended Test Period, does not exceed 5.50:1.00; (~~xiv~~xv) purchases of minority interests in ~~non-~~Restricted Subsidiaries that are not Wholly-Owned Subsidiaries by ~~the Lead Borrower and the Guarantors~~Credit Parties; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed the greater of $~~5,000,000~~44,300,000 and 10.0% of LTM Consolidated EBITDA (measured at the time of such Dividend); (xvxvi) the declaration and payment of ~~dividends~~ Dividends or the payment of other distributions by Holdings, so long as the ~~Lead Borrower in an aggregate amount since~~ Consolidated Total Net Leverage Ratio, on a Pro Forma Basis as of the ~~Closing Date~~ last day of the most recently ended Test Period, does not to exceed ~~$35,000,000~~4.00:1.00 and no Event of Default shall have occurred and be continuing or result therefrom; (~~xvi~~xvii) ~~the Lead Borrower~~ Holdings and each Restricted Subsidiary may declare and make ~~dividend~~ Dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of ~~dividend~~ Dividend or other distribution by a Restricted Subsidiary, ~~the Lead Borrower~~ Holdings or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (~~xvii~~xviii) ~~the Lead Borrower~~ Holdings may ~~make payments~~ pay Dividends with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent ~~Company~~Company completed after the Amendment and Restatement Effective Date, so long as, with respect to any such payments, no Event of Default under Section 11.01(a) or 11.01(e) shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (~~iii~~xviii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (~~b)(x)(ii~~a)(ii) of the definition of “Available Amount”; (~~xviii~~xix) ~~the Lead Borrower~~ Holdings and any Restricted Subsidiary may pay ~~dividends and distributions~~ Dividends within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03~~; and~~; (~~xix~~xx) [reserved]; (xxi) Holdings and any ~~Dividends~~Restricted Subsidiary may make payments and distributions to dissenting stockholders pursuant to applicable law pursuant to or in connection with a sale, ~~so long~~ consolidation, merger or transfer of Holdings and the Restricted Subsidiaries taken as a whole that complies with the terms of this Agreement, including Section 10.02 hereof; (xxxii) Holdings and any Restricted Subsidiary may declare and pay Dividends to holders of any class or series of Qualified Preferred Stock issued by a Parent Company after the Amendment and Restatement Effective Date; provided that (A) the Consolidated Fixed Charge Coverage Ratio at the time ~~of, and after giving effect to~~ of the issuance of such ~~Dividend, no Event of Default shall have occurred and be continuing and~~ Qualified Preferred Stock (y) calculated on a Pro Forma Basis, ) is 2.00 to 1.00 or greater and (B) the ~~Consolidated Total Net Leverage Ratio~~ aggregate amount of Dividends declared and paid pursuant to this Section 10.03(xxii) does not exceed ~~3.25~~ the net cash proceeds received by the Parent Company and contributed to ~~1.00~~Holdings from any such sale of Qualified Preferred Stock issued after the Amendment and Restatement Effective Date and contributed to Holdings; and (xxiii) Holdings and any Restricted Subsidiary may pay Dividends in an aggregate amount not to exceed the greater of $110,750,000 and 25% of LTM Consolidated EBITDA (measured at the time of such Dividend), which may, at the election of the Borrower (and without duplication), be reallocated to make Investments pursuant to Section 10.05(xix). In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the ~~definition~~ definitions of “Consolidated ~~EBITDA~~ EBITDA” and “Consolidated Net Income”), amounts loaned or advanced to ~~Holdings~~ any Parent Company pursuant to Section 10.05(vi) ~~shall~~ shall, to the extent such loan or advance remains unpaid, be deemed to be cash Dividends paid to ~~Holdings~~ such Parent Company to the extent provided in said Section 10.05(vi). For purposes of determining compliance with this Section 10.03, if the payment of Dividends would be permitted pursuant to one or more provisions described above, the Borrower, in its sole discretion, from time to time, may classify or reclassify or divide such payment of Dividends (or any portion thereof) in any manner that complies with this Section 10.03.

Appears in 2 contracts

Sources: Credit Agreement (Iridium Communications Inc.), Credit Agreement (Iridium Communications Inc.)

Dividends. ~~The Lead~~ Borrower will not, and will not permit any of ~~its~~ the Restricted Subsidiaries to, authorize, declare or pay any Dividends with respect to ~~the Lead~~ Borrower or any of its Restricted Subsidiaries, except that: (i) any Restricted Subsidiary of ~~the Lead~~ a Borrower may authorize, declare and pay Dividends or return capital or make distributions and other similar payments with regard to its Equity Interests to ~~the Lead~~ Borrower or to other Restricted Subsidiaries of ~~the Lead~~ Borrower which directly or indirectly own equity therein; (ii) any non-Wholly-Owned Subsidiary of ~~the Lead~~ Borrower may authorize, declare and pay cash Dividends to its shareholders generally so long as ~~the Lead~~ Borrower or its Restricted Subsidiary which owns the Equity Interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary); (iii) so long as no ~~Default or~~ Event of Default exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, ~~the Lead~~ Borrower may authorize, declare and pay cash Dividends to Holdings to allow Holdings to pay cash dividends or make cash distributions to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of Holdings or such other Parent Company from ~~current or former members of~~ management, employees~~, consultants~~, officers and directors (and their successors and assigns) of ~~the Lead~~ Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by ~~the Lead~~ Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings or such other Parent Company in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to ~~the Lead~~ Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of ~~the Lead~~ Borrower, (x) the greater of $~~10,000,000~~ 75,000,000 and 6.25% of Consolidated EBITDA of Borrower and its Restricted Subsidiaries for the most recently ended Test Period (measured at the time of such Dividend) or (y) subsequent to the consummation of any Initial Public Offering of common stock or other comparable equity interests of Borrower or any direct or indirect parent of Borrower, the greater of $120,000,000 and 10% of Consolidated EBITDA of Borrower and its Restricted Subsidiaries for the most recently ended Test Period (measured at the time of such Dividend) (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by ~~the Lead~~ Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to ~~the Lead~~ Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (~~b)(x)(ii~~a)(iii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to ~~the Lead~~ Borrower from ~~current or former~~ members of management, officers, directors, employees of ~~the Lead~~ Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of Holdings or any other Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) ~~the Lead~~ Borrower may authorize, declare and pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to ~~the Lead~~ Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to ~~the Lead~~ Borrower or the relevant Restricted Subsidiary of ~~the Lead~~ Borrower out of the proceeds of such offering promptly if such offering is completed; (v) ~~the Lead~~ Borrower may authorize, declare and pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with ~~applicable laws~~Requirements of Law, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) ~~the Lead~~ Borrower may authorize, declare and pay cash ~~dividends~~ Dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their ~~existence~~existence to the extent such Taxes, fees and expenses are reasonably attributable to the operations of Holdings, Borrower and its Restricted Subsidiaries; (B) with respect to any ~~taxable year (~~period where Borrower or ~~portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b)~~ any of its Subsidiaries is a member of a consolidated, combined or similar income ~~tax~~ Tax group ~~(a “~~for U.S. federal and/or applicable state, local or foreign income or similar Tax ~~Group”)~~ purposes of which ~~any Parent Company~~ a direct or ~~other entity~~ indirect parent of Borrower is the common ~~parent~~parent or other applicable taxpayer, the portion of any U.S. federal, ~~state~~ state, local and/or foreign income and ~~local income~~ similar Taxes (including any alternative minimum ~~Taxes~~taxes) ~~(or franchise and similar Taxes imposed in lieu~~ of such ~~minimum Taxes)~~ Tax group that is attributable to the taxable income of Borrower and/or its applicable Restricted Subsidiaries and, to the extent of the amount actually received from its Unrestricted Subsidiaries for such purpose, in amounts required to pay any such Taxes that are attributable to the taxable income of ~~the Lead Borrower and its~~ such Unrestricted Subsidiaries; provided that ~~for each taxable period,~~ the aggregate amount of such payments ~~made in~~ with respect to such period (regardless of ~~such taxable period in the aggregate~~ when paid) shall not exceed the aggregate amount of such Taxes that Borrower and/or its applicable Restricted Subsidiaries (and, subject to the ~~Lead Borrower and its~~ limitation described above, any applicable Unrestricted Subsidiaries of Borrower) would have been required to pay as with respect to such period were such entities stand-alone corporate taxpayers or a stand-alone ~~Tax Group; provided, further, that~~ corporate tax group for all applicable taxable periods ending after the ~~permitted payment pursuant~~ date hereof taking into account any applicable limitations on the ability to ~~this clause (B) with respect to~~ utilize net operating loss carryforwards and similar tax attributes under the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar TaxesCode; (C) customary salary, bonus and other ~~compensation and~~ benefits payable to ~~current and former officers,~~ directors, ~~consultants~~ officers and employees of any Parent Company to the extent such salaries, bonuses and other ~~compensation and~~ benefits are reasonably attributable to the ownership or operations of ~~the Lead~~ Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of ~~the Lead~~ Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of ~~the Lead~~ Borrower or any Parent Company; (F) the purchase or other acquisition by Holdings or any ~~parent~~ other Parent Company of ~~the Lead~~ Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by ~~the Lead~~ Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such ~~parent~~ Parent Company shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to ~~the Lead~~ Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into ~~the Lead~~ Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such ~~purchaser~~ purchase or other acquisition;; and (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of ~~the Lead~~ Borrower and its Restricted Subsidiaries; (vii) Borrower and its Restricted Subsidiaries may give reasonable and customary indemnities to directors, officers and employees of Holdings or any other Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of ~~the Lead~~ Borrower and its Restricted Subsidiaries; (viii) ~~the Lead~~ Borrower may authorize, declare and pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of ~~the Lead~~ Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory ~~Agreement (as in effect on the Closing Date~~Agreement; (ix) any Dividend used (x) to fund the Transaction, including Transaction ~~Costs and the Special Dividend~~Costs, and (y) in order to satisfy deferred purchase price, earn-outs and contingent payments in respect of any ~~Dividend from proceeds received~~ amounts due and owing as provided for in ~~connection with any working capital adjustment pursuant to~~ the Acquisition Agreement; (x) ~~the Lead~~ Borrower may authorize, declare and pay cash Dividends to Holdings (who may subsequently authorize, declare and pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v), 10.06(vii) and ~~10.06(vii~~10.06(xii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or ~~the settlement or vesting of other~~ similar equity incentive awards; (xii) a Dividend (including to any Parent ~~Company~~ Company) to fund a payment of dividends on ~~such~~ Borrower’s or any Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, ~~of up~~ not to 6exceed, in any fiscal year, 6.0% ~~per annum~~ of the net cash proceeds contributed to the capital of ~~the Lead~~ Borrower from any such Initial Public Offering; (xiii) ~~on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00,~~ any Dividends to the extent the same are made solely with the Available Amount, so long as as, solely to the extent clause (a)(ii) of the definition of “Available Amount” is being utilized, at the time of, and after giving effect to such ~~Dividend~~Dividend on a Pro Forma Basis, (i) no Event of Default shall have occurred and be ~~continuing~~continuing and (ii) the Consolidated First Lien Net Leverage Ratio, on a Pro Forma Basis as of the last day of the most recently ended Test Period, does not exceed 3.10:1.00; (xiv) purchases of minority interests in ~~non-~~Restricted Subsidiaries that are not Wholly-Owned Subsidiaries by ~~the Lead~~ Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed the greater of $~~5,000,000~~60,000,000 and 5.0% of Consolidated EBITDA of Borrower and its Restricted Subsidiaries for the most recently ended Test Period (measured at the time of such Dividend); (xv) the authorization, declaration and payment of ~~dividends~~ Dividends or the payment of other distributions by ~~the Lead~~ Borrower in an aggregate amount since the Closing Date not to exceed the greater of $~~35,000,000~~250,000,000 and 25.0% of Consolidated EBITDA of Borrower and its Restricted Subsidiaries for the most recently ended Test Period (measured at the time of such Dividend); (xvi) ~~the Lead~~ Borrower and each Restricted Subsidiary may authorize, declare and make ~~dividend~~ Dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of ~~dividend~~ Dividend or other distribution by a Restricted Subsidiary, ~~the Lead~~ Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) ~~the Lead~~ Borrower may ~~make payments~~ authorize, declare and pay Dividends with the cash proceeds contributed to its common equity (including from the net cash proceeds of any equity issuance by any Parent Company), so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (~~iii~~xvii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (~~b)(x)(ii~~a)(iii) of the definition of “Available Amount”; (xviii) ~~the Lead~~ Borrower and any Restricted Subsidiary may authorize, declare and pay ~~dividends and distributions~~ Dividends within 60 90 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03~~; and~~; (xix) any Dividends, so long as (x) at the time ~~of,~~ of and after giving effect to such Dividend, no Event of Default ~~shall have~~ has occurred and be is continuing and (y) on a Pro Forma Basis, as of the last day of the most recently ended Test Period, the Consolidated ~~Total~~ First Lien Net Leverage Ratio does not exceed ~~3.25~~ 2.10:1.00; (xx) [reserved]; (xxi) any payment that is intended to ~~1.00~~prevent any Indebtedness of Borrower from being treated as an “applicable high yield discount obligation” within the meaning of Section 163(i)(1) of the Code; (xxii) [reserved]; and (xxiii) any Dividend or other distribution made with the net cash proceeds or other assets or property received from a disposition permitted pursuant to Section 10.02(xxix). In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the ~~definition~~ definitions of “Consolidated ~~EBITDA~~ EBITDA” and “Consolidated Net Income”), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) ~~shall~~ shall, to the extent such loan or advance remains unpaid, be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi). Notwithstanding anything to the contrary in this Section 10.03, Borrower and its Restricted Subsidiaries shall not, directly or indirectly, sell or otherwise transfer any Intellectual Property that is material to the operations of Borrower and its Subsidiaries taken as a whole to any Unrestricted Subsidiary.

Appears in 2 contracts

Sources: Term Loan Credit Agreement (Ingram Micro Holding Corp), Term Loan Credit Agreement (Ingram Micro Holding Corp)

Dividends. ~~The Lead Borrower~~ It will not, and will not permit any of its ~~Restricted~~ Subsidiaries to~~, authorize~~, declare or pay any ~~Dividends with respect to the Lead Borrower or any of its Restricted Subsidiaries, except that: (i) any Restricted Subsidiary of the Lead Borrower may pay Dividends or return capital~~ dividends or make distributions ~~and~~ (other ~~similar payments with regard to its Equity Interests to the Lead Borrower~~ than dividends or to other Restricted Subsidiaries of the Lead Borrower which directly or indirectly own equity therein; (ii) any non-Wholly-Owned Subsidiary of the Lead Borrower may declare and pay cash Dividends to its shareholders generally so long as the Lead Borrower or its Restricted Subsidiary which owns the Equity Interests distributions payable solely in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary); (iii) so long as no Default or Event of Default exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, the Lead Borrower may pay cash Dividends to Holdings to allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of such Parent Company from current or former members of management, employees, consultants, officers and directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by the Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than Disqualified Equity Interests)) or return any capital to ~~the extent included in the Available Amount) and contributed~~ its equity holders or make any other distribution, payment or delivery of property or cash to ~~the Lead Borrower in connection with such redemption~~ its equity holders as such, or ~~repurchase)~~redeem, ~~in either case~~retire, ~~exceed during any fiscal year of the Lead Borrower~~purchase or otherwise acquire, ~~$10,000,000 (provided that the amount of cash Dividends permitted to be~~directly or indirectly, ~~but not~~for consideration, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its ~~Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of~~ Equity Interests or Equity Interests of ~~Holdings~~any direct or indirect parent thereof now or hereafter outstanding, ~~in each case to members~~ or set aside any funds for any of ~~management~~the foregoing purposes, ~~managers, directors~~ or ~~consultants of any Parent Company or~~ permit any of its Subsidiaries ~~that occurs after the Closing Date, where the net proceeds of such sale are received by~~ to purchase or ~~contributed to the Lead Borrower; provided that the amount of~~ otherwise acquire for consideration any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of ~~any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement;~~ KCMH, now or hereafter outstanding (iv) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the ~~property and assets or business of any Person~~foregoing, ~~or of assets constituting a business unit~~“dividends”), ~~a line of business or division of such Person, or of all of the Equity Interests in a Person;~~ provided that KCMH and any Subsidiary may pay dividends if ~~such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that~~ (Ax) immediately before and after paying such dividend, ~~distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause~~ no (1) ~~all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary~~ Default or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $5,000,000; (xv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as (x) at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) ~~on a Pro Forma Basis~~the Debt to Equity Ratio is less than or equal to * to 1.00 after giving pro forma effect thereto. The limitations set forth in the immediately preceding sentence (other than subclause (x)(2) in the proviso thereto) shall not apply to any of the following items so long as KCMH is in compliance with Section 6.03 after giving pro forma effect thereto: (i) it may (or may pay dividends to permit any direct or indirect parent thereof to) redeem in whole or in part any of its Equity Interests for another class of its (or such parent’s) Equity Interests (other than Disqualified Equity Interests) or with proceeds from substantially concurrent equity contributions or issuances of new Equity Interests (other than Disqualified Equity Interests), provided that such new Equity Interests contain terms and provisions at least as advantageous to the Lenders in all respects material to their interests as those contained in the Equity Interests redeemed thereby; (ii) it may pay dividends, the ~~Consolidated Total Net Leverage Ratio does not exceed 3.25~~ proceeds of which will be used to ~~1.00. In determining compliance~~ pay (or to pay dividends to allow any direct or indirect parent of KCMH to pay (including to the individual owners of any direct or indirect parent of KCMH)) the tax liability of such parent and the individual owners of any direct or indirect parent, determined at the highest rate combined federal, state and local income tax rate applicable to an individual resident in New York City, attributable to KCMH or its Subsidiaries determined as if KCMH and its Subsidiaries filed separately; (iii) it or any of its Subsidiaries may (i) pay cash in lieu of fractional Equity Interests in connection with ~~this Section 10.03~~ any dividend, split or combination thereof and (ii) honor any conversion request by a holder of convertible Indebtedness and make cash payments in ~~determining amounts~~ lieu of fractional shares in connection with any such conversion; and (iv) any Subsidiary of KCMH may pay dividends to its direct parent; provided that if any such dividends are paid ~~as Dividends pursuant hereto~~ by a non-Wholly-Owned Subsidiary, such dividends shall be made ratably based on the equity holder’s interests therein (or any other amount more favorable to KCMH), provided further that if the proceeds of any outstanding Loans or Letters of Credit have been used for ~~purposes~~ an Investment in such non-Wholly-Owned Subsidiary, any cash dividends paid to such parent shall be applied to prepay such Loans or cash collateralize such Letters of Credit if no Loans are outstanding, at the option of the ~~definition~~ Administrative Agent, without application of ~~Consolidated EBITDA and Consolidated Net Income), amounts loaned~~ Section 3.12 or ~~advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to~~ at the ~~extent provided in said Section 10.05(vi~~end of the next Interest Period(s).

Appears in 2 contracts

Sources: 364 Day Revolving Credit Agreement (KKR & Co. Inc.), 364 Day Revolving Credit Agreement (KKR & Co. L.P.)

Dividends. The Lead Borrower will not, and will not permit any of its Restricted Subsidiaries to, authorize, declare or pay any Dividends with respect to the Lead Borrower or any of its Restricted Subsidiaries, except that: (i) any Restricted Subsidiary of the Lead Borrower Parent may pay ~~Dividends or return capital~~ dividends (or make any other distributions ~~and other similar payments with regard~~ to its Equity Interests to the Lead Borrower or to other Restricted Subsidiaries of the Lead Borrower which directly or indirectly own equity therein; (ii) any non-Wholly-Owned Subsidiary of the Lead Borrower may declare and pay cash Dividends to its shareholders generally so long as the Lead Borrower or its Restricted Subsidiary which owns the Equity Interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary); (iii) so long as no Default or Event of Default exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, the Lead Borrower may pay cash Dividends to Holdings to allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of such Parent Company from current or former members of management, employees, consultants, officers and directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by the Lead Borrower to Holdings pursuant to this clause (iiishareholders), ~~and the aggregate amount paid by Holdings~~ buy-back its own common stock and/or make new material investments in ~~respect~~ any company, shares, common stock or enter into any kind of ~~all such Equity Interests so redeemed or repurchased shall not~~ new forward contracts (~~net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than~~ including total return swaps), only to the extent ~~included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption~~ that no Default is continuing or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds would result from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time ofproposed transaction, and after giving effect to such ~~Dividend~~transaction, no the Parent and its Subsidiaries are in compliance with the Financial Covenants set out in Clause 22 (Financial Covenants) of this Agreement. To the extent the Parent has issued preference capital, any mandatory yield (interest) payments on such preference capital shall not be treated as dividend (or other distribution to its shareholders) for the purpose of this Clause 23.14. If an Event of Default ~~shall have~~ has occurred and be is continuing; , Seadrill ▇▇▇▇ and Seadrill Gulf ▇▇▇▇ may not pay dividends (~~xiv~~or make any other distributions to its shareholders) ~~purchases~~ or buy-back its own common stock. None of ~~minority interests~~ the Borrowers or Intra-Group Charterers shall incur, create or permit to subsist any Financial Indebtedness. The restrictions in ~~non-Wholly-Owned Subsidiaries by~~ paragraph (a) above do not apply to; Financial Indebtedness incurred pursuant to the ~~Lead Borrower~~ Finance Documents; intercompany loans and advances on the ~~Guarantors; provided~~ conditions that the ~~aggregate amount of such purchases, when added~~ loans or advances are subordinated and unsecured in a form and substance satisfactory to the ~~aggregate amount~~ Agent; or Financial Indebtedness incurred by an Intra-Group Charterer by way of ~~Investments pursuant~~ guarantees provided by such Intra-Group Charterer in relation to ~~Section 10.05(xvii)~~any financing of a vessel or rig in the Group. For the avoidance of doubt, the restrictions on Financial Indebtedness in Clause 23.15 (a) shall not ~~exceed $5,000,000; (xv)~~ apply to Seadrill Capricorn, unless it becomes or accedes to the ~~declaration and payment~~ position of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a ~~Restricted Subsidiary, the Lead~~ Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default an Intra-Group Charterer. Each Obligor shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as (x) at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and ~~in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA~~ shall procure that each Subsidiary will) procure that all transactions entered into with an Affiliate are made on market terms and ~~Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi)~~otherwise on arm’s length terms.

Appears in 2 contracts

Sources: Senior Secured Credit Facility Agreement, Senior Secured Credit Facility Agreement (Seadrill Partners LLC)

Dividends. The Lead Borrower will not, and will not permit any of its Restricted Subsidiaries to, authorize, declare or pay any Dividends with respect to the Lead Borrower or any of its Restricted Subsidiaries, except that: (i) any Restricted Subsidiary of the Lead Borrower may pay Dividends or return capital or make distributions and other similar payments with regard to its Equity Interests to the Lead Borrower or to other Restricted Subsidiaries of the Lead Borrower which directly or indirectly own equity therein; (ii) any non-Wholly-Owned Subsidiary of the Lead Borrower may declare and pay cash Dividends to its shareholders generally so long as the Lead Borrower or its Restricted Subsidiary which owns the Equity Interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary); (iii) so long as no Default or Event of Default exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, the Lead Borrower may pay cash Dividends to Holdings to allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of such Parent Company from current or former members of management, employees, consultants, officers and directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by the Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests ~~(other than to the extent included in the Available Amount)~~ and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date); (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) the Lead Borrower may pay any Dividends so long as the Distribution Conditions are satisfied on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and Basis immediately after giving effect to such ~~Dividend, no Event of Default shall have occurred and be continuing~~Dividends; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $5,000,000; (xv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $~~35,000,000~~35,000,000 (less any amounts used Section 10.07(a)(B)(ii) and Section 10.07(b)(ii)); (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result ~~therefrom;~~ therefrom and provided ~~that~~ such payments are made substantially contemporaneously with the ~~amount~~ receipt of ~~any~~ such cash proceeds ~~that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of~~ by the ~~definition of “Available Amount”;~~Lead Borrower; and (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as (x) at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi).

Appears in 2 contracts

Sources: Revolving Credit Agreement (PAE Inc), Revolving Credit Agreement (PAE Inc)

Dividends. The ~~Lead Borrower~~ Borrowers will not, ~~and~~ nor will ~~not~~ they permit any ~~of its Restricted Subsidiaries~~ other Credit Party to~~, authorize~~, declare or pay any ~~Dividends with respect to the Lead Borrower~~ dividends or make any distributions on its capital stock (other than dividends payable in their own capital stock) or redeem, repurchase or otherwise acquire or retire any of its ~~Restricted Subsidiaries~~capital stock at any time outstanding, ~~except that: (i)~~ including within the scope of such prohibition, any ~~Restricted Subsidiary~~ such dividends or distributions of ~~the Lead Borrower may pay Dividends~~ whatever kind or ~~return capital or make distributions and other similar payments with regard~~ type, contemplated above to ~~its Equity Interests to the Lead Borrower or to other Restricted Subsidiaries of the Lead Borrower which directly or indirectly own equity therein; (ii)~~ any non-Wholly-Owned Subsidiary of the Lead Borrower may declare and pay cash Dividends to its shareholders generally so long as the Lead Borrower or its Restricted Subsidiary which owns the Equity Interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferencesExisting Subordinated Note Indenture Additional Parties; provided, however, if ~~any~~(a) no Default, ~~of the various classes of Equity Interests of such Subsidiary); (iii) so long as no Default or~~ Event of Default ~~exists at the time of the applicable Dividend~~or Deficiency has occurred and continues in effect or remains uncured or will result from or be caused by such dividend or distribution, redemption or repurchase or would exist immediately after giving effect thereto, the Lead Borrower may pay cash Dividends to Holdings to allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of such Parent Company from current or former members of management, employees, consultants, officers and directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by the Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) Unit is ~~a member~~ in compliance with the limitations of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income Section 3.04 of the ~~Lead Borrower~~ Existing Subordinated Notes Indenture and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, ~~loan or advance shall be made concurrently with the closing of such purchase~~ redemption, repurchase or other acquisition or retirement of capital stock, together with other Restricted Payments (as that term is defined in the Existing Subordinated Notes Indenture) does not cause or result in a breach of Section 3.04 of the Existing Subordinated Notes Indenture, (i) any Subsidiary may declare and ~~(B) such parent shall~~pay dividends or make distributions to, ~~immediately following the closing thereof~~or redeem, ~~cause (1) all property acquired (whether assets~~ purchase or ~~Equity Interests) and~~ otherwise acquire or retire any ~~liabilities assumed to be contributed to the Lead Borrower~~ of its capital stock from, Unit or any ~~Restricted~~ Subsidiary or (2) other than and expressly excluding the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(viiExisting Subordinated Note Indenture Additional Parties); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as ~~at the time of, and after giving effect to~~ such ~~Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-~~Subsidiary is not a Wholly-Owned ~~Subsidiaries~~ Subsidiary, if the dividend, distribution, redemption, purchase, acquisition or retirement, as the case may be, is made on a pro rata basis (or with respect to Unit or its Subsidiaries, better than a pro rata basis), (ii) during any fiscal year Unit may pay cash dividends in amounts not exceeding thirty (30%) of its Consolidated Net Income (after taxes) for the preceding fiscal year, (iii) Unit may make any purchases of its outstanding common stock under a stock repurchase program approved by the ~~Lead Borrower~~ Unit Board of Directors and conducted in compliance with the ~~Guarantors; provided that~~ applicable rules and regulations of the ~~aggregate amount of such purchases~~SEC, ~~when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $5,000,000;~~ and (xviv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary Unit may declare and ~~make dividend payments or other distributions~~ pay dividends with respect to its capital stock payable solely in ~~the Equity Interests~~ additional shares of ~~such Person so long~~ its capital stock (other than Disqualified Stock as that term is defined in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as (x) at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(viExisting Subordinated Notes Indenture).

Appears in 2 contracts

Sources: Senior Credit Agreement (Unit Corp), Senior Credit Agreement (Unit Corp)

Dividends. ~~The Lead Borrower will not, and will not permit any of its Restricted Subsidiaries to, authorize~~Authorize, declare or ~~pay~~ pay, directly or indirectly, any Dividends with respect to ~~the Lead Borrower or~~ any ~~of its Restricted Subsidiaries~~Company, except that: (a) any Subsidiary of Borrower (i) may pay cash Dividends to Borrower or any ~~Restricted~~ Wholly Owned Subsidiary of ~~the Lead~~ Borrower ~~may pay Dividends or return capital or make distributions~~ and ~~other similar payments with regard to its Equity Interests to the Lead Borrower or to other Restricted Subsidiaries of the Lead Borrower which directly or indirectly own equity therein;~~ (ii) ~~any non-Wholly-~~if such Subsidiary is not a Wholly Owned Subsidiary of ~~the Lead Borrower~~ Borrower, may ~~declare and~~ pay cash Dividends to its shareholders generally so long as ~~the Lead~~ Borrower or its ~~Restricted~~ Subsidiary which owns the ~~Equity Interests~~ equity interest or interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative ~~holding~~ holdings of ~~the Equity Interests~~ equity interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of ~~Equity Interests of~~ equity interests in such Subsidiary); (~~iii~~b) so long as no Default ~~or Event of Default~~ exists ~~at the time of the applicable Dividend, redemption or repurchase~~ or would ~~exist immediately after giving effect thereto~~result therefrom, Borrower may pay Dividends to Holdings for the ~~Lead~~ purpose of paying Dividends to Parent in order to enable Parent to repurchase outstanding shares of its capital stock (or options to purchase such capital stock) following the death, disability, retirement or termination of employment of employees, officers or directors of any Company or upon the exercise by any such person of any “put” right in respect of any such capital stock (or options); provided that the aggregate amount of Dividends paid by Borrower pursuant to this paragraph (b) shall not exceed an aggregate amount of $3.0 million (exclusive of any amounts repaid to Borrower concurrently therewith in respect of loans made pursuant to Section 6.03(j); (c) Borrower may pay cash Dividends to Holdings for the purpose of paying cash Dividends to ~~allow Holdings~~ Parent, so long as all proceeds thereof are promptly used by Parent to pay ~~cash dividends~~ its franchise taxes and operating expenses incurred in the ordinary course of business and other corporate overhead costs and expenses (including legal and accounting expenses and similar expenses and customary fees to ~~any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests~~ non-officer directors of ~~such Parent Company from current or former members of management, employees, consultants, officers and directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries~~Parent); provided that ~~(A)~~ the aggregate amount of Dividends ~~made by the Lead Borrower~~ paid to Holdings pursuant to this clause (~~iii), and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased~~ c) shall not ~~(net of any cash proceeds received by Holdings (but~~ exceed $1.0 million in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of ~~the Lead Borrower, $10,000,000~~ Parent; (~~provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii~~d) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower Subsidiary may pay cash Dividends to Holdings ~~so long as~~ for the ~~proceeds thereof are promptly used by Holdings (or subsequently paid~~ purpose of paying cash dividends to ~~any other~~ Parent ~~Company) to pay expenses incurred by Holdings or any other Parent Company~~ in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) an amount not in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary excess of the ~~Lead Borrower out of the proceeds of~~ federal and state (in such ~~offering promptly if such offering is completed; (v~~states that permit consolidated or combined tax returns) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) liability that ~~are attributable to the taxable income of the Lead~~ Borrower and ~~its Subsidiaries; provided that for each taxable period,~~ the ~~amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its~~ Subsidiaries would have been ~~required to pay as~~ liable for if any of the Companies had filed their taxes on a stand-alone ~~Tax Group; provided~~basis, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the ~~purposes~~ purpose of paying such ~~consolidated~~taxes; provided that such payments shall be made by Parent no earlier than five days prior to the date on which Parent is required to make its payments to the Internal Revenue Service, ~~combined or similar Taxes~~as applicable; (Ce) ~~customary salary, bonus and other compensation and benefits payable~~ Borrower may pay Dividends to ~~current and former officers, directors, consultants and employees~~ Holdings for the purpose of ~~any~~ paying dividends to Parent ~~Company~~ of capital stock of Parent to the extent such ~~salaries~~capital stock of Parent is acquired by Borrower as a result of a foreclosure action following a default on an advance, ~~bonuses and~~ loan and/or other ~~compensation and benefits are reasonably attributable to the ownership or operations~~ extension of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition credit permitted ~~to be made~~ pursuant to Section ~~9.14~~6.03(j); ~~provided that~~ and (Af) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower ~~or any Restricted Subsidiary or (2) the merger (~~may pay Dividends to the extent permitted in by Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $5,000,000; (xv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as (x) at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi6.06(h).

Appears in 2 contracts

Sources: Credit Agreement (Cpi International, Inc.), Credit Agreement (Cpi International, Inc.)

Dividends. ~~The Lead~~ (a) At any time that the Leverage Ratio equals or exceeds 6.00:1.00, the U.S. Borrower will not, and will not permit any of its ~~Restricted~~ Subsidiaries to, authorize, declare or pay any Dividends with respect to the ~~Lead~~ U.S. Borrower or any of its ~~Restricted~~ Subsidiaries, except that: (i) any ~~Restricted~~ Subsidiary of the ~~Lead~~ U.S. Borrower may pay cash Dividends ~~or return capital or make distributions and other similar payments with regard to its Equity Interests~~ to the ~~Lead~~ U.S. Borrower or to ~~other Restricted Subsidiaries~~ a Wholly-Owned Subsidiary of the ~~Lead Borrower which directly or indirectly own equity therein~~U.S. Borrower; (ii) any non-Wholly-Owned Subsidiary of the ~~Lead~~ U.S. Borrower may ~~declare and~~ pay cash Dividends to its ~~shareholders~~ shareholders, members or partners generally so long as the ~~Lead~~ U.S. Borrower or its ~~Restricted~~ respective Subsidiary which owns the ~~Equity Interests~~ equity interest or interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative ~~holding~~ holdings of ~~the Equity Interests~~ equity interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of ~~Equity Interests of~~ equity interests in such Subsidiary);; provided, however, that this Section 11.11 shall not limit the redemption or repurchase of equity interests of a shareholder, member or partner of any non-Wholly-Owned Subsidiary of the U.S. Borrower if such redemption or repurchase is permitted pursuant to Section 11.10. (iii) so long as (x) no Specified Default or Event of Default then exists ~~at the time of the applicable Dividend, redemption or repurchase~~ or would exist immediately after giving effect ~~thereto~~thereto and (y) HHRI qualifies, or has taken all other actions necessary to qualify, as a “real estate investment trust” under the Code during any fiscal year of HHRI, the ~~Lead~~ U.S. Borrower may pay quarterly cash Dividends (which may be based on estimates) to HHRI and all other holders of OP Units generally when and to the extent necessary for HHRI to distribute, and HHRI may so distribute, cash Dividends to its shareholders generally in an aggregate amount not to exceed the greater of (I) the greatest of (A) 100% of Cash Available for Distribution for such fiscal year, (B) 100% of Taxable Income and (C) the minimum amount necessary for HHRI to maintain its tax status as a real estate investment trust and to satisfy the distributions required to be made by Notice 88-19 under the Code (or Treasury regulations issued pursuant thereto) by reason of HHRI making the election provided for therein and (II) at any time when, based upon the financial statements delivered pursuant to Section 10.11(a) or (b) and the U.S. Borrower’s estimation of the results of the current fiscal quarter, the Consolidated Interest Coverage Ratio is greater than 2.00:1:00, 85% of the Adjusted Funds From Operations for the current fiscal year; (iv) so long as no Specified Default or Event of Default then exists or would result therefrom, the U.S. Borrower may pay cash Dividends to Holdings to allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of such Parent Company from current or former members of management, employees, consultants, officers and directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by the Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may pay cash Dividends to Holdings HHRI so long as the proceeds ~~thereof~~ therefrom are promptly used by ~~Holdings (or subsequently paid to any other Parent Company)~~ HHRI to pay ~~expenses incurred by Holdings or~~ (x) any ~~other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities~~ Permitted Tax Payments at the time and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent ~~such salaries, bonuses~~ actually due and ~~other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries;~~ payable (~~D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties)~~ but without duplication of any ~~Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash~~ tax payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section ~~9.14; provided that (A~~11.11(a)(iii) ~~such dividend, distribution, loan or advance shall~~ above to satisfy the distribution required to be made ~~concurrently with~~ by Notice 88-19 under the ~~closing of such purchase~~ Code (or ~~other acquisition~~ Treasury regulations issued pursuant thereto)) and (By) ~~such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests)~~ any general corporate and ~~any~~ other overhead expenses and liabilities ~~assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (~~incurred by it to the extent ~~permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition~~not otherwise prohibited by this Agreement; (Gv) ~~any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to~~ so long as no Specified Default or Event of Default then exists or would result therefrom, the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead U.S. Borrower may pay cash Dividends to ~~Holdings so long as~~ HHRI in an aggregate amount not to exceed $10,000,000 for the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date;Revolving Credit Period; and (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (xvi) the ~~Lead~~ U.S. Borrower may pay cash Dividends to ~~Holdings (who may subsequently pay cash Dividends to any other Parent Company)~~ HHRI so long as HHRI promptly thereafter uses the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such ~~common stock after the Closing Date~~Dividends to repurchase shares of its capital stock, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the ~~Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00~~Borrower may repurchase OP Units, ~~any Dividends to the extent the same are made solely with the Available Amount,~~ in each case so long as ~~at the time of, and after giving effect to such Dividend,~~ (i) no Specified Default or Event of Default ~~shall have occurred and be continuing;~~ then exits or would result therefrom, (~~xiv~~ii) ~~purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that~~ the aggregate amount of ~~such purchases, when added to the aggregate amount of Investments~~ all repurchases and redemptions made pursuant to this Section ~~10.05(xvii), shall~~ 11.11(a)(vi) in any fiscal year of HHRI does not exceed ~~$5,000,000;~~ an amount equal to 1% of Adjusted Total Assets determined at the time of declaration of the Dividend (xv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with ~~the cash proceeds contributed to its common equity~~ any unused Roll Forward Amount from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that one fiscal year increasing the amount ~~of any such cash proceeds that are utilized for any~~ available to be paid as a Dividend under this ~~clause~~ Section 11.11(a)(vi) in subsequent fiscal years). Dividends paid during a period when the Leverage Ratio is less than 6.00:1.00 shall, in the event that the Leverage Ratio subsequently exceeds 6.00:1.00, be counted against the baskets provided for in this Section 11.11(a) (~~iii~~as applicable) ~~will not be considered to be cash proceeds of Equity Interests~~ for purposes of ~~clause (b)(x)(ii) of the definition of “Available Amount”;~~determining basket availability only. (~~xviii~~b) At any time that the ~~Lead~~ Leverage Ratio is less than 6.00:1.00, the U.S. Borrower and ~~any Restricted Subsidiary may pay dividends and distributions within 60 days after~~ the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as (x) at the time ofGuarantors will not, and ~~after giving effect to such Dividend~~will not permit any of their Restricted Subsidiaries to, ~~no Event of Default shall have occurred and be continuing and (y) on~~ directly or indirectly, authorize, declare, or pay any Dividends that would constitute a ~~Pro Forma Basis,~~ Restricted Payment that is prohibited under the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi)Governing Senior Note Indenture.

Appears in 2 contracts

Sources: Credit Agreement (Host Hotels & Resorts, Inc.), Credit Agreement (Host Hotels & Resorts L.P.)

Dividends. ~~The Lead Borrower~~ Parent will not, and will not permit any of its Restricted Subsidiaries to, ~~authorize,~~ declare or pay any ~~Dividends with respect to the Lead Borrower or any of its Restricted Subsidiaries~~Dividends, except that: (ia) each Restricted Subsidiary of Parent may make Restricted Payments to Parent and any Restricted Subsidiary of the Lead Borrower may pay Dividends or return capital or make distributions and other similar payments with regard to its Equity Interests to the Lead Borrower or to other Restricted Subsidiaries of the Lead Borrower which directly or indirectly own equity thereinParent; (iib) any ~~non~~Non-Wholly-Owned Subsidiary of ~~the Lead Borrower~~ Parent may ~~declare and~~ pay ~~cash~~ Dividends to its ~~shareholders generally~~ shareholders, members or partners generally, so long as ~~the Lead Borrower~~ Parent or its respective Restricted Subsidiary which owns the Equity ~~Interests~~ Interest in the Restricted Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity ~~Interests~~ Interest in the Restricted Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Restricted Subsidiary); (~~iii~~c) ~~so long as no Default or Event of Default exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, the Lead Borrower~~ Parent may (and may pay cash Dividends to ~~Holdings to allow Holdings to pay cash dividends to~~ any ~~other~~ direct or indirect parent of Parent ~~Company to redeem~~ for the purpose of enabling any direct or ~~repurchase~~indirect parent of Parent to) redeem, ~~contemporaneously with such Dividend,~~ repurchase or otherwise acquire for value Equity Interests of Parent (or of such direct or indirect parent of Parent) following the death, disability, retirement or termination of employment of officers, directors or employees of Parent ~~Company from current~~ or ~~former members~~ any of ~~management~~its Restricted Subsidiaries, ~~employees, consultants, officers and directors (and their successors and assigns)~~ provided that the sum of the ~~Lead Borrower~~ aggregate amount of Dividends paid by Parent in reliance on this clause (c) shall not exceed $15,000,000 in any Fiscal Year (which shall increase to $20,000,000 subsequent to the consummation of an IPO) with unused amounts in any fiscal year being permitted to be carried over to the immediately succeeding fiscal year, plus any cash proceeds received by Parent or any of its Restricted Subsidiaries from key man life insurance policies; (d) Parent may pay cash Dividends to any direct or indirect parent of Parent at the times and in the amounts necessary to enable such direct or indirect parent of Parent to pay their respective tax obligations, to the extent attributable to the business of Parent and its Restricted Subsidiaries; provided that (Ax) the ~~aggregate~~ amount of cash Dividends ~~made~~ paid by ~~the Lead Borrower to Holdings~~ Parent pursuant to this clause (~~iii),~~ d) to enable any direct or indirect parent of Parent to pay Federal and ~~the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased~~ state income and franchise taxes at any time shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed ~~during any fiscal year of the Lead Borrower, $10,000,000 (provided that~~ the amount of ~~cash~~ such Federal and state income and franchise taxes actually owing by such direct or indirect parent of Parent at such time for the respective period as determined in good faith by such direct or indirect parent of Parent and (y) the proceeds of such Dividends ~~permitted to be, but not, paid~~ shall be used by such direct or indirect parent of Parent for the purposes described above in ~~any fiscal year pursuant to~~ this clause (~~iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii~~d)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (ive) ~~the Lead Borrower~~ Parent may pay cash Dividends to ~~Holdings so long as the proceeds thereof are promptly used by Holdings (~~any direct or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any indirect parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used by such direct or indirect parent of Parent solely to (i) pay operating expenses of such direct or indirect parent of Parent incurred in the ~~Sponsor or Sponsor Affiliate~~ ordinary course of business (including, without limitation, outside directors and professional fees, expenses and ~~indemnification~~ indemnities) and other similar corporate overhead costs and expenses in each case attributable to the ownership or operations of Parent and the Restricted Subsidiaries and (ii) pay cash Dividends to any direct or indirect parent of Parent for the purpose of paying (and so long as same are used to pay) operating expenses of such direct or indirect parent of Parent incurred in the ordinary course of business and other similar corporate overhead costs and expenses in each case attributable to the ownership or operations of Parent and the Restricted Subsidiaries; (f) the Borrower may pay Dividends to Holdings (or any direct or indirect parent company thereof) at the times and in amounts necessary to enable Parent (or any direct or indirect parent company thereof) to make payments ~~that are then~~ due under the Tax Receivable Agreement (and Parent (or such direct or indirect parent company) shall be permitted to ~~be paid pursuant to Sections 10.06(v) and 10.06(vii~~make such payments); (xig) after an IPO, (i) any Dividend by Parent to pay listing fees and other costs and expenses payable by any direct or indirect parent of Parent that are attributable to being a publicly traded company and are reasonable and customary and (ii) additional Dividends in an aggregate amount in any Fiscal Year not to exceed an amount equal to 6.0% of the Market Capitalization; (h) Parent may, in lieu of making direct cash payments to Sponsor and its Affiliates or the Advance Shareholders as otherwise permitted by Sections 9.06(g), (h), (i), (j) and (k), pay Dividends (including to any direct or indirect parent of Parent) in order to make the payments permitted by such Sections; (i) if immediately before and immediately after giving effect to the respective Dividend, the First Lien Net Leverage Ratio for the Calculation Period most recently ended (calculated on a Pro Forma Basis) does not exceed 4.70:1.00, other Dividends in an aggregate amount not to exceed the Available Amount; provided that with respect to any Dividend made pursuant to this Section 9.03(i), no Event of Default has occurred and is continuing or would result therefrom; (j) other Dividends, so long as the aggregate amount of all Dividends made pursuant to this Section 9.03(j) does not exceed $75,000,000; (k) other Dividends so long as the Total Net Leverage Ratio for the Calculation Period most recently ended (calculated on a Pro Forma Basis) does not exceed 4.00:1.00; (l) Parent and each of its Restricted Subsidiaries may declare and make Dividends payable solely in the Equity Interests of such Person (other than Disqualified Equity Interests); (m) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants if such Equity Interests represent a portion of the exercise price of such options or ~~the settlement~~ warrants; (n) repurchases of Equity Interests in Parent (or any direct or indirect parent thereof) or any Restricted Subsidiary of Parent deemed to occur upon exercise or vesting of stock options, warrants, or other ~~equity incentive awards;~~ Equity Interests if such Equity Interests (~~xii~~i) represent all or a ~~Dividend to any Parent Company to fund a payment~~ portion of ~~dividends on such Parent Company’s common stock following an Initial Public Offering~~ the exercise price of such ~~common stock after the Closing Date~~options or warrants, ~~of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from~~ or (ii) are surrendered in connection with satisfying any federal, state, local, or foreign income tax obligation (including withholding in respect thereof) incurred in connection with such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $5,000,000; (xv) the declaration and payment of dividends exercise or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03vesting; and (~~xix~~o) Parent or any ~~Dividends~~Restricted Subsidiary of Parent may (i) pay cash in lieu of fractional Equity Interests in connection with any dividend, ~~so long as (x) at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing~~ split or combination thereof or any Permitted Acquisition and (yii) honor any conversion request by a holder of convertible Indebtedness and make cash payments in lieu of fractional shares in connection with any such conversion and may make payments on ~~a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance~~ convertible Indebtedness in accordance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi)its terms.

Appears in 2 contracts

Sources: Term Loan Credit Agreement (AdvancePierre Foods Holdings, Inc.), Term Loan Credit Agreement (AdvancePierre Foods Holdings, Inc.)

Dividends. ~~The Lead~~ Borrower will not, and will not permit any of ~~its~~ the Restricted Subsidiaries to, authorize, declare or pay any Dividends with respect to ~~the Lead~~ Borrower or any of its Restricted Subsidiaries, except that: (i) any Restricted Subsidiary of ~~the Lead~~ a Borrower may authorize, declare and pay Dividends or return capital or make distributions and other similar payments with regard to its Equity Interests to ~~the Lead~~ Borrower or to other Restricted Subsidiaries of ~~the Lead~~ Borrower which directly or indirectly own equity therein; (ii) any non-Wholly-Owned Subsidiary of ~~the Lead~~ Borrower may authorize, declare and pay cash Dividends to its shareholders generally so long as ~~the Lead~~ Borrower or its Restricted Subsidiary which owns the Equity Interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary); (iii) so long as no ~~Default or~~ Event of Default exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, ~~the Lead~~ Borrower may authorize, declare and pay cash Dividends to Holdings to allow Holdings to pay cash dividends or make cash distributions to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of Holdings or such other Parent Company from ~~current or former members of~~ management, employees~~, consultants~~, officers and directors (and their successors and assigns) of ~~the Lead~~ Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by ~~the Lead~~ Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings or such other Parent Company in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to ~~the Lead~~ Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of ~~the Lead~~ Borrower, (x) the greater of $~~10,000,000~~ 75,000,00083,562,500 and 6.25% of Consolidated EBITDA of Borrower and its Restricted Subsidiaries for the most recently ended Test Period (measured at the time of such Dividend) or (y) subsequent to the consummation of any Initial Public Offering of common stock or other comparable equity interests of Borrower or any direct or indirect parent of Borrower, the greater of $120,000,000133,700,000 and 10% of Consolidated EBITDA of Borrower and its Restricted Subsidiaries for the most recently ended Test Period (measured at the time of such Dividend) (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by ~~the Lead~~ Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to ~~the Lead~~ Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (~~b)(x)(ii~~a)(iii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to ~~the Lead~~ Borrower from ~~current or former~~ members of management, officers, directors, employees of ~~the Lead~~ Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of Holdings or any other Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) ~~the Lead~~ Borrower may authorize, declare and pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to ~~the Lead~~ Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to ~~the Lead~~ Borrower or the relevant Restricted Subsidiary of ~~the Lead~~ Borrower out of the proceeds of such offering promptly if such offering is completed; (v) ~~the Lead~~ Borrower may authorize, declare and pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with ~~applicable laws~~Requirements of Law, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) ~~the Lead~~ Borrower may authorize, declare and pay cash ~~dividends~~ Dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their ~~existence~~existence to the extent such Taxes, fees and expenses are reasonably attributable to the operations of Holdings, Borrower and its Restricted Subsidiaries; (B) with respect to any ~~taxable year (~~period where Borrower or ~~portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b)~~ any of its Subsidiaries is a member of a consolidated, combined or similar income ~~tax~~ Tax group ~~(a “~~for U.S. federal and/or applicable state, local or foreign income or similar Tax ~~Group”)~~ purposes of which ~~any Parent Company~~ a direct or ~~other entity~~ indirect parent of Borrower is the common ~~parent~~parent or other applicable taxpayer, the portion of any U.S. federal, ~~state~~ state, local and/or foreign income and ~~local income~~ similar Taxes (including any alternative minimum ~~Taxes~~taxes) ~~(or franchise and similar Taxes imposed in lieu~~ of such ~~minimum Taxes)~~ Tax group that is attributable to the taxable income of Borrower and/or its applicable Restricted Subsidiaries and, to the extent of the amount actually received from its Unrestricted Subsidiaries for such purpose, in amounts required to pay any such Taxes that are attributable to the taxable income of ~~the Lead Borrower and its~~ such Unrestricted Subsidiaries; provided that ~~for each taxable period,~~ the aggregate amount of such payments ~~made in~~ with respect to such period (regardless of ~~such taxable period in the aggregate~~ when paid) shall not exceed the aggregate amount of such Taxes that Borrower and/or its applicable Restricted Subsidiaries (and, subject to the ~~Lead Borrower and its~~ limitation described above, any applicable Unrestricted Subsidiaries of Borrower) would have been required to pay as with respect to such period were such entities stand-alone corporate taxpayers or a stand-alone ~~Tax Group; provided, further, that~~ corporate tax group for all applicable taxable periods ending after the ~~permitted payment pursuant~~ Closing Date taking into account any applicable limitations on the ability to ~~this clause (B) with respect to~~ utilize net operating loss carryforwards and similar tax attributes under the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar TaxesCode; (C) customary salary, bonus and other ~~compensation and~~ benefits payable to ~~current and former officers,~~ directors, ~~consultants~~ officers and employees of any Parent Company to the extent such salaries, bonuses and other ~~compensation and~~ benefits are reasonably attributable to the ownership or operations of ~~the Lead~~ Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of ~~the Lead~~ Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of ~~the Lead~~ Borrower or any Parent Company; (F) the purchase or other acquisition by Holdings or any ~~parent~~ other Parent Company of ~~the Lead~~ Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by ~~the Lead~~ Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such ~~parent~~ Parent Company shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to ~~the Lead~~ Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into ~~the Lead~~ Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such ~~purchaser~~ purchase or other acquisition;; and (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of ~~the Lead~~ Borrower and its Restricted Subsidiaries; (vii) Borrower and its Restricted Subsidiaries may give reasonable and customary indemnities to directors, officers and employees of Holdings or any other Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of ~~the Lead~~ Borrower and its Restricted Subsidiaries; (viii) ~~the Lead~~ Borrower may authorize, declare and pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of ~~the Lead~~ Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory ~~Agreement (as in effect on the Closing Date~~Agreement; (ix) any Dividend used (x) to fund the Transaction, including Transaction ~~Costs and the Special Dividend~~Costs, and (y) in order to satisfy deferred purchase price, earn-outs and contingent payments in respect of any ~~Dividend from proceeds received~~ amounts due and owing as provided for in ~~connection with any working capital adjustment pursuant to~~ the Acquisition Agreement; (x) ~~the Lead~~ Borrower may authorize, declare and pay cash Dividends to Holdings (who may subsequently authorize, declare and pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v), 10.06(vii) and ~~10.06(vii~~10.06(xii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or ~~the settlement or vesting of other~~ similar equity incentive awards; (xii) a Dividend (including to any Parent ~~Company~~ Company) to fund a payment of dividends on ~~such~~ Borrower’s or any Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, ~~of up~~ not to 6exceed, in any fiscal year, 6.0% ~~per annum~~ of the net cash proceeds contributed to the capital of ~~the Lead~~ Borrower from any such Initial Public Offering; (xiii) ~~on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00,~~ any Dividends to the extent the same are made solely with the Available Amount, so long as as, solely to the extent clause (a)(ii) of the definition of “Available Amount” is being utilized, at the time of, and after giving effect to such ~~Dividend~~Dividend on a Pro Forma Basis, (i) no Event of Default shall have occurred and be ~~continuing~~continuing and (ii) the Consolidated First Lien Net Leverage Ratio, on a Pro Forma Basis as of the last day of the most recently ended Test Period, does not exceed 3.10:1.00; (xiv) purchases of minority interests in ~~non-~~Restricted Subsidiaries that are not Wholly-Owned Subsidiaries by ~~the Lead~~ Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed the greater of $~~5,000,000~~60,000,00066,850,000 and 5.0% of Consolidated EBITDA of Borrower and its Restricted Subsidiaries for the most recently ended Test Period (measured at the time of such Dividend); (xv) the authorization, declaration and payment of ~~dividends~~ Dividends or the payment of other distributions by ~~the Lead~~ Borrower in an aggregate amount since the Closing Date not to exceed the greater of $~~35,000,000~~250,000,000334,250,000 and 25.0% of Consolidated EBITDA of Borrower and its Restricted Subsidiaries for the most recently ended Test Period (measured at the time of such Dividend); (xvi) ~~the Lead~~ Borrower and each Restricted Subsidiary may authorize, declare and make ~~dividend~~ Dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of ~~dividend~~ Dividend or other distribution by a Restricted Subsidiary, ~~the Lead~~ Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) ~~the Lead~~ Borrower may ~~make payments~~ authorize, declare and pay Dividends with the cash proceeds contributed to its common equity (including from the net cash proceeds of any equity issuance by any Parent Company), so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (~~iii~~xvii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (~~b)(x)(ii~~a)(iii) of the definition of “Available Amount”; (xviii) ~~the Lead~~ Borrower and any Restricted Subsidiary may authorize, declare and pay ~~dividends and distributions~~ Dividends within 60 90 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03~~; and~~; (xix) any Dividends, so long as (x) at the time ~~of,~~ of and after giving effect to such Dividend, no Event of Default ~~shall have~~ has occurred and be is continuing and (y) on a Pro Forma Basis, as of the last day of the most recently ended Test Period, the Consolidated ~~Total~~ First Lien Net Leverage Ratio does not exceed ~~3.25~~ 2.10:1.00; (xx) [reserved]; (xxi) any payment that is intended to ~~1.00~~prevent any Indebtedness of Borrower from being treated as an “applicable high yield discount obligation” within the meaning of Section 163(i)(1) of the Code; (xxii) [reserved]; and (xxiii) any Dividend or other distribution made with the net cash proceeds or other assets or property received from a disposition permitted pursuant to Section 10.02(xxix). In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the ~~definition~~ definitions of “Consolidated ~~EBITDA~~ EBITDA” and “Consolidated Net Income”), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) ~~shall~~ shall, to the extent such loan or advance remains unpaid, be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi). Notwithstanding anything to the contrary in this Section 10.03, Borrower and its Restricted Subsidiaries shall not, directly or indirectly, sell or otherwise transfer any Intellectual Property that is material to the operations of Borrower and its Subsidiaries taken as a whole to any Unrestricted Subsidiary.

Appears in 1 contract

Sources: Term Loan Credit Agreement (Ingram Micro Holding Corp)

Dividends. ~~The Lead Borrower will not, and will not permit any of its Restricted Subsidiaries to, authorize~~Authorize, declare or ~~pay~~ pay, directly or indirectly, any Dividends, except that the following shall be permitted: (a) Dividends ~~with respect~~ by any Company to PESRM or any Guarantor; (b) payments to Holdings to permit Holdings, to repurchase or redeem Qualified Capital Stock of Holdings held by officers, directors or employees or former officers, directors or employees (or their transferees, estates or beneficiaries under their estates) of any Company, upon their death, disability, retirement, severance, resignation or termination of employment or service or pursuant to any employee or directors’ and/or officers’ equity or stock compensation plan; provided, that the aggregate cash consideration paid for all such redemptions and payments shall not exceed, in any fiscal year, $[**] (and up to [**]% of such $[**] not used in any fiscal year may be carried forward to the ~~Lead Borrower or any of its Restricted Subsidiaries, except that:~~next succeeding (but no other) fiscal year); (i) ~~any Restricted Subsidiary~~ to the extent actually used by Holdings or Intermediate Holdco to pay such Taxes, costs and expenses, payments by PESRM to or on behalf of ~~the Lead Borrower may~~ Holdings or Intermediate Holdco in an amount sufficient to pay ~~Dividends or return capital or make distributions~~ franchise taxes and other ~~similar~~ fees required to maintain the legal existence of Holdings or Intermediate Holdco and (ii) payments ~~with regard~~ by PESRM to ~~its Equity Interests~~ or on behalf of Holdings or Intermediate Holdco in an amount sufficient to pay out-of-pocket legal, accounting and filing costs and other expenses in the ~~Lead Borrower~~ nature of overhead in the ordinary course of business of Holdings or Intermediate Holdco in an aggregate amount not to ~~other Restricted Subsidiaries of the Lead Borrower which directly or indirectly own equity therein~~exceed $[**] in any fiscal year; (d) Dividends, provided that both before and after giving effect to any such Dividend, (i) Pro Forma Liquidity shall be greater than the Threshold Basket Amount, (ii) any non-Wholly-Owned Subsidiary of the Lead Borrower may declare and pay cash Dividends to its shareholders generally so long as the Lead Borrower or its Restricted Subsidiary which owns the Equity Interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary); (iii) so long as no Default or Event of Default ~~exists at the time of the applicable Dividend, redemption~~ shall have occurred or repurchase or would exist immediately after giving effect thereto, the Lead Borrower may pay cash Dividends to Holdings to allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of such Parent Company from current or former members of management, employees, consultants, officers shall result therefrom and directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by the Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) ~~shall increase the amount of cash Dividends permitted to be paid~~ ** Certain information in ~~the succeeding two fiscal years pursuant to~~ this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made document has been omitted and filed separately with the ~~cash proceeds described in the preceding clause (I);~~ Securities and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed Exchange Commission. Confidential treatment has been requested with respect to the ~~Securities Act,~~ omitted portions. the ~~Securities Exchange Act or the respective rules and regulations promulgated thereunder;~~ Consolidated Fixed Charge Coverage Ratio (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) calculated on a Pro Forma Basis~~, if~~ ) is not less than the Minimum Fixed Charge Coverage Ratio and it being understood that such Dividend shall be included in the calculation of Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event Fixed Charges for purposes of ~~Default shall have occurred and be continuing~~this subclause (iii); (~~xiv~~e) ~~purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower~~ Permitted Tax Distributions and ~~the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $5,000,000~~Employee Payment Distributions; (xvf) ~~the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower~~ PESRM and each ~~Restricted~~ Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests (other than Disqualified Capital Stock) of such ~~Person so long~~ Person; (g) to the extent ultimately contributed to PESRM, the Net Cash Proceeds from the sale of Equity Interests (other than Disqualified Capital Stock) of Holdings and, to the extent ultimately contributed to PESRM, Equity Interests of any of Holdings’ direct or indirect parent companies, in each case, to members of management, directors or consultants of Holdings, PESRM or any of their Subsidiaries; (h) any amount paid to Sponsor pursuant to the terms of the Advisory Agreement, but only to the extent that no Event of Default or Trigger Event (as such term is defined in the Senior Secured Credit Facility) has occurred and is continuing; (i) the Transactions as contemplated by the Transaction Documents, including (i) a conveyance, transfer or assignment of the North Yard and the West Yard to Sunoco or any nominee of Sunoco and (ii) the sale of the North Yard Assets and the Other Logistics Assets to any third party; (j) Dividends permitted under Section 11.02(g)(ii) and Section 11.08; (k) upon consummation of an IPO, (i) the net proceeds received by PESRM from the sale of securities in such IPO and (ii) dividends from Available Cash on and following such consummation, provided that, in the case of ~~dividend or other distribution by a Restricted Subsidiary~~this clause (ii), the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect after giving effect to any such ~~payments~~dividend, ~~no Event~~ Liquidity shall equal or exceed the greater of ~~Default shall have occurred and be continuing or would result therefrom; provided that the~~ (x) an amount ~~of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered~~ equal to ~~be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii)~~ [**]% of the ~~definition of “Available Amount”;~~ then current Borrowing Base and (~~xviii~~y) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03$[**]; and (~~xix~~l) ~~any~~ Dividends taking the form of issuance of Qualified Capital Stock in PESRM; (m) prior to, but in contemplation of an IPO, Dividends equal to existing cash and accounts receivable of PESRM (which upon consummation of the IPO (and in no event later than three (3) Business Days after the making of such Dividends), shall be replaced with an equal amount of IPO proceeds (which portion of the IPO proceeds shall not, for the avoidance of doubt, be distributed pursuant to clause (k)(i) above); and (n) a distribution of the Equity Interests of PESA to an Affiliate Transferee, so long as ~~(x) at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio~~ PESA does not ~~exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes~~ own any material portion of the ~~definition of Consolidated EBITDA~~ Refinery, ** Certain information in this document has been omitted and ~~Consolidated Net Income)~~filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions. provided that, ~~amounts loaned or advanced~~ notwithstanding anything to ~~Holdings~~ the contrary herein, Dividends permitted pursuant to ~~Section 10.05(vi)~~ any of the foregoing clauses shall not be ~~deemed~~ included in the calculation of total amount of Dividends consummated pursuant to ~~be cash Dividends paid to Holdings to~~ any other of the ~~extent provided in said Section 10.05(vi)~~foregoing clauses.

Appears in 1 contract

Sources: Supply and Offtake Agreement (Philadelphia Energy Solutions Inc.)

Dividends. ~~The Lead Borrower~~ Holdings will not, and will not permit any of ~~its~~ the Restricted Subsidiaries to, ~~authorize, declare or~~ pay any Dividends with respect to ~~the Lead Borrower~~ Holdings or any of ~~its~~ the Restricted Subsidiaries, except that: (i) any Restricted Subsidiary of ~~the Lead Borrower~~ Holdings may pay Dividends or return capital or make distributions and other similar payments with regard to its Equity Interests to ~~the Lead Borrower~~ Holdings or to other Restricted Subsidiaries of ~~the Lead Borrower~~ Holdings which directly or indirectly own equity therein; (ii) any non-Wholly-Owned Subsidiary of ~~the Lead Borrower~~ Holdings may declare and pay cash Dividends to its shareholders generally so long as ~~the Lead Borrower~~ Holdings or its Restricted Subsidiary which owns the Equity Interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary); (iii) so long as no Default or Event of Default exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, ~~the Lead Borrower~~ Holdings may pay cash Dividends to ~~Holdings to allow Holdings to pay cash dividends to~~ any ~~other~~ Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of such Parent Company from ~~current or former members of~~ management, employees~~, consultants~~, officers and directors (and their successors and assigns) of Holdings and the ~~Lead Borrower and its~~ Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by ~~the Lead Borrower to~~ Holdings pursuant to this clause (iii), and the aggregate amount paid by ~~Holdings~~ such Parent Company in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings ~~(but in no event from any Initial Public Offering)~~ from issuances of its Equity Interests (other than to the extent included in the Available Amount) ~~and contributed to the Lead Borrower~~ in connection with such redemption or repurchase), in either case, exceed during any fiscal year of Holdings, the ~~Lead Borrower,~~ greater of $~~10,000,000~~ 44,300,000 and 10.0% of LTM Consolidated EBITDA (measured at the time of such Dividend) (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two (2) fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by ~~the Lead Borrower~~ Holdings or any of ~~its~~ the Restricted Subsidiaries after the ~~Closing~~ Amendment and Restatement Effective Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings or of any Parent Company which net proceeds are contributed to Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the ~~Closing~~ Amendment and Restatement Effective Date~~, where the net proceeds of such sale are received by or contributed to the Lead Borrower~~; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (~~b)(x)(ii~~a)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to ~~the Lead Borrower~~ Holdings from ~~current or former~~ members of management, officers, directors, employees of ~~the Lead Borrower~~ Holdings or any of its Subsidiaries in connection with a repurchase of Equity Interests of Holdings or any other Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) ~~the Lead Borrower~~ Holdings may pay cash Dividends to ~~Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to~~ any ~~other~~ Parent ~~Company)~~ Company to pay expenses incurred by ~~Holdings or~~ any ~~other~~ Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to ~~the Lead Borrower~~Holdings, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as ~~Holdings and any other~~ such Parent Company shall cause the amount of such expenses to be repaid to ~~the Lead Borrower~~ Holdings or the relevant Restricted Subsidiary of ~~the Lead Borrower~~ Holdings out of the proceeds of such offering promptly if such offering is completed; (v) ~~the Lead Borrower~~ Holdings may pay cash Dividends to ~~Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to~~ any ~~other~~ Parent ~~Company)~~ Company to pay costs (including all professional fees and expenses) incurred by ~~Holdings or any other~~ such Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) for any taxable period in which (a) Holdings and/or any of its Subsidiaries is a member of a consolidated, combined, unitary or similar U.S. federal, state, local and/or foreign income or similar tax group whose common parent is a Parent Company (a “Tax Group”) or (b) Holdings is a pass-through entity for U.S. federal income tax purposes that is owned by a Parent Company that is a corporation for U.S. federal income tax purposes (directly or indirectly through one or more corporate subsidiaries of such Parent Company (any such corporate subsidiaries, together with such Parent Company, the ~~Lead Borrower~~ “Corporate Owners”)), Holdings may make distributions to any Parent Company to pay any consolidated, combined, unitary or similar U.S. federal, state, local and/or foreign income or similar income Taxes of such Tax Group, as applicable, or to any Corporate Owner to pay the U.S. federal, state, local and/or foreign income or similar Taxes of such Corporate Owner, in each case that are attributable to the taxable income of Holdings and/or its applicable Subsidiaries, as applicable; provided that (A) the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount of such Taxes that Holdings and/or its applicable Subsidiaries would have been required to pay in respect of such taxable period if such entity(ies) were a stand-alone corporate taxpayer or stand-alone corporate tax group consisting only of Holdings and/or such Subsidiaries for all relevant taxable periods, (B) the portion of any payment otherwise permitted pursuant to this clause (vi) with respect to any Taxes attributable to the income of any Unrestricted Subsidiary shall be limited to the amount actually paid by such Unrestricted Subsidiary to Holdings or any Credit Party for the purposes of paying such Taxes, and (C) with respect to any taxable period (or portion thereof) ending prior to the Amendment and Restatement Effective Date, payments pursuant to this clause (vi) shall be permitted only to the extent relating to Tax adjustments that arise after the Amendment and Restatement Effective Date as a result of audits or other Tax proceedings; (vii) Holdings may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their ~~existence~~existence to the extent such Taxes, fees and expenses are reasonably attributable to the operations of Holdings and the Restricted Subsidiaries; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other ~~compensation and~~ benefits payable to ~~current and former officers, directors, consultants~~ officers and employees of any Parent Company to the extent such salaries, bonuses and other ~~compensation and~~ benefits are reasonably attributable to the ownership or operations of Holdings and the ~~Lead Borrower and its~~ Restricted Subsidiaries; (DC) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of Holdings and the ~~Lead Borrower~~ Restricted Subsidiaries (including, for the avoidance of doubt, administrative costs and ~~its Restricted Subsidiaries~~expenses of Syncom-Iridium Holdings Corp. and/or Iridium Blocker-B. Inc.); (ED) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of ~~the Lead Borrower~~ Holdings or any Parent Company; (FE) for the purchase or other acquisition by any ~~parent of the Lead Borrower~~ Parent Company of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that (1) if such purchase or other acquisition had been made by ~~the Lead Borrower~~Holdings, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14~~; provided that~~ , (A2) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B3) such ~~parent~~ Parent Company shall, immediately following the closing thereof, cause (1x) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to ~~the Lead Borrower~~ Holdings or any Restricted Subsidiary or (2y) the merger (to the extent permitted in Section 10.02) into ~~the Lead Borrower~~ Holdings or any Restricted Subsidiary of the Person formed or acquired in order to consummate such ~~purchaser~~ purchase or other acquisition;; and (GF) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company ~~directly~~ reasonably attributable to the operations of Holdings and the ~~Lead Borrower and its~~ Restricted Subsidiaries; provided that the aggregate amount of Dividends made pursuant to subclauses (B), (C) and (F) of this clause (vii) shall not exceed the greater of $44,300,000 and 10.0% of LTM Consolidated EBITDA (measured at the time of such Dividend) in any fiscal year; (~~vii~~viii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of Holdings and the ~~Lead Borrower and its~~ Restricted Subsidiaries; (~~viii~~ix) ~~the Lead Borrower~~ Holdings may pay cash Dividends to ~~Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to~~ any ~~other~~ Parent ~~Company)~~ Company for payment of ~~(x)~~ obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs Holdings and the ~~Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement~~Restricted Subsidiaries; (x) ~~the Lead Borrower~~ [reserved]; (xi) Holdings may pay cash Dividends to ~~Holdings (who may subsequently pay cash Dividends to~~ any ~~other~~ Parent ~~Company)~~ Company so long as the proceeds thereof are used to pay ~~the Sponsor or Sponsor Affiliate~~ fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections ~~10.06(v~~10.06(vii) and ~~10.06(vii~~10.06(xii); (xixii) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or ~~the settlement or vesting of other~~ similar equity incentive awards; (~~xii~~xiii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common ~~stock following an Initial Public Offering~~ stock, not to exceed, in any fiscal year, 5.0% of such ~~common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering~~Parent Company’s Market Capitalization; (~~xiii~~xiv) ~~on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00,~~ any Dividends to the extent the same are made solely with the Available Amount; provided that to the extent clause (a)(i)(B) of the definition of “Available Amount” is being utilized, ~~so long as~~ at the time of, and after giving effect to such ~~Dividend~~Dividend on a Pro Forma Basis, (x) no Event of Default under Section 11.01(a) or Section 11.01(e) shall have occurred and be ~~continuing~~continuing and (y) the Consolidated Total Net Leverage Ratio, on a Pro Forma Basis as of the last day of the most recently ended Test Period, does not exceed 5.50:1.00; (~~xiv~~xv) purchases of minority interests in ~~non-~~Restricted Subsidiaries that are not Wholly-Owned Subsidiaries by ~~the Lead Borrower and the Guarantors~~Credit Parties; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed the greater of $~~5,000,000~~44,300,000 and 10.0% of LTM Consolidated EBITDA (measured at the time of such Dividend); (xvxvi) the declaration and payment of ~~dividends~~ Dividends or the payment of other distributions by Holdings, so long as the ~~Lead Borrower in an aggregate amount since~~ Consolidated Total Net Leverage Ratio, on a Pro Forma Basis as of the ~~Closing Date~~ last day of the most recently ended Test Period, does not to exceed ~~$35,000,000~~4.00:1.00 and no Event of Default shall have occurred and be continuing or result therefrom; (~~xvi~~xvii) ~~the Lead Borrower~~ Holdings and each Restricted Subsidiary may declare and make ~~dividend~~ Dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of ~~dividend~~ Dividend or other distribution by a Restricted Subsidiary, ~~the Lead Borrower~~ Holdings or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (~~xvii~~xviii) ~~the Lead Borrower~~ Holdings may ~~make payments~~ pay Dividends with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent ~~Company~~Company completed after the Amendment and Restatement Effective Date, so long as, with respect to any such payments, no Event of Default under Section 11.01(a) or 11.01(e) shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (~~iii~~xviii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (~~b)(x)(ii~~a)(ii) of the definition of “Available Amount”; (~~xviii~~xix) ~~the Lead Borrower~~ Holdings and any Restricted Subsidiary may pay ~~dividends and distributions~~ Dividends within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03~~; and~~; (~~xix~~xx) [reserved]; (xxi) Holdings and any ~~Dividends~~Restricted Subsidiary may make payments and distributions to dissenting stockholders pursuant to applicable law pursuant to or in connection with a sale, ~~so long~~ consolidation, merger or transfer of Holdings and the Restricted Subsidiaries taken as a whole that complies with the terms of this Agreement, including Section 10.02 hereof; (xxxii) Holdings and any Restricted Subsidiary may declare and pay Dividends to holders of any class or series of Qualified Preferred Stock issued by a Parent Company after the Amendment and Restatement Effective Date; provided that (A) the Consolidated Fixed Charge Coverage Ratio at the time ~~of, and after giving effect to~~ of the issuance of such ~~Dividend, no Event of Default shall have occurred and be continuing and~~ Qualified Preferred Stock (y) calculated on a Pro Forma Basis, ) is 2.00 to 1.00 or greater and (B) the ~~Consolidated Total Net Leverage Ratio~~ aggregate amount of Dividends declared and paid pursuant to this Section 10.03(xxii) does not exceed ~~3.25~~ the net cash proceeds received by the Parent Company and contributed to ~~1.00~~Holdings from any such sale of Qualified Preferred Stock issued after the Amendment and Restatement Effective Date and contributed to Holdings; and (xxiii) Holdings and any Restricted Subsidiary may pay Dividends in an aggregate amount not to exceed the greater of $110,750,000 and 25% of LTM Consolidated EBITDA (measured at the time of such Dividend), which may, at the election of the Borrower (and without duplication), be reallocated to make Investments pursuant to Section 10.05(xix). In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the ~~definition~~ definitions of “Consolidated ~~EBITDA~~ EBITDA” and “Consolidated Net Income”), amounts loaned or advanced to ~~Holdings~~ any Parent Company pursuant to Section 10.05(vi) ~~shall~~ shall, to the extent such loan or advance remains unpaid, be deemed to be cash Dividends paid to ~~Holdings~~ such Parent Company to the extent provided in said Section 10.05(vi). For purposes of determining compliance with this Section 10.03, if the payment of Dividends would be permitted pursuant to one or more provisions described above, the Borrower, in its sole discretion, from time to time, may classify or reclassify or divide such payment of Dividends (or any portion thereof) in any manner that complies with this Section 10.03.

Appears in 1 contract

Sources: Credit Agreement (Iridium Communications Inc.)

Dividends. ~~The Lead Borrower will not~~In the event of dividends or distributions on Common Stock, the following terms and ~~will not permit any of its Restricted Subsidiaries to, authorize, declare or pay any Dividends with respect to the Lead Borrower or any of its Restricted Subsidiaries,~~ conditions shall apply except ~~that~~as provided in Section 4(b) below: (i) In the event of a cash dividend or distribution on Common Stock, such dividend or distribution shall be automatically reinvested in additional shares of Restricted Stock in accordance with the B▇▇▇▇ Direct Stock Purchase and Dividend Reinvestment Plan (or any ~~Restricted Subsidiary of~~ successor, or if participation therein is not administratively feasible, on terms substantially the ~~Lead Borrower may pay Dividends or return capital or make distributions~~ same as under such plan). Employee agrees to sign the new account application and ~~other similar payments with regard to its Equity Interests~~ related forms under the Company’s Direct Stock Purchase and Dividend Reinvestment Plan. Share acquired under this Section 4(a)(i) will become vested if and to the ~~Lead Borrower~~ same extent as the original Restricted Stock with respect to which the cash dividend or distribution was made becomes vested and, to the greatest extent practicable, shall be subject to all other terms and conditions as applied to the original Restricted ~~Subsidiaries of the Lead Borrower which directly or indirectly own equity therein~~Stock; (ii) In the event of any non-~~Wholly-Owned Subsidiary~~ cash dividend or distribution in the form of property other than Common Stock payable on Common Stock (including shares of a subsidiary of the ~~Lead Borrower may declare~~ Company distributed in a spin-off), the Company shall retain in its custody the property so distributed in respect of Employee’s Restricted Stock, which property thereafter will become vested if and ~~pay cash Dividends~~ to ~~its shareholders generally so long~~ the same extent as the ~~Lead Borrower or its~~ original Restricted ~~Subsidiary~~ Stock with respect to which ~~owns~~ the ~~Equity Interests~~ property was distributed becomes vested and, to the greatest extent practicable, shall be subject to all other terms and conditions as applied to the original Restricted Stock, including in the ~~Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding~~ event of ~~the Equity Interests~~ any dividends or distributions paid in ~~the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests~~ respect of such ~~Subsidiary)~~property or with respect to the placement of any legend on certificate(s) or documents representing such property; provided, however, that any dividend or distribution of rights that expire before the applicable Stated Vesting Date will be unrestricted and exercisable by Employee in accordance with their terms; (iii) ~~so long as no Default~~ In the event of a dividend or ~~Event~~ distribution in the form of ~~Default exists at the time~~ Common Stock or split-up of ~~the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto~~shares, the ~~Lead Borrower may pay cash Dividends to Holdings to allow Holdings to pay cash dividends to any other Parent Company to redeem~~ Common Stock issued or ~~repurchase, contemporaneously with~~ delivered as such ~~Dividend, Equity Interests of~~ dividend or distribution or resulting from such Parent Company from current or former members of management, employees, consultants, officers and directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by the Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) split-up will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to ~~constitute a Dividend for purposes of this Agreement; (iv)~~ be additional Restricted Stock and will become vested if and to the ~~Lead Borrower may pay cash Dividends to Holdings so long~~ same extent as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant original Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date Stock with respect to which the ~~Lead Borrower (a) is treated~~ dividend or distribution was payable becomes vested, and shall be subject to all other terms and conditions as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable applied to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its original Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $5,000,000; (xv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as (x) at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi)Stock.

Appears in 1 contract

Sources: Restricted Stock Agreement (Bowne & Co Inc)

Dividends. The ~~Lead Borrower~~ Company will not, ~~and~~ nor will ~~not~~ it permit any ~~of its Restricted Subsidiaries~~ Subsidiary to~~, authorize~~, declare or pay any ~~Dividends with respect to the Lead Borrower or any of its Restricted Subsidiaries~~Dividends, except that: (ia) any Restricted Subsidiary of the Lead Borrower may pay Dividends or return capital or make distributions and other similar payments with regard to its Equity Interests to the Lead Borrower or to other Restricted Subsidiaries of the Lead Borrower which directly or indirectly own equity therein; (ii) any non-Any Wholly-Owned Subsidiary of the ~~Lead Borrower~~ Company may ~~declare~~ pay Dividends to the Company or any Wholly-Owned Subsidiary of the Company and (b) any Subsidiary that is not a Wholly-Owned Subsidiary may pay ~~cash~~ Dividends to its shareholders generally so long as the ~~Lead Borrower~~ Company or its ~~Restricted~~ respective Subsidiary which owns the Equity ~~Interests~~ Interest in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative ~~holding~~ holdings of ~~the~~ Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of in such Subsidiary);. (~~iii~~ii) so So long as there shall exist no Default or ~~Event of~~ Unmatured Default ~~exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately~~ (both before and after giving effect ~~thereto~~to the payment thereof), the ~~Lead Borrower~~ Company may ~~pay cash Dividends~~ repurchase outstanding shares of its common stock (or options to ~~Holdings to allow Holdings to pay cash dividends to any other Parent Company to redeem~~ purchase such common stock) following the death, disability, retirement or ~~repurchase, contemporaneously with such Dividend, Equity Interests~~ termination of ~~such Parent Company from current or former members~~ employment of ~~management,~~ employees, ~~consultants,~~ officers ~~and~~ or directors ~~(and their successors and assigns)~~ of the ~~Lead Borrower and~~ Company or any of its ~~Restricted~~ Subsidiaries; provided that (Aa) all amounts used to effect such repurchases are obtained by the Company from a substantially concurrent issuance of its common stock (or options to purchase such common stock) to other employees, members of management, executive officers or directors of the Company or any of its Subsidiaries or (b) to the extent the proceeds used to effect any repurchase are not obtained as described in preceding clause (a), the aggregate amount of Dividends ~~made~~ paid by the ~~Lead Borrower to Holdings~~ Company pursuant to this Section 6.10(ii) (exclusive of amounts paid as described pursuant to preceding clause (~~iii~~a)~~, and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased~~ ) shall not ~~(net of any cash proceeds received by Holdings (but~~ exceed $1,000,000 in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the ~~Lead Borrower~~Company; provided that, ~~$10,000,000 (provided~~ in the event that the maximum amount ~~of cash Dividends~~ which is permitted to ~~be, but not, paid~~ be expended in respect of Dividends during any fiscal year pursuant to this clause (~~iii~~b) ~~shall increase~~ is not fully expended during such fiscal year, the maximum amount ~~of cash Dividends permitted to~~ which may be ~~paid in~~ expended during the immediately succeeding ~~two~~ fiscal ~~years~~ year pursuant to this clause (~~iii)); (B~~b) ~~such amount in any calendar year may~~ shall be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such ~~sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause~~ unutilized amount. (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may pay cash Dividends to Holdings so So long as ~~the proceeds thereof are promptly used by Holdings~~ there shall exist no Default or Unmatured Default (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, both before and after giving effect to ~~such Dividend~~the payment thereof), ~~no Event~~ the Company may repurchase outstanding shares of ~~Default shall have occurred and be continuing; (xiv) purchases~~ its common stock or equivalents thereof or rights to purchase any of ~~minority interests~~ the foregoing issued in ~~non-Wholly-Owned Subsidiaries by~~ connection with the ~~Lead Borrower and the Guarantors~~Company’s directors compensation plan; provided that the aggregate amount of ~~such purchases, when added~~ shares repurchased paid by the Company pursuant to ~~the aggregate amount~~ this Section 6.10(iii) (exclusive of ~~Investments~~ amounts paid as described pursuant to Section ~~10.05(xvii~~6.10(ii), ) shall not exceed $~~5,000,000;~~750,000 in any fiscal year and shall not exceed a maximum of $1,750,000 for all such repurchases made on or after the Closing Date. (xviv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so So long as ~~in the case of dividend~~ there shall exist no Default or ~~other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution;~~ Unmatured Default (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as (x) at the time of, both before and after giving effect to ~~such Dividend~~the declaration and payment thereof), the Company may pay Dividends with respect to its outstanding common stock, provided that (i) no ~~Event~~ Dividend shall be declared or paid during any fiscal year unless the Senior Leverage Ratio, determined as of ~~Default shall have occurred and be continuing~~ the end of the immediately preceding fiscal year, was less than 2.50 to 1.0, and (yii) ~~on a Pro Forma Basis,~~ the ~~Consolidated Total Net Leverage Ratio does~~ aggregate amount of the Dividends declared or paid pursuant to this Section 6.10(iv) during any fiscal year shall not exceed ~~3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes~~ 25% of the ~~definition of Consolidated EBITDA and~~ positive Consolidated Net ~~Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to~~ Income of the ~~extent provided in said Section 10.05(vi)~~Company and its Subsidiaries for the immediately preceding fiscal year.

Appears in 1 contract

Sources: Credit Agreement (Actuant Corp)

Dividends. The ~~Lead~~ Borrower ~~will not, and~~ will not permit any ~~of its Restricted Subsidiaries~~ Company to, authorize, declare or pay any Dividends with respect to the ~~Lead~~ Borrower or any of ~~its Restricted~~ the Subsidiaries, except that: (i) any ~~Restricted~~ Subsidiary of the ~~Lead~~ Borrower may pay cash and non-cash Dividends ~~or return capital or make distributions and other similar payments with regard to its Equity Interests~~ to the ~~Lead~~ Borrower or any Wholly Owned Subsidiary or, provided that no Material Default or Event of Default shall have occurred and be continuing, to any other ~~Restricted~~ equity holders of such Subsidiary on a pro rata basis with any such Dividends to be paid to the Borrower and any other Subsidiaries of the ~~Lead~~ Borrower ~~which directly or indirectly own~~ having equity ~~therein~~interests in such Dividend paying Subsidiary; (ii) ~~any non-Wholly-Owned Subsidiary of the Lead Borrower may declare and pay cash Dividends to its shareholders generally~~ so long as the Lead Borrower or its Restricted Subsidiary which owns the Equity Interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary); (iii) so long as there shall exist no Default or Event of Default ~~exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately~~ (both before and after giving effect ~~thereto~~to the payment thereof), the ~~Lead~~ Borrower may, and may pay ~~cash~~ Dividends to Holdings in order for Holdings to, repurchase or redeem outstanding shares of Capital Stock (or options to ~~allow~~ purchase such Capital Stock) of Holdings ~~to pay cash dividends to any other Parent Company to redeem~~ or ~~repurchase~~Borrower, ~~contemporaneously with such Dividend~~as applicable, ~~Equity Interests of such Parent Company from~~ owned by current or former ~~members of management,~~ employees, ~~consultants~~officers, ~~officers and~~ directors ~~(and their successors and assigns)~~ or consultants of ~~the Lead Borrower and its Restricted Subsidiaries;~~ Holdings or any Subsidiary pursuant to any management equity subscription agreement, stock option agreement or other equity agreement, shareholders agreement or similar agreement or arrangement or benefit plan, provided that ~~(A)~~ the aggregate amount of all Dividends ~~made by the Lead Borrower to Holdings~~ paid pursuant to this clause (iii), and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offeringii) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year ~~pursuant to this clause~~ shall not exceed $5,000,000 (~~iii) shall increase the amount of cash Dividends~~ it being understood, however, that unused amounts permitted to be paid ~~in the succeeding two fiscal years~~ pursuant to this ~~clause (iii)~~proviso are available to be carried over to subsequent fiscal years); ~~(B)~~ provided further that such amount in any ~~calendar~~ fiscal year may be increased by an amount not to exceed: : (Ia) the Permitted Expenditure Amount; plus (b) the cash proceeds of key man life insurance policies received by the ~~Lead~~ Borrower ~~or any of its Restricted~~ and the Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less ~~(III)~~ the amount of any Dividends previously made ~~with the cash proceeds described in the preceding clause~~ pursuant to clauses (~~I);~~ a) and (Cb) ~~cancellation~~ above; (iii) the Borrower may cancel all or a portion of ~~Indebtedness owing~~ the principal amount of notes delivered to the ~~Lead~~ Borrower ~~from current~~ by employees, officers or ~~former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries~~ directors in connection with a the vesting of interests or repurchase of interests pursuant to any Equity ~~Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement~~Plan; (iv) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and ~~its Subsidiaries; provided that for each taxable period,~~ the ~~amount~~ Subsidiaries may repurchase or redeem equity interests of ~~such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its~~ Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower sold or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares issued in connection with the ~~exercise of warrants~~Hospital Investment Program, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that ~~if such purchase~~ no Material Default or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $5,000,000; (xv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing at the time of such repurchase or ~~would~~ redemption; (v) the Borrower may pay Dividends, directly or indirectly, to Holdings to be used by Holdings to pay (x) consolidated, combined or similar Federal, state and local taxes payable by Holdings and directly attributable to (or arising as a result ~~therefrom~~of) the operations of the Borrower and the Subsidiaries and (y) franchise or similar taxes and fees of Holdings required to maintain Holdings' corporate existence and other taxes; provided ~~that~~ that: (a) the amount of ~~any~~ such ~~cash proceeds~~ Dividends paid shall not exceed the amount (x) that ~~are utilized~~ would be due with respect to a consolidated, combined or similar Federal, state or local tax return that included the Borrower and the Subsidiaries if Borrower were a corporation for ~~any Dividend under this clause~~ Federal, state and local tax purposes plus (~~iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii~~y) the ~~Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration~~ actual amount of such ~~payment~~franchise or similar taxes and fees of Holdings required to maintain Holdings' corporate existence and other taxes, ~~such payment would have complied with another provision of this Section 10.03~~each as applicable; and (~~xix~~b) ~~any~~ such payments are used by Holdings for such purposes within 90 days of the receipt of such payments; (vi) the Borrower may pay Dividends, directly or indirectly, to Holdings if the proceeds thereof are used to pay general corporate and overhead expenses (including salaries and other compensation of employees and directors) incurred in the ordinary course of its business; (vii) the Borrower may, and may pay Dividends to Holdings in order to permit Holdings to, make a repurchase of Capital Stock which is deemed to occur upon the exercise of options, rights or warrants to the extent such Capital Stock represents a portion of the exercise price of those options, rights or warrants; (viii) the Borrower may pay Dividends to Holdings in order to permit Holdings to repurchase or make any payments in respect of the 13% Notes; and (ix) so long as there shall exist no Default or Event of Default (~~x) at the time of,~~ both before and after giving effect to ~~such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis~~the payment thereof), the ~~Consolidated Total Net Leverage Ratio does~~ Borrower may pay Dividends in an amount not to exceed ~~3.25 to 1.00. In determining compliance with this Section 10.03~~ the sum of (~~and in determining amounts paid as Dividends pursuant hereto for purposes of~~ a) $15,000,000 plus (b) the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi)Permitted Expenditure Amount.

Appears in 1 contract

Sources: Credit Agreement (Biltmore Surgery Center Holdings Inc)

Dividends. ~~The Lead Borrower will not~~On each Distribution Date, after the Company has made all payments required on such Distribution Date under the Loan Documents in accordance with the terms 146 thereof, and ~~will~~ prior to making any distributions to the Other Shareholders (except as provided hereunder), the Company shall distribute, to the extent of available funds the following amounts in the following priority: (a) First, to the Preferred Shareholder, all Monthly Preferred Yield Amounts (or portions thereof) with respect to prior Distribution Dates that have not ~~permit any~~ previously been paid (in the order of ~~its Restricted Subsidiaries to~~the Distribution Dates to which such amounts relate, ~~authorize, declare or pay any Dividends~~ amounts with respect to the ~~Lead Borrower or any of its Restricted Subsidiaries, except that: (i~~earliest Distribution Dates being paid first) ~~any Restricted Subsidiary of~~ plus additional yield thereon at the ~~Lead Borrower may pay Dividends or return capital or~~ Adjusted Preferred Rate accruing from the Distribution Date on which the unpaid Monthly Preferred Yield Amount would have been distributed had there been funds available to make ~~distributions and other similar payments with regard to its Equity Interests to~~ such distribution in the ~~Lead Borrower or to other Restricted Subsidiaries of the Lead Borrower which directly or indirectly own equity therein~~Preferred Cash Collateral Account; (iib) ~~any non-Wholly-Owned Subsidiary~~ Second, to the Preferred Shareholder, the Monthly Preferred Yield Amount with respect to the current Distribution Date; (c) Third, to the Preferred Shareholder, all Monthly Redemption Amounts (or portions thereof) with respect to prior Distribution Dates that have not previously been paid (in the order of the ~~Lead Borrower may declare and pay cash Dividends~~ Distribution Dates to ~~its shareholders generally so long as~~ which such amounts relate, amounts with respect to the Lead Borrower or its Restricted Subsidiary which owns the Equity Interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiaryearliest Distribution Dates being paid first); (~~iii~~d) ~~so long as no Default or Event of Default exists at~~ Fourth, to the ~~time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto~~Preferred Shareholder, the Lead Borrower may pay cash Dividends to Holdings to allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of such Parent Company from current or former members of management, employees, consultants, officers and directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by the Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed Monthly Redemption Amount with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Distribution Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $5,000,000; (xv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (~~xix~~e) ~~any Dividends~~Fifth, ~~so long as (x) at~~ provided all amounts due and payable to the ~~time of~~Lender pursuant to the Loan Documents and to the Preferred Shareholder hereunder have been paid, and ~~after giving effect to such Dividend~~provided further that no Breach exists, ~~no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis,~~ in the ~~Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes~~ sole discretion of the ~~definition of Consolidated EBITDA and Consolidated Net Income)~~Company, ~~amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings~~ to the ~~extent provided~~ Other Shareholders pro rata in ~~said Section 10.05(vi)~~respect of the Class A Shares owned by each.

Appears in 1 contract

Sources: Loan Agreement (Alternative Living Services Inc)

Dividends. ~~The Lead Borrower will not, and will not permit any of its Restricted Subsidiaries to, authorize~~Authorize, declare or ~~pay~~ pay, directly or indirectly, any Dividends with respect to ~~the Lead Borrower~~ any Restricted Party (including pursuant to any Synthetic Purchase Agreement) or incur any ~~of its Restricted Subsidiaries~~obligation (contingent or otherwise) to do so, except ~~that~~that the following shall be permitted: (i) any Restricted Subsidiary of the ~~Lead~~ Borrower may pay Dividends ~~or return capital or make distributions and other similar payments with regard to its Equity Interests~~ to the ~~Lead~~ Borrower or ~~to other Restricted Subsidiaries of the Lead Borrower which directly or indirectly own equity therein;~~ any Subsidiary Guarantor, (ii) any ~~non-Wholly-Owned~~ Restricted Subsidiary of the ~~Lead~~ Borrower that is not a Loan Party also may pay Dividends to any other Wholly Owned Domestic Restricted Subsidiary of the Borrower and (iii) any non-Wholly Owned Restricted Subsidiary of the Borrower may ~~declare and~~ pay cash Dividends to its ~~shareholders generally~~ shareholders, members or partners generally, so long as the ~~Lead~~ Borrower or its respective Restricted Subsidiary of the Borrower which owns the Equity ~~Interests~~ Interest in the Restricted Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity ~~Interests~~ Interest in the Restricted Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Restricted Subsidiary); (~~iii~~b) so long as no ~~Default or~~ Event of Default then exists or would result therefrom, cash Dividends by the Borrower to Holdings at the ~~time~~ times and in the amounts needed to permit Holdings to repurchase or redeem shares of its capital stock from directors or employees or former officers, directors or employees (or their transferees, estates or beneficiaries under their estates) of any Company, upon their death, disability, retirement, severance or termination of employment or service; provided that the ~~applicable~~ aggregate amount of all such payments shall not exceed, in any period of 12 consecutive months, $2,500,000 and, in the aggregate, $5,000,000; (c) to the extent constituting a Dividend, ~~redemption or repurchase~~ payments to Holdings permitted pursuant to Section 6.09(e); (d) so long as (i) the OIN Spinoff has not been consummated, (ii) Holdings has insufficient funds to pay the respective interest payment and third party expense and (iii) no Default then exists or would ~~exist immediately after giving effect thereto~~result therefrom, the ~~Lead~~ Borrower may pay cash Dividends to Holdings at the times that any interest payment or third party expense is due on the Existing OSG Notes in an aggregate amount not to ~~allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests~~ exceed 50% of such Parent Company from current or former members of management, employees, consultants, officers and directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of ~~Dividends~~ such interest payment or third party expense (after taking into account any payments made ~~by the Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid~~ by Holdings in respect thereof); (e) (x) so long as no Event of ~~all such Equity Interests so redeemed~~ Default then exists or ~~repurchased shall not~~ would result therefrom, the Borrower may make Permitted Tax Distributions to Holdings; and (~~net of~~ f) any cash ~~proceeds received by Holdings (but~~ Dividends in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an aggregate amount not to ~~exceed: (I)~~ exceed the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, Available Amount as in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed effect immediately prior to the ~~Lead Borrower; provided that the amount of any~~ respective Dividend so long as (x) no Default has occurred and is continuing immediately prior to and after giving effect to such ~~net proceeds that are utilized for any~~ Dividend ~~under this~~ and (y) other than with respect to Dividends made in reliance on clause (~~iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii~~a) of the definition of “Available Amount~~”; less (III)~~ ” contained herein or Dividends made to Holdings at the times that any interest payments are due on the Existing OSG Notes in an aggregate amount not to exceed the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may pay cash Dividends to Holdings such interest payment so long as the ~~proceeds thereof are promptly used by~~ OIN Spinoff has not been consummated and Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used has insufficient funds to pay the ~~Sponsor or Sponsor Affiliate fees, expenses~~ respective interest (after taking into account any payments made to Holdings in respect thereof and ~~indemnification payments that are then permitted~~ any Dividends made to ~~be paid~~ Holdings pursuant to ~~Sections 10.06(v~~clause (d) ~~and 10.06(vii~~above)~~; (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or~~ , the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing DateBorrower shall be in compliance, ~~of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii)~~ on a Pro Forma Basis, ~~if the Consolidated First Lien Net~~ with a Total Leverage Ratio ~~does not exceed 3.00 to 1.00 and~~ of no greater than 4.25:1.00 for the ~~Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends~~ Test Period most recently ended for which financial statements have been delivered to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments Administrative Agent pursuant to Section ~~10.05(xvii~~5.01(a)(iii) or (b)(iii), shall not exceed $5,000,000; (xv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as (x) at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi)applicable.

Appears in 1 contract

Sources: Term Loan Credit Agreement (Overseas Shipholding Group Inc)

Dividends. ~~The Lead Borrower~~ Holdings will not, and will not permit any of its ~~Restricted~~ Subsidiaries to, authorize, declare or pay any Dividends with respect to ~~the Lead Borrower~~ Holdings or any of its ~~Restricted~~ Subsidiaries, except that: (i) any ~~Restricted~~ Subsidiary of the ~~Lead~~ Borrower may pay cash Dividends ~~or return capital or make distributions and other similar payments with regard to its Equity Interests~~ to the ~~Lead~~ Borrower or to ~~other Restricted Subsidiaries~~ any Wholly-Owned Domestic Subsidiary of the ~~Lead~~ Borrower ~~which directly or indirectly own equity therein~~and any Foreign Subsidiary of the Borrower also may pay cash Dividends to any Wholly-Owned Foreign Subsidiary of the Borrower; (ii) any non-Wholly-Owned Subsidiary of the ~~Lead~~ Borrower may ~~declare and~~ pay cash Dividends to its ~~shareholders~~ shareholders, partners or members generally so long as the ~~Lead~~ Borrower or its ~~Restricted~~ respective Subsidiary which owns the Equity ~~Interests~~ Interest in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity ~~Interests~~ Interest in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary); (iii) ~~so long as no Default or Event of Default exists at~~ the ~~time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, the Lead~~ Borrower may pay cash Dividends to Holdings so long as Holdings promptly uses such proceeds solely to ~~allow~~ (and Holdings ~~to pay cash dividends to any other Parent Company to~~ may) redeem or ~~repurchase~~repurchase outstanding shares of Holdings’ common stock (or options to purchase such common stock) following the death, ~~contemporaneously with such Dividend~~disability, ~~Equity Interests~~ retirement or termination of ~~such Parent Company from current~~ employment of officers, directors or ~~former members~~ employees of ~~management~~Holdings or any of its Subsidiaries, ~~employees, consultants, officers and directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries;~~ provided that (Ax) the aggregate amount of Dividends ~~made by the Lead Borrower to Holdings~~ pursuant to this ~~clause~~ Section 10.03(iii) shall not exceed (~~iii), and~~ I) $750,000 in any fiscal year of Holdings plus (II) the aggregate amount ~~paid~~ of cash proceeds received by Holdings after the Initial Borrowing Date in ~~respect~~ connection with the issuance of ~~all~~ Holdings’ common stock (or options to purchase such ~~Equity Interests so redeemed~~ common stock) to officers, directors or ~~repurchased shall not~~ employees of Holdings and its Subsidiaries plus (~~net of~~ III) any cash proceeds received by Holdings ~~(but in no event~~ or the Borrower from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies ~~received by~~ obtained solely for the ~~Lead Borrower~~ purpose of making such redemptions or ~~any of its Restricted Subsidiaries after~~ repurchases and (y) at the ~~Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants~~ time of any ~~Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of~~ Dividend (including any such ~~net proceeds that are utilized for any Dividend under this clause (iii~~redemption or repurchase) ~~will not be considered~~ permitted to be ~~net proceeds~~ made pursuant to this Section 10.03(iii), no Default or Event of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current Default shall then exist or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreementresult therefrom; (iv) Holdings may pay regularly scheduled Dividends on its Qualified Preferred Stock pursuant to the ~~Lead~~ terms thereof solely through the issuance of additional shares of such Qualified Preferred Stock rather than in cash; (v) the Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings ~~(or subsequently paid to any other Parent Company)~~ solely to pay operating expenses incurred by in the ordinary course of business (including, without limitation, professional fees and expenses) and other similar corporate overhead costs and expenses, provided that the aggregate amount of all cash Dividends paid pursuant to this clause (v) shall not exceed $3,000,000 in any fiscal year of Holdings; (vi) the Borrower may pay cash Dividends to Holdings, and Holdings may use such proceeds to pay or ~~any other Parent Company~~ make cash Dividends, in ~~connection with offerings~~an aggregate amount not to exceed, ~~registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed~~ when added to the ~~Lead Borrower, (B) in a prorated~~ aggregate amount of ~~such expenses in proportion~~ cash payments made pursuant to ~~the amount of such net proceeds intended to be so received or contributed or loaned~~Section 10.08(i)(y), ~~or (C) otherwise on an interim basis prior to completion of such offering~~ $25,000,000, so long as (i) no Default or Event of Default then exists or would result therefrom, (ii) at the time that any such Dividend is paid or made (and immediately after giving effect thereto), Holdings shall be in compliance, on a Pro Forma Basis, with the financial covenants contained in Section 10.07 for the Calculation Period most recently ended on or prior to the date of the respective Dividend, and ~~any other Parent Company shall cause~~ (iii) prior to the ~~amount~~ payment or making of such ~~expenses to be repaid~~ cash Dividend, Holdings or the Borrower shall have delivered to the ~~Lead Borrower or~~ Administrative Agent a certificate executed by an Authorized Financial Officer, certifying to the ~~relevant Restricted Subsidiary of the Lead Borrower out of the proceeds~~ best of such ~~offering promptly if such offering is completed~~officer’s knowledge, compliance with the requirements of preceding clauses (i) and (ii), and containing the calculations (in reasonable detail) required by preceding clause (ii); (vvii) the ~~Lead~~ Borrower may pay additional cash Dividends to Holdings, and Holdings may use such proceeds to pay or make additional cash Dividends, in an aggregate amount not to exceed the Cumulative Retained Excess Cash Flow Amount as in effect immediately before the respective Dividend, so long as (i) no Default or Event of Default then exists or would result therefrom, (ii) at the time that any such Dividend is paid or made (and immediately after giving effect thereto), Holdings shall be in compliance, on a Pro Forma Basis, with (x) a Secured Leverage Ratio of less than 2.75:1.00 and (y) the financial covenant contained in Section 10.07(a), in each case for the Calculation Period most recently ended on or prior to the date of the respective Dividend, (iii) the Minimum Liquidity Condition is satisfied at such time and immediately after giving effect to the payment of the respective Dividend, and (iv) prior to the payment or making of such cash Dividend, Holdings or the Borrower shall have delivered to the Administrative Agent a certificate executed by an Authorized Financial Officer, certifying to the best of such officer’s knowledge, compliance with the requirements of preceding clauses (i), (ii) and (iii), and containing the calculations (in reasonable detail) required by preceding clauses (ii) and (iii); (viii) the Borrower may pay additional cash Dividends to Holdings, and Holdings may use such proceeds to pay or make additional cash Dividends, in an aggregate amount not to exceed the lesser of (I) the Permitted Equity Proceeds Basket Amount as in effect immediately before the respective Dividend and (II) $20,000,000, in each case, so long as no Default or Event of Default then exists or would result therefrom; and (ix) the Borrower may pay cash Dividends to Holdings ~~so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs~~ (including ~~all professional fees and expenses~~through payments under any tax sharing agreement with Holdings) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for ~~any Parent Company or the equity interest holders thereof~~ Holdings to pay, in each case without duplication: , (Ax) franchise ~~Taxes (~~taxes and other ~~fees and expenses)~~ similar taxes required to maintain ~~their~~ Holdings’ corporate existence~~; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal~~, ~~state, and/or local income tax purposes~~ and (by) ~~is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent~~foreign, federal, state ~~and~~ and/or local income ~~Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of~~ taxes, to the extent such ~~minimum Taxes) that~~ income taxes are attributable to the ~~taxable~~ income of the ~~Lead~~ Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $5,000,000; (xv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as (x) at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi).

Appears in 1 contract

Sources: Credit Agreement (Town Sports International Holdings Inc)

Dividends. ~~The Lead Borrower~~ Holdings and the Borrowers will not, and will not permit any of ~~its Restricted~~ their Subsidiaries to, authorize, declare or pay any Dividends with respect to ~~the Lead Borrower~~ Holdings or any of its ~~Restricted~~ Subsidiaries, except that: (i) any ~~Restricted~~ Subsidiary of the ~~Lead~~ US Borrower may pay Dividends ~~or return capital or make distributions and other similar payments with regard~~ to ~~its Equity Interests to~~ (x) the ~~Lead~~ US Borrower or ~~to other Restricted Subsidiaries of the Lead Borrower which directly or indirectly own equity therein;~~ (iiy) any ~~non-~~Wholly-Owned Subsidiary of the Lead Borrower may declare and pay cash Dividends to its shareholders generally so long as the Lead Borrower or its Restricted Subsidiary which owns the Equity Interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary)US Borrower; (~~iii~~ii) ~~so long as no Default or Event of Default exists at~~ the ~~time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, the Lead~~ US Borrower may pay cash Dividends to Holdings ~~to allow Holdings to pay cash dividends to~~ in the amounts and at the times of any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of such Parent Company from current or former members of management, employees, consultants, officers and directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by the Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid payment by Holdings in respect of ~~all such Equity Interests so redeemed or repurchased shall not (net of~~ taxes, provided that any ~~cash proceeds~~ refunds received by Holdings ~~(but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than~~ shall promptly be returned by Holdings to the ~~extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the Lead~~ US Borrower~~, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause~~ ; (iii) ~~shall increase~~ the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead US Borrower may pay cash Dividends to Holdings in an amount not to exceed $1,000,000 in any fiscal year so long as the proceeds thereof are promptly used by Holdings ~~(or subsequently paid to any other Parent Company)~~ to pay expenses ~~incurred~~ in the ordinary course of business; (a) Holdings may redeem or purchase shares of its capital stock or other equity interests (or options to purchase its capital stock or other equity interests) held by management of Holdings or any ~~other Parent Company~~ of its Subsidiaries or employees following the termination of their employment (by death, disability, termination, resignation or retirement) or following a determination by management of Holdings in ~~connection with offerings~~good faith that a hardship exists as to any member of management or any employee, ~~registrations~~provided that (x) the only consideration paid by Holdings in respect of such redemptions and/or purchases shall be cash and Shareholder Subordinated Notes, ~~or exchange listings~~ (y) the sum of ~~equity or debt securities and maintenance of same~~ (A) ~~where~~ the ~~net proceeds~~ aggregate amount paid by Holdings in cash in respect of all such ~~offering are to be received by or contributed to the Lead Borrower,~~ redemptions and/or purchases plus (B) ~~in a prorated~~ the aggregate amount of all principal and interest payments made on Shareholder Subordinated Notes, shall not exceed $5,000,000 in any fiscal year of Holdings (plus the amount available to be used pursuant to this clause (iv)(a)(y) in prior fiscal years and not so used, but in no event more than $7,500,000 in the aggregate after the Restatement Effective Date), provided that all such ~~expenses in proportion~~ amounts shall be increased by (I) an amount equal to the ~~amount~~ net cash proceeds received by Holdings after the Restatement Effective Date from the sale or issuance of ~~such net proceeds intended~~ its equity interests (to the extent not required to be so applied to repay Term Loans pursuant to Section 4.02(c), not used to effect a Permitted Acquisition and not applied to make Capital Expenditures pursuant to Section 8.07(b)) and (II) an amount equal to key man life insurance proceeds received by Holdings and its Subsidiaries after the Restatement Effective Date and (z) at the time of any cash payment permitted to be made pursuant to this Section 8.03(iv), including any cash payment under a Shareholder Subordinated Note, no Default or ~~contributed~~ Event of Default shall then exist or ~~loaned, or~~ result therefrom; and (Cb) ~~otherwise on an interim basis prior to completion of such offering~~ so long as ~~Holdings and any other Parent Company shall cause~~ no Default or Event of Default then exists or would result therefrom, the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead US Borrower may pay cash Dividends to Holdings so long as Holdings promptly uses such proceeds for the ~~proceeds thereof are promptly used by Holdings~~ purposes described in clause (~~or subsequently paid to any other Parent Company~~iv)(a) ~~to pay costs~~ of this Section 8.03 (including ~~all professional fees and expenses~~for the purpose of making interest or principal payments on any Shareholder Subordinated Note); (v) ~~incurred by~~ Holdings may pay Dividends on any outstanding Qualified Capital Stock (including any Qualified Capital Stock outstanding on the Restatement Effective Date) solely through the issuance of additional shares or ~~any other Parent Company~~ units of Qualified Capital Stock of the same class, or through accrual or accretion, but not in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereundercash; (vi) the ~~Lead~~ Borrower may pay ~~cash dividends or other distributions, or~~ Dividends to Holdings to enable Holdings to make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income payments of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required type referred to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries8.06(iv); (vii) ~~reasonable and customary indemnities~~ the US Borrower may pay Dividends to ~~directors, officers and employees of any Parent Company in the ordinary course of business,~~ Holdings to ~~the extent reasonably attributable~~ enable Holdings to ~~the ownership or operation of the Lead Borrower and its Restricted Subsidiaries~~make loans pursuant to Section 8.05(iii); (viii) the ~~Lead~~ US Borrower may pay ~~cash~~ Dividends to Holdings ~~so long as~~ to enable Holdings to make required payments on any Permitted Earn-Out Preferred Equity in accordance with the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Dateterms thereof; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries ~~by the Lead Borrower and the Guarantors; provided that the aggregate amount~~ of ~~such purchases, when added to the aggregate amount of Investments~~ Holdings acquired pursuant to Section ~~10.05(xvii), shall not exceed $5,000,000; (xv~~8.05(xviii) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as any such Dividends are paid pro rata to all equity holdings of such Subsidiaries; and (x) at Holdings and the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) US Borrower shall be ~~deemed~~ permitted to ~~be cash~~ pay Dividends consisting of shares of Qualified Capital Stock, provided that any such Dividends paid by the US Borrower shall be paid only to ~~Holdings to the extent provided in said Section 10.05(vi)~~Holdings.

Appears in 1 contract

Sources: Credit Agreement (Aearo Corp)

Dividends. ~~The Lead Borrower will not~~Declare or pay, ~~and will not permit any of its Restricted Subsidiaries to~~directly or indirectly, ~~authorize, declare or pay~~ any Dividends with respect to ~~the Lead Borrower or~~ any ~~of its Restricted Subsidiaries~~Company (including pursuant to any Synthetic Purchase Agreement), except ~~that~~that the following shall be permitted: (i) Dividends by any ~~Restricted~~ Company that is a Wholly Owned Subsidiary of ~~the Lead~~ Borrower ~~may pay Dividends or return capital or make distributions and other similar payments with regard~~ to ~~its Equity Interests to the Lead~~ Borrower or ~~to other Restricted Subsidiaries~~ any Guarantor that is a Wholly Owned Subsidiary of ~~the Lead~~ Borrower ~~which directly or indirectly own equity therein;~~ shall be permitted and (ii) Dividends by any Company that is a non-~~Wholly-~~Wholly Owned Subsidiary of ~~the Lead~~ Borrower ~~may declare and pay cash Dividends~~ to its ~~shareholders generally~~ equity holders generally, so long as ~~the Lead~~ Borrower or its respective Restricted Subsidiary which owns the ~~Equity Interests~~ capital stock in the Restricted Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon ~~its~~ the relative holding of the ~~Equity Interests~~ capital stock in the Restricted Subsidiary paying such ~~Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary~~Dividends); (~~iii~~b) so payments by Borrower to repurchase or redeem Qualified Capital Stock of Borrower held by officers, directors or employees or former officers, directors or employees (or their transferees, estates or beneficiaries under their estates) of any Company, upon their death, disability, retirement, severance or termination of employment or service; provided that the aggregate amount of payments to Borrower shall not exceed, in any period of 12 consecutive months, $2,000,000 (the “Annual Redemption Basket”), plus the aggregate amount of net cash proceeds from the issuance of Qualified Capital Stock of the Borrower that have not otherwise been used, the net cash proceeds of capital contributions to the Borrower that have not otherwise been used and the net cash proceeds of any key man life insurance policy covering the applicable director, officer or employee received by Borrower during such 12 consecutive month period that have not otherwise been used; provided, that 50% of the unused amount of the Annual Redemption Basket shall increase the Annual Redemption Basket by such amount for the next succeeding period of 12 consecutive months, but not any additional periods of 12 consecutive months (with any payments made under this Section 6.08(b) being allocated last to any carry-over amounts); provided, further that the aggregate amount of payments pursuant to this clause (c) shall not exceed $6,000,000 during the life of this Agreement; (c) So long as no Default or Event of Default exists and is continuing, Dividends in an aggregate amount outstanding not to exceed the Cumulative Credit Availability so long as the Total Net Leverage Ratio does not exceed 2.75:1.00 at the same time ~~of the applicable Dividend, redemption or repurchase or would exist immediately~~ that such Dividend is made after giving effect ~~thereto,~~ to the Lead Borrower may pay cash Dividends to Holdings to allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of such Parent Company from current or former members of management, employees, consultants, officers and directors (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiariespayment thereof; provided that ~~(A) the aggregate amount of Dividends made by the Lead~~ Borrower ~~to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased~~ shall ~~not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than~~ have delivered an Officers’ Certificate to the ~~extent included~~ Administrative Agent certifying as to compliance with the foregoing; (d) So long as no Default or Event of Default exists and is continuing, additional Dividends in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an aggregate amount not to ~~exceed: (I)~~ exceed $5,000,000 during the ~~cash proceeds of key man~~ life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xie) repurchases of ~~Equity Interests~~ Qualified Capital Stock of Borrower deemed to occur upon exercise of stock options or warrants or similar rights if such Qualified Capital Stock represents a portion of the ~~settlement~~ exercise price of such options or ~~vesting of other equity incentive awards~~warrants or similar rights (as long as Borrower and its Restricted Subsidiaries make no payment in connection therewith that is not otherwise permitted hereunder); (~~xii~~f) ~~a Dividend to~~ Borrower may pay cash in lieu of fractional capital stock in connection with any ~~Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date~~dividend, ~~of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from~~ split or combination thereof or any ~~such Initial Public Offering~~Permitted Acquisition or other similar Investment permitted hereunder; (~~xiii~~g) ~~on a Pro Forma Basis~~the distribution, ~~if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00~~by dividend or otherwise, ~~any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event~~ of ~~Default shall have occurred and be continuing;~~Qualified Capital Stock of Unrestricted Subsidiaries; and (~~xiv~~h) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $5,000,000; (xv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of any dividend or ~~other~~ distribution ~~by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution;~~ within sixty (~~xvii~~60) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration ~~of such payment,~~ (i) such payment would have complied with ~~another provision~~ the provisions of this ~~Section 10.03; and~~ Agreement, (~~xix~~ii) ~~any Dividends, so long as (x) at the time of, and after giving effect to such Dividend,~~ no Event of Default ~~shall have~~ occurred and be was continuing immediately prior to such declaration and (yiii) ~~on a Pro Forma Basis,~~ no Specified Event of Default has occurred and is continuing at the ~~Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes~~ time of ~~the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned~~ such dividend or ~~advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi)~~distribution.

Appears in 1 contract

Sources: Credit Agreement (Internap Corp)

Dividends. ~~The~~ Each of the Lead Borrower ~~will not,~~ and any Restricted Subsidiary will not ~~permit any of its Restricted Subsidiaries to,~~ authorize, declare or pay any Dividends with respect to the Lead Borrower or any ~~of its~~ Restricted ~~Subsidiaries~~Subsidiary, except that: : (i149) (150) any Restricted Subsidiary ~~of the Lead Borrower~~ may pay Dividends or return capital or make distributions and other similar payments with regard to its Equity Interests to the Lead Borrower or to other Restricted Subsidiaries ~~of the Lead Borrower~~ which directly or indirectly own equity therein; ; (ii151) (152) any non-Wholly-Owned Subsidiary of the Lead Borrower may declare and pay cash Dividends to its shareholders generally so long as the Lead Borrower or ~~its~~ any Restricted Subsidiary which owns the Equity Interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary); ; (~~iii~~153) (154) so long as no ~~Default or~~ Event of Default exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, the Lead Borrower may pay cash Dividends to Holdings to allow Holdings to ~~pay cash dividends to any other Parent Company to~~ redeem or repurchase, contemporaneously with such Dividend, Equity Interests of ~~such Parent Company~~ Holdings from ~~current or former members of~~ management, employees~~, consultants~~, officers and directors (and their successors and assigns) of the Lead Borrower and ~~its~~ any Restricted ~~Subsidiaries~~Subsidiary; provided that (A) the aggregate amount of Dividends made by the Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings ~~(but in no event from any Initial Public Offering)~~ from issuances of its Equity Interests ~~(other than to the extent included in the Available Amount)~~ and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed ~~during any fiscal year of the Lead Borrower,~~ $~~10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid~~ 5,000,000 in any ~~fiscal~~ calendar year ~~pursuant to this clause~~ (~~iii) shall increase the amount of cash Dividends~~ with unused amounts in any calendar year being permitted to be ~~paid~~ carried over to succeeding calendar years in an amount not exceeding $10,000,000 in the ~~succeeding two fiscal years pursuant to this clause (iii)~~aggregate); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any ~~of its~~ Restricted ~~Subsidiaries~~ Subsidiary after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of ~~any Parent Company~~ Holdings or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from ~~current or former~~ members of management, officers, directors, employees of the Lead Borrower or any ~~of its Subsidiaries~~ Subsidiary in connection with a repurchase of Equity Interests of ~~any Parent Company~~ Holdings will not be deemed to constitute a Dividend for purposes of this Agreement; ; (iv155) (156) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings ~~(or subsequently paid to any other Parent Company)~~ to pay expenses incurred by Holdings ~~or any other Parent Company~~ in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings ~~and any other Parent Company~~ shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $5,000,000; (xv) the declaration and payment of dividends or the payment of other distributions by the Lead Borrower in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03; and (xix) any Dividends, so long as (x) at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi).

Appears in 1 contract

Sources: Credit Agreement (Ryerson Holding Corp)

Dividends. The ~~Lead~~ Borrower will not, and will not permit any of its ~~Restricted~~ Subsidiaries to, authorize, declare or pay any Dividends with respect to the ~~Lead~~ Borrower or any of its ~~Restricted~~ Subsidiaries, except that: (ia) any ~~Restricted~~ Subsidiary of the ~~Lead~~ Borrower may declare and pay cash Dividends ~~or return capital or make distributions and other similar payments with regard to its Equity Interests~~ to the ~~Lead~~ Borrower or to ~~other Restricted Subsidiaries~~ any Subsidiary of the ~~Lead Borrower which directly or indirectly own equity therein~~Borrower; (iib) any non-Wholly-Owned Subsidiary of the ~~Lead~~ Borrower may declare and pay cash Dividends to its shareholders generally so long as the ~~Lead~~ Borrower or its ~~Restricted~~ respective Subsidiary which owns the ~~Equity Interests~~ equity interest in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the ~~Equity Interests~~ equity interest in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of ~~Equity Interests~~ equity interests of such Subsidiary); (~~iii~~c) the Borrower may repurchase (from the respective officers, directors or employees, or their families or estates) outstanding shares of its common stock (or options to purchase such common stock) following the death, disability or termination of employment of officers, directors or employees of the Borrower or any of its Subsidiaries, PROVIDED that (i) the aggregate amount paid by the Borrower in respect of all such repurchases shall not at any time exceed $25,000,000 (with no more than $10,000,000 of such repurchases in the aggregate to be made during the period from the Effective Date until the second anniversary thereof) and (ii) at the time of, and immediately after giving effect to, any repurchase or payment permitted to be made pursuant to this paragraph (c), no Default shall then exist; (i) so long as no Default ~~or Event of Default~~ then exists ~~at the time of the applicable Dividend, redemption or repurchase~~ or would exist immediately after giving effect thereto, the Lead Borrower may pay cash Dividends to Holdings to allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of such Parent Company from current or former members of management, employees, consultants, officers and directors thereto (and their successors and assigns) of the Lead Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by the Lead Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the Lead Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the Lead Borrower, $10,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the Lead Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the Lead Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the Lead Borrower from current or former members of management, officers, directors, employees of the Lead Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the Lead Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the Lead Borrower or the relevant Restricted Subsidiary of the Lead Borrower out of the proceeds of such offering promptly if such offering is completed; (v) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the Lead Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their existence; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the Lead Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company or other entity is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) reasonably believes that are attributable to the taxable income of the Lead Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the Lead Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the Lead Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other compensation and benefits payable to current and former officers, directors, consultants and employees of any Parent Company to the extent such salaries, bonuses and other compensation and benefits are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the Lead Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Lead Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the Lead Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the Lead Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the Lead Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the Lead Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the Lead Borrower and its Restricted Subsidiaries; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries; (viii) the Lead Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the Lead Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; (ix) any Dividend used to fund the Transaction, including Transaction Costs and the Special Dividend, and any Dividend from proceeds received in connection with any working capital adjustment pursuant to the Acquisition Agreement; (x) the Lead Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and 10.06(vii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or the settlement or vesting of other equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the Lead Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated Total Net Leverage Ratio does not exceed 4.25 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as no Default will exist at the time ~~of, and after giving effect to such Dividend, no Event~~ of ~~Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by~~ the ~~Lead Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii~~respective payment thereof), ~~shall not exceed $5,000,000; (xv)~~ the ~~declaration and payment of dividends or the payment of other distributions by the Lead~~ Borrower ~~in an aggregate amount since the Closing Date not to exceed $35,000,000; (xvi) the Lead Borrower and each Restricted Subsidiary~~ may declare ~~and make dividend payments or other distributions~~ Dividends (in any event payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the Lead Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the Lead Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the Lead Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of ~~declaration thereof, if at~~ declaration) to its shareholders generally on its common stock in an amount not to exceed $.08 per share (adjusted in an equitable manner in the event of any stock split or similar event) per fiscal quarter of the Borrower and (ii) so long as the requirements of preceding clause (i) were satisfied on the date of ~~declaration~~ declaration, the Borrower may pay such Dividends within 60 days after the date of such ~~payment,~~ declaration; (e) non Wholly-Owned Subsidiaries may repurchase their outstanding Equity Interests held by Persons other than the Borrower and its Subsidiaries; PROVIDED that any and all such ~~payment would have complied with another provision of this~~ repurchases shall be deemed to constitute Investments and shall be required to be independently justified under Section ~~10.03~~6.06(x); and (~~xix~~f) ~~any Dividends,~~ the Borrower may repurchase additional shares of its outstanding common stock so long as (xi) at the ~~time of, and~~ Total Leverage Ratio after giving effect to any such ~~Dividend, no Event of Default shall have occurred and be continuing~~ repurchase is less than 3.50:1.00 and (yii) ~~on a Pro Forma Basis,~~ the ~~Consolidated Total Net Leverage Ratio does~~ aggregate amount paid by the Borrower with respect to all such repurchases shall not exceed 3.25 to 1.00. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi)$25,000,000.

Appears in 1 contract

Sources: Credit Agreement (Fleming Companies Inc /Ok/)

Appears in 1 contract

Sources: Credit Agreement (Iridium Communications Inc.)

Dividends. The ~~Lead~~ Borrower will not, and will not permit any of its Restricted Subsidiaries to, authorize, declare or pay any Dividends with respect to the ~~Lead~~ Borrower or any of its Restricted Subsidiaries, except that: (i) any Restricted Subsidiary of the ~~Lead~~ Borrower may pay Dividends or return capital or make distributions and other similar payments with regard to its Equity Interests to the ~~Lead~~ Borrower or to other Restricted Subsidiaries of the ~~Lead~~ Borrower which directly or indirectly own equity therein; (ii) any non-Wholly-Owned Subsidiary of the ~~Lead~~ Borrower may declare and pay cash Dividends to its shareholders generally so long as the ~~Lead~~ Borrower or its Restricted Subsidiary which owns the Equity Interests in the Subsidiary paying such Dividends receives at least its proportionate share thereof (based upon its relative holding of the Equity Interests in the Subsidiary paying such Dividends and taking into account the relative preferences, if any, of the various classes of Equity Interests of such Subsidiary); (iii) so long as no Default or Event of Default exists at the time of the applicable Dividend, redemption or repurchase or would exist immediately after giving effect thereto, the ~~Lead~~ Borrower may pay cash Dividends to Holdings to allow Holdings to pay cash dividends to any other Parent Company to redeem or repurchase, contemporaneously with such Dividend, Equity Interests of such Parent Company from ~~current or former members of~~ management, employees~~, consultants~~, officers and directors (and their successors and assigns) of the ~~Lead~~ Borrower and its Restricted Subsidiaries; provided that (A) the aggregate amount of Dividends made by the ~~Lead~~ Borrower to Holdings pursuant to this clause (iii), and the aggregate amount paid by Holdings in respect of all such Equity Interests so redeemed or repurchased shall not (net of any cash proceeds received by Holdings (but in no event from any Initial Public Offering) from issuances of its Equity Interests (other than to the extent included in the Available Amount) and contributed to the ~~Lead~~ Borrower in connection with such redemption or repurchase), in either case, exceed during any fiscal year of the ~~Lead~~ Borrower, $~~10,000,000~~ 5,000,000 (provided that the amount of cash Dividends permitted to be, but not, paid in any fiscal year pursuant to this clause (iii) shall increase the amount of cash Dividends permitted to be paid in the succeeding two fiscal years pursuant to this clause (iii)); (B) such amount in any calendar year may be increased by an amount not to exceed: (I) the cash proceeds of key man life insurance policies received by the ~~Lead~~ Borrower or any of its Restricted Subsidiaries after the Closing Date; plus (II) the net proceeds from the sale of Equity Interests of Holdings, in each case to members of management, managers, directors or consultants of any Parent Company or any of its Subsidiaries that occurs after the Closing Date, where the net proceeds of such sale are received by or contributed to the ~~Lead~~ Borrower; provided that the amount of any such net proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be net proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; less (III) the amount of any Dividends previously made with the cash proceeds described in the preceding clause (I); and (C) cancellation of Indebtedness owing to the ~~Lead~~ Borrower from ~~current or former~~ members of management, officers, directors, employees of the ~~Lead~~ Borrower or any of its Subsidiaries in connection with a repurchase of Equity Interests of any Parent Company will not be deemed to constitute a Dividend for purposes of this Agreement; (iv) the ~~Lead~~ Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay expenses incurred by Holdings or any other Parent Company in connection with offerings, registrations, or exchange listings of equity or debt securities and maintenance of same (A) where the net proceeds of such offering are to be received by or contributed to the ~~Lead~~ Borrower, (B) in a prorated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed or loaned, or (C) otherwise on an interim basis prior to completion of such offering so long as Holdings and any other Parent Company shall cause the amount of such expenses to be repaid to the ~~Lead~~ Borrower or the relevant Restricted Subsidiary of the ~~Lead~~ Borrower out of the proceeds of such offering promptly if such offering is completed; provided that the aggregate amount of Dividends made pursuant to this clause (iv), together with the aggregate amount of Dividends made pursuant to clauses (vi)(C)-(G), (vii) and (viii) of this Section 10.03, shall not exceed $5,000,000 in any fiscal year; (v) the ~~Lead~~ Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) to pay costs (including all professional fees and expenses) incurred by Holdings or any other Parent Company in connection with reporting obligations under or otherwise incurred in connection with compliance with applicable laws, applicable rules or regulations of any governmental, regulatory or self-regulatory body or stock exchange, including in respect of any reports filed with respect to the Securities Act, the Securities Exchange Act or the respective rules and regulations promulgated thereunder; (vi) the ~~Lead~~ Borrower may pay cash dividends or other distributions, or make loans or advances to, any Parent Company or the equity interest holders thereof in amounts required for any Parent Company or the equity interest holders thereof to pay, in each case without duplication: (A) franchise Taxes (and other fees and expenses) required to maintain their ~~existence~~existence to the extent such Taxes, fees and expenses are reasonably attributable to the operations of Holdings, the Borrower and its Restricted Subsidiaries; (B) with respect to any taxable year (or portion thereof) ending after the Closing Date with respect to which the ~~Lead~~ Borrower (a) is treated as a corporation for U.S. federal, state, and/or local income tax purposes and (b) is a member of a consolidated, combined or similar income tax group (a “Tax Group”) of which any Parent Company ~~or other entity~~ is the common parent, federal, state and local income Taxes (including minimum Taxes) (or franchise and similar Taxes imposed in lieu of such minimum Taxes) that are attributable to the taxable income of the ~~Lead~~ Borrower and its Subsidiaries; provided that for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall not exceed the amount that the ~~Lead~~ Borrower and its Subsidiaries would have been required to pay as a stand-alone Tax Group; provided, further, that the permitted payment pursuant to this clause (B) with respect to the Taxes of any Unrestricted Subsidiary for any taxable period shall be limited to the amount actually paid by such Unrestricted Subsidiary to the ~~Lead~~ Borrower or its Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar Taxes; (C) customary salary, bonus and other ~~compensation and~~ benefits payable to ~~current and former officers, directors, consultants~~ officers and employees of any Parent Company to the extent such salaries, bonuses and other ~~compensation and~~ benefits are reasonably attributable to the ownership or operations of the ~~Lead~~ Borrower and its Restricted Subsidiaries; (D) general corporate operating and overhead costs and expenses (including administrative, legal, accounting and similar expenses provided by third parties) of any Parent Company to the extent such costs and expenses are reasonably attributable to the ownership or operations of the ~~Lead~~ Borrower and its Restricted Subsidiaries; (E) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the ~~Lead~~ Borrower or any Parent Company; (F) the purchase or other acquisition by any parent of the ~~Lead~~ Borrower of all or substantially all of the property and assets or business of any Person, or of assets constituting a business unit, a line of business or division of such Person, or of all of the Equity Interests in a Person; provided that if such purchase or other acquisition had been made by the ~~Lead~~ Borrower, it would have constituted a Permitted Acquisition permitted to be made pursuant to Section 9.14; provided that (A) such dividend, distribution, loan or advance shall be made concurrently with the closing of such purchase or other acquisition and (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) and any liabilities assumed to be contributed to the ~~Lead~~ Borrower or any Restricted Subsidiary or (2) the merger (to the extent permitted in Section 10.02) into the ~~Lead~~ Borrower or any Restricted Subsidiary of the Person formed or acquired in order to consummate such purchaser or other acquisition; (G) any customary fees and expenses related to any unsuccessful equity offering by any Parent Company directly attributable to the operations of the ~~Lead~~ Borrower and its Restricted Subsidiaries; provided that the aggregate amount of Dividends made pursuant to subclauses (C)-(G) of this clause (vi), together with the aggregate amount of Dividends made pursuant to clauses (iv), (vii) and (viii) of this Section 10.03, shall not exceed $5,000,000 in any fiscal year; (vii) reasonable and customary indemnities to directors, officers and employees of any Parent Company in the ordinary course of business, to the extent reasonably attributable to the ownership or operation of the ~~Lead~~ Borrower and its Restricted Subsidiaries; provided that the aggregate amount of Dividends made pursuant to this clause (vii), together with the aggregate amount of Dividends made pursuant to clauses (iv), (vi)(C)-(G) and (viii) of this Section 10.03, shall not exceed $5,000,000 in any fiscal year; (viii) the ~~Lead~~ Borrower may pay cash Dividends to Holdings so long as the proceeds thereof are promptly used by Holdings (or subsequently paid to any other Parent Company) for payment of (x) obligations under or in respect of director and officer insurance policies to the extent reasonably attributable to the ownership or operation of the ~~Lead~~ Borrower and its Restricted Subsidiaries or (y) indemnification obligations owing to the Sponsor and Sponsor Affiliates under the Advisory Agreement (as in effect on the Closing Date; provided that the aggregate amount of Dividends made pursuant to this clause (viii), together with the aggregate amount of Dividends made pursuant to clauses (iv), (vi)(C)-(G) and (vii) of this Section 10.03, shall not exceed $5,000,000 in any fiscal year; (ix) any Dividend used (i) to fund the Transaction, including Transaction ~~Costs and the Special Dividend~~Costs, and ~~any Dividend from proceeds received~~ (ii) in ~~connection with any working capital adjustment pursuant~~ order to satisfy indemnity and other similar obligations under the Acquisition Agreement; (x) the ~~Lead~~ Borrower may pay cash Dividends to Holdings (who may subsequently pay cash Dividends to any other Parent Company) so long as the proceeds thereof are used to pay the Sponsor or Sponsor Affiliate fees, expenses and indemnification payments that are then permitted to be paid pursuant to Sections 10.06(v) and ~~10.06(vii~~10.06(viii); (xi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants or ~~the settlement or vesting of other~~ similar equity incentive awards; (xii) a Dividend to any Parent Company to fund a payment of dividends on such Parent Company’s common stock following an Initial Public Offering of such common stock after the Closing Date, of up to 6% per annum of the net cash proceeds contributed to the capital of the ~~Lead~~ Borrower from any such Initial Public Offering; (xiii) on a Pro Forma Basis, if the Consolidated ~~First Lien Net Leverage Ratio does not exceed 3.00 to 1.00 and the Consolidated~~ Total Net Leverage Ratio does not exceed ~~4.25~~ 5.00 to 1.00, any Dividends to the extent the same are made solely with the Available Amount, so long as at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing; (xiv) purchases of minority interests in non-Wholly-Owned Subsidiaries by the ~~Lead~~ Borrower and the Guarantors; provided that the aggregate amount of such purchases, when added to the aggregate amount of Investments pursuant to Section 10.05(xvii), shall not exceed $5,000,000; (xv) the declaration and payment of dividends or the payment of other distributions by the ~~Lead~~ Borrower in an aggregate amount since the Closing Date not to exceed $~~35,000,000~~30,000,000 less any amounts used under Section 10.07(a)(B)(ii) and Section 10.07(b)(ii); (xvi) the ~~Lead~~ Borrower and each Restricted Subsidiary may declare and make dividend payments or other distributions payable solely in the Equity Interests of such Person so long as in the case of dividend or other distribution by a Restricted Subsidiary, the ~~Lead~~ Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution; (xvii) the ~~Lead~~ Borrower may make payments with the cash proceeds contributed to its common equity from the net cash proceeds of any equity issuance by any Parent Company, so long as, with respect to any such payments, no Event of Default shall have occurred and be continuing or would result therefrom; provided that the amount of any such cash proceeds that are utilized for any Dividend under this clause (iii) will not be considered to be cash proceeds of Equity Interests for purposes of clause (b)(x)(ii) of the definition of “Available Amount”; (xviii) the ~~Lead~~ Borrower and any Restricted Subsidiary may pay dividends and distributions within 60 days after the date of declaration thereof, if at the date of declaration of such payment, such payment would have complied with another provision of this Section 10.03~~; and~~; (xix) any Dividends, so long as (x) at the time of, and after giving effect to such Dividend, no Event of Default shall have occurred and be continuing and (y) on a Pro Forma Basis, the Consolidated Total Net Leverage Ratio does not exceed ~~3.25~~ 3.50 to 1.00; and (xx) [reserved]; (xxi) any Dividend or other distribution of assets in, or Equity Interests of, any or all Designated Companies. In determining compliance with this Section 10.03 (and in determining amounts paid as Dividends pursuant hereto for purposes of the definition of Consolidated EBITDA and Consolidated Net Income), amounts loaned or advanced to Holdings pursuant to Section 10.05(vi) shall be deemed to be cash Dividends paid to Holdings to the extent provided in said Section 10.05(vi).

Appears in 1 contract

Sources: Term Loan Credit Agreement

Common use of Dividends Clause in Contracts