Equity Cure. If a Cure Event occurs, any Cure Fund Payments received by (x) Borrowers, in the case of the Current Ratio or Collateral Coverage Ratio, or (y) Holdings, in the case of the Debt to Capitalization Ratio, in either case, during the applicable Cure Period will, at the request of Borrowers, be included (i) as cash in the calculation of the Collateral Formula Amount (in the event of a Default with respect to the Collateral Coverage Covenant), (ii) Net Worth of Holdings (in the event of a Default with respect to the Debt to Capitalization Covenant) or (iii) as cash in the determination of ▇▇ ▇▇▇▇▇’▇ current assets (in the event of a Default with respect to the Current Ratio Covenant) solely for the purposes of determining compliance with such Financial Covenants at the end of such test period and any subsequent test period that includes such test; provided that (a) the amount of any Cure Fund Payment will be (x) with respect to a Default under the Collateral Coverage Covenant, an amount greater than or equal to the amount required to cause the Collateral Coverage Ratio, determined on a pro forma basis, to equal the Collateral Coverage Cure Target, and (y) with respect to all other Financial Covenant Defaults, an amount greater than or equal to the least amount required to cause the Loan Parties to be in compliance with Financial Covenants, (b) notwithstanding anything in this Agreement to the contrary, all Cure Fund Payments will be disregarded for all other purposes, including calculating basket levels, pricing and other items governed by reference to the Financial Covenants, liquidity or availability and may not be used for any other purpose hereunder, (c) all Cure Fund Payments shall be promptly used by Borrowers to prepay Loans and other Obligations in the manner prescribed by Section 2.4(d), and (d) for the avoidance of doubt, any Loans prepaid with any Cure Fund Payments shall be deemed outstanding for purposes of determining compliance with such financial covenants for the test period in respect of which Cure Fund Payment was received. So long as Borrowers are otherwise entitled to exercise its rights under this Section 8.2, (i) from the effective date of delivery of an irrevocable written notice from Borrowers to Agent of Borrowers’ intent to exercise their rights hereunder (a “Cure Notice”) until the earlier to occur of the end of the applicable Cure Period and the date on which Agent is notified that the Cure Fund Payment will not be made, neither Agent nor any Lender shall exercise any enforcement remedy against any Loan Party or any Subsidiary of any Restricted Loan Party or any of their respective properties solely on the basis of the failure to comply with the applicable Financial Covenant in respect of which the Cure Notice was delivered, and (ii) until the earlier to occur of the last day of the applicable Cure Period and the date on which Agent is notified that the Cure Fund Payment will not be made, neither Agent nor any Lender shall impose default interest, terminate the Revolving Loan Commitments or accelerate the Obligations solely on the basis of the failure to comply with the applicable Financial Covenant. Upon timely receipt by Borrowers in cash of the appropriate Cure Fund Payment, if and to the extent after giving effect this Section 8.2 all applicable Events of Default pursuant to Section 6 would no longer exist on a pro forma basis, such Events of Default shall be deemed cured.
Appears in 2 contracts
Sources: Loan and Security Agreement (Green Plains Inc.), Loan and Security Agreement (Green Plains Inc.)
Equity Cure. If a Cure Event occurs, any Cure Fund Payments received by (x) Borrowersi). Notwithstanding anything to the contrary in this Agreement, in the case of the Current Ratio or Collateral Coverage Ratio, or (y) Holdings, in the case of the Debt to Capitalization Ratio, in either case, during the applicable Cure Period will, at the request of Borrowers, be included (i) as cash in the calculation of the Collateral Formula Amount (in the event of a Default with respect to the Collateral Coverage Covenant), (ii) Net Worth of Holdings (in the event of a Default with respect to the Debt to Capitalization Covenant) or (iii) as cash in the determination of ▇▇ ▇▇▇▇▇’▇ current assets (in the event of a Default with respect to the Current Ratio Covenant) solely for the purposes of determining compliance with such Financial Covenants at the end of such test period and any subsequent test period that includes such test; provided that (a) the amount of any Cure Fund Payment will be (x) with respect to a Default under the Collateral Coverage Covenant, an amount greater than or equal to the amount required to cause the Collateral Coverage Ratio, determined on a pro forma basis, to equal the Collateral Coverage Cure Target, and (y) with respect to all other Financial Covenant Defaults, an amount greater than or equal to the least amount required to cause the Loan Parties fail to be in compliance comply (or anticipate that they may fail to comply) with Financial Covenants, (b) notwithstanding anything the maximum Leverage Ratio covenant contained in this Agreement to Section 5(bb) (the contrary, all Cure Fund Payments will be disregarded for all other purposes, including calculating basket levels, pricing and other items governed by reference to the “Financial Covenants, liquidity or availability and may not be used for any other purpose hereunder, (c) all Cure Fund Payments shall be promptly used by Borrowers to prepay Loans and other Obligations in the manner prescribed by Section 2.4(d), and (d) for the avoidance of doubt, any Loans prepaid with any Cure Fund Payments shall be deemed outstanding for purposes of determining compliance with such financial covenants for the test period in respect of which Cure Fund Payment was received. So long as Borrowers are otherwise entitled to exercise its rights under this Section 8.2, (i) from the effective date of delivery of an irrevocable written notice from Borrowers to Agent of Borrowers’ intent to exercise their rights hereunder (a “Cure NoticeCovenant”) until the earlier to occur as of the end of any fiscal quarter (the applicable “Cure Period and Quarter”), then Borrower shall have the date on which Agent is notified that right, during the period (the “Cure Fund Payment will not be made, neither Agent nor any Lender shall exercise any enforcement remedy against any Loan Party or any Subsidiary of any Restricted Loan Party or any of their respective properties solely Period”) beginning on the basis of the failure to comply with the applicable Financial Covenant in respect of which the Cure Notice was delivered, and (ii) until the earlier to occur of the last first day of the applicable Cure Period Quarter until the tenth (10) Business Day after the day on which the financial statements with respect to such test period for which such covenant is being measured are required to be delivered for the applicable Cure Quarter pursuant to Sections 5(d)(i) or 5(d)(ii), as applicable (such financial statements, the “Applicable Financial Statements” and such date, the “Cure Deadline”), to include an amount equal to the cash proceeds of a Specified Equity Contribution (the “Cure Amount”) in EBITDA for the purposes of calculating the Financial Covenant (the “Cure Right”), and pursuant to the exercise of the Cure Right, the Financial Covenant shall be recalculated, (A) upon the date on which Agent of receipt if such Specified Equity Contribution is notified that received after the Cure Fund Payment will not be made, neither Agent nor any Lender shall impose default interest, terminate delivery of the Revolving Loan Commitments Applicable Financial Statements or accelerate the Obligations solely (B) on the basis date the Applicable Financial Statements are delivered if such Specified Equity Contribution is received prior to the delivery of the failure to comply with the applicable Applicable Financial Covenant. Upon timely receipt by Borrowers in cash of the appropriate Cure Fund Payment, if and to the extent after Statements giving effect this Section 8.2 all applicable Events of Default pursuant to Section 6 would no longer exist on a pro forma basis, increase to EBITDA for such Events of Default test period in an amount equal to such Cure Amount; provided that such pro forma adjustment to EBITDA shall be deemed curedgiven solely for the purpose of measuring the Financial Covenant with respect to any period that includes the fiscal quarter for which such Cure Right was exercised and not for any other purpose under any Loan Document (including any other use of the Financial Covenant).
Appears in 1 contract
Equity Cure. If a Cure Event occurs, any Cure Fund Payments received by (x) BorrowersNotwithstanding anything to the contrary contained in this Section 11, in the case event that the Borrower fails to comply with the requirement of the Current Ratio or Collateral Coverage Ratiofinancial covenant set forth in Section 10.9, or the Borrower may elect to cure such failure (ythe “Cure Right”) Holdings, in the case of the Debt to Capitalization Ratio, in either case, during the applicable Cure Period will, at the request of Borrowers, be included (i) as cash by including in the calculation of such financial covenant the Collateral Formula Amount cash net equity proceeds derived from an issuance of Capital Stock or Stock Equivalents (other than Disqualified Stock) by the Borrower, or from a contribution to the common equity capital of the Borrower, in each case, received at any time from the event first day of the last fiscal quarter of the Test Period in respect of which such financial covenant is being measured until the expiration of the fifteenth Business Day following the date financial statements referred to in Section 9.1(a) or (b) (such period, the “Cure Period”) are required to be delivered in respect of such Test Period for which such financial covenant is being measured (such cash amount being referred to as the “Cure Amount”), and upon such election by the Borrower to exercise such Cure Right, such financial covenant shall be recalculated giving effect to the following pro forma adjustments:
(a) Consolidated EBITDA shall be increased, solely for the purpose of determining the existence of an Event of Default resulting from a Default breach of the financial covenant set forth in Section 10.9 with respect to any period of four consecutive fiscal quarters that includes the Collateral Coverage Covenantfiscal quarter for which the Cure Right was exercised and not for any other purpose under this Agreement, by an amount equal to the Cure Amount;
(b) to the extent proceeds of the Cure Amount are applied to repay any Indebtedness, the calculation of the covenant in Section 10.9 shall not give pro forma effect to such repayment for the Test Period ending with the fiscal quarter for which the Cure Right is exercised (but shall be given effect in calculations of the covenant in Section 10.9 in subsequent fiscal quarters); and
(c) if, after giving effect to the foregoing recalculations, the Borrower shall then be in compliance with the requirements of the financial covenant set forth in Section 10.9, the Borrower shall be deemed to have satisfied the requirements of the financial covenant set forth in Section 10.9 as of the relevant date of determination with the same effect as though there had been no failure to comply therewith at such date, and the applicable breach or default of such financial covenant that had occurred shall be deemed cured for the purposes of this Agreement; provided, that (i) in each period of four consecutive fiscal quarters there shall be at least two fiscal quarters in which no Cure Right is exercised, (ii) Net Worth there shall be a maximum of Holdings (in five Cure Rights exercised during the event term of a Default with respect to the Debt to Capitalization Covenant) or this Agreement, (iii) as cash in the determination of ▇▇ ▇▇▇▇▇’▇ current assets (in the event of a Default with respect to the Current Ratio Covenant) solely for the purposes of determining compliance with such Financial Covenants at the end of such test period and any subsequent test period that includes such test; provided that (a) the amount of any each Cure Fund Payment will Amount shall be (x) with respect to a Default under the Collateral Coverage Covenant, an amount no greater than or equal to the amount required to cause the Collateral Coverage Ratio, determined on a pro forma basis, to equal the Collateral Coverage Cure Target, and (y) with respect to all other Financial Covenant Defaults, an amount greater than or equal to the least amount required to cause the Loan Parties Borrower to be in compliance with Financial Covenants, the financial covenant set forth in Section 10.9 (b) notwithstanding anything in this Agreement it being understood that to the contraryextent the notice described in the immediately succeeding paragraph is provided in advance of delivery of a Compliance Certificate for the applicable fiscal period, the amount of such net equity proceeds that is designated as the Cure Amount may be lower than the amount specified in such notice to the extent the amount necessary to cure such Event of Default is less than the full amount originally designated); and (iv) all Cure Fund Payments will Amounts shall be disregarded for all other purposes, including calculating basket levels, pricing and other items governed by reference to the Financial Covenants, liquidity or availability and may not be used for any other purpose hereunder, (c) all Cure Fund Payments shall be promptly used by Borrowers to prepay Loans and other Obligations in the manner prescribed by Section 2.4(d), and (d) for the avoidance of doubt, any Loans prepaid with any Cure Fund Payments shall be deemed outstanding for purposes of any financial ratio determination under the Credit Documents other than for determining compliance with such financial covenants for Section 10.9. Upon delivery to the test period Administrative Agent by the Borrower of written notice that it intends to exercise its Cure Right under this Section 11.14, any Default or Event of Default, as the case may be, under Section 11.3(a) in respect of which Cure Fund Payment was received. So long a failure to observe or perform the covenant contained in Section 10.9 (or any other Default or Event of Default as Borrowers are otherwise entitled a result thereof) shall retroactively be deemed not to exercise its rights under this Section 8.2have occurred; provided, (i) from the effective date of delivery of an irrevocable written notice from Borrowers to Agent of Borrowers’ intent to exercise their rights hereunder (a “Cure Notice”) until the earlier to occur of the end of the applicable Cure Period and the date on which Agent is notified that the Cure Fund Payment will Borrower shall not be made, neither Agent nor permitted to borrow Revolving Loans or make any Lender shall exercise any enforcement remedy against any Loan Party or any Subsidiary Letter of any Restricted Loan Party or any of their respective properties solely on the basis of the failure to comply with the applicable Financial Covenant Credit Request in respect of which issuing a new Letter of Credit or otherwise extending or increasing the face amount of an existing Letter of Credit unless and until (x) the proceeds of the issuance or contribution, as the case may be, constituting the Cure Notice was deliveredAmount shall have been received by the Borrower such that, upon recalculation taking into account such Cure Amount received, the Borrower shall be in compliance with the covenant contained in Section 10.9 or (y) all such Defaults and (ii) until Event of Defaults shall have been waived in accordance with the earlier to occur terms of this Agreement; provided, further, that if the Cure Amount is not received before the expiration of the last day of the applicable Cure Period Period, unless all such Defaults and the date on which Agent is notified that the Cure Fund Payment will not be made, neither Agent nor any Lender shall impose default interest, terminate the Revolving Loan Commitments or accelerate the Obligations solely on the basis of the failure to comply with the applicable Financial Covenant. Upon timely receipt by Borrowers in cash of the appropriate Cure Fund Payment, if and to the extent after giving effect this Section 8.2 all applicable Events of Default pursuant to Section 6 would no longer exist on a pro forma basisshall have been waived in accordance with the terms of this Agreement, each such Events Default or Event of Default shall be deemed curedreinstated. No Agent or Lender shall take any action to foreclose on, or take possession of, the Collateral, accelerate any Obligations, terminate any Commitments or otherwise exercise any remedies under any Credit Document or any applicable law on the basis of a breach of Section 10.9 (or any other Default or Event of Default as a result thereof) unless and until the Cure Period has expired and the Borrower has not received the Cure Amount.
Appears in 1 contract
Sources: First Lien Credit Agreement (Aveanna Healthcare Holdings, Inc.)
Equity Cure. If a Cure Event occurs, any Cure Fund Payments received by (x) BorrowersNotwithstanding anything to the contrary contained in Article VII, in the case event that the Borrower fails to comply with the requirements of the Current Ratio Financial Covenant, until the expiration of the 15th day subsequent to the date the certificate calculating compliance (or Collateral Coverage Rationon-compliance) with the Financial Covenant is required to be delivered pursuant to Section 5.01, Holdings shall have the right to issue Permitted Cure Securities for cash or (y) otherwise receive cash contributions to the capital of Holdings, and, in each case, to contribute any such cash to the case capital of the Debt Borrower (collectively, the “Cure Right”), and upon the receipt by the Borrower of such cash (the “Cure Amount”) pursuant to Capitalization Ratiothe exercise by Holdings of such Cure Right, the Financial Covenant shall be recalculated giving effect to the following pro forma adjustments:
(a) Consolidated EBITDA shall be increased, solely for the purpose of measuring compliance with such Financial Covenant and not for any other purpose under this Agreement, including in either caseconnection with determining whether, during after giving effect to an event, the requirements of the Financial Covenant have been met or Pro Forma Compliance exists, by an amount equal to the Cure Amount; and
(b) If, after giving effect to the foregoing recalculations, the Borrower shall then be in compliance with the requirements of the Financial Covenant, the Borrower shall be deemed to have satisfied the requirements of the Financial Covenant as of the relevant date of determination with the same effect as though there had been no failure to comply therewith at such date, and the applicable Cure Period willbreach or default of the Financial Covenant that had occurred shall be deemed cured for this purposes of the Agreement. Notwithstanding anything herein to the contrary, at the request of Borrowers, be included (i) as cash in each four fiscal quarter period there shall be a period of at least two fiscal quarters in which the calculation of the Collateral Formula Amount (in the event of a Default with respect to the Collateral Coverage Covenant)Cure Right is not exercised, (ii) Net Worth the Cure Amount shall be no greater than the amount required for purposes of Holdings (in complying with the event of a Default with respect to the Debt to Capitalization Covenant) or Financial Covenant and (iii) as cash in the determination any Equity Issuance consisting of ▇▇ ▇▇▇▇▇’▇ current assets (in the event of a Default with respect to the Current Ratio Covenant) solely Permitted Cure Securities shall be disregarded for the purposes of determining compliance with such Financial Covenants at any limitation contained in any of the end of such test period and any subsequent test period that includes such test; provided that covenants in Article VI hereof (a) the amount of any Cure Fund Payment will be (x) with respect to a Default under the Collateral Coverage Covenant, an amount greater other than or equal to the amount required to cause the Collateral Coverage Ratio, determined on a pro forma basis, to equal the Collateral Coverage Cure Target, and (y) with respect to all other Financial Covenant Defaults, an amount greater than or equal to the least amount required to cause the Loan Parties to be in compliance with Financial Covenants, (b) notwithstanding anything in this Agreement to the contrary, all Cure Fund Payments will be disregarded for all other purposes, including calculating basket levels, pricing and other items governed by reference to the Financial Covenants, liquidity or availability and may not be used for any other purpose hereunder, (c) all Cure Fund Payments shall be promptly used by Borrowers to prepay Loans and other Obligations in the manner prescribed by Section 2.4(dCovenant), and (d) for the avoidance of doubt, any Loans prepaid with any Cure Fund Payments shall be deemed outstanding for purposes of determining compliance with such financial covenants for the test period in respect of which Cure Fund Payment was received. So long as Borrowers are otherwise entitled to exercise its rights under this Section 8.2, (i) from the effective date of delivery of an irrevocable written notice from Borrowers to Agent of Borrowers’ intent to exercise their rights hereunder (a “Cure Notice”) until the earlier to occur of the end of the applicable Cure Period and the date on which Agent is notified that the Cure Fund Payment will not be made, neither Agent nor any Lender shall exercise any enforcement remedy against any Loan Party or any Subsidiary of any Restricted Loan Party or any of their respective properties solely on the basis of the failure to comply with the applicable Financial Covenant in respect of which the Cure Notice was delivered, and (ii) until the earlier to occur of the last day of the applicable Cure Period and the date on which Agent is notified that the Cure Fund Payment will not be made, neither Agent nor any Lender shall impose default interest, terminate the Revolving Loan Commitments or accelerate the Obligations solely on the basis of the failure to comply with the applicable Financial Covenant. Upon timely receipt by Borrowers in cash of the appropriate Cure Fund Payment, if and to the extent after giving effect this Section 8.2 all applicable Events of Default pursuant to Section 6 would no longer exist on a pro forma basis, such Events of Default shall be deemed cured.
Appears in 1 contract
Sources: Credit Agreement (Hawaiian Telcom Communications, Inc.)
Equity Cure. If a Cure Event occursIn the event the Borrower fails to comply with the Financial Covenants as of any Test Date, any Cure Fund Payments received by cash equity contribution (xor qualified preferred equity or other equity on terms reasonably satisfactory to the Administrative Agent) Borrowers, in the case Borrower after the beginning of the Current Ratio applicable Fiscal Quarter ending on such Test Date and on or Collateral Coverage Ratio, or prior to the day that is ten (y10) Holdings, in Business Days after the case of day on which financial statements are required to be delivered for the Debt to Capitalization Ratio, in either case, during the applicable Cure Period Fiscal Quarter ended on such Test Date will, at the request irrevocable election of Borrowersthe Borrower, be included (i) as cash in the calculation of the Collateral Formula Amount (in the event of a Default with respect to the Collateral Coverage Covenant), (ii) Net Worth of Holdings (in the event of a Default with respect to the Debt to Capitalization Covenant) or (iii) as cash in the determination of ▇▇ ▇▇▇▇▇’▇ current assets (in the event of a Default with respect to the Current Ratio Covenant) Consolidated Adjusted EBITDA solely for the purposes of determining compliance with such the Financial Covenants at the end as of such test period Test Date and as of any subsequent test period Test Date that includes such testFiscal Quarter for purposes of determining compliance with the Financial Covenants (any such equity contribution so included in the calculation of Consolidated Adjusted EBITDA, a “Specified Equity Contribution”); provided that (ai) no more than two Specified Equity Contributions may be made in any four consecutive Fiscal Quarter period and only three Specified Equity Contributions may be made during the term of this Agreement, (ii) the amount of any Cure Fund Payment Specified Equity Contribution will be (x) with respect to a Default under the Collateral Coverage Covenant, an amount no greater than or equal to the amount required to cause the Collateral Coverage Ratio, determined on a pro forma basis, to equal the Collateral Coverage Cure Target, and (y) with respect to all other Financial Covenant Defaults, an amount greater than or equal to the least amount required to cause the Loan Parties Borrower to be in compliance with the Financial Covenants, (biii) notwithstanding anything in this Agreement to the contrary, all Cure Fund Payments Specified Equity Contributions will 148797484_8155722702_14 be disregarded for all other purposes, including the calculation of Consolidated Adjusted EBITDA for all purposes other than the compliance with the Financial Covenants for such applicable Test Period and subsequent Test Periods that include the Fiscal Quarter ending on the applicable Test Date, and including calculating basket levels, pricing levels and other items governed by reference to Consolidated Adjusted EBITDA, (iv) with respect to the Fiscal Quarter for which it is contributed to cure a breach of the Financial Covenants, liquidity or availability any Specified Equity Contribution shall not reduce the outstanding Indebtedness of the Borrower for such Fiscal Quarter (it being understood and may agreed that such limitation shall not be used for any other purpose hereunder, (capply in subsequent Fiscal Quarters if actually applied to repay Term Loans) all Cure Fund Payments shall be promptly used by Borrowers to prepay Loans and other Obligations in the manner prescribed by Section 2.4(d), and (dv) for the avoidance Borrower shall not, unless otherwise agreed by the Required Lenders under the Revolving Credit Facility, be permitted to incur Revolving Loans or request the issuance of doubt, any Loans prepaid with any Cure Fund Payments shall be deemed outstanding for purposes Letters of determining compliance with such financial covenants for Credit during the test ten Business Day period in respect of which Cure Fund Payment was received. So long as Borrowers are otherwise entitled referred to exercise its rights under this Section 8.2, (i) from the effective date of delivery of an irrevocable written notice from Borrowers to Agent of Borrowers’ intent to exercise their rights hereunder (a “Cure Notice”) above unless and until the earlier to occur Borrower has received the proceeds of the end of the applicable Cure Period and the date on which Agent is notified that the Cure Fund Payment will not be made, neither Agent nor any Lender shall exercise any enforcement remedy against any Loan Party or any Subsidiary of any Restricted Loan Party or any of their respective properties solely on the basis of the failure to comply with the applicable Financial Covenant in respect of which the Cure Notice was delivered, and (ii) until the earlier to occur of the last day of the applicable Cure Period and the date on which Agent is notified that the Cure Fund Payment will not be made, neither Agent nor any Lender shall impose default interest, terminate the Revolving Loan Commitments or accelerate the Obligations solely on the basis of the failure to comply with the applicable Financial Covenant. Upon timely receipt by Borrowers in cash of the appropriate Cure Fund Payment, if and to the extent after giving effect this Section 8.2 all applicable Events of Default pursuant to Section 6 would no longer exist on a pro forma basis, such Events of Default shall be deemed curedSpecified Equity Contribution.
Appears in 1 contract
Equity Cure. If a Cure Event occursIn the event the Borrower fails to comply with the financial covenants set forth in subsection (a), (b) and/or (c) of this Section 6.12, any Cure Fund Payments received by cash equity contribution (x) Borrowers, which equity will be in the case form of common equity) made to the Current Ratio Borrower by the Sponsor after the end of a Fiscal Quarter and on or Collateral Coverage Ratioprior to the day that is 10 Business Days after the day on which Financial Statements are required to be delivered for such Fiscal Quarter (such period, or (ythe “Cure Period”) Holdings, in the case of the Debt to Capitalization Ratio, in either case, during the applicable Cure Period will, at by written notice to the request of BorrowersLender, be included (i) as cash in the calculation of Adjusted EBITDA and/or Total Capitalization, as the Collateral Formula Amount (in the event of a Default with respect to the Collateral Coverage Covenant)case may be, (ii) Net Worth of Holdings (in the event of a Default with respect to the Debt to Capitalization Covenant) or (iii) as cash in the determination of ▇▇ ▇▇▇▇▇’▇ current assets (in the event of a Default with respect to the Current Ratio Covenant) solely for the purposes of determining compliance with such Financial Covenants financial covenants at the end of such test period Fiscal Quarter and any each subsequent test period that includes such testFiscal Quarter (any such equity contribution so included in the calculation of Adjusted EBITDA and/or Total Capitalization, as the case may be, an “Equity Cure Contribution”); provided that (ai) no more than two Equity Cure Contributions may be made consecutively, (ii) no more than four Equity Cure Contributions, including any “Equity Cure Contributions” voluntarily made by the Sponsor in accordance with the Capital Maintenance Agreement, may be made during the term of this Agreement, (iii) the amount of any Equity Cure Fund Payment Contribution in any period will be (x) with respect to a Default under the Collateral Coverage Covenant, an amount no greater than or equal to the amount required to cause the Collateral Coverage Ratio, determined on a pro forma basis, to equal the Collateral Coverage Cure Target, and (y) with respect to all other Financial Covenant Defaults, an amount greater than or equal to the least amount required to cause the Loan Parties Borrower to be in compliance with Financial Covenants, (b) notwithstanding anything in this Agreement to the contrary, all Cure Fund Payments will be disregarded for all other purposes, including calculating basket levels, pricing and other items governed by reference to the Financial Covenants, liquidity or availability and may not be used for any other purpose hereunder, (c) all Cure Fund Payments shall be promptly used by Borrowers to prepay Loans and other Obligations in the manner prescribed by Section 2.4(d), and (d) for the avoidance of doubt, any Loans prepaid with any Cure Fund Payments shall be deemed outstanding for purposes of determining compliance with such financial covenants for such period (provided that one Equity Cure Contribution made during the test period term of this Agreement may equal up to 110% of any such required amount), (iv) each Equity Cure Contribution shall be counted solely for the purposes of determining compliance with the financial covenants and shall not be included for the purposes of any satisfying the condition to any Borrowings hereunder, determining the availability or amount of any covenant baskets or carve-outs, if any, and (v) the Equity Cure Contribution may not reduce Indebtedness for purposes of calculating such financial covenants. If, after receipt of the Equity Cure Contribution and the recalculations pursuant to the preceding sentence, the Borrower shall then be in respect compliance with the requirements of which Cure Fund Payment was received. So long as Borrowers are otherwise entitled to exercise its rights under subsection (a) and/or (b) of this Section 8.26.12, as applicable, the Borrower shall be deemed to have satisfied the requirements of said subsection (ia) from and/or (b) of this Section 6.12 as of the effective relevant date of delivery determination with the same effect as though there had been no failure to comply therewith at such date, and the applicable Event of Default that had occurred shall be deemed cured. The Lender shall not exercise any remedy under the Loan Documents (including application of default interest) on the basis of an irrevocable written notice from Borrowers Event of Default caused solely by the failure of the Loan Parties to Agent of Borrowers’ intent to exercise their rights hereunder (a “Cure Notice”) comply with Section 6.12 until the earlier to occur of the end of the applicable Cure Period and the date on which Agent is notified that the Cure Fund Payment will not be made, neither Agent nor any Lender shall exercise any enforcement remedy against any Loan Party or any Subsidiary of any Restricted Loan Party or any of their respective properties solely on the basis of the failure to comply with the applicable Financial Covenant in respect of which the Cure Notice was delivered, and (ii) until the earlier to occur of the last day of the applicable Cure Period and the date on which Agent is notified that the Cure Fund Payment will not be made, neither Agent nor any Lender shall impose default interest, terminate the Revolving Loan Commitments or accelerate the Obligations solely on the basis of the failure to comply with the applicable Financial Covenant. Upon timely receipt by Borrowers in cash of the appropriate Cure Fund Payment, if and to the extent after giving effect this Section 8.2 all applicable Events of Default pursuant to Section 6 would no longer exist on a pro forma basis, such Events of Default shall be deemed curedPeriod.
Appears in 1 contract
Equity Cure. If a Cure Event occurs, any Cure Fund Payments received by (x) Borrowers, in the case of the Current Ratio or Collateral Coverage Ratio, or (y) Holdings, in the case of the Debt to Capitalization Ratio, in either case, during the applicable Cure Period will, at the request of Borrowers, be included (i) In the event Borrowers fail to comply with Section 6.9(b) of this Agreement as of any required measurement date (the “Noncompliance Date”), Borrowers shall have the right to cure such non-compliance (the “Equity Cure Right”) by receiving a cash proceeds of at least the shortfall amount (the “Cash Contribution”), from the sale and issuance of Parent’s equity securities or Subordinated Debt from existing shareholders within the thirty (30) day period following the Noncompliance Date (the “Initial Cure Period”) or within the twenty (20) Business Day period that follows thereafter (the “Extended Cure Period”). If the Cash Contribution is received during the Initial Cure Period, Borrowers shall note as such on the Compliance Certificate delivered to Bank at the end of the Initial Cure Period. If the Cash Contribution has not been received during the Initial Cure Period, Borrowers shall note on the Compliance Certificate delivered to Bank at the end of the Initial Cure Period that Borrowers have elected to exercise the Equity Cure Right and intend to receive the Cash Contribution during the Extended Cure Period, and shall notify Bank within one Business Day following receipt of such Cash Contribution, but in any event no later than the end of the Extended Cure Period.
(ii) Upon receipt of such Cure Contribution in accordance with the terms set forth above, Borrowers shall be deemed as if they were in compliance with such financial covenant as of the Noncompliance Date and no Event of Default shall be deemed not to have occurred for purposes of the Loan Documents.
(iii) Cash Contributions received in compliance with the foregoing shall be included in the calculation of the Collateral Formula Amount (in the event of a Default with respect to the Collateral Coverage Covenant), (ii) Net Worth of Holdings (in the event of a Default with respect to the Debt to Capitalization Covenant) or (iii) as cash in the determination of ▇▇ ▇▇▇▇▇’▇ current assets (in the event of a Default with respect to the Current Ratio Covenant) solely Borrowers’ Adjusted EBITDA for the purposes of determining compliance with such Financial Covenants at the end of such test period and any subsequent test period that includes such test; provided that (a) the amount of any Cure Fund Payment will be (x) with respect to a Default under the Collateral Coverage Covenant, an amount greater than or equal to the amount required to cause the Collateral Coverage Ratio, determined on a pro forma basis, to equal the Collateral Coverage Cure Target, and (y) with respect to all other Financial Covenant Defaults, an amount greater than or equal to the least amount required to cause the Loan Parties to be in compliance with Financial Covenants, (b) notwithstanding anything in this Agreement to the contrary, all Cure Fund Payments will be disregarded for all other purposes, including calculating basket levels, pricing and other items governed by reference to the Financial Covenants, liquidity or availability and may not be used for any other purpose hereunder, (c) all Cure Fund Payments shall be promptly used by Borrowers to prepay Loans and other Obligations in the manner prescribed by Section 2.4(d), and (d6.9(b) for the avoidance of doubtaffected period, any Loans prepaid with any Cure Fund Payments shall be deemed outstanding for purposes of determining compliance with such financial covenants and for the test subsequent period in respect of which includes the affected period. The Equity Cure Fund Payment was received. So long as Borrowers are otherwise entitled to exercise its rights under this Section 8.2, (i) from the effective date of delivery of an irrevocable written notice from Borrowers to Agent of Borrowers’ intent to exercise their rights hereunder (a “Cure Notice”) until the earlier to occur of the end of the applicable Cure Period and the date on which Agent is notified that the Cure Fund Payment will Right shall not be made, neither Agent nor any Lender shall exercise any enforcement remedy against any Loan Party or any Subsidiary exercised more than twice over the erm of any Restricted Loan Party or any of their respective properties solely on the basis of the failure to comply with the applicable Financial Covenant in respect of which the Cure Notice was deliveredthis Agreement, and (ii) until the earlier to occur of the last day of the applicable Cure Period and the date on which Agent is notified that the Cure Fund Payment will shall not be made, neither Agent nor exercised for any Lender shall impose default interest, terminate the Revolving Loan Commitments or accelerate the Obligations solely on the basis of the failure to comply with the applicable Financial Covenant. Upon timely receipt by Borrowers in cash of the appropriate Cure Fund Payment, if and to the extent after giving effect this Section 8.2 all applicable Events of Default pursuant to Section 6 would no longer exist on a pro forma basis, such Events of Default shall be deemed curedtwo consecutive measurement dates.
Appears in 1 contract
Equity Cure. (a) If the Company is in breach (or a Cure Event occursbreach is anticipated) of any obligation set out in Clause 25.2 (Financial condition) (other than the Capital Expenditure covenant set out in paragraph (e) of Clause 25.2 (Financial condition)) (each a “Financial Covenant”), any Cure Fund Payments received by then the Company may procure the contribution of a Permitted Equity Contribution (xthe “Equity Cure”) Borrowerswhich, subject to the conditions in paragraphs (b) and (c) below, shall have the case effect that each Financial Covenant is recalculated as at the relevant test date for that Relevant Period giving effect to the following pro forma adjustments:
(i) for the purpose of the Current Ratio or Collateral Leverage Ratio, an amount equal to the Equity Cure shall be deducted from the calculation of Consolidated Total Debt at the end of that Relevant Period;
(ii) for the purpose of calculating the Debt Service Coverage Ratio, or (y) Holdings, in an amount equal to the case of the Debt Equity Cure shall be added to Capitalization Ratio, in either case, during the applicable Cure Period will, at the request of Borrowers, be included (i) as cash in the calculation of of, and be treated as forming part of, Consolidated Cash Flow for the Collateral Formula Amount (in the event of a Default with respect to the Collateral Coverage Covenant), (ii) Net Worth of Holdings (in the event of a Default with respect to the Debt to Capitalization Covenant) or Relevant Period;
(iii) as cash in the determination of ▇▇ ▇▇▇▇▇’▇ current assets (in the event of a Default with respect to the Current Ratio Covenant) solely for the purposes of determining compliance with calculating the Interest Coverage Ratio, the amount of such Financial Covenants Equity Cure shall be treated (for this purpose only) as having been applied in prepayment of the Term Facilities on the first day of the Relevant Period in respect of which a cure is to be effected and the Consolidated Finance Charges shall be re-calculated accordingly; and
(iv) the Consolidated Tangible Net Worth shall be calculated by reducing the amount of debt owed by the Company as at the end of such test period and any subsequent test period that includes such test; provided that (a) the amount of any Cure Fund Payment will be (x) with respect to a Default under the Collateral Coverage Covenant, Relevant Period by an amount greater than or equal to the amount required Equity Cure received by the Company. All such Permitted Equity Contributions shall be deemed to cause have been provided immediately prior to the Collateral Coverage Ratio, determined last day of such Relevant Period (without prejudice to paragraph (iii) above) and shall be included in all relevant covenant calculations (without double counting the effect of the prepayment of the Facilities out of such Permitted Equity Contributions) for the Relevant Periods ending on a pro forma basis, to equal each of the Collateral Coverage Cure Targetthree subsequent Quarter Dates, and (y) compliance with respect to all other the relevant Financial Covenant Defaults, an amount greater than or equal to the least amount required to cause the Loan Parties to be in compliance with Financial Covenants, (b) notwithstanding anything in this Agreement to the contrary, all Cure Fund Payments will be disregarded for all other purposes, including calculating basket levels, pricing and other items governed determined by reference to the relevant re-calculation and the requirements of the Financial Covenants, liquidity or availability and may not be used for any other purpose hereunder, (c) all Cure Fund Payments shall be promptly used by Borrowers to prepay Loans and other Obligations in the manner prescribed by Section 2.4(d), and (d) for the avoidance of doubt, any Loans prepaid with any Cure Fund Payments Covenant shall be deemed outstanding for purposes of determining compliance with such financial covenants for to have been satisfied as at the test period in respect of which Cure Fund Payment was received. So long as Borrowers are otherwise entitled to exercise its rights under this Section 8.2, (i) from the effective relevant original date of delivery of an irrevocable written notice from Borrowers to Agent of Borrowers’ intent to exercise their rights hereunder (a “Cure Notice”) until the earlier to occur of the end of the applicable Cure Period and the date on which Agent is notified that the Cure Fund Payment will not be made, neither Agent nor any Lender shall exercise any enforcement remedy against any Loan Party or any Subsidiary of any Restricted Loan Party or any of their respective properties solely on the basis of the determination as though there had been no failure to comply with the applicable Financial Covenant in respect of which the Cure Notice was delivered, such requirements and (ii) until the earlier to occur of the last day of the applicable Cure Period and the date on which Agent is notified that the Cure Fund Payment will not be made, neither Agent nor any Lender shall impose default interest, terminate the Revolving Loan Commitments Default or accelerate the Obligations solely on the basis of the failure to comply with the applicable Financial Covenant. Upon timely receipt by Borrowers in cash of the appropriate Cure Fund Payment, if and to the extent after giving effect this Section 8.2 all applicable Events Event of Default pursuant to Section 6 would no longer exist on a pro forma basis, such Events of Default occasioned thereby shall be deemed curedto have been remedied for the purposes of the Finance Documents.
(b) Any Equity Cure made to effect a cure of a Financial Covenant must be contributed in cash and received by the Company no later than the date which is 15 Business Days following the date for delivery of the Compliance Certificate which relates to the Relevant Period in which there would be a breach of Financial Covenant, but for the operation of this provision and must be applied in full in immediate prepayment of the Facilities in accordance with Clause 11.4 (Application of mandatory prepayments).
(c) The contribution of Equity Cure may only be made for the purpose of effecting a cure of a Financial Covenant breach a maximum of two times over the life of the Facilities and not in consecutive Relevant Periods.
Appears in 1 contract
Sources: Term and Revolving Facilities Agreement (ShangPharma Corp)
Equity Cure. If a Cure Event occurs, any Cure Fund Payments received by (xa) BorrowersNotwithstanding anything to the contrary contained in this Article 11, in the case event that the Borrower fails to comply with the Financial Performance Covenant, then until the expiration of the Current Ratio tenth Business Day subsequent to the date the compliance certificate for calculating such Financial Performance Covenant is required to be delivered pursuant to Section 9.1(c) (the “Cure Deadline”), the Borrower shall have the right to cure such failure (the “Cure Right”) by causing cash net equity proceeds derived from an issuance of Stock or Collateral Coverage RatioStock Equivalents (other than Disqualified Stock) to be contributed as common equity to the Borrower, or and upon receipt by the Borrower of such cash proceeds (ysuch cash amount being referred to as the “Cure Amount”) Holdingspursuant to the exercise of such Cure Right, in the case of Financial Performance Covenant shall be recalculated giving effect to the Debt to Capitalization Ratio, in either case, during the applicable Cure Period will, at the request of Borrowers, be included following pro forma adjustments:
(i) as cash Consolidated EBITDA shall be increased, solely for the purpose of determining the existence of an Event of Default resulting from a breach of the Financial Performance Covenant with respect to any Test Period that includes the fiscal quarter for which the Cure Right was exercised and not for any other purpose under this Agreement, by an amount equal to the Cure Amount;
(ii) Consolidated Total Debt for such Test Period shall be decreased solely to the extent proceeds of the Cure Amount are actually applied to prepay any Indebtedness (provided that any such Indebtedness so prepaid shall be a permanent repayment of such Indebtedness and termination of commitments thereunder) included in the calculation of the Collateral Formula Amount Consolidated Total Debt; and
(in the event of a Default with respect iii) if, after giving effect to the Collateral Coverage foregoing recalculations, the Borrower shall then be in compliance with the requirements of the Financial Performance Covenant), the Borrower shall be deemed to have satisfied the requirements of the Financial Performance Covenant as of the relevant date of determination with the same effect as though there had been no failure to comply therewith at such date, and the applicable breach or default of the Financial Performance Covenant that had occurred shall be deemed cured for the purposes of this Agreement; provided that (i) in each period of four consecutive fiscal quarters there shall be at least two fiscal quarters in which no Cure Right is made, (ii) Net Worth there shall be a maximum of Holdings (in five Cure Rights made during the event term of a Default with respect to the Debt to Capitalization Covenant) or this Agreement, (iii) as cash in the determination of ▇▇ ▇▇▇▇▇’▇ current assets (in the event of a Default with respect to the Current Ratio Covenant) solely for the purposes of determining compliance with such Financial Covenants at the end of such test period and any subsequent test period that includes such test; provided that (a) the amount of any each Cure Fund Payment will Amount shall be (x) with respect to a Default under the Collateral Coverage Covenant, an amount no greater than or equal to the amount required to cause the Collateral Coverage Ratio, determined on a pro forma basis, to equal the Collateral Coverage Cure Target, and (y) with respect to all other Financial Covenant Defaults, an amount greater than or equal to the least amount required to cause the Loan Parties Borrower to be in compliance with the Financial CovenantsPerformance Covenant (such amount, the “Necessary Cure Amount”); provided that if the Cure Right is exercised prior to the date financial statements are required to be delivered for such fiscal quarter then the Cure Amount shall be equal to the amount reasonably determined by the Borrower in good faith that is required for purposes of complying with the Financial Performance Covenant for such fiscal quarter (such amount, the “Expected Cure Amount”), (biv) notwithstanding anything in this Agreement to the contrary, all Cure Fund Payments will Amounts shall be disregarded for all other purposes, including calculating basket levels, pricing and other items governed by reference to the Financial Covenants, liquidity or availability and may not be used for any other purpose hereunder, (c) all Cure Fund Payments shall be promptly used by Borrowers to prepay Loans and other Obligations in the manner prescribed by Section 2.4(d), and (d) for the avoidance of doubt, any Loans prepaid with any Cure Fund Payments shall be deemed outstanding for purposes of any financial ratio determination under the Credit Documents other than for determining compliance with such financial covenants for the test Financial Performance Covenant and (v) no Lender or Letter of Credit Issuer shall be required to make any extension of credit hereunder during the 10 Business Day period in respect of which Cure Fund Payment was received. So long as Borrowers are otherwise entitled referred to exercise its rights under this Section 8.2above, (i) from unless the effective date of delivery of an irrevocable written notice from Borrowers to Agent of Borrowers’ intent to exercise their rights hereunder (a “Cure Notice”) until the earlier to occur of the end of the applicable Cure Period and the date on which Agent is notified that Borrower shall have received the Cure Fund Payment will not be made, neither Agent nor any Lender shall exercise any enforcement remedy against any Loan Party or any Subsidiary of any Restricted Loan Party or any of their respective properties solely on the basis of the failure to comply with the applicable Financial Covenant in respect of which the Cure Notice was delivered, and (ii) until the earlier to occur of the last day of the applicable Cure Period and the date on which Agent is notified that the Cure Fund Payment will not be made, neither Agent nor any Lender shall impose default interest, terminate the Revolving Loan Commitments or accelerate the Obligations solely on the basis of the failure to comply with the applicable Financial Covenant. Upon timely receipt by Borrowers in cash of the appropriate Cure Fund Payment, if and to the extent after giving effect this Section 8.2 all applicable Events of Default pursuant to Section 6 would no longer exist on a pro forma basis, such Events of Default shall be deemed curedAmount.
Appears in 1 contract
Equity Cure. If In the event that Borrowers fail to comply with any financial covenant contained in Section 9.12, (a “Financial Covenant Default”), Borrowers shall have the right to cure such Event of Default on the following terms and conditions (the “Equity Cure”):
(a) In the event that Borrowers desire to cure a Financial Covenant Default, Borrowers shall deliver to Administrative Agent irrevocable written notice of its intent to cure (a “Cure Event occurs, Notice”) at any Cure Fund Payments received by (x) Borrowers, in time during the case period commencing on the date that the Financial Statements and corresponding Compliance Certificate as of and for the period ending on the last day of the Current Ratio or Collateral Coverage Ratio, or computation period as of which such Financial Covenant Default occurred (yeach a “Test Date”) Holdings, in are delivered to Administrative Agent and Lenders and ending on the case of the Debt to Capitalization Ratio, in either case, during the applicable Cure Period will, at the request of Borrowers, be included fifth (i5th) as cash in the calculation of the Collateral Formula Amount (in the event of a Default with respect to the Collateral Coverage Covenant), (ii) Net Worth of Holdings (in the event of a Default with respect to the Debt to Capitalization Covenant) or (iii) as cash in the determination of ▇▇ Business Days after Administrative Agent’s and ▇▇▇▇▇’▇ current ▇▇’ receipt of such Financial Statements and Compliance Certificate. The Cure Notice shall set forth the calculation of the applicable Cure Amount (as hereinafter defined).
(b) In the event that Borrowers deliver a Cure Notice, a capital contribution shall be made to Parent or Parent shall sell its assets for cash or receive cash in respect of any investments or from any other source in an amount not less than the Cure Amount at any time during the period commencing on the date of Administrative Agent’s receipt of such Cure Notice and ending on the tenth (10th) Business Day following the date on which the relevant Financial Statements and Compliance Certificate were required to be delivered to Administrative Agent and the Lenders (such tenth (10th) Business Day, the “Required Contribution Date”). The “Cure Amount” shall be the amount which, as of the applicable Test Date, would result in the event Credit Parties being in pro forma compliance with the applicable financial covenant which is the subject of such Financial Covenant Default(s) as of such Test Date (provided, however, that if more than one such Financial Covenant Default exists as of a Default Test Date, the Cure Amount for purposes hereof shall equal the largest amount necessary to cure such applicable Financial Covenant Defaults). Such cash received by Parent of the appropriate Cure Amount shall be:
(1) in the case of a failure to comply with respect the Minimum Total Net Worth, Maximum Total Debt to Total Adjusted Net Worth Ratio and Minimum Interest Coverage Ratio financial covenants set forth in Sections 9.12(a), 9.12(b) and 9.12(c), applied to increase the Total Net Worth of Guarantor and its Subsidiaries and either (A) reduce Total Debt (if applied to the Current Ratio Covenantrepayment of Total Debt) or (B) increase cash and Cash Equivalents on the balance sheet of Guarantor or its Subsidiaries (but not both), as elected by Guarantor in its sole discretion, which increase shall be deemed to have occurred on the last day of the applicable fiscal quarter for which such Equity Cure is being made; and
(2) in the case of a failure to comply with the Minimum Total Liquidity financial covenant set forth in Section 9.12(d), added to Total Liquidity in the calculation thereof solely for the purposes of determining compliance with such Financial Covenants at the end of such test period and any subsequent test period that includes such test; provided that (a) the amount of any Cure Fund Payment will be (x) with respect to a Default under the Collateral Coverage Covenant, an amount greater than or equal to the amount required extent constituting unrestricted cash and Cash Equivalents.
(c) The Equity Cure may not be exercised more than twice in any four (4) consecutive fiscal quarter period or (ii) more than five (5) times prior to cause the Collateral Coverage RatioStated Maturity Date. 92
(d) Upon timely receipt by Borrowers in cash of the appropriate Cure Amount, determined if and to the extent after giving effect to the following clause (e) all applicable Financial Covenant Defaults would no longer exist on a pro forma basis, to equal the Collateral Coverage Cure Target, and (y) with respect to all other applicable Financial Covenant Defaults, an amount greater than or equal to Defaults shall be deemed cured.
(e) The Equity Cure and the least amount required to cause the Loan Parties to be in compliance with Financial Covenants, (b) notwithstanding anything in this Agreement to the contrary, all Cure Fund Payments effects thereof will be disregarded for all other purposespurposes under the Financing Agreements, including calculating basket levelsincluding, pricing and other items governed by reference to the Financial Covenantswithout limitation, liquidity or availability and may not be used for any other purpose hereunder, (c) all Cure Fund Payments shall be promptly used by Borrowers to prepay Loans and other Obligations in the manner prescribed by Section 2.4(d), and (d) for the avoidance of doubt, any Loans prepaid with any Cure Fund Payments shall be deemed outstanding for purposes of determining compliance with such financial covenants calculating a threshold for the test period in respect of which Cure Fund Payment was receivedpermitted exceptions to various affirmative and negative covenants. So long as the applicable Cure Amount does not exceed the amount permitted under Section 11.12(c) and Borrowers are otherwise entitled to exercise its rights under an Equity Cure pursuant to the foregoing terms and provisions of this Section 8.211.12, (i) from the effective date of delivery of an irrevocable written notice from Borrowers to Agent of Borrowers’ intent to exercise their rights hereunder (a “Cure Notice”) Notice until the earlier to occur of the end of the applicable Cure Period Required Contribution Date and the date on which Administrative Agent is notified that the Cure Fund Payment required contribution will not be made, neither Administrative Agent nor any Lender shall impose default interest, accelerate the Liabilities, terminate the Revolving Loan Commitment or exercise any enforcement remedy against any Loan Credit Party or any Subsidiary of any Restricted Loan Party its Subsidiaries or any of their respective properties solely on the basis of the failure to comply with the applicable Financial Covenant Default in respect of which the Cure Notice was delivered, and (ii) ; provided until the earlier to occur timely receipt of the last day of the applicable Cure Period and the date on which Agent is notified that the Cure Fund Payment will not be madeAmount, neither Agent nor any Lender shall impose default interest, terminate the Revolving Loan Commitments or accelerate the Obligations solely on the basis of the failure to comply with the applicable Financial Covenant. Upon timely receipt by Borrowers in cash of the appropriate Cure Fund Payment, if and to the extent after giving effect this Section 8.2 all applicable Events of Default pursuant to Section 6 would no longer exist on a pro forma basis, such Events an Event of Default shall be deemed curedto exist for all other purposes of this Agreement, including, without limitation, Section 8 and Section 9 hereof and any term or provision of any Financing Agreement which prohibits any action to be taken by a Credit Party or any of its Subsidiaries during the existence of an Event of Default; provided, further, that notwithstanding the foregoing, upon a deemed cure pursuant to Section 11.12(e), the requirements of the applicable financial covenants shall be deemed to have been satisfied as of the applicable Test Date with the same effect as though there had been no Financial Covenant Default at such date or thereafter.]
Appears in 1 contract
Sources: Loan and Security Agreement (BlackRock Monticello Debt Real Estate Investment Trust)
Equity Cure. If a Cure Event occurs, (a) Notwithstanding anything to the contrary contained in this Section 11 or in any Cure Fund Payments received by (x) BorrowersCredit Document, in the case of event that the Current Borrower fails to comply with the Leverage Ratio or Collateral Coverage Ratio, or (y) Holdings, in the case of the Debt to Capitalization Ratio, in either case, during the applicable Cure Period will, at the request of Borrowers, be included (i) as cash in the calculation of the Collateral Formula Amount (in the event of a Default with respect to the Collateral Coverage Covenant), (ii) Net Worth of Holdings (in the event of a Default with respect to the Debt to Capitalization Covenant) or (iii) as cash in the determination of ▇▇ ▇▇▇▇▇’▇ current assets (in the event of a Default with respect to Covenant and/or the Current Ratio Covenant) solely for the purposes of determining compliance with such Financial Covenants at the end of such test period and any subsequent test period that includes such test; provided that , then (a) the amount of any Cure Fund Payment will be (x) with respect to a Default under the Collateral Coverage Covenant, an amount greater than or equal to the amount required to cause the Collateral Coverage Ratio, determined on a pro forma basis, to equal the Collateral Coverage Cure Target, and (y) with respect to all other Financial Covenant Defaults, an amount greater than or equal to the least amount required to cause the Loan Parties to be in compliance with Financial Covenants, (b) notwithstanding anything in this Agreement to the contrary, all Cure Fund Payments will be disregarded for all other purposes, including calculating basket levels, pricing and other items governed by reference to the Financial Covenants, liquidity or availability and may not be used for any other purpose hereunder, (c) all Cure Fund Payments shall be promptly used by Borrowers to prepay Loans and other Obligations in the manner prescribed by Section 2.4(d), and (d) for the avoidance of doubt, any Loans prepaid with any Cure Fund Payments shall be deemed outstanding for purposes of determining compliance with such financial covenants for the test period in respect of which Cure Fund Payment was received. So long as Borrowers are otherwise entitled to exercise its rights under this Section 8.2, (i) from the effective date of delivery of an irrevocable written notice from Borrowers to Agent of Borrowers’ intent to exercise their rights hereunder (a “Cure Notice”A) until the earlier to occur expiration of the end tenth Business Day subsequent to the date the compliance certificate for calculating the applicable Financial Performance Covenant is required to be delivered pursuant to Section 9.1(c) (the “Cure Deadline”), the Borrower shall have the right to cure such failure (the “Cure Right”) by receiving cash proceeds (which cash proceeds shall be received no earlier than the first day of the applicable Cure Period and the date on fiscal quarter for which Agent there is notified that the Cure Fund Payment will not be made, neither Agent nor any Lender shall exercise any enforcement remedy against any Loan Party or any Subsidiary of any Restricted Loan Party or any of their respective properties solely on the basis of the a failure to comply with the applicable Financial Performance Covenant) from an issuance of Qualified Equity Interests (other than Disqualified Stock) for cash as a cash capital contribution (or from any other contribution of cash to capital or issuance or sale of any other Equity Interests on terms reasonably acceptable to the Administrative Agent), and upon receipt by the Borrower of such cash proceeds (such cash amount being referred to as the “Cure Amount”) pursuant to the exercise of such Cure Right, the Leverage Ratio Covenant in and/or the Current Ratio Covenant (as applicable) shall be recalculated giving effect to the following pro forma adjustments:
(A) Consolidated EBITDAX shall be increased, solely for the purpose of determining the existence of an Event of Default resulting from a breach of the Leverage Ratio Covenant with respect of to any Test Period that includes the fiscal quarter for which the Cure Notice Right was deliveredexercised and not for any other purpose under this Agreement, by an amount equal to the Cure Amount and/or (B) Consolidated Current Assets shall be increased, solely for the purpose of determining the existence of an Event of Default resulting from a breach of the Current Ratio Covenant with respect to any Test Period that includes the fiscal quarter for which the Cure Right was exercised and not for any other purpose under this Agreement, by an amount equal to the Cure Amount;
(ii) until neither Consolidated Total Debt nor Consolidated Current Liabilities for such Test Period shall be decreased by any prepayments of Indebtedness with the earlier to occur proceeds of the last day Cure Amount and any cash proceeds shall not be “netted” for purposes of ratio calculations with respect to any four fiscal quarter period in which the fiscal quarter period in which such equity cure has been made is included; and
(iii) if, after giving effect to the foregoing recalculations, the Borrower shall then be in compliance with the requirements of the Financial Performance Covenants, the Borrower shall be deemed to have satisfied the requirements of the Financial Performance Covenants as of the relevant date of determination with the same effect as though there had been no failure to comply therewith at such date, and the applicable breach or default of the applicable Financial Performance Covenant that had occurred shall be deemed cured for the purposes of this Agreement; provided that (A) in each period of four (4) consecutive fiscal quarters there shall be at least two (2) fiscal quarters in which no Cure Period and the date on which Agent Right is notified that the exercised, (B) Cure Fund Payment will Rights shall not be madeexercised more than five times during the term of this Agreement, neither Agent nor any Lender shall impose default interest, terminate (C) if the Revolving Loan Commitments or accelerate the Obligations solely on the basis of Borrower cures the failure to comply with both Financial Performance Covenants in the same fiscal quarter, such cures shall constitute a single cure for purposes of the preceding subclause (B), (D) if the Borrower cures the failure to comply with both Financial Performance Covenants in the same fiscal quarter, the same dollar of the Cure Amount shall be applied only once to either increase Consolidated EBITDAX or Consolidated Current Assets but not both, (E) each Cure Amount shall be no greater than the amount required to cause the Borrower to be in compliance with the applicable Financial Covenant. Upon timely Performance Covenant above (such amount, the “Necessary Cure Amount”); provided that if the Cure Right is exercised prior to the date financial statements are required to be delivered for such fiscal quarter, then the Cure Amount shall be equal to the amount reasonably determined by the Borrower in good faith that is required for purposes of complying with the Financial Performance Covenants for such fiscal quarter (such amount, the “Expected Cure Amount”), (F) in respect of the fiscal quarter in which such Cure Right was exercised and for each Test Period that includes such fiscal quarter, all Cure Amounts shall be disregarded for the purposes of any financial ratio determination under the Credit Documents other than for determining compliance with the Financial Performance Covenants and (G) no Lender or Issuing Bank shall be required to make any extension of credit hereunder during the ten (10) Business Day period referred to above, unless the Borrower shall have received the Cure Amount; and
(iv) upon receipt by Borrowers the Administrative Agent of written notice, on or prior to the Cure Deadline, that the Borrower intends to exercise the Cure Right in cash respect of a fiscal quarter, the Lenders shall not be permitted to accelerate Loans held by them or to exercise remedies against the Collateral on the basis of a failure to comply with the requirements of the appropriate Cure Fund PaymentFinancial Performance Covenants, if and unless such failure is not cured pursuant to the extent after giving effect this Section 8.2 all applicable Events exercise of Default pursuant the Cure Right on or prior to Section 6 would no longer exist on a pro forma basis, such Events of Default shall be deemed curedthe Cure Deadline.
Appears in 1 contract
Equity Cure. If a Cure Event occurs, any Cure Fund Payments received by (x) BorrowersNotwithstanding anything to the contrary contained in this Section 11, in the case event that the Borrower fails to comply with the requirement of the Current Ratio or Collateral Coverage Ratiofinancial covenant set forth in Section 10.9, or the Borrower may elect to cure such failure (ythe “Cure Right”) Holdings, in the case of the Debt to Capitalization Ratio, in either case, during the applicable Cure Period will, at the request of Borrowers, be included (i) as cash by including in the calculation of such financial covenant the Collateral Formula Amount cash net equity proceeds derived from an issuance of Capital Stock or Stock Equivalents (other than Disqualified Stock) by the Borrower, or from a contribution to the common equity capital of the Borrower, in each case, received at any time from the event first day of the last fiscal quarter of the Test Period in respect of which such financial covenant is being measured until the expiration of the fifteenth Business Day following the date financial statements referred to in Section 9.1(a) or (b) (such period, the “Cure Period”) are required to be delivered in respect of such Test Period for which such financial covenant is being measured (such cash amount being referred to as the “Cure Amount”), and upon such election by the Borrower to exercise such Cure Right, such financial covenant shall be recalculated giving effect to the following pro forma adjustments:
(a) Consolidated EBITDA shall be increased, solely for the purpose of determining the existence of an Event of Default resulting from a Default breach of the financial covenant set forth in Section 10.9 with respect to any period of four consecutive fiscal quarters that includes the Collateral Coverage Covenantfiscal quarter for which the Cure Right was exercised and not for any other purpose under this Agreement, by an amount equal to the Cure Amount;
(b) to the extent proceeds of the Cure Amount are applied to repay any Indebtedness, the calculation of the covenant in Section 10.9 shall not give pro forma effect to such repayment for the Test Period ending with the fiscal quarter for which the Cure Right is exercised (but shall be given effect in calculations of the covenant in Section 10.9 in subsequent fiscal quarters); and
(c) if, after giving effect to the foregoing recalculations, the Borrower shall then be in compliance with the requirements of the financial covenant set forth in Section 10.9, the Borrower shall be deemed to have satisfied the requirements of the financial covenant set forth in Section 10.9 as of the relevant date of determination with the same effect as though there had been no failure to comply therewith at such date, and the applicable breach or default of such financial covenant that had occurred shall be deemed cured for the purposes of this Agreement; 245 LEGAL_US_E # 167910103.1167910103.8 provided, that (i) in each period of four consecutive fiscal quarters there shall be at least two fiscal quarters in which no Cure Right is exercised, (ii) Net Worth there shall be a maximum of Holdings (in five Cure Rights exercised during the event term of a Default with respect to the Debt to Capitalization Covenant) or this Agreement, (iii) as cash in the determination of ▇▇ ▇▇▇▇▇’▇ current assets (in the event of a Default with respect to the Current Ratio Covenant) solely for the purposes of determining compliance with such Financial Covenants at the end of such test period and any subsequent test period that includes such test; provided that (a) the amount of any each Cure Fund Payment will Amount shall be (x) with respect to a Default under the Collateral Coverage Covenant, an amount no greater than or equal to the amount required to cause the Collateral Coverage Ratio, determined on a pro forma basis, to equal the Collateral Coverage Cure Target, and (y) with respect to all other Financial Covenant Defaults, an amount greater than or equal to the least amount required to cause the Loan Parties Borrower to be in compliance with Financial Covenants, the financial covenant set forth in Section 10.9 (b) notwithstanding anything in this Agreement it being understood that to the contraryextent the notice described in the immediately succeeding paragraph is provided in advance of delivery of a Compliance Certificate for the applicable fiscal period, the amount of such net equity proceeds that is designated as the Cure Amount may be lower than the amount specified in such notice to the extent the amount necessary to cure such Event of Default is less than the full amount originally designated); and (iv) all Cure Fund Payments will Amounts shall be disregarded for all other purposes, including calculating basket levels, pricing and other items governed by reference to the Financial Covenants, liquidity or availability and may not be used for any other purpose hereunder, (c) all Cure Fund Payments shall be promptly used by Borrowers to prepay Loans and other Obligations in the manner prescribed by Section 2.4(d), and (d) for the avoidance of doubt, any Loans prepaid with any Cure Fund Payments shall be deemed outstanding for purposes of any financial ratio determination under the Credit Documents other than for determining compliance with such financial covenants for Section 10.9. Upon delivery to the test period Administrative Agent by the Borrower of written notice that it intends to exercise its Cure Right under this Section 11.14, any Default or Event of Default, as the case may be, under Section 11.3(a) in respect of which Cure Fund Payment was received. So long a failure to observe or perform the covenant contained in Section 10.9 (or any other Default or Event of Default as Borrowers are otherwise entitled a result thereof) shall retroactively be deemed not to exercise its rights under this Section 8.2have occurred; provided, (i) from the effective date of delivery of an irrevocable written notice from Borrowers to Agent of Borrowers’ intent to exercise their rights hereunder (a “Cure Notice”) until the earlier to occur of the end of the applicable Cure Period and the date on which Agent is notified that the Cure Fund Payment will Borrower shall not be made, neither Agent nor permitted to borrow Revolving Loans or make any Lender shall exercise any enforcement remedy against any Loan Party or any Subsidiary Letter of any Restricted Loan Party or any of their respective properties solely on the basis of the failure to comply with the applicable Financial Covenant Credit Request in respect of which issuing a new Letter of Credit or otherwise extending or increasing the face amount of an existing Letter of Credit unless and until (x) the proceeds of the issuance or contribution, as the case may be, constituting the Cure Notice was deliveredAmount shall have been received by the Borrower such that, upon recalculation taking into account such Cure Amount received, the Borrower shall be in compliance with the covenant contained in Section 10.9 or (y) all such Defaults and (ii) until Event of Defaults shall have been waived in accordance with the earlier to occur terms of this Agreement; provided, further, that if the Cure Amount is not received before the expiration of the last day of the applicable Cure Period Period, unless all such Defaults and the date on which Agent is notified that the Cure Fund Payment will not be made, neither Agent nor any Lender shall impose default interest, terminate the Revolving Loan Commitments or accelerate the Obligations solely on the basis of the failure to comply with the applicable Financial Covenant. Upon timely receipt by Borrowers in cash of the appropriate Cure Fund Payment, if and to the extent after giving effect this Section 8.2 all applicable Events of Default pursuant to Section 6 would no longer exist on a pro forma basisshall have been waived in accordance with the terms of this Agreement, each such Events Default or Event of Default shall be deemed curedreinstated. No Agent or Lender shall take any action to foreclose on, or take possession of, the Collateral, accelerate any Obligations, terminate any Commitments or otherwise exercise any remedies under any Credit Document or any applicable law on the basis of a breach of Section 10.9 (or any other Default or Event of Default as a result thereof) unless and until the Cure Period has expired and the Borrower has not received the Cure Amount.
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Sources: First Lien Credit Agreement (Aveanna Healthcare Holdings, Inc.)
Equity Cure. (a) If the Debt Service Cover Ratio and/or Projected Debt Service Ratio for a Cure Event occursCalculation Period required under Clause 24.1(r) (Ratios) (the “Relevant Financial Covenants”) are not met, the Company may elect to treat any Cure Fund Payments Amount received either during the relevant Calculation Period it is received by it or on or prior to the date falling twenty-one (x21) Borrowersdays after the date on which the Financial Test is conducted, as included in Cashflow Available for Debt Service or Projected Cashflow Available for Debt Service (as the case of the Current Ratio or Collateral Coverage Ratio, or may be) (ywithout double counting) Holdings, in the case of the Debt to Capitalization Ratio, in either case, during the applicable Cure Period will, at the request of Borrowers, be included (i) as cash in the calculation of the Collateral Formula Amount (in the event of a Default with respect to the Collateral Coverage Covenant), (ii) Net Worth of Holdings (in the event of a Default with respect to the Debt to Capitalization Covenant) or (iii) as cash in the determination of ▇▇ ▇▇▇▇▇’▇ current assets (in the event of a Default with respect to the Current Ratio Covenant) solely for the purposes of determining compliance with such calculating the Relevant Financial Covenants. If, after including the Cure Amount and its application in the calculations, the requirements of the Relevant Financial Covenants at are met, there shall be deemed to have been no breach of the end of such test period Relevant Financial Covenants and any subsequent test period resulting Default shall be deemed remedied and waived for that includes such test; provided that (a) the amount of any Cure Fund Payment will be (x) with respect to a Default under the Collateral Coverage Covenant, an amount greater than or equal to the amount required to cause the Collateral Coverage Ratio, determined on a pro forma basis, to equal the Collateral Coverage Cure Target, and (y) with respect to all other Financial Covenant Defaults, an amount greater than or equal to the least amount required to cause the Loan Parties to be in compliance with Financial Covenants, relevant Calculation Period.
(b) notwithstanding anything in this Agreement to Any Cure Amount where elected under Clause 19.9(a) (Equity Cure) shall be paid by the contraryShareholder or Sponsor as Shareholder Debt into the Offshore Revenue Account, all Cure Fund Payments will be disregarded treated as, and included in, Cashflow Available for all other purposes, including calculating basket levels, pricing and other items governed by reference to Debt Service or Projected Cashflow Available for Debt Service (as the Financial Covenants, liquidity or availability and case may not be used be) for any other purpose hereunder, each relevant Calculation Period.
(c) all Cure Fund Payments shall be promptly used by Borrowers The Company may not exercise the right to prepay Loans and other Obligations cure under Clause 19.9(a) (Equity Cure) on more than 2 occasions in the manner prescribed by Section 2.4(d), and any period of 6 consecutive Calculation Periods.
(d) Unless otherwise provided pursuant to this Agreement, prior to electing to treat a Cure Amount as Cashflow Available for Debt Service or Projected Cashflow Available for Debt Service (as the case may be), the Company shall deliver to the Global Agent a certificate signed by an Authorised Representative of the Company) setting out the reasons for the avoidance breach of doubt, any Loans prepaid with any Cure Fund Payments shall be deemed outstanding for purposes of determining compliance with such financial covenants for Relevant Financial Covenant and the test period in respect of which Cure Fund Payment was received. So long as Borrowers are otherwise entitled to exercise its rights under this Section 8.2, (i) from the effective date of delivery of an irrevocable written notice from Borrowers to Agent of Borrowers’ intent to exercise their rights hereunder (a “Cure Notice”) until the earlier to occur nature of the end of the applicable Cure Period and the date on which Agent is notified remedial action being taken, confirming that the Cure Fund Payment will not be made, neither Agent nor any Lender shall exercise any enforcement remedy against any Loan Party or any Subsidiary of any Restricted Loan Party or any of their respective properties solely on the basis of the failure to comply with the applicable Financial Covenant in respect of which Company’s current financial projections (taking into account the Cure Notice was delivered, Amount) the Relevant Financial Covenants will be complied with and (ii) until the earlier to occur of the last day of the applicable Cure Period and the date on which Agent is notified that the Cure Fund Payment will not be made, neither Agent nor any Lender shall impose default interest, terminate the Revolving Loan Commitments or accelerate the Obligations solely on the basis of the failure to comply with the applicable including a revised Financial Covenant. Upon timely receipt by Borrowers in cash of the appropriate Cure Fund Payment, if and to the extent after giving effect this Section 8.2 all applicable Events of Default pursuant to Section 6 would no longer exist on a pro forma basis, Test demonstrating such Events of Default shall be deemed curedcompliance.
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Equity Cure. If a Cure Event occurs, any Cure Fund Payments received by (x) BorrowersNotwithstanding anything to the contrary contained in this Article VII, in the case event that the Consolidated Group fails to comply with the financial covenants in Section 6.1 as of the Current Ratio or Collateral Coverage Ratio, or (y) Holdings, in the case of the Debt to Capitalization Ratio, in either case, during the applicable Cure Period will, at the request of Borrowers, be included (i) as cash in the calculation of the Collateral Formula Amount (in the event of a Default with respect to the Collateral Coverage Covenant), (ii) Net Worth of Holdings (in the event of a Default with respect to the Debt to Capitalization Covenant) or (iii) as cash in the determination of ▇▇ ▇▇▇▇▇’▇ current assets (in the event of a Default with respect to the Current Ratio Covenant) solely for the purposes of determining compliance with such Financial Covenants at the end of such test period and any subsequent test period that includes such test; provided that (a) fiscal quarter, then the amount of any Cure Fund Payment will be (x) with respect to a Default under Borrower shall have the Collateral Coverage Covenantright, an amount greater no later than or equal to 10 days after the amount day on which the financial statements are required to cause be delivered for the Collateral Coverage Ratio, determined on a pro forma basisapplicable fiscal quarter pursuant to Section 5.1(a) and Section 5.1(b), to equal the Collateral Coverage Cure Targetissue common Equity Interests in exchange for cash or otherwise receive cash contributions (but not, and (y) with respect to all other Financial Covenant Defaults, an amount greater than or equal to the least amount required to cause the Loan Parties to be in compliance with Financial Covenants, (b) notwithstanding anything in this Agreement to the contrary, all Cure Fund Payments will be disregarded for all other purposes, including calculating basket levels, pricing and other items governed by reference to the Financial Covenants, liquidity or availability and may not be used for any other purpose hereunder, (c) all Cure Fund Payments shall be promptly used by Borrowers to prepay Loans and other Obligations in the manner prescribed by Section 2.4(d), and (d) for the avoidance of doubt, any Loans prepaid incur Indebtedness of the Borrower) in an aggregate amount equal to the minimum amount which, when added to Consolidated EBITDA, is sufficient to cure the relevant failure to comply with any the financial covenants in Section 6.1 (the “Cure Fund Payments Amount”). The entire cash proceeds of such issuance or contribution shall be deemed outstanding contributed in cash to the Borrower and be included in the calculation of Consolidated EBITDA solely for purposes of determining compliance with the applicable financial covenants (the “Cure Right”). Upon the receipt by the Borrower of the Cure Amount, the applicable financial covenants shall be recalculated giving effect to the following pro forma adjustments:
(a) Consolidated EBITDA shall be increased, solely for the purpose of measuring such financial covenants and not for the test period in respect of which Cure Fund Payment was received. So long as Borrowers are otherwise entitled to exercise its rights any other purpose under this Agreement, by an amount equal to the Cure Amount;
(b) the Consolidated Group shall be deemed to have satisfied the requirements of such financial covenants as of the date the Cure Amount is received by the Borrower, and the applicable breach or default of the financial covenants shall thereafter be deemed cured for all purposes of this Agreement and the other Loan Documents; and
(c) to the extent a fiscal quarter as to which the Cure Right has been exercised is included in the calculation of Consolidated EBITDA for purposes of any of the financial covenants in Section 8.26.1 in a subsequent measurement period, the Cure Amount shall be included in the amount of Consolidated EBITDA for such subsequent measurement period. Notwithstanding anything herein to the contrary, (ia) Cure Amounts received pursuant to any exercise of the Cure Right shall be disregarded for any calculation of Consolidated EBITDA required hereunder for any purpose other than compliance with the financial covenants set forth in Section 6.1 as provided in this Section 7.3, (b) the Cure Right shall not be exercised more than five times, (c) in each period of four fiscal quarters, there shall be at least two fiscal quarters as to which the Cure Right is not exercised, (d) the Cure Right shall not be exercised as to two consecutive fiscal quarters and (e) from the effective date of delivery of an irrevocable written notice from Borrowers day on which the financial statements are delivered for the applicable fiscal quarter pursuant to Agent of Borrowers’ intent Section 5.1(a) and 5.1(b) indicating that the Consolidated Group have failed to exercise their rights hereunder (a “Cure Notice”) until the earlier to occur comply with such financial covenants as of the end of the applicable Cure Period and the date on which Agent is notified that the Cure Fund Payment will not be made, neither Agent nor any Lender shall exercise any enforcement remedy against any Loan Party or any Subsidiary of any Restricted Loan Party or any of their respective properties solely on the basis of the failure to comply with the applicable Financial Covenant in respect of which the Cure Notice was delivered, and (ii) such fiscal quarter until the earlier to occur of receipt by the last day Borrower of the applicable Cure Period Amount, the Lenders shall not be required to make any Loans and the date on which Agent is notified that the Cure Fund Payment will Issuing Bank shall not be made, neither Agent nor required to issue any Lender shall impose default interest, terminate the Revolving Loan Commitments or accelerate the Obligations solely on the basis Letters of the failure to comply with the applicable Financial Covenant. Upon timely receipt by Borrowers in cash of the appropriate Cure Fund Payment, if and to the extent after giving effect this Section 8.2 all applicable Events of Default pursuant to Section 6 would no longer exist on a pro forma basis, such Events of Default shall be deemed curedCredit.
Appears in 1 contract
Equity Cure. If a Cure Event occurs, Notwithstanding anything to the contrary contained in Section 8.01 or any Cure Fund Payments received by (x) Borrowersother provision of this Agreement, in the case of event that CCR fails to comply (or believes it may fail to comply) with any financial covenant contained in Section 7.11, CCR shall have the Current Ratio right on one or Collateral Coverage Ratiomore occasions from the Amendment No. 1 Effective Date until the Term Loan Maturity Date, or (y) Holdings, in the case of the Debt to Capitalization Ratio, in either case, including during the applicable Measurement Period through and including the 10th Business Day after the delivery of a Notice of Issuance of Permitted Cure Period willSecurities, at the request of Borrowers, be included (i) as to issue Permitted Cure Securities for cash in an aggregate principal amount not to exceed $35,000,000 (collectively, the calculation of the Collateral Formula Amount (in the event of a Default with respect to the Collateral Coverage Covenant“Cure Right”), (ii) Net Worth the net cash proceeds of Holdings (which shall be applied in accordance with Section 2.07(b)(H), and upon the event later of a Default with respect to the Debt to Capitalization Covenant) or (iii) as cash in the determination of ▇▇ ▇▇▇▇▇’▇ current assets (in the event of a Default with respect to the Current Ratio Covenant) solely for the purposes of determining compliance with such Financial Covenants at the end of such test period and any subsequent test period that includes such test; provided that (a) the amount application by CCR of such net cash proceeds and (b) the end of the relevant Measurement Period, such financial covenant shall be calculated or recalculated, as the case may be, giving effect to the following:
(i) Consolidated EBITDA shall be increased, as provided in the definition thereof, solely for the purpose of measuring compliance with the financial covenants in Section 7.11 and will not be applied for any Cure Fund Payment will be (x) with respect other purpose under this Agreement, including but not limited to a Default under other provisions hereof that are based upon the Collateral Coverage CovenantConsolidated Total Leverage Ratio in effect from time to time, by an amount greater than not to exceed the amount necessary to cure the non-compliance or equal potential non-compliance (the “Cure Amount”), as applicable;
(ii) if, after giving effect to the amount required to cause the Collateral Coverage Ratioforegoing increase in Consolidated EBITDA, determined on a pro forma basis, to equal the Collateral Coverage Cure Target, and (y) with respect to all other Financial Covenant Defaults, an amount greater than or equal to the least amount required to cause the Loan Parties to CCR shall be in compliance with Financial Covenantsthe requirements of such financial covenant, (b) notwithstanding anything in this Agreement to the contrary, all Cure Fund Payments will be disregarded for all other purposes, including calculating basket levels, pricing and other items governed by reference to the Financial Covenants, liquidity or availability and may not be used for any other purpose hereunder, (c) all Cure Fund Payments shall be promptly used by Borrowers to prepay Loans and other Obligations in the manner prescribed by Section 2.4(d), and (d) for the avoidance of doubt, any Loans prepaid with any Cure Fund Payments CCR shall be deemed outstanding for purposes to have satisfied the requirements of determining compliance with such financial covenants for the test period in respect of which Cure Fund Payment was received. So long covenant as Borrowers are otherwise entitled to exercise its rights under this Section 8.2, (i) from the effective date of delivery of an irrevocable written notice from Borrowers to Agent of Borrowers’ intent to exercise their rights hereunder (a “Cure Notice”) until the earlier to occur of the end of the applicable Cure relevant Measurement Period and there shall be (or shall be deemed to be) no applicable breach or default of such financial covenant for all purposes of this Agreement and the date on which Agent is notified that the Cure Fund Payment will other Loan Documents;
(iii) Indebtedness shall not be made, neither Agent nor any Lender shall exercise any enforcement remedy against any Loan Party or any Subsidiary deemed to have been repaid for purposes of any Restricted Loan Party or any of their respective properties solely on calculating the basis of the failure to comply with financial covenants for the applicable Financial Covenant in Measurement Period with respect of to which the such Cure Notice Right was delivered, and exercised; and
(iiiv) until the earlier to occur of the last day of the applicable Cure Period and the date on which Agent is notified that the Cure Fund Payment will not be made, neither Agent nor any Lender shall impose default interest, terminate the Revolving Loan Commitments or accelerate the Obligations solely on the basis of the failure to comply with the applicable Financial Covenant. Upon timely receipt by Borrowers in cash of the appropriate Cure Fund Payment, if and to the extent after a fiscal quarter ended for which such financial covenant is calculated giving effect this Section 8.2 all applicable Events to a Cure Amount is included in the calculation of Default pursuant a financial covenant in a subsequent fiscal period, the Cure Amount shall continue to Section 6 would no longer exist on a pro forma basis, be included in the amount of Consolidated EBITDA for such Events of Default shall be deemed cured.fiscal quarter;
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