Common use of Permitted Distributions Clause in Contracts

Permitted Distributions. (i) so long as no Default or Event of Default shall have occurred and be continuing at the time of any such Distribution, Distributions from any Borrower or any Subsidiary of any Borrower to Parent in an amount during any 12 month period, which when added to all other amounts received by Parent during such period from any Borrower or any Subsidiary of any Borrower from any source (including, without limitation, payments on any Debt of such Borrower or any of their respective Subsidiaries held by Parent, but excluding Distributions received by Parent in accordance with clauses (ii), (iii) and (iv) below) shall not exceed 120% of Parent’s actual operating expenses during such period, (ii) so long as no Default or Event of Default shall have occurred and be continuing at the time of declaration or after giving effect to the payment thereof (and any Revolver Loans made in connection therewith), (a) Parent may make Distributions to the extent that, after giving effect thereto, Aggregate Availability shall be at least $20,000,000, and (b) Borrowers and their Subsidiaries may make Distributions to Parent in the amount of, and concurrently with, the Distribution permitted to be made by Parent under clause (a) above in order to enable Parent to make such Distribution, (iii) so long as no Default or Event of Default shall have occurred and be continuing at the time of declaration or after giving effect to the payment thereof, Borrowers and their Subsidiaries may make Distributions to Parent in the amount of, and concurrently with, any Permitted Acquisition or Permitted Foreign Subsidiary Investment permitted to be made by Parent under Section 10.2.11 in order to enable Parent to make such Permitted Acquisition or Permitted Foreign Subsidiary Investment, and (iv) Borrowers and their Subsidiaries may make Permitted Convertible Debenture Distributions. Notwithstanding the foregoing, no such Distribution may be made (I) unless such Distribution is permitted under all Applicable Laws, and (II) unless the Person making such Distribution would be Solvent after giving effect to such Distribution (and any Revolver Loans made hereunder in connection therewith) and, to the extent any such Distribution is to be made with the proceeds of Revolver Loans, Obligors shall have delivered to Agent such certificates, financial statements and financial projections as Agent may reasonably request at the time of any such proposed Revolver Loan in order to confirm Obligors’ compliance with this clause (II).

Permitted Distributions. (d) the Digiscope Loans; (e) loans and advances to employees, officers and directors in an aggregate principal amount not to exceed $2,500,000 at any time outstanding; (f) contributions of capital to Immaterial Subsidiaries provided such Subsidiaries use such contributions to simultaneously pay off accumulated intercompany debt of such Immaterial Subsidiaries to the Borrower or the Parent existing on the Closing Date in an amount not in excess of $7,000,000; (g) payments made pursuant to the Tax Sharing Agreement; (h) Distributions and Restricted Investments made in connection with the 2003 Recapitalization; (i) so long loans made giving rise to Debt permitted under SECTION 7.13(d); (j) purchases of Equipment (not included in the Borrowing Base) owned by Borrower but subject to a purchase option in favor of the customer for whose account such Equipment was purchased, with such option being exercisable at the end of a specified contractual term, entered into in accordance with past practice and in the ordinary course of business; (k) purchases of spare parts inventory booked as no a long-term rather than current asset in accordance with past practice and in the ordinary course of business; (l) payments described in clause (i) of the definition of the term "Permitted Affiliate Transactions"; (m) payments in amounts necessary to permit Parent to (x) make payments in respect of its indemnification obligations owing to directors, officers or other Persons under Parent's charter or by-laws or pursuant to written agreements with any such Person, or obligations in respect of director and officer insurance (including premiums therefor) or (y) satisfy its obligations, or through the Company satisfy its obligations, under any registration rights agreement or (z) make payments in respect of indemnification obligations of Parent in connection with any issuance by Parent of capital stock of Parent; (n) Distributions by the Parent in an aggregate amount of up to $2,000,000 made to permit repurchases of common stock of the Parent or to purchase options to purchase common stock of the Parent granted to directors, officers and certain key employees of the Parent or the Borrower pursuant to stock option plans adopted by the board of directors of the Parent or the Borrower; (o) Restricted Investments by the Parent in an aggregate amount of up to $2,000,000 made to permit repurchases of common stock of the Parent or to purchase options to purchase common stock of the Parent granted to directors, officers and certain key employees of the Parent or the Borrower pursuant to stock option plans adopted by the board of directors of the Parent or the Borrower; and (p) other Dividends and Restricted Investments in an aggregate amount outstanding of up to $2,000,000; PROVIDED, HOWEVER, none of the Parent, the Borrower or any Subsidiary shall make any Distribution or Restricted Investment permitted under clauses (n), (o) or (p) above if a Default or Event of Default shall have occurred and be continuing at the time of any such Distribution, Distributions from any Borrower exists immediately prior to or any Subsidiary of any Borrower to Parent in an amount during any 12 month period, which when added to all other amounts received by Parent during such period from any Borrower or any Subsidiary of any Borrower from any source (including, without limitation, payments on any Debt of such Borrower or any of their respective Subsidiaries held by Parent, but excluding Distributions received by Parent in accordance with clauses (ii), (iii) and (iv) below) shall not exceed 120% of Parent’s actual operating expenses during such period, (ii) so long as no Default or Event of Default shall have occurred and be continuing at the time of declaration or after giving effect to the payment thereof (and any Revolver Loans made in connection therewith), (a) Parent may make Distributions to the extent that, after giving effect thereto, Aggregate Availability shall be at least $20,000,000, and (b) Borrowers and their Subsidiaries may make Distributions to Parent in the amount of, and concurrently with, the Distribution permitted to be made by Parent under clause (a) above in order to enable Parent to make such Distribution, (iii) so long as no Default or Event of Default shall have occurred and be continuing at the time of declaration or after giving effect to the payment thereof, Borrowers and their Subsidiaries may make Distributions to Parent in the amount of, and concurrently with, any Permitted Acquisition or Permitted Foreign Subsidiary Investment permitted to be made by Parent under Section 10.2.11 in order to enable Parent to make such Permitted Acquisition or Permitted Foreign Subsidiary Investment, and (iv) Borrowers and their Subsidiaries may make Permitted Convertible Debenture Distributions. Notwithstanding the foregoing, no such Distribution may be made (I) unless such Distribution is permitted under all Applicable Laws, and (II) unless the Person making such Distribution would be Solvent exist immediately after giving effect to such Distribution (and any Revolver Loans made hereunder in connection therewith) and, to the extent any such Distribution is to be made with the proceeds of Revolver Loans, Obligors shall have delivered to Agent such certificates, financial statements and financial projections as Agent may reasonably request at the time of any such proposed Revolver Loan in order to confirm Obligors’ compliance with this clause (II)or Permitted Investment.

Permitted Distributions. (d) the Digiscope Loans; (e) loans and advances to employees, officers and directors in an aggregate principal amount not to exceed $1,000,000 at any time outstanding; (f) contributions of capital to Immaterial Subsidiaries provided such Subsidiaries use such contributions to simultaneously pay off accumulated intercompany debt of such Immaterial Subsidiaries to the Borrower or the Parent existing on the Closing Date in an amount not in excess of $7,000,000; (g) payments made pursuant to the Tax Sharing Agreement; (h) Distributions and Restricted Investments made in connection with the 2003 Recapitalization; (i) so long loans made giving rise to Debt permitted under Section 7.13(d); (j) purchases of Equipment (not included in the Borrowing Base) owned by Borrower but subject to a purchase option in favor of the customer for whose account such Equipment was purchased, with such option being exercisable at the end of a specified contractual term, entered into in accordance with past practice and in the ordinary course of business; (k) purchases of spare parts inventory booked as a long-term rather than current asset in accordance with past practice and in the ordinary course of business; (l) payments described in clause (i) of the definition of the term "Permitted Affiliate Transactions"; (m) payments in amounts necessary to permit Parent to (x) make payments in respect of its indemnification obligations owing to directors, officers or other Persons under Parent's charter or by-laws or pursuant to written agreements with any such Person, or obligations in respect of director and officer insurance (including premiums therefor) or (y) satisfy its obligations, or through the Company satisfy its obligations, under any registration rights agreement or (z) make payments in respect of indemnification obligations of Parent in connection with any issuance by Parent of capital stock of Parent; (n) Distributions and Restricted Investments by the Parent in an aggregate amount of up to $500,000 made to permit repurchases of common stock of the Parent or to purchase options to purchase common stock of the Parent granted to directors, officers and certain key employees of the Parent or the Borrower pursuant to stock option plans adopted by the board of directors of the Parent or the Borrower; and (o) other Distributions and Restricted Investments in an aggregate amount outstanding of up to $500,000; provided, however, the Parent, the Borrower or any Subsidiary may (I) make the Distributions and Restricted Investments permitted under clauses (n) and (o) above only if no Default or Event of Default shall have occurred and be continuing at the time of any such Distribution, Distributions from any Borrower exist immediately prior to or any Subsidiary of any Borrower to Parent in an amount during any 12 month period, which when added to all other amounts received by Parent during such period from any Borrower or any Subsidiary of any Borrower from any source (including, without limitation, payments on any Debt of such Borrower or any of their respective Subsidiaries held by Parent, but excluding Distributions received by Parent in accordance with clauses (ii), (iii) and (iv) below) shall not exceed 120% of Parent’s actual operating expenses during such period, (ii) so long as no Default or Event of Default shall have occurred and be continuing at the time of declaration or after giving effect to the payment thereof (and any Revolver Loans made in connection therewith), (a) Parent may make Distributions to the extent that, after giving effect thereto, Aggregate Availability shall be at least $20,000,000, and (b) Borrowers and their Subsidiaries may make Distributions to Parent in the amount of, and concurrently with, the Distribution permitted to be made by Parent under clause (a) above in order to enable Parent to make such Distribution, (iii) so long as no Default or Event of Default shall have occurred and be continuing at the time of declaration or after giving effect to the payment thereof, Borrowers and their Subsidiaries may make Distributions to Parent in the amount of, and concurrently with, any Permitted Acquisition or Permitted Foreign Subsidiary Investment permitted to be made by Parent under Section 10.2.11 in order to enable Parent to make such Permitted Acquisition or Permitted Foreign Subsidiary Investment, and (iv) Borrowers and their Subsidiaries may make Permitted Convertible Debenture Distributions. Notwithstanding the foregoing, no such Distribution may be made (I) unless such Distribution is permitted under all Applicable Laws, and (II) unless the Person making such Distribution would be Solvent immediately after giving effect to such Distribution or Restricted Investment and (II) make additional Distributions and any Revolver Loans made hereunder Restricted Investments in connection therewith) and, an aggregate amount of up to the extent any such Distribution is to be made with the proceeds $1,500,000 in excess of Revolver Loans, Obligors shall have delivered to Agent such certificates, financial statements and financial projections as Agent may reasonably request at the time of any such proposed Revolver Loan in order to confirm Obligors’ compliance with this those permitted under clause (II).n) above and

Permitted Distributions. (ia) Permitted Tax Distributions; (b) other Distributions made in cash so long as the Payment Conditions are satisfied with respect to each such Distribution made under this clause (b); (c) so long as no Event of Default shall have occurred and be continuing or would result therefrom, the purchase, repurchase, redemption or other acquisition, cancellation or retirement for value of Equity Interests, or options, warrants, equity appreciation rights or other rights to purchase or acquire Equity Interests, of Infinera Corp held by any existing or former employees, management or directors of or consultants to Infinera Corp or any Subsidiary of Infinera Corp or their assigns, estates or heirs, in each case in connection with the repurchase provisions under employee stock option or stock purchase agreements or other compensatory agreements approved by the Board of Directors of Infinera Corp; provided that such purchases, repurchases, redemptions, acquisitions, cancellations or retirements pursuant to this clause (c) and clause (k) will not exceed $5,000,000 in the aggregate during any calendar year; (d) so long as no Default or Event of Default shall have occurred and be continuing at the time or would result therefrom, Infinera Corp may make distributions to former employees, officers, or directors of Infinera Corp (or any spouses, ex-spouses, or estates of any of the foregoing), solely in the form of forgiveness of Debt of such DistributionPersons owing to Infinera Corp on account of repurchases of the Equity Interests of Infinera Corp held by such Persons; provided, Distributions from any Borrower that such Debt was incurred by such Persons solely to acquire Equity Interests of Infinera Corp; (e) dividends, distributions or other payments may be made by any Subsidiary of any Borrower that is not an Obligor to Parent in an amount during any 12 month period, which when added to all other amounts received by Parent during such period from any Borrower or any Subsidiary of any Borrower from Obligor or to any source Borrower; (includingf) repurchases or other acquisitions of Equity Interests deemed to occur (i) upon the exercise of stock options, without limitationwarrants, restricted stock units or other rights to purchase Equity Interests or other convertible securities if such Equity Interests represents a portion of the exercise price thereof or conversion price thereof or (ii) in connection with withholdings or similar taxes payable by any future, present or former employee, director or officer; (g) cash payments on in lieu of the issuance of fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of Infinera Corp or other exchanges of securities of Infinera Corp or a Subsidiary in exchange for Equity Interests of Infinera Corp; (h) the purchase of fractional shares of Equity Interests of the Infinera Corp arising out of stock dividends, splits or combinations or mergers, consolidations or other acquisitions; (i) in connection with any Debt Permitted Acquisition, the receipt or acceptance of such Borrower the return to Infinera Corp or any of their respective its Subsidiaries held by Parent, but excluding Distributions received by Parent of Equity Interests of Infinera Corp constituting a portion of the purchase price consideration in settlement of indemnification claims or as a result of a purchase price adjustment (including earn-outs or similar obligations); (j) the distribution of rights pursuant to any shareholder rights plan or the redemption of such for nominal consideration in accordance with clauses the terms of any shareholder rights plan; (ii)k) payments or distributions to stockholders pursuant to appraisal rights required under applicable law in connection with any Permitted Acquisition or Investment that is not a Restricted Investment; provided that such payments or distributions pursuant to this clause (k) and clause (c) will not exceed $5,000,000 in the aggregate during any calendar year; and (l) non-cash Distributions made in connection with a Permitted Tax Restructuring. Permitted Intercompany Advances: loans, advances or equity contributions made by (a) an Obligor to another Obligor, (iiib) and (iv) below) shall a Subsidiary of an Obligor that is not exceed 120% an Obligor to another Subsidiary of Parent’s actual operating expenses during such periodan Obligor that is not an Obligor, (iic) a Subsidiary of an Obligor that is not an Obligor to an Obligor, so long as the parties thereto are party to an intercompany subordination agreement, (d) an Obligor to a Subsidiary of an Obligor that is not an Obligor, so long as no Default or Event of Default shall have occurred and be continuing continuing, or would result therefrom and the aggregate amount of all such loans (by type, not by the borrower) does not exceed $5,000,000 outstanding at the time of declaration or after giving effect to the payment thereof (and any Revolver Loans made in connection therewith), (a) Parent may make Distributions to the extent that, after giving effect thereto, Aggregate Availability shall be at least $20,000,000one time, and (be) Borrowers and their Subsidiaries may make Distributions an Obligor to Parent in the amount ofa Subsidiary of an Obligor that is not an Obligor, and concurrently with, the Distribution permitted to be made by Parent under clause (a) above in order to enable Parent to make such Distribution, (iii) so long as no Default the Payment Conditions are satisfied with respect to each such loan, advance, or Event of Default shall have occurred and be continuing at the time of declaration or after giving effect to the payment thereof, Borrowers and their Subsidiaries may make Distributions to Parent equity contribution. Permitted Lien: as defined in the amount of, and concurrently with, any Permitted Acquisition or Permitted Foreign Subsidiary Investment permitted to be made by Parent under Section 10.2.11 in order to enable Parent to make such Permitted Acquisition or Permitted Foreign Subsidiary Investment, and (iv) Borrowers and their Subsidiaries may make Permitted Convertible Debenture Distributions. Notwithstanding the foregoing, no such Distribution may be made (I) unless such Distribution is permitted under all Applicable Laws, and (II) unless the Person making such Distribution would be Solvent after giving effect to such Distribution (and any Revolver Loans made hereunder in connection therewith) and, to the extent any such Distribution is to be made with the proceeds of Revolver Loans, Obligors shall have delivered to Agent such certificates, financial statements and financial projections as Agent may reasonably request at the time of any such proposed Revolver Loan in order to confirm Obligors’ compliance with this clause (II)10.2.2.