Common use of Restricted Actions Clause in Contracts

Restricted Actions. (a) The affirmative vote of the Majority Holders, acting by written consent as a separate class or voting separately as a separate class, shall be necessary to authorize the Corporation or any Subsidiary of the Corporation to take any of the following actions: (i) authorize, create, issue, modify the material terms of, or change the amount of authorized or issued shares of, any Senior Capital Stock (or any securities convertible into or exchangeable for any Senior Capital Stock) or Indebtedness that by its terms is convertible or exchangeable into Senior Capital Stock (or any securities convertible into or exchangeable for Senior Capital Stock; (ii) effect (x) any Sale of the Corporation other than a Qualified Sale of the Corporation or a Qualified Public Offering or (y) any Reorganization of the Corporation; (iii) alter the rights, preferences or privileges of the Series B Preferred Stock; (iv) increase the authorized number of shares of Series B Preferred Stock; (v) redeem, purchase or otherwise acquire any shares of Common Stock or Preferred Stock (or pay into a sinking fund for such purpose); provided, however, that this restriction shall not apply to any redemption specifically permitted pursuant to this Certificate of Designation or to the repurchase of shares of Common Stock at the original purchase price from employees, officers, directors or other persons performing services for the Corporation. (b) Notwithstanding the foregoing provisions of this Section 5 and except as otherwise required by law, the creation, authorization or issuance of any shares of any Junior Capital Stock or Parity Capital Stock, or the increase or decrease in the amount of authorized Junior Capital Stock or Parity Capital Stock of any class shall not require the affirmative vote or consent of the Majority Holders and shall not be deemed to materially affect adversely the rights, preferences, privileges or voting rights of shares of Series B Preferred Stock. (c) In any case in which the Holders of Series B Preferred Stock shall be entitled to vote (as Holders of Series B Preferred Stock rather than on an as-if-converted basis) pursuant hereto or pursuant to the General Corporation Law of the State of Delaware, each Holder of Series B Preferred Stock entitled to vote with respect to such matters shall be entitled to one vote for each share of Series B Preferred Stock held.

Restricted Actions. Prior to the conversion of, or redemption of, the Series D Shares (other than with respect to Section 8.1(e) which shall survive the conversion of the Series D Shares and shall terminate on the date that no Securities are outstanding), without the prior written consent of the holders of a majority of the Series D Shares (other than with respect to Section 8.1(e) which shall require the prior written consent of the holders of a majority of the Underlying Common Stock), the Company shall not, nor shall the Company suffer or permit any member of the Company Group to, directly or indirectly: (a) The affirmative vote use the proceeds from the sale of the Majority Holders, acting by written consent as a separate class or voting separately as a separate class, shall be necessary to authorize Series D Shares and the Corporation or any Subsidiary of the Corporation to take any of the following actions: Warrants hereunder other than (i) authorizeto pay the Closing Fee, createthe CRP Fee and other fees and expenses associated with the transactions contemplated by this Agreement and the Related Documents, issue, modify the material terms of, or change the amount of authorized or issued shares of, any Senior Capital Stock (or any securities convertible into or exchangeable for any Senior Capital Stock) or Indebtedness that by its terms is convertible or exchangeable into Senior Capital Stock (or any securities convertible into or exchangeable for Senior Capital Stock; (ii) effect (x) any Sale of the Corporation other than a Qualified Sale of the Corporation or a Qualified Public Offering or (y) any Reorganization of the Corporation; for Permitted Acquisitions and (iii) alter the rights, preferences or privileges of the Series B Preferred Stockfor working capital and general corporate purposes; (iv) increase the authorized number of shares of Series B Preferred Stock; (v) redeem, purchase or otherwise acquire any shares of Common Stock or Preferred Stock (or pay into a sinking fund for such purpose); provided, however, that this restriction shall not apply to any redemption specifically permitted pursuant to this Certificate of Designation or to the repurchase of shares of Common Stock at the original purchase price from employees, officers, directors or other persons performing services for the Corporation. (b) Notwithstanding prior to the third anniversary of the Initial Closing Date, consummate a Company Sale unless the amount of cash consideration and the Market Price (as of the date of receipt) of any other consideration received by the holders of the Underlying Common Stock, in the aggregate, in such Company Sale, plus the aggregate value of any cash hereafter distributed or issued as a dividend or distribution with respect to any of the Securities is equal to 175% of the aggregate amount of capital invested in the Securities; (c) incur, create, assume or in any way become liable for any Indebtedness for Borrowed Money, Capital Leases or Guarantees unless at the time of and after giving pro forma effect to such incurrence and the application of proceeds therefrom, the ratio of the Company’s Indebtedness for Borrowed Money to EBITDA would be less than or equal to 2.0 to 1.0. Solely for purposes of this Section 8.1(c), (x) Indebtedness for Borrowed Money shall mean all obligations of the Company Group for borrowed money which should be classified upon the obligor’s balance sheet as liabilities, the present value of any Capital Leases and the amount of all Guarantees (whether or not required to be reflected on such obligor’s balance sheet as liabilities), in each case as determined in accordance with GAAP, and (y) EBITDA shall mean the net income of the Company Group (including in the “Company Group” for all purposes of this Section 8.1(c)(y), MAI Systems Corporation and its direct and indirect subsidiaries, for the entire period being measured, regardless of whether such period includes time periods preceding the acquisition of MAI Systems Corporation by the Company), (A) adjusted for the elimination of the following items if, and only if, such items shall never require the expenditure of cash by any member of the Company Group: (1) non-cash interest; (2) non-cash employee compensation expense and (3) nonrecurring non-cash charges, (B) minus any extraordinary gains and other non-recurring gains and (C) plus to the extent deducted from net income (1) income tax expense; (2) depreciation and amortization expense and (3) the aggregate cash interest expense of the Company Group paid, payable or accrued for such period, all of which calculations shall be determined in accordance with GAAP based on the consolidated financial statements of the Company Group for the 12 month period ending on the last day of the fiscal quarter for which the most recent financial statements have been delivered to the Purchasers pursuant to Section 8.3; provided, that notwithstanding the foregoing provisions of this Section 5 8.1(c), (x) the Company may incur Indebtedness under Capital Leases in an amount not to exceed $1,000,000 in the aggregate outstanding at any time, and except (y) the Company may incur Indebtedness under that certain Credit Agreement, dated as otherwise required of the date of this Agreement, by lawand between the Company, certain Subsidiaries of the Company, the creationlenders named therein, authorization and ▇▇▇▇▇ Fargo Foothill, Inc., as Arranger and Administrative Agent in effect on the date hereof (the “Senior Facility”) even though the Ratio will exceed 2.0 to 1.0, if such Indebtedness is incurred to finance Permitted Acquisitions or issuance for working capital and general corporate purposes on or after the date of this Amendment and either (i) following such incurrence, the aggregate amount of Indebtedness outstanding under the Senior Facility does not exceed $23,000,000; or (ii) such Indebtedness under the Senior Facility (A) is incurred at any shares time during the period beginning on March 31, 2007 and ending on ▇▇▇▇▇▇▇▇ ▇▇, ▇▇▇▇, (▇) does not exceed $30,000,000 and (c) is incurred when the Company’s EBITDA for the twelve month period ended on the most recently ended fiscal quarter equals or exceeds the Minimum EBITDA Targets set forth opposite the date below that corresponds to the most recently ended fiscal quarter prior to the date of any Junior Capital Stock or Parity Capital Stockthe borrowing: March 31, or 2007 $ 9,000,000 June 30, 2007 $ 9,000,000 September 30, 2007 $ 10,701,744 December 31, 2007 $ 11,862,744 (d) from and after the increase or decrease in third anniversary of the Initial Closing Date, consummate a Company Sale unless the amount of authorized Junior Capital Stock or Parity Capital Stock cash consideration and the Market Price (as of the date of receipt) of any class shall not require other consideration received by the affirmative vote or consent holders of the Majority Holders and shall not be deemed Series D Preferred Stock, in the aggregate, in such Company Sale is at least equal to materially affect adversely the rights, preferences, privileges or voting rights of Series D Redemption Price for all such shares of Series B D Preferred Stock. (c) In any case in which the Holders of Series B Preferred Stock shall be entitled to vote (as Holders of Series B Preferred Stock rather than on an as-if-converted basis) pursuant hereto or pursuant to the General Corporation Law of the State of Delaware, each Holder of Series B Preferred Stock entitled to vote with respect to such matters shall be entitled to one vote for each share of Series B Preferred Stock held.;

Restricted Actions. Prior to the conversion of, or redemption of, the Series C Shares (other than with respect to Section 8.1(e) which shall survive the conversion of the Series C Shares and shall terminate on the date that no Securities are outstanding), without the prior written consent of the holders of a majority of the Series C Shares (other than with respect to Section 8.1(e) which shall require the prior written consent of the holders of a majority of the Underlying Common Stock), the Company shall not, nor shall the Company suffer or permit any member of the Company Group to, directly or indirectly: (a) The affirmative vote use the proceeds from the sale of the Majority HoldersSeries C Shares and the Warrants hereunder other than (x)(i) to payoff the indebtedness of the Company and its Subsidiaries outstanding under the Subordinated Notes, acting and (ii) to pay the Closing Fee and other fees and expenses associated with the transactions contemplated by written consent this Agreement and the Related Documents, (y) to the extent the Company has paid in full the indebtedness of the Company and its Subsidiaries under the Subordinated Notes and the Closing Fee, (i) for Permitted Acquisitions and (ii) for working capital and general corporate purposes; (b) prior to the third anniversary of the Closing Date, consummate a Company Sale unless the amount of cash consideration and the Market Price (as of the date of receipt) of any other consideration received by the holders of the Underlying Common Stock, in the aggregate, in such Company Sale, plus the aggregate value of any cash hereafter distributed or issued as a separate class dividend or voting separately as a separate class, shall be necessary distribution with respect to authorize the Corporation or any Subsidiary of the Corporation to take any of the following actions:Securities is equal to 175% of the aggregate amount of capital invested in the Securities; (ic) authorizeincur, create, issueassume or in any way become liable for any Indebtedness for Borrowed Money, modify Capital Leases or Guarantees unless at the material terms oftime of and after giving pro forma effect to such incurrence and the application of proceeds therefrom, the ratio of the Company’s Indebtedness for Borrowed Money to EBITDA would be less than or change equal to 2.0 to 1.0. Solely for purposes of this Section 8.1(c), (x) Indebtedness for Borrowed Money shall mean all obligations of the Company Group for borrowed money which should be classified upon the obligor’s balance sheet as liabilities, the present value of any Capital Leases and the amount of authorized all Guarantees (whether or issued shares ofnot required to be reflected on such obligor’s balance sheet as liabilities), in each case as determined in accordance with GAAP, and (y) EBITDA shall mean the net income of the Company Group, (A) adjusted for the elimination of the following items if, and only if, such items shall never require the expenditure of cash by any Senior Capital Stock member of the Company Group: (1) non-cash interest; (2) non-cash employee compensation expense and (3) nonrecurring non-cash charges, (B) minus any extraordinary gains and other non-recurring gains and (C) plus to the extent deducted from net income (1) income tax expense; (2) depreciation and amortization expense and (3) the aggregate cash interest expense of the Company Group paid, payable or any securities convertible into or exchangeable accrued for any Senior Capital Stock) or Indebtedness that by its terms is convertible or exchangeable into Senior Capital Stock (or any securities convertible into or exchangeable such period, all of which calculations shall be determined in accordance with GAAP based on the consolidated financial statements of the Company Group for Senior Capital Stockthe 12 month period ending on the last day of the fiscal quarter for which the most recent financial statements have been delivered to the Purchasers pursuant to Section 8.3; (iid) effect (x) any Sale from and after the third anniversary of the Corporation other than Closing Date, consummate a Qualified Company Sale unless the amount of cash consideration and the Market Price (as of the Corporation or a Qualified Public Offering or (ydate of receipt) of any Reorganization of other consideration received by the Corporation; (iii) alter the rights, preferences or privileges holders of the Series B C Preferred Stock, in the aggregate, in such Company Sale is at least equal to the Series C Redemption Price for all such shares of Series C Preferred Stock; (ive) increase enter into any agreement, instrument, arrangement or understanding (or amend or modify the authorized number terms of shares any existing agreement, instrument, arrangement or understanding), which by its terms would restrict the Company’s ability to comply with the terms of Series B Preferred Stockthis Agreement or any of the Related Documents in any material respect; (vf) redeementer into or suffer to exist any contract, purchase agreement, arrangement or transaction with any Affiliate (an “Affiliate Transaction”), other than a Permitted Affiliate Transaction, without the prior consent of the members of the Board of Directors with no interest in such Affiliate Transaction; (g) sell, transfer or otherwise acquire dispose of the capital stock of any shares Subsidiary; (h) in the case of Common Stock any Company Subsidiary, authorize, issue or Preferred Stock enter into an agreement providing for the issuance of (contingent or otherwise) of any Equity Securities, unless after giving effect to such issuance, such Subsidiary is Wholly-Owned Subsidiary of the Company; (i) materially alter its principal line of business as conducted on the Closing Date or engage in any business unless such business is reasonably related to such principal line of business of the Company Group as conducted on the Closing Date; (j) complete a Material Acquisition that is not approved by the Board of Directors, including the consent of the Series C Director; or (k) with respect to the Company or any Material Subsidiary, make an assignment for the benefit of creditors or admit in writing its inability to pay into a sinking fund for such purpose); providedits debts generally as they become due, however, that this restriction shall not or petition or apply to any redemption specifically permitted pursuant to this Certificate tribunal for the appointment of Designation a custodian, trustee, receiver or liquidator of the Company or any Material Subsidiary or of any substantial part of the assets of the Company or any Material Subsidiary, or commence any proceeding (other than a proceeding for the voluntary liquidation and dissolution of a Subsidiary) relating to the repurchase Company or any Material Subsidiary under any bankruptcy, reorganization, arrangement, insolvency, readjustment of shares of Common Stock at the original purchase price from employeesdebt, officers, directors dissolution or other persons performing services for the Corporation. (b) Notwithstanding the foregoing provisions of this Section 5 and except as otherwise required by law, the creation, authorization or issuance liquidation law of any shares of jurisdiction; or approve, consent to or acquiescence in any Junior Capital Stock such petition or Parity Capital Stockapplication filed, or any such proceeding commenced, by any third party against the increase Company or decrease in the amount of authorized Junior Capital Stock or Parity Capital Stock of any class shall not require the affirmative vote or consent of the Majority Holders and shall not be deemed to materially affect adversely the rights, preferences, privileges or voting rights of shares of Series B Preferred StockSubsidiary. (c) In any case in which the Holders of Series B Preferred Stock shall be entitled to vote (as Holders of Series B Preferred Stock rather than on an as-if-converted basis) pursuant hereto or pursuant to the General Corporation Law of the State of Delaware, each Holder of Series B Preferred Stock entitled to vote with respect to such matters shall be entitled to one vote for each share of Series B Preferred Stock held.