Common use of Consolidation, Merger, Sale or Purchase of Assets, etc Clause in Contracts

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties will not, nor will they permit any Subsidiary to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets or agree to do so at a future time, except the following, without duplication, shall be expressly permitted: (A) the sale, transfer, lease or other disposition of inventory and materials in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cash; (ii) Extraordinary Receipts for which such Credit Party or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt are used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii); (iii) the sale, lease, transfer or other disposition of machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties or any of their Subsidiaries; (iv) (A) the sale, lease or transfer of property or assets from one Credit Party to another Credit Party, (B) the sale, lease or transfer of property or assets from a Subsidiary to a Credit Party and (C) the sale, lease or transfer of property or assets from a Subsidiary that is not a Credit Party to another Subsidiary that is not a Credit Party; (v) the termination of any Hedging Agreement; (vi) the Hawthorne Asset Disposition; and (vii) the sale, lease or transfer of property or assets not to exceed $10,000,000 in the aggregate in any fiscal year, excluding transfers made pursuant to Section 6.4(a)(iv); provided that (A) with respect to clauses (i)(A), (ii), (iii), (vi) and (vii) above, at least 75% of the consideration received therefor by the Credit Parties or any such Subsidiary shall be in the form of cash or Cash Equivalents, (B) after giving effect to any Asset Disposition pursuant to clause (vii) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is available, and (C) with respect to clauses (iv), (v), (vi) and (vii) above, no Default or Event of Default shall exist or shall result therefrom; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lender, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business, or (ii) enter into any transaction of merger or consolidation, except for (A) Investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity, (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower is a party thereto, the Borrower will be the surviving corporation, and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit Party.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties will not, nor will they permit any Subsidiary to, directly or indirectly, (a) dissolvemerge into or with or consolidate with any other Person or permit any other Person to merge into or with or consolidate with it, liquidate except that any Credit Party may merge with and into or wind up consolidate with any other Credit Party; provided, that, each of the following conditions is satisfied as determined by the Administrative Agent: (i) the Administrative Agent shall have received not less than five (5) days’ prior written notice of the consummation of any merger or consolidation of such Credit Party to so merge or consolidate and such information with respect thereto as the Administrative Agent may reasonably request, (ii) as of the effective date of the merger or consolidation and after giving effect thereto, no Event of Default or Default shall exist or have occurred and be continuing, (iii) the Administrative Agent shall have received true, correct and complete copies of all agreements, documents and instruments relating to such merger, including, but not limited to, the certificate or certificates of merger as filed with each appropriate Secretary of State, (iv) the surviving entity shall expressly confirm, ratify and assume the Credit Party Obligations and the Credit Documents to which it is a party in writing, in form and substance reasonably satisfactory to the Administrative Agent, and execute and deliver such other agreements, documents and instruments as the Administrative Agent may request in connection therewith, (v) the surviving entity of a merger between the Borrower and a Guarantor shall be the Borrower, and (vi) each Credit Party shall ratify and confirm that its affairsguarantee of the Credit Party Obligations shall apply to the Credit Party Obligations as assumed by such surviving entity; or (b) sell, or sellassign, transfer, lease abandon or otherwise dispose of its property any Capital Stock, Indebtedness or assets or agree to do so at a future timeany other Person, except the following, without duplication, shall be expressly permittedfor: (Ai) the sale, transfer, lease or other disposition sales of inventory Inventory and materials rendition of services in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cashbusiness; (ii) Extraordinary Receipts for which the sale or other disposition of equipment so long as, as of the date of such Credit Party sale and after giving effect thereto, no Event of Default or such Subsidiary has received any cash insurance proceeds Default shall exist or condemnation or expropriation award with respect to such property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt are used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii)have occurred; (iii) the saleissuance and sale by the Borrower of its Capital Stock after the date hereof; provided, leasethat, transfer (A) the Borrower shall not be required to pay any cash dividends or repurchase or redeem its Capital Stock or make any other disposition payments in respect thereof, except to the extent such dividends, or repurchases or redemptions are otherwise permitted under Section 6.10 hereof, (B) the terms of machinerysuch Capital Stock, parts and equipment no longer used or useful in the conduct terms and conditions of the business purchase and sale thereof, shall not include any terms that include any limitation on the right of the Borrower to request or receive Loans or Letters of Credit Parties or the right of the Borrower to amend or modify any of the terms and conditions of this Credit Agreement or any of their Subsidiariesthe other Credit Documents or otherwise in any way relate to or affect the arrangements of the Borrower with the Administrative Agent and Lenders or are more restrictive or burdensome to the Borrower than the terms of any Capital Stock of the Borrower in effect on the date hereof and (C) as of the date of such issuance and sale and after giving effect thereto, no Event of Default or Default shall exist or have occurred and be continuing; (iv) (Ain addition to the issuance of Capital Stock permitted in Section 6.4(b)(ii) above, the sale, lease or transfer issuance of property or assets from one Capital Stock of any Credit Party to another Credit Party, (B) the sale, lease or transfer consisting of property or assets from a Subsidiary common stock pursuant to a stock option plan or 401(k) plan of such Credit Party for the benefit of its employees, directors and (C) the saleconsultants; provided, lease or transfer of property or assets from a Subsidiary that is not a that, in no event shall such Credit Party be required to another Subsidiary that is not issue, or shall such Credit Party issue, Capital Stock pursuant to such stock option plan or 401(k) plan which would result in a Credit PartyChange of Control or other Event of Default; (v) the termination of any Hedging Agreement; (vi) the Hawthorne Asset DispositionCredit Parties and their Subsidiaries may encumber (to the extent permitted by Section 6.2), sell, enter into sale-leaseback agreements (to the extent permitted by Section 6.12) or otherwise dispose of Properties, in each case for fair market value, which are not Collateral (a) with a fee simple fair market value of $125,000,000 in the aggregate or less and (b) subject to Section 5.12, with a fee simple fair market value of greater than $125,000,000 in the aggregate; and (vii) the saleBorrower may sell the Collateral for fair market value so long as the Borrower complies with the provisions of Sections 2.4(b)(i) and 5.12. (c) wind up, lease liquidate or transfer dissolve except that any Subsidiary of property the Borrower or assets a Guarantor may wind up, liquidate and dissolve; provided, that, each of the following conditions is satisfied: (i) the winding up, liquidation and dissolution of such Subsidiary shall not to exceed $10,000,000 violate any Requirement of Law in any material respect and shall not conflict with or result in the aggregate breach of, or constitute a default under, any material indenture, mortgage, deed of trust, or other agreement or instrument to which the Borrower, such Guarantor or such Subsidiary is a party or may be bound, (ii) such winding up, liquidation or dissolution shall be done in accordance with all Requirements of Law, (iii) effective upon such winding up, liquidation or dissolution, all of the assets and properties of such Subsidiary shall be duly and validly transferred and assigned to the Borrower, a Guarantor or in the case of a Subsidiary which is not a Borrower or Guarantor, to the Borrower, a Guarantor or another Subsidiary (which is not a Borrower or Guarantor) free and clear of any fiscal yearLiens, excluding transfers made pursuant to Section 6.4(a)(iv); provided that restrictions or encumbrances other than the security interests and Liens of the Administrative Agent or other Permitted Liens or restrictions or encumbrances expressly permitted hereunder (A) with respect to clauses (i)(Aand the Administrative Agent shall have received such evidence thereof as the Administrative Agent may require), (ii)iv) the Administrative Agent shall have received copies of all documents and agreements of such Subsidiary to be filed with any Governmental Authority or otherwise required to effectuate such winding up, liquidation or dissolution, (iii)v) no Credit Party shall assume any Indebtedness, obligations or liabilities as a result of such winding up, liquidation or dissolution, or otherwise become liable in respect of any obligations or liabilities of the Person which is winding up, liquidating or dissolving, unless such Indebtedness is otherwise expressly permitted hereunder or such obligations or liabilities are not prohibited under this Credit Agreement or any of the other Credit Documents, (vi) and the Administrative Agent shall have received not less than ten (10) Business Days’ prior written notice of the intention of such Subsidiary to wind up, liquidate or dissolve, (vii) abovethe Administrative Agent shall have received copies of such deeds, at least 75% assignments or other agreements as the Administrative Agent may reasonably request to evidence and confirm the transfer of such assets from the Subsidiary which is liquidating to the transferee, and (viii) as of the consideration received therefor by the Credit Parties date of such winding up, liquidation or any such Subsidiary shall be in the form of cash or Cash Equivalents, (B) dissolution and after giving effect to any Asset Disposition pursuant to clause (vii) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is available, and (C) with respect to clauses (iv), (v), (vi) and (vii) abovethereto, no Default or Event of Default shall exist or shall result therefrom; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall have occurred and be entitled, without the consent of any Lender, to release its Liens relating to the particular assets soldcontinuing; or (bd) lease or sublease Mortgaged Properties that (i) purchaserepresent more than 15% of the total number of Mortgaged Properties (other than those set forth on Schedule 3.31(b)) at any time and (ii) together with the Mortgaged Properties that are vacant or otherwise non-operational or that are being altered, renovated or refurbished at any one time (excluding minor alterations and upkeep) in accordance with the terms of Section 5.12(a), represent more than 25% of the total number of Mortgaged Properties at any time; provided that the Credit Parties shall promptly (but in any event within five (5) Business Days after the execution and delivery of such lease or otherwise acquire (in a single transaction or a series of related transactionssublease) notify the property or assets Administrative Agent of any Person, other than lease or sublease of a Mortgaged Property and any such lease or sublease (A) Permitted Acquisitions shall be on market terms and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business, or (ii) enter into any transaction of merger or consolidation, except for (A) Investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entityat market rents, (B) (y) shall in no way diminish the merger fair market value or consolidation useful life of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower is a party theretoMortgaged Property, the Borrower will be the surviving corporation, and (C) the merger or consolidation of a Subsidiary that is shall not a release any Credit Party from its obligations under the Mortgaged Instrument with respect to such Mortgaged Property, (D) shall be expressly subject and into another Subsidiary subordinate to the Mortgaged Instrument with respect to such Mortgaged Property and (E) shall be subject to a subordination, non-disturbance and attornment agreement to the extent requested by the Borrower or the Administrative Agent and consented to by the Administrative Agent (such consent not to be unreasonably withheld), which agreement shall be in form and substance reasonably satisfactory to the Borrower and the Administrative Agent; or (e) agree to do any of the foregoing (unless such agreement has been consented to in writing by the Administrative Agent or includes as a condition to the effectiveness of such agreement that is not a Credit Partythe Administrative Agent’s consent thereto be obtained).

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties will not, nor will they permit any Subsidiary to,: (a) dissolve, liquidate or wind up its affairs, consolidate or merge with another Person, or sell, transfer, lease or otherwise dispose of its property or assets or agree to do so at a future time, time except the following, without duplication, shall be expressly permitted: (Ai) the sale, transfer, lease or other disposition of inventory and materials in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cashSpecified Sales; (ii) Extraordinary Receipts for which such Credit Party or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such the disposition of property or assets as a result of a Recovery Event to the extent the Net Cash Proceeds from such Extraordinary Receipt therefrom are used to make mandatory prepayments or otherwise used repay Loans pursuant to Section 2.7(b)(vii2.9(b)(vii) or repair or replace damaged property or to purchase or otherwise acquire new assets or property in accordance with the terms of Section 2.9(b)(vii); (iii) the sale, lease, transfer or other disposition of machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties or any of their Subsidiaries; (iv) (A) the sale, lease or transfer of property or assets from one Credit Party to another Credit Party, (B) the sale, lease or transfer of property or assets from a Credit Party to another Credit Party (other than a Permitted Real Estate Entity); provided that prior to or simultaneously with any such sale, lease or transfer, all actions required by the Administrative Agent shall be taken to insure the continued perfection and priority of the Administrative Agent’s Liens on such property and assets; (iv) the consolidation, liquidation or merger of a Credit Party into another Credit Party (other than a Permitted Real Estate Entity) or any Subsidiary into a Credit Party (other than a Permitted Real Estate Entity); provided that (A) prior to a or simultaneously with any such consolidation, liquidation or merger, all actions required by the Administrative Agent shall be taken to insure the continued perfection and priority of the Administrative Agent’s Liens on the property and assets of each such Credit Party and (CB) if such consolidation, liquidation or merger involves the Borrower, the Borrower shall be the surviving entity; (v) the saledissolution, lease liquidation or transfer winding up of property or assets from a Subsidiary that is not a Credit Party Party; provided that prior to another or simultaneously with any such dissolution, liquidation or winding up, all assets of such Subsidiary that is not are transferred to a Credit PartyParty (other than a Permitted Real Estate Entity) or, to the extent required by law or binding contract, a creditor or creditors thereof; (vvi) the termination of any Hedging AgreementAgreement permitted pursuant to Section 6.1; (vi) the Hawthorne Asset Disposition; and (vii) the saleBorrower and its Subsidiaries may sell or discount, lease or transfer of property or assets not to exceed $10,000,000 in each case without recourse and in the aggregate ordinary course of business, accounts receivable arising in the ordinary course of business (A) which are overdue, or (B) which the Borrower or such Subsidiary may reasonably determine are difficult or uneconomic to collect but only in connection with the compromise or collection thereof consistent with customary industry practice (and not as part of any fiscal yearbulk sale or financing of receivables); (viii) the Borrower and its Subsidiaries may license its patents, excluding transfers made pursuant to Section 6.4(a)(ivtrade secrets, know-how and other intellectual property (the “Technology”); provided that such license shall be assignable to the Administrative Agent or any assignee of the Administrative Agent without the consent of the licensee and no such license shall (A) transfer ownership of such Technology to any other Person or (B) require the Borrower to pay any fees for any such use; (ix) the grant of certain rights pertaining to “Aggregates” to Granite Construction Company pursuant to the Agreement Granting Right to Mine Aggregates dated November 18, 2004 (the “Granite Agreement”); (x) the sale of real property and related assets by Permitted Real Estate Entities; (xi) the sale of any Capital Stock or other equity interests of any Permitted Real Estate Entity; (xii) Permitted Real Estate Sales; (xiii) Permitted Real Estate Transfers; (xiv) the sale, transfer or other disposition of any assets that are obsolete, worn out or no longer useful in any Credit Party’s or Subsidiary’s business; and (xv) the sale, transfer, lease or other disposition of any other assets, provided that the aggregate Net Cash Proceeds received from the sale of all assets subject to this subsection which are not reinvested to acquire assets to be used in such Person’s business shall not exceed $20,000,000 in any fiscal year of the Borrower; provided, that, with respect to clauses subsections (i)(Ai), (ii), (iiivii), (viviii) and (viixv) above, at least 75% of the consideration received therefor by the such Credit Parties Party, Subsidiary or any such Subsidiary Permitted Real Estate Entity shall be in the form of cash or Cash Equivalents; and, (B) after giving effect to any Asset Disposition pursuant to clause (vii) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is available, and (C) with respect to clauses (iv), (v), (vi) and (vii) above, no Default or Event of Default shall exist or shall result therefrom; provided, further, that with respect to sales the non-cash portion of assets permitted hereunder only, the Administrative Agent any such consideration shall be entitled, without in compliance with the consent provisions of any Lender, to release its Liens relating to the particular assets soldSection 6.5 hereof; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, Person (other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, leases, materials, property and equipment in the ordinary course of business, except as otherwise limited or (ii) enter into any transaction of merger or consolidationprohibited herein), except for (Ai) transactions permitted pursuant to Section 6.4(a), (ii) Investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity, (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (ziii) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower is a party thereto, the Borrower will be the surviving corporation, and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit PartyPermitted Acquisitions.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties will not, nor will they permit any Subsidiary to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease lease, consummate a Division as the Dividing Person or otherwise dispose of its property or assets (each a “Disposition”) or agree to do so at a future time, except the following, without duplication, shall be expressly permitted: (A) the sale, transfer, lease or other disposition of inventory and materials in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cash; (ii) Extraordinary Receipts for which such Credit Party the sale, transfer or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such other disposition of property or assets to an unrelated party not in the ordinary course of business where and to the extent Net Cash Proceeds from such Extraordinary Receipt that they are used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii)the result of a Recovery Event; (iii) the sale, lease, transfer or other disposition of (A) machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties or any of their SubsidiariesSubsidiaries and (B) obsolete or worn out property, whether now owned or hereafter acquired, in the ordinary course of business; (iv) (A) the sale, lease or transfer of property or assets from one Credit Party to another Credit Party, (B) the sale, lease Party or transfer dissolution of property or assets from a Subsidiary to a Credit Party and (C) the sale, lease or transfer of property or assets from a Subsidiary that is not a any Credit Party to the extent any and all assets are distributed to another Subsidiary that is not a Credit Party; (v) the termination of any Hedging Agreement; (vi) Dispositions of equipment or real property to the Hawthorne Asset extent that (A) such property is exchanged for credit against the purchase price of similar replacement property within twelve (12) months of such Disposition or (B) the proceeds of such Disposition are reasonably promptly applied to the purchase price of such replacement property within 12 months of such Disposition; and; (vii) the licensing of Intellectual Property in the ordinary course of business consistent with past practice; (viii) Dispositions by the Borrower or any Subsidiary; provided that at any time after the Collateral Event, (i) with respect to asset sales for more than $300,000,000 per disposition or series of related dispositions, at least 75% of the consideration for any such asset sale shall consist of cash or cash equivalents (provided that for purposes of the 75% cash consideration requirement (x) the amount of any Indebtedness or other liabilities of the Borrower or any Subsidiary (as shown on such person’s most recent balance sheet or in the notes thereto) that are assumed by the transferee of any such assets, (y) the amount of any trade-in value applied to the purchase price of any replacement assets acquired in connection with such asset sale, and (z) any securities received by the Borrower or such Subsidiary from such transferee that are converted by the Borrower or such Subsidiary into cash or cash equivalents (to the extent of the cash or cash equivalents received) within 270 days following the closing of the applicable asset sale, shall each be deemed to be cash or cash equivalents) and (ii) immediately prior to the consummation of such asset sale, no Event of Default shall have occurred and be continuing and no Event of Default shall result therefrom; (ix) the sale, lease or transfer of property or assets as part of a Sale and Leaseback Transaction; (x) the merger of a Credit Party or a Subsidiary thereof with another Credit Party or a Subsidiary thereof to the extent permitted by Section 6.4(b)(ii) below; (xi) Dispositions of Equity Interests in Permitted JVs pursuant to the terms of the joint venture or equivalent agreements governing such Permitted JVs so long as such joint venture or equivalent agreements are not to exceed $10,000,000 solely between Persons that are Credit Parties, Subsidiaries or Affiliates of Credit Parties; (xii) terminations of leases by a Credit Party or a Subsidiary in the aggregate ordinary course of business that do not interfere in any fiscal yearmaterial respect with the business of the Credit Parties or their Subsidiaries; (xiii) any Subsidiary that is an LLC may consummate a Division as the Dividing Person if, excluding transfers made pursuant immediately upon the consummation of the Division, the assets of the applicable Dividing Person are held by one or more Subsidiaries at such time, or, with respect to assets not so held by one or more Subsidiaries, such Division, in the aggregate, would otherwise result in a Disposition permitted by Section 6.4(a)(iv)6.4(a)(viii) or (x) above; and (xiv) any sale, transfer, assignment, disposition, abandonment or lapse of Intellectual Property that is no longer commercially practicable, usable or desirable in the conduct of business, in the ordinary course of business; provided that (A) with respect to clauses (i)(A), (ii), (iii), (vi) and (vii) above, at least 75% of the consideration received therefor by the Credit Parties or any such Subsidiary shall be in the form of cash or Cash Equivalents, (B) after giving effect to any Asset Disposition pursuant to clause clauses (viiviii) and (xi) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereofhereof (provided that for purposes of this Section 6.4(a) the applicable Consolidated Net Leverage Ratio shall be 4.50 to 1.00 for any fiscal quarter), recalculated for the most recently ended month for which information is available, and (CB) with respect to clauses (iv), (v), (vi), (viii) and (viixi) above, no Default or Event of Default shall exist or shall result therefrom; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lender, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business, or (ii) enter into consummate any transaction of merger merger, Division as the Dividing Person or consolidation, except for (A) Investments or acquisitions (including pursuant to a Division) permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger merger, Division or consolidation is the surviving entity, (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower is a party thereto, the Borrower will be the surviving corporation, and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit PartyParty and (D) any Credit Party or any Subsidiary may consummate a Division as the Dividing Person if, immediately upon the consummation of the Division, (x) the assets of the applicable Dividing Person are held by a Credit Party or one or more Subsidiaries at such time or, (y) with respect to assets not held by a Credit Party or one or more Subsidiaries, such Division, in the aggregate, would otherwise be permitted by this Section 6.4 (without reliance on this subclause (D)) and/or Section 6.5.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties Borrower will not, nor will they it permit any Subsidiary of its Subsidiaries to,: (a) except in connection with a disposition of assets permitted by the terms of subsection (c) below, dissolve, liquidate or wind up its their affairs, or sell, transfer, lease or otherwise dispose of its property or assets or agree to do so at a future time, except the following, without duplication, shall be expressly permitted: (A) the sale, transfer, lease or other disposition of inventory and materials in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cash; (iib) Extraordinary Receipts for which such enter into any transaction of merger or consolidation; provided, however, that, so long as no Default or Event of Default would be directly or indirectly caused as a result thereof, any Credit Party (other than the Borrower) may merge or such Subsidiary has received consolidate with any cash insurance proceeds or condemnation or expropriation award with respect to such property or assets to other Credit Party (other than the extent Net Cash Proceeds from such Extraordinary Receipt are used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(viiBorrower); (iiic) the salesell, lease, transfer or otherwise dispose of any Property of the Borrower and its Subsidiaries other than (i) the sale or disposition of machinery, parts machinery and equipment no longer used or useful in the conduct of the business of the Credit Parties or any of their Subsidiaries; (iv) (A) the sale, lease or transfer of property or assets from one Credit Party to another Credit Partysuch Person's business, (Bii) other sales of assets (but not accounts receivable, except delinquent accounts sold for collection purposes only), provided that, after giving effect to such sale or other disposition, the sale, lease aggregate book value of assets sold or transfer otherwise disposed of property or assets from a Subsidiary pursuant to a Credit Party and this clause (Cii) the sale, lease or transfer of property or assets from a Subsidiary that is does not a Credit Party to another Subsidiary that is not a Credit Party; (v) the termination of any Hedging Agreement; (vi) the Hawthorne Asset Disposition; and (vii) the sale, lease or transfer of property or assets not to exceed $10,000,000 in the aggregate 500,000 in any fiscal year, excluding transfers made pursuant year and (iii) the grant of any option or other right to Section 6.4(a)(iv); provided purchase any asset in a transaction that (A) with respect to clauses (i)(A), would be permitted under the provisions of the foregoing clause (ii), (iii), (vi) and (vii) above, at least 75% of the consideration received therefor by the Credit Parties or any such Subsidiary shall be in the form of cash or Cash Equivalents, (B) after giving effect to any Asset Disposition pursuant to clause (vii) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is available, and (C) with respect to clauses (iv), (v), (vi) and (vii) above, provided that no Default or Event of Default shall exist has occurred and is continuing at the time of such grant; (d) acquire all or shall result therefrom; provided, further, that with respect to sales any portion of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent capital stock or securities of any Lender, to release its Liens relating to the particular assets sold; or (b) (i) other Person or purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) all or any portion of the property or assets Property of any other Person, other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business, or (ii) enter into any transaction of merger or consolidation, except for (A) Investments any merger or acquisitions consolidation permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger 8.4(b); or (e) become a general partner in any general or consolidation is the surviving entitylimited partnership, (B) (y) the merger joint venture or consolidation similar arrangement. Upon a sale of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation any Property of a Credit Party with and into another Credit Party; provided that if the Borrower is a party theretopermitted by Section 8.4(c), the Borrower will be Agent shall (to the surviving corporationextent applicable) deliver to the Credit Parties, upon the Credit Parties' request and at the Credit Parties' expense, such documentation as is reasonably necessary to evidence the release of the Agent's security interest, if any, in such Property, including, without limitation, amendments or terminations of UCC financing statements, if any, the return of stock certificates, if any, and (C) the merger or consolidation release of a Subsidiary that is not a such Credit Party with and into another Subsidiary that is not a from all of its obligations, if any, under the Credit PartyDocuments.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties will not, nor will they permit any Subsidiary to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets or agree to do so at a future time, except the following, without duplication, shall be expressly permitted: (A) the sale, transfer, lease or other disposition of inventory and materials in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cash; (ii) Extraordinary Receipts for which such Credit Party or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt are used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii)Recovery Events; (iii) the sale, lease, transfer or other disposition of machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties or any of their SubsidiariesSubsidiaries or where machinery, parts and equipment shall be replaced by other machinery, parts and equipment; (iv) (A) the sale, lease or transfer of property or assets from one Credit Party to another Credit Party, (Bat fair value) between the Borrower and any Guarantor; (v) the sale, lease or transfer of property or assets from a Credit Party other than the Borrower to another Credit Party; (vi) the licenses of Intellectual Property rights in the ordinary course of business; (vii) the termination of any Hedging Agreement permitted pursuant to Section 6.1; (viii) the ESI Sale; provided that at the time of such sale (A) no Default or Event of Default has occurred and is continuing and no Default or Event of Default would result therefrom and (B) such sale is for fair market value as determined by the board of directors of the Borrower; (ix) the consolidation, liquidation or merger of a Credit Party into another Credit Party or any Subsidiary into a Credit Party; provided, that (A) prior to a or simultaneously with any such consolidation, liquidation or merger, all actions required by the Administrative Agent shall be taken to ensure the continued perfection and priority of the Administrative Agent’s Liens on the property and assets of each such Credit Party and (CB) if such consolidation, liquidation or merger involves the Borrower, the Borrower shall be the surviving entity; (x) the saledissolution, lease liquidation or transfer winding up of property or assets from a Subsidiary that is not a Credit Party Party; provided that prior to another or simultaneously with any such dissolution, liquidation or winding up, all assets of such Subsidiary that is not are transferred to a Credit PartyParty or a Subsidiary thereof; (vxi) the termination liquidation of any Hedging Agreement; (vi) the Hawthorne Asset Dispositioninactive or dormant Subsidiary; and (viixii) the sale, lease or transfer of property or assets not to exceed $10,000,000 2,000,000 in the aggregate in any fiscal year, excluding transfers made pursuant to Section 6.4(a)(iv); . provided that (A) with respect to clauses (i)(A), (ii), (iii), (vi) and (viivi) above, at least 75% of the consideration received therefor by the Credit Parties or any such Subsidiary shall be in the form of cash or Cash Equivalents, (B) after giving effect to any Asset Disposition pursuant to clause (viivi) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is available, and (C) with respect to clauses (iv), (v), (vi) and (viivi) above, no Default or Event of Default shall exist or shall result therefrom; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lenderthe Required Lenders, to release its Liens relating to the particular assets soldsold and, in the case of a Guarantor which is the subject of the asset sale, to release it from its Guaranty; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of Intellectual Property, inventory, materials, property and equipment in the ordinary course of business, or (ii) enter into any transaction of merger or consolidation, except for (A) Investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity, and (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower is a party thereto, the Borrower will be the surviving corporation, and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit PartyPerson.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Each of the Credit Parties will not, nor will they it permit any Subsidiary to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets or agree to do so at a future time, time except the following, without duplication, shall be expressly permitted: (Ai) the sale, transfer, lease or other disposition of inventory (whether current, obsolete or excess) and materials in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cashbusiness; (ii) Extraordinary Receipts for which such Credit Party the sale, transfer or such Subsidiary has received any other disposition of cash insurance proceeds or condemnation or expropriation award with respect to such and Cash Equivalents; (A) the disposition of property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt are used to make mandatory prepayments as a direct result of a Recovery Event or otherwise used pursuant to Section 2.7(b)(vii); (iiiB) the sale, lease, transfer or other disposition of machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties Borrower or any of their its Subsidiaries, so long as the net proceeds therefrom are used to replace such machinery, parts and equipment or to purchase or otherwise acquire new assets or property within 180 days of receipt of the net proceeds; (iv) (A) the sale, lease or transfer of property or assets from one between Credit Party to another Credit Party, (B) the sale, lease or transfer of property or assets from a Subsidiary to a Credit Party and (C) the sale, lease or transfer of property or assets from a Subsidiary that is not a Credit Party to another Subsidiary that is not a Credit PartyParties; (v) the termination any sale of any Hedging AgreementTransferred Assets by such Person to a Receivables Financier in connection with a Permitted Receivables Financing; (vi) the Hawthorne Asset Dispositionsale of assets attributable to the Borrower's (A) Argentinean operations and (B) Armour food business; and (vii) the sale, lease or transfer of property or assets not to exceed $10,000,000 20,000,000 in the aggregate in any fiscal year; provided, excluding transfers made pursuant to Section 6.4(a)(iv); provided that (A) with respect to that, in the case of clauses (i)(A), (ii), (iii), (vi) and (vii) above, at least 75% of the consideration received therefor by the Credit Parties Borrower or any such Subsidiary shall be is in the form of cash or Cash Equivalents, (B) after giving effect to any Asset Disposition pursuant to clause (vii) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is available, and (C) with respect to clauses (iv), (v), (vi) and (vii) above, no Default or Event of Default shall exist or shall result therefrom; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lender, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, Person (other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business, except as otherwise limited or prohibited herein) or (ii) enter into any transaction of merger or consolidation, except for (A) Investments investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity7.5, and (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower is a party thereto, the Borrower will be the surviving corporation, and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit Party.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties will not, nor will they permit any Subsidiary to, (a) dissolve, dissolve or liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets or agree to do so at a future timetime (other than agreements to dispose of property or assets with a fair market value less than $1,000,000 individually or $5,000,000 in the aggregate during the term of this Agreement), except the following, without duplication, shall be expressly permitted: (i) (A) the sale, transfer, lease lease, sublease or other disposition of inventory and materials property in the ordinary course of business and business; (B) the conversion of cash into Cash Equivalents and of Cash Equivalents into cashcash and (C) (1) the licensing out of intellectual property and other rights and (2) the sale, transfer, licensing or other disposition of Off-Shore Rights to an International Holding Company; (ii) Extraordinary Receipts Recovery Events for which such Credit Party or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt are used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii)assets; (iii) the sale, lease, sublease, transfer or other disposition of property, machinery, parts and equipment and other goods no longer used or useful in in, or consistent with the Borrower’s plans for, the conduct of the business of the Credit Parties or any of their Subsidiaries; (iv) (A) the sale, lease or transfer of property or assets from the Borrower or any Subsidiary to a Credit Party or from one Credit Party to another Credit Party, (B) the sale, lease Party or transfer of property or assets from a Subsidiary to a Credit Party and (C) the sale, lease or transfer of property or assets from a any Subsidiary that is not a Credit Party to another any other Subsidiary that is not a Credit Party; (v) the termination of any Hedging Agreement; (vi) the Hawthorne Asset Dispositionsale of Investments held in securities accounts; (vii) the liquidation or dissolution of any Subsidiary that is not a Credit Party if the assets of such Subsidiary are transferred to a Credit Party after the repayment of all Indebtedness and other obligations of such Subsidiary upon liquidation or dissolution; (viii) the disposition of any property or assets for purposes of making a Permitted Investment; and (viiix) the sale, lease or transfer of property or assets not to exceed (A) $10,000,000 50,000,000 in net cash proceeds in the aggregate during any Fiscal Year and (B) $100,000,000 in any fiscal year, excluding transfers made pursuant to Section 6.4(a)(iv)net cash proceeds in the aggregate during the term of the Agreement; provided that (A) with respect to clauses (i)(A), (ii), (iii), (vi) and (viiix) above, except for transactions involving assets with a fair market value (as determined by a Responsible Officer) not exceeding $2,000,000 in any fiscal year, at least 75% of the consideration received therefor by the Credit Parties or any such Subsidiary shall be in the form of cash or Cash Equivalents, (B) after giving effect to any Asset Disposition pursuant to clause (viiix) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month quarter for which information is available, and (C) with respect to clauses (iv), (v), (vi) and (vii) above, no Default or Event of Default shall exist or shall result therefrom; provided, further, that with respect to sales dispositions of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lender, to release its Liens relating to the particular assets soldsubject to such disposition; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) all or substantially all of the property or assets of any Person, other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business, or (ii) enter into any transaction of merger or consolidation, except for (A) in connection with Investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entityentity or the surviving entity will become a Credit Party concurrently with effectiveness of the merger or consolidation, (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower is a party thereto, the Borrower will be the surviving corporation, and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit PartyParty and (D) any merger or consolidation, the purpose or effect of which is to effect, all or in part, a disposition permitted pursuant to Section 6.4(a) or an Investment permitted pursuant to Section 6.5.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties Parent will not, nor will they it permit any Subsidiary to, (a) dissolveexcept as provided in Section 6.4(d) below, liquidate enter into any transaction of merger or consolidation or amalgamation, or liquidate, wind up its affairsor dissolve itself (or suffer any liquidation or dissolution); (b) acquire any business or assets from, or sellCapital Stock of, transferor be a party to any acquisition of, lease or otherwise dispose of its property or assets or agree to do so at a future time, except the following, without duplication, shall be expressly permittedany Person except: (Ai) the sale, transfer, lease or other disposition for purchases of inventory and materials other assets to be sold or used in the ordinary course of business; and (ii) Investments permitted under Section 6.5 hereof; (c) convey, sell, lease, transfer or otherwise dispose of, in one transaction or a series of transactions, any part of its business or assets, whether now owned or hereafter acquired (including, without limitation, receivables and leasehold interests), but excluding: (Bi) the conversion of cash into Cash Equivalents and Cash Equivalents into cashany Excluded Disposition; (ii) Extraordinary Receipts for which such Credit Party obsolete or such Subsidiary has received any cash insurance proceeds worn-out Property, tools or condemnation or expropriation award with respect to such property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt are used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii); (iii) the sale, lease, transfer or other disposition of machinery, parts and equipment no longer used or useful in the conduct of the its business of the Credit Parties (other than any Excluded Disposition) or any of their Subsidiariesreal Property no longer used or useful in its business; (iviii) (A) the any sale, lease or transfer of property or assets from one a Credit Party to another Credit Party, (B) the sale, lease or transfer of property or assets from a Subsidiary to a Credit Party and (C) the sale, lease or transfer of property or assets from a Subsidiary that is not a Credit Party to another Subsidiary that is not a Credit Party; (v) the termination of any Hedging Agreement; (vi) the Hawthorne Asset Disposition; and (viiiv) the sale, lease or transfer of property or other assets not to exceed $10,000,000 in provided that the aggregate current market value of all assets so sold or transferred (in each case determined at the time of such sale or transfer) shall not at any fiscal yeartime exceed, excluding transfers made when added to the assets sold or transferred pursuant to Section 6.4(a)(iv); provided that (A) with respect to clauses (i)(A)6.12 hereof, (ii), (iii), (vi) and (vii) above, at least 7510% of the consideration received therefor by current market value of the Credit Parties or any such Subsidiary shall be in total assets of the form of cash or Cash Equivalents, (B) Parent and its Subsidiaries and immediately after giving effect to any Asset Disposition pursuant to clause (vii) abovesuch transaction, the Credit Parties Parent and its Subsidiaries shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is available, hereof on a Pro Forma Basis and (C) with respect both before and after giving effect to clauses (iv), (v), (vi) and (vii) abovesuch transaction, no Default or Event of Default shall exist or shall result therefromhave occurred and be continuing; provided, further, that in each case with respect to sales subsection (iv) above at least 85% of assets permitted hereunder only, the Administrative Agent shall be entitled, without consideration received therefor by the consent Parent or any such Subsidiary is in the form of any Lender, to release its Liens relating to the particular assets soldcash or Cash Equivalents; orand (bd) Notwithstanding the foregoing provisions of this Section 6.4, so long as no Default or Event of Default shall have occurred and be continuing, and after giving effect to any of the succeeding transactions, no Default or Event of Default would exist hereunder: (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business, or (ii) enter into any transaction of merger or consolidation, except for (A) Investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party may be merged or consolidated with or into another Credit Party; provided, that, subject to clause (D) immediately below, if one of the parties to such merger or consolidation is the Borrower, the Borrower shall be the continuing or surviving entitycorporation, (B) any Subsidiary may be merged or consolidated with or into another Credit Party so long as the surviving party is either (x) a Credit Party or (y) an Additional Credit Party; provided, that, subject to clause (D) immediately below, if one of the parties to such merger or consolidation is the Borrower, the Borrower shall be the continuing or surviving corporation, (C) any of a the Parent or any Subsidiary may merge or consolidate with or into any Person that is not a Credit Party, provided that the applicable conditions set forth in Section 6.4(b) regarding acquisitions are complied with in connection with any such acquisition by merger, the Parent or any such Subsidiary shall be the continuing or surviving corporation and immediately after giving effect to such transaction, the Parent and its Subsidiaries shall be in compliance with the financial covenants set forth in Section 5.9 hereof on a Pro Forma Basis and (D) the Borrower may merge or consolidate with or into any Credit Party or with any Person wholly-owned and into controlled by a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; , provided that if the Borrower is a party theretonot the continuing or surviving entity, the surviving entity shall have assumed all obligations of the Borrower will under the Credit Documents and immediately after giving effect to such transaction, the Parent and its Subsidiaries shall be in compliance with the surviving corporationfinancial covenants set forth in Section 5.9 hereof on a Pro Forma Basis and the ownership of the properties and assets of the Credit Parties as a whole shall remain unchanged; and (ii) any Subsidiary of the Parent (other than, and if the Parent is no longer the Borrower, the Borrower) may sell, lease, transfer or otherwise dispose of any or all of its assets (Cupon voluntary liquidation or otherwise) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a to any Credit Party. The Borrower shall provide the Administrative Agent with prior written notice of any transaction described in this Section 6.4(d) and take such other action as may be required pursuant to the terms of Section 5.12.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Each of the Credit Parties will not, nor will they it permit any Subsidiary to,: (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease to a third party or otherwise dispose of its property or assets or agree to do so at a future time, time except the following, without duplication, shall be expressly permitted: (Ai) the sale, transfer, lease or other disposition of inventory and materials in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cashSpecified Sales; (ii) Extraordinary Receipts for which such Credit Party or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such property or assets Sale Leaseback Transactions to the extent Net Cash Proceeds from such Extraordinary Receipt are used to make mandatory prepayments or otherwise used pursuant to permitted under Section 2.7(b)(vii)6.12; (iii) the disposition of property or assets as a result of a Recovery Event; (iv) the sale, lease, transfer or other disposition of (A) machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties Borrower or any of their Subsidiariesits Subsidiaries and (B) property and assets located at or used in connection with, or which are otherwise associated with, restaurants that are not material to the business of any Credit Party; (iv) (Av) the sale, lease or transfer of property or assets between Credit Parties, so long as the Liens of the Administrative Agent with respect to such property or assets remain in full force and effect and fully perfected after giving effect to such transaction; (vi) the dissolution, liquidation or winding up of a Liquor License Subsidiary or any sale, transfer or other disposition of assets from one a Liquor License Subsidiary to a Credit Party to or another Credit Party, Liquor License Subsidiary; (Bvii) the sale, lease or transfer of property or assets from a Subsidiary to a Credit Party and (C) the saleproperties set forth on Schedule 2.8(b)(ii), lease or transfer of property or assets from a Subsidiary that is not a Credit Party to another Subsidiary that is not a Credit Party; (v) the termination of any Hedging Agreement; (vi) the Hawthorne Asset Disposition; and (viiviii) the sale, lease or transfer of property or assets not to exceed $10,000,000 2,000,000 in the aggregate in any fiscal yearyear and $10,000,000 in the aggregate during the term of this Agreement; provided, excluding transfers made pursuant that in each case (other than with respect to Section 6.4(a)(iv); provided that clause (v) above and dispositions of assets of a restaurant in connection with a refinishing, refurnishing or upgrade of such restaurant for consideration less than $100,000 in the aggregate per restaurant) (A) with respect to clauses (i)(A), (ii), (iii), (vi) and (vii) above, at least 75% of the consideration received therefor by the any Credit Parties Party or any such Subsidiary shall be in the form of cash or Cash Equivalents, (B) after giving effect to any Asset Disposition pursuant to clause the sale, lease, transfer or other disposition of such property or assets and the repayment of Indebtedness (viiif any) abovewith the proceeds thereof, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is availablehereof and shall be in compliance with all other terms and conditions of this Agreement, and (C) with respect to clauses (iv), (v), (vi) and (vii) above, no Default or Event of Default shall exist or shall result therefromfrom such sale, lease, transfer or other disposition of property or assets; provided, further, that with respect to sales any sale or transfer of property or assets permitted hereunder onlyto an unrelated third party, the Administrative Agent shall be entitled, without the consent of any Lenderthe Lenders or the Required Lenders, to release its Liens relating to the particular property or assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) all or substantially all of the property or assets or a majority of the Voting Stock of any Person, Person (other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, goods, materials, property and equipment in the ordinary course of business, except as otherwise limited or prohibited herein) or (ii) enter into any transaction of merger or consolidation, except for (A) Investments Permitted Acquisitions, (B) investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity6.6, (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (zC) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower is a party thereto, the Borrower will be the surviving corporation, and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit Party.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties will not, nor will they permit any Subsidiary to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets or agree to do so at a future time, except the following, without duplication, shall be expressly permitted: (A) the sale, transfer, lease or other disposition of inventory and materials in the ordinary course of business and (B) the conversion of cash into Cash Equivalents Corporate Investment Policy Investments and Cash Equivalents Corporate Investment Policy Investments into cash; (ii) Extraordinary Receipts for which such Credit Party or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt are used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii)Recovery Events; (iii) the sale, lease, transfer or other disposition of machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties or any of their Subsidiaries; (iv) the sale, lease, transfer or other disposition of property or assets (at fair value) (A) between US Credit Parties, (B) between Foreign Credit Parties and (C) between Foreign Subsidiaries (other than Foreign Credit Parties); provided that in no event shall a Credit Party sell, transfer or otherwise dispose of any Intellectual Property to a Person that is not a Credit Party, except that the Foreign Borrowers may license such Intellectual Property in the ordinary course of business, without the prior written consent of the Administrative Agent; (v) the dissolution or winding up of any Subsidiary of the Company that is not a Credit Party; provided, that the assets of any such Subsidiary shall be transferred to another Subsidiary of the Company; (vi) [Intentionally Omitted] (vii) [Intentionally Omitted] (viii) the dissolution or winding up of any Credit Party (other than a Borrower); provided, that the assets of any such Credit Party shall be transferred to another Credit Party; (A) the sale, lease sale or transfer issuance of property or assets from one Credit Party to another the Capital Stock of a Foreign Subsidiary (other than a Credit Party) of the Company to any Subsidiary of the Company to the extent not otherwise prohibited under this Credit Agreement or any of the other Credit Documents, (B) the sale, lease sale or transfer issuance of property or assets from the Capital Stock of a Subsidiary US Credit Party (other than the Company) to a another US Credit Party and (C) the sale, lease sale or transfer issuance of property or assets from the Capital Stock of a Subsidiary that is not a Foreign Credit Party to another Subsidiary that is not a Credit Party; (vx) the termination merger or consolidation of any Hedging Agreementa Subsidiary of the Company (other than a Borrower) into another Subsidiary of the Company; provided that if either Subsidiary is a Credit Party, the continuing or surviving Person shall be a Credit Party; (vixi) the Hawthorne Asset Dispositionmerger or consolidation of any Subsidiary into the Company; andprovided that the Company shall be the continuing or surviving entity; (viixii) transactions permitted pursuant to Sections 6.1, 6.5 and 9.21 to the extent not already permitted pursuant to this Section 6.4(a); (xiii) the sale, lease or transfer of property or assets not to exceed $10,000,000 500,000 in the aggregate in any fiscal year, excluding transfers made pursuant ; and (xiv) the sale of any Foreign Subsidiary (not including any Foreign Credit Party) which the Company has demonstrated to Section 6.4(a)(iv); the reasonable satisfaction of the Administrative Agent has less than $10,000,000 in total annual revenue. provided that (A) with respect to clauses (i)(A), clause (ii), (iii), (vi) and (vii) above, at least 75% of the consideration received therefor by the Credit Parties or any such Subsidiary shall be in the form of cash or Cash Equivalents, (B) after giving effect to any Asset Disposition pursuant to clause (vii) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is availableCorporate Investment Policy Investments, and (CB) with respect to clauses clause (iv), (v), (vi) and (vii) above, no Default or Event of Default shall exist or shall result therefrom; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitledshall, without the consent of any Lenderthe Required Lenders, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases purchases, leases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business, or (ii) enter into any transaction of merger or consolidation, except for (A) Permitted Acquisitions and Investments or acquisitions permitted pursuant to Section Sections 6.4(a) and 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity, and (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower Company is a party thereto, the Borrower Company will be the surviving corporation, and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit Party.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties will not, nor will they permit any Subsidiary to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets or agree to do so at a future time, except the following, without duplication, shall be expressly permitted: (A) the sale, transfer, lease or other disposition of inventory and materials in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cash; (ii) Dispositions resulting in Extraordinary Receipts for which such Credit Party or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt are used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii)assets; (iii) the sale, lease, transfer or other disposition of machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties or any of their Subsidiaries; (iv) (A) the sale, lease or transfer of property or assets from one Credit Party to another Credit Party, (B) the sale, lease or transfer of property or assets from a Subsidiary to a Credit Party and Party, (C) the sale, lease or transfer of property or assets from a Subsidiary that is not a Credit Party to another Subsidiary that is not a Credit Party, (D) the dissolution of any Credit Party to the extent any and all assets of such Credit Party at the time of such dissolution are distributed to another Credit Party, (E) the dissolution of a Subsidiary that is not a Credit Party to the extent any and all assets of such Subsidiary at the time of such dissolution are distributed to another Subsidiary; (v) the termination of any Hedging Agreement; (vi) the Hawthorne Asset Disposition; and (vii) the sale, lease or transfer of property or assets not to exceed $10,000,000 in the aggregate greater of, in any fiscal year, (i) $50,000,000 and (ii) 7.5% of Consolidated Total Tangible Assets, excluding transfers made pursuant to Sections 6.4(a)(iv) and (ix); (vii) the dissolution, liquidation or winding up of the affairs of, or the sale, transfer, lease or other disposition of the property or assets of, any Subsidiary in connection with the Permitted Reorganization; (viii) sale leaseback transactions to the extent permitted pursuant to Section 6.4(a)(iv)6.12; and (ix) the sale, transfer, lease or other disposition of any Subsidiary of the Borrower or any line of business following the Sixth Amendment Effective Date; provided, that the Credit Parties shall demonstrate to the reasonable satisfaction of the Administrative Agent that, (a) after giving effect to such disposition on a Pro Forma Basis, the Consolidated Secured Net Leverage Ratio shall be less than or equal to the Consolidated Secured Net Leverage Ratio immediately prior to giving effect to such disposition on a Pro Forma Basis and (b) the assets that comprise such disposition do not exceed 20% of the assets of the Borrower and its Subsidiaries on a Consolidated basis determined as of the last day of the most recently ended fiscal quarter of the Borrower; provided that (A) with respect to clauses (i)(A), (ii), (iii), (vi) and (viiviii) above, at least 75% of the consideration received therefor by the Credit Parties or any such Subsidiary shall be in the form of cash or Cash Equivalents, (B) after giving effect to any Asset Disposition disposition pursuant to clause (viivi) or (ix) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is available, and (C) with respect to clauses (iv), (v), (vi), (viii) and (viiix) above, no Default or Event of Default shall exist or shall result therefrom; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lender, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business, or (ii) enter into any transaction of merger or consolidation, except for (A) Investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity, (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower is a party thereto, the Borrower will be the surviving corporation, and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit Party. For avoidance of doubt, an issuance by the Borrower of its Equity Interests shall not be prohibited by this Section 6.4.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties will not, Neither the Borrower nor will they permit any Subsidiary to,of its Subsidiaries shall: (a) dissolveEnter into a transaction of merger or consolidation, liquidate except (i) a member of the Consolidated Group may be a party to a transaction of merger or wind up consolidation with another member of the Consolidated Group and (ii) any acquisition permitted pursuant to clause (c) immediately below may be effected by a merger with and into a Credit Party or Subsidiary of a Credit Party so long as, in either case, (A) if the Borrower is a party thereto, (x) the Borrower shall be the surviving corporation and (y) the Borrower shall not alter or amend its affairsexisting capital structure in a manner changing its status as an employee-owned corporation, (B) if a Subsidiary Guarantor is a party thereto and the Borrower is not a party thereto, the Subsidiary Guarantor shall be the surviving corporation, and (C) no Default or sellEvent of Default shall exist either immediately prior to or immediately after giving effect thereto; (b) Sell, transferlease, lease transfer or otherwise dispose of its assets, property or assets or agree to do so at a future timeand/or operations (including any sale-leaseback transaction, except the following, without duplication, shall be expressly permitted: but excluding (Ax) the sale, transfer, lease or other disposition sale of inventory and materials in the ordinary course of business; (y) the sale or disposition of plant, property and equipment which is no longer useful in the business or as to which the proceeds therefrom are reinvested in plant, property and equipment within six months thereof; and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cash; (ii) Extraordinary Receipts for which such Credit Party or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt are used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii); (iiiz) the sale, lease, transfer or other disposition of machinerythe Wystar record keeping software system), parts and equipment no longer used or useful unless (i) the book value of such assets, property and/or operations do not in the conduct aggregate exceed $5,000,000 in any fiscal year, and (ii) no Default of Event of Default exists or would exist after giving effect thereto on a Pro Forma Basis, without the prior written consent of the business of the Credit Parties or any of their SubsidiariesMajority Banks; (ivc) Acquire all or any portion of the capital stock or other ownership interest in any Person or all or any substantial portion of the assets, property and/or operations of any Person or make any Investment in any Subsidiary, without the prior written consent of the Majority Banks, unless (i) the amount of any such acquisition or Investment, together with any other acquisitions or Investments made pursuant to this subsection (c) shall not exceed the sum of (A) the sale, lease or transfer of property or assets from one Credit Party to another Credit Party, (B) the sale, lease or transfer of property or assets from a Subsidiary to a Credit Party and (C) the sale, lease or transfer of property or assets from a Subsidiary that is not a Credit Party to another Subsidiary that is not a Credit Party; (v) the termination of any Hedging Agreement; (vi) the Hawthorne Asset Disposition; and (vii) the sale, lease or transfer of property or assets not to exceed $10,000,000 in the aggregate in any fiscal year, excluding transfers made pursuant to Section 6.4(a)(iv); provided that (A) with respect to clauses (i)(A), (ii), (iii), (vi) and (vii) above, at least 75% of the consideration received therefor by the Credit Parties or any such Subsidiary shall be in the form of cash or Cash Equivalents, year plus (B) after giving effect to the amount of any Asset Disposition pursuant to clause payment due in such fiscal year in connection with the KPMG Acquisition (vii) aboveof which sum, not more than $10,000,000 may be paid in cash in such fiscal year); provided, however, that the total amount of any such acquisition or Investment in any one Person or any one Subsidiary shall not exceed $20,000,000 in the aggregate at any one time; and provided, further, that, notwithstanding the foregoing, the Credit Parties shall be total amount paid in compliance on a Pro Forma Basis connection with the financial covenants set forth in Section 5.9 hereof, recalculated for KPMG Acquisition shall not exceed $16,000,000; (ii) the most recently ended month for Board of Directors of the Person which information is available, and the subject of the acquisition shall have approved the acquisition; and (Ciii) with respect to clauses (iv), (v), (vi) and (vii) above, no Default or Event of Default shall would exist or shall result therefrom; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lender, to release its Liens relating to the particular assets soldafter giving effect thereto on a Pro Forma Basis; or (bd) (i) purchase, lease or otherwise acquire (in a single transaction or a series In the case of related transactions) the property or assets of Borrower and any Person, other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business, or (ii) enter into any transaction of merger or consolidation, except for (A) Investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity, (B) (y) the merger or consolidation of a Material Subsidiary that which is not a Credit Party with and into a Credit Party; provided that wholly-owned, liquidate, wind-up or dissolve, whether voluntarily or involuntarily (or suffer to permit any such Credit Party will be the surviving entity and (z) the merger liquidation or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower is a party thereto, the Borrower will be the surviving corporation, and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit Partydissolution).

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties will not, nor will they permit any Subsidiary to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets or agree to do so at a future time, except the following, without duplication, shall be expressly permitted: (A) the sale, transfer, lease or other disposition of inventory and materials in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cash; (ii) Extraordinary Receipts for which such Credit Party or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt are used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii2.7(b)(vi); (iii) the sale, lease, transfer or other disposition of machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties or any of their Subsidiaries; (iv) (A) the sale, lease or transfer of property or assets from one Credit Party to another Credit Party, (B) the sale, lease or transfer of property or assets from a Subsidiary to a Credit Party and (C) the sale, lease or transfer of property or assets from a Subsidiary that is not a Credit Party to another Subsidiary that is not a Credit Party; (v) the termination of any Hedging Agreement; (vi) the Hawthorne Asset Disposition; and (viivi) the sale, lease or transfer of property or assets not to exceed $10,000,000 1,000,000 in the aggregate in any fiscal year, excluding transfers made pursuant to Section 6.4(a)(iv); provided that (A) with respect to clauses (i)(A), (ii), (iii), (vi) and (viivi) above, at least 75% of the consideration received therefor by the Credit Parties or any such Subsidiary shall be in the form of cash or Cash Equivalents, (B) after giving effect to any Asset Disposition pursuant to clause (viivi) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is available, and (C) with respect to clauses (iv), (v), (vi) and (viivi) above, no Default or Event of Default shall exist or shall result therefrom; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lender, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business, or (ii) enter into any transaction of merger or consolidation, except for (A) Investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity, (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower is a party thereto, the Borrower will be the surviving corporation, and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit Party.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties will not, nor will they permit any Subsidiary to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets or agree to do so at (each a future time“Disposition”), except the following, without duplication, shall be expressly permitted: (A) the sale, transfer, lease or other disposition of inventory and materials in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cash, and the use of cash and Cash Equivalents in the ordinary course of business; (ii) Extraordinary Receipts for which such Credit Party the sale, transfer or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such other disposition of property or assets to an unrelated party not in the ordinary course of business where and to the extent Net Cash Proceeds from such Extraordinary Receipt that they are used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii)the result of a Recovery Event; (iii) the sale, lease, transfer or other disposition of machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties or any of their Subsidiaries; (iv) (A) the sale, lease or transfer of property or assets from one Credit Party to another Credit Party, (B) the sale, lease Party or transfer dissolution of property or assets from a Subsidiary to a any Credit Party (other than any Borrower) to the extent any and (C) the sale, lease or transfer all assets of property or assets from a Subsidiary that is not a such Credit Party are distributed to another Subsidiary that is not a Credit Party; (v) the termination of any Hedging Agreement; (vi) the Hawthorne Asset DispositionBank Product; and (viivi) the sale, lease or transfer of property or assets not to exceed $10,000,000 1,000,000 in the aggregate in any fiscal year, excluding transfers made pursuant to Section 6.4(a)(iv); provided that (A) with respect to clauses (i)(A), (ii), (iii), clause (vi) and (vii) above, at least 75% of the consideration received therefor by the Credit Parties or any such Subsidiary shall be in the form of cash or Cash Equivalents, (B) after giving effect to any Asset Disposition pursuant to clause (viivi) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month fiscal quarter for which information is available, and (C) with respect to clauses (iv), (v), (vi) and (viivi) above, no Default or Event of Default shall exist or shall result therefromtherefrom and (D) any Disposition pursuant to clauses (i), (iii) and (vi) shall be for fair market value; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lender, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business, or (ii) enter into any transaction of merger or consolidation, except for (A) Investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity, (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the any Borrower is a party thereto, the such Borrower will be the surviving corporation, and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit Party.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties will not, nor will they permit any Subsidiary to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets or agree to do so at a future time, except the following, without duplication, shall be expressly permitted: (A) the sale, transfer, lease or other disposition of inventory and materials in the ordinary course of business and (B) the conversion of cash into Cash Equivalents Corporate Investment Policy Investments and Cash Equivalents Corporate Investment Policy Investments into cash; (ii) Extraordinary Receipts for which such Credit Party or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt are used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii)Recovery Events; (iii) the sale, lease, transfer or other disposition of machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties or any of their Subsidiaries; (iv) the sale, lease, transfer or other disposition of property or assets (at fair value) (A) between US Credit Parties, (B) between Foreign Credit Parties and (C) between Foreign Subsidiaries (other than Foreign Credit Parties); (v) the sale, lease or transfer of property or assets from one Credit Party to another Credit Party, the Polish Property and the Belgian Property; (Bvi) the sale, lease or transfer of property the German Property (including a sale, lease or transfer in connection with a sale-leaseback transaction); (vii) the dissolution or winding up of any Subsidiary of the Company that is not a Credit Party; provided, that the assets from of any such Subsidiary shall be transferred to another Subsidiary of the Company; (viii) the dissolution or winding up of any Credit Party (other than a Borrower); provided, that the assets of any such Credit Party shall be transferred to another Credit Party; (A) the sale or issuance of the Capital Stock of a Foreign Subsidiary (other than a Credit Party) of the Company to any Subsidiary of the Company to the extent not otherwise prohibited under this Credit Agreement or any of the other Credit Documents, (B) the sale or issuance of the Capital Stock of a US Credit Party (other than the Company) to another US Credit Party and (C) the sale, lease sale or transfer issuance of property or assets from the Capital Stock of a Subsidiary that is not a Foreign Credit Party to another Subsidiary that is not a Credit Party; (vx) the termination merger or consolidation of any Hedging Agreementa Subsidiary of the Company (other than a Borrower) into another Subsidiary of the Company; provided that if either Subsidiary is a Credit Party, the continuing or surviving Person shall be a Credit Party; (vixi) the Hawthorne Asset Dispositionmerger or consolidation of any Subsidiary into the Company; provided that the Company shall be the continuing or surviving entity; (xii) transactions permitted pursuant to Sections 6.1, 6.5 and 9.22 to the extent not already permitted pursuant to this Section 6.4(a); and (viixiii) the sale, lease or transfer of property or assets not to exceed $10,000,000 500,000 in the aggregate in any fiscal year, excluding transfers made pursuant to Section 6.4(a)(iv); provided that (A) with respect to clauses (i)(A), (ii), (iii), (vi) and (viixiii) above, at least 75% of the consideration received therefor by the Credit Parties or any such Subsidiary shall be in the form of cash or Cash EquivalentsCorporate Investment Policy Investments, (B) after giving effect to any Asset Disposition pursuant to clause (viivi) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is available, and (C) with respect to clauses (iv), (v), (vi) and (viivi) above, no Default or Event of Default shall exist or shall result therefrom; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lenderthe Required Lenders, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases purchases, leases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business, or (ii) enter into any transaction of merger or consolidation, except for (A) Investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity, and (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower Company is a party thereto, the Borrower Company will be the surviving corporation, and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit Party.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties will not, nor will they permit any Subsidiary to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets or agree to do so at a future time, except the following, without duplication, shall be expressly permitted: (A) the sale, transfer, lease or other disposition of inventory and materials in the ordinary course of business and (B) the conversion of cash into Cash Equivalents Corporate Investment Policy Investments and Cash Equivalents Corporate Investment Policy Investments into cash; (ii) Extraordinary Receipts for which such Credit Party or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt are used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii)Recovery Events; (iii) the sale, lease, transfer or other disposition of machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties or any of their Subsidiaries; (iv) the sale, lease, transfer or other disposition of property or assets (at fair value) (A) between US Credit Parties, (B) between Foreign Credit Parties and (C) between Foreign Subsidiaries (other than Foreign Credit Parties); provided that in no event shall a Credit Party sell, transfer or otherwise dispose of any Intellectual Property to a Person that is not a Credit Party, except that the Foreign Borrower may license such Intellectual Property in the ordinary course of business, without the prior written consent of the Administrative Agent; (v) the dissolution or winding up of any Subsidiary of the Company that is not a Credit Party; provided, that the assets of any such Subsidiary shall be transferred to another Subsidiary of the Company; (vi) the sale, lease or transfer of property or assets from one Credit Party to another Credit Party, the German Property; (Bvii) the sale, lease or transfer of property the Belgian Property; (viii) the dissolution or winding up of any Credit Party (other than a Borrower); provided, that the assets from of any such Credit Party shall be transferred to another Credit Party; (A) the sale or issuance of the Capital Stock of a Foreign Subsidiary (other than a Credit Party) of the Company to any Subsidiary of the Company to the extent not otherwise prohibited under this Credit Agreement or any of the other Credit Documents, (B) the sale or issuance of the Capital Stock of a US Credit Party (other than the Company) to another US Credit Party and (C) the sale, lease sale or transfer issuance of property or assets from the Capital Stock of a Subsidiary that is not a Foreign Credit Party to another Subsidiary that is not a Credit Party; (vx) the termination merger or consolidation of any Hedging Agreementa Subsidiary of the Company (other than a Borrower) into another Subsidiary of the Company; provided that if either Subsidiary is a Credit Party, the continuing or surviving Person shall be a Credit Party; (vixi) the Hawthorne Asset Dispositionmerger or consolidation of any Subsidiary into the Company; andprovided that the Company shall be the continuing or surviving entity; (viixii) transactions permitted pursuant to Sections 6.1, 6.5 and 9.22 to the extent not already permitted pursuant to this Section 6.4(a); (xiii) the sale, lease or transfer of property or assets not to exceed $10,000,000 500,000 in the aggregate in any fiscal year, excluding transfers made pursuant ; and (xiv) the sale of any Foreign Subsidiary (not including any Foreign Credit Party) which the Company has demonstrated to Section 6.4(a)(iv); the reasonable satisfaction of the Administrative Agent has less than $10,000,000 in total annual revenue. provided that (A) with respect to clauses (i)(A), (ii), (iii), (vi) and (viixi) above, at least 75% of the consideration received therefor by the Credit Parties or any such Subsidiary shall be in the form of cash or Cash Equivalents, (B) after giving effect to any Asset Disposition pursuant to clause (vii) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is availableCorporate Investment Policy Investments, and (CB) with respect to clauses clause (iv), (v), (vi) and (vii) above, no Default or Event of Default shall exist or shall result therefrom; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitledshall, without the consent of any Lenderthe Required Lenders, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases purchases, leases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business, or (ii) enter into any transaction of merger or consolidation, except for (A) Investments or acquisitions permitted pursuant to Section Sections 6.4(a) and 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity, and (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower Company is a party thereto, the Borrower Company will be the surviving corporation, and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit Party.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties will not, nor will they permit any Subsidiary to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose Dispose of any of its property or assets in one transaction or agree to do so at a future time, series of related transactions except the following, without duplication, shall be expressly permitted: (Ai) the saleSpecified Sales, transfer, lease or other disposition of inventory Dispositions effectuated by any transaction permitted under clause (b) below and materials in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cashDispositions permitted under Section 8.10; (ii) Extraordinary Receipts for which such Credit Party or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt are used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii); (iii) the sale, lease, transfer or other disposition of machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties or any of their Subsidiaries; (iv) (A) the sale, lease or transfer Disposition of property or assets from one by a Credit Party to another any other Credit PartyParty (including, (B) without limitation, as the saleresult of any dissolution, lease liquidation or transfer wind up of property or assets from a the affairs of any Subsidiary), and by any Subsidiary to a Credit Party and (Csubject to the requirements of Section 8.7); or (iii) the sale, lease or transfer other Dispositions of property or assets from a Subsidiary that is not a Credit Party to another Subsidiary that is not a Credit Party; (v) the termination of any Hedging Agreement; (vi) the Hawthorne Asset Disposition; and (vii) the sale, lease or transfer of property or assets not to exceed $10,000,000 in the aggregate in any fiscal year, excluding transfers made pursuant to Section 6.4(a)(iv); provided that (A) with respect to clauses (i)(A), (ii), (iii), (vi) and (vii) above, at least 75% of the consideration received therefor by the Credit Parties Borrower or any such Subsidiary shall be in the form of cash or Cash Equivalentsthereof; provided, (B) after giving effect to any Asset Disposition pursuant to clause (vii) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is available, and (C) with respect to clauses (iv), (v), (vi) and (vii) above, that no Default or Event of Default shall exist be outstanding immediately prior to or shall result therefromafter giving pro forma effect to the applicable Disposition; provided, further, that with respect to sales that the aggregate book value of all property and assets permitted hereunder onlyDisposed of in any fiscal year shall not exceed 5% of Consolidated Total Assets as determined as of the end of the immediately preceding fiscal year; (the “Disposition Threshold”); provided, further, that, the Administrative Agent shall portion of the Disposition Threshold that is unused in any fiscal year may be entitled, without carried forward to one or more future periods but in no fiscal year may the consent Disposition Threshold exceed 10% of any Lender, to release its Liens relating to the particular assets sold; orConsolidated Total Assets as determined as of the end of the immediately preceding fiscal year. (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) all or any part of the property or assets of any Person, Person other than purchases or other acquisitions of inventory, leases, materials, property, equipment and other assets in the ordinary course of business (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business), or (ii) enter into any transaction of merger or consolidation, except for (Ai) Investments investments or acquisitions permitted pursuant constituting Permitted Investments and, subject to the limitations set forth in Section 6.5 so long as the 8.10, repurchases by any Credit Party subject to such merger or consolidation is the surviving entityof its outstanding capital stock, (B) (yii) the merger or consolidation of a Subsidiary that is not a any Credit Party with and or into a another Credit Party; , provided that in any such Credit Party will case the Borrower (if party thereto) shall be the surviving entity and entity, (ziii) the merger or consolidation of a Credit Party any wholly-owned Subsidiary with and or into another Credit Party; provided that if the Borrower is a party theretoany other wholly-owned Subsidiary, the Borrower will be the surviving corporation, and (Civ) the merger or consolidation of a any wholly-owned Subsidiary that is not a with or into the Borrower or another Credit Party with and into another Subsidiary provided that is not a in any such case the Borrower or such other Credit Party, as applicable, shall be the surviving entity, (v) Permitted Acquisitions; provided, that aggregate consideration for all Permitted Acquisitions consummated during any fiscal year shall not exceed $25,000,000, and (vi) purchases, leases or acquisitions not constituting Permitted Acquisitions or transactions otherwise described in clauses (i) through (v) so long as no Default or Event of Default shall be outstanding immediately prior to or after giving pro forma effect to the applicable purchase, lease or acquisition and the aggregate book value of all property and assets purchased, leased or acquired in any fiscal year pursuant to this clause (vi) shall not exceed 5% of Consolidated Total Assets as determined as of the end of the immediately preceding fiscal year.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties will not, nor will they permit any Restricted Subsidiary to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets or agree to do so at a future time, except the following, without duplication, shall be expressly permitted: (i) any Restricted Subsidiary of the Company (other than Holdco and Opco) may be liquidated, wound up or dissolved, and all or any part of its business, property or assets may be conveyed, sold, leased, transferred or otherwise disposed of (A) to the extent it is a Restricted Subsidiary of Holdco, to any Opco Credit Party and (B) to the extent it is not a Restricted Subsidiary of Holdco, to any Credit Party; (ii) (A) the sale, transfer, lease or other disposition of inventory and materials in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cash; (iiiii) Extraordinary Receipts for which such Credit Party or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt are used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii)Recovery Events; (iiiiv) the sale, lease, transfer or other disposition of machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties or any of their Restricted Subsidiaries; (iv) (A) the sale, lease or transfer of property or assets from one a Credit Party to another Credit Party, Party and (B) the sale, lease or transfer of property or assets from a Subsidiary to a an Opco Credit Party to another Opco Credit Party; (vi) in order to resolve disputes that occur in the ordinary course of business, the Company and its Restricted Subsidiaries may discount or otherwise compromise for less than the face value thereof, notes or accounts receivable; (vii) the Company and its Restricted Subsidiaries may sell or dispose of shares of Capital Stock of any of its Subsidiaries in order to qualify members of the Governing Body of such Subsidiary if required by applicable law; (viii) the grant by the Company or any of its Restricted Subsidiaries in the ordinary course of business of a license to any Person for the use of any Intellectual Property owned by the Company or any of its Restricted Subsidiaries; (ix) the unwinding of any derivative instruments or agreements; (x) the sale or disposition of Investments under clauses (f), (j), (k) and (Cn) of the definition of Permitted Investments (other than Investments received in connection with any Asset Disposition permitted by subsection (xv) below); (xi) the sublease of any real or personal property in the ordinary course of business; (xii) sales, assignments, transfers or dispositions of accounts receivable in the ordinary course of business for purposes of collection; (xiii) the sale of the real property and improvements located at 0 Xxxx Xxxx Xxxx, Xxxxxxxx, Xxxxxxxxxxxxx; (xiv) the sale, lease or transfer of any property or assets from acquired pursuant to a Subsidiary that is not Permitted Acquisition or contributed to a Credit Party to another Subsidiary that is not or an Opco Credit Party by the Company or a Credit Party;Party at any time after the Closing Date; or (vxv) sales of revenue-producing assets (or of all of the outstanding Capital Stock of a Subsidiary (other than Holdco and Opco) that owns such assets): (A) to the extent the Attributable Revenues of all such assets (and Subsidiaries) transferred in all such asset sales during any period of 365 consecutive days does not exceed 16.5% of Pro Forma Revenues for the most recent four fiscal quarter period for which Pro Forma Revenues can then be determined; provided that (1) the termination consideration received for such assets shall be in an amount at least equal to the fair market value thereof and (2) the proceeds of any Hedging Agreement;such asset sales shall be applied as required by subsection 2.9(b)(iii); or (viB) to the extent the Attributable Revenues of all assets (and Subsidiaries) transferred in all such asset sales during any period of 365 consecutive days exceeds 16.5% but does not exceed 33% of Pro Forma Revenues for the most recent four fiscal quarter period for which Pro Forma Revenues can then be determined; provided that (1) the Hawthorne Asset Disposition; and consideration received for such assets shall be in an amount at least equal to the fair market value thereof, (vii2) the saleconsideration received in connection with all asset sales made pursuant to this clause (B), lease or transfer when added to the consideration received in connection with all asset sales made pursuant to clause (A) above, shall be not less than a multiple of property or 8.25 times the Attributable EBITDA of all assets not to exceed $10,000,000 (and Subsidiaries) transferred in all such asset sales in the aggregate in any fiscal year, excluding transfers made pursuant to Section 6.4(a)(ivduring such 365-day period and (45) the proceeds of such asset sales shall be applied as required by subsection 2.9(b)(iii); provided that (A) with respect to clauses (i)(A), (ii), (iii), (vi) and (vii) above, at least 75% of the consideration received therefor by the Credit Parties or any such Subsidiary shall be in the form of cash or Cash Equivalents, (B) after giving effect to any Asset Disposition pursuant to clause (vii) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is available, and (C) with respect to clauses (iv), (v), (vi) and (viixv) above, no Default or Event of Default shall exist or shall result therefrom; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lenderthe Required Lenders, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business, or (ii) enter into any transaction of merger or consolidation, except for (A) Investments or acquisitions permitted pursuant to Section 6.5 so long as 6.5, (B) the Credit Party subject to such merger or consolidation of a Credit Party with and into another Credit Party; provided that if the Company is a party thereto, the Company will be the surviving entity, (B) (yC) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided provided, that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower is a party thereto, the Borrower will be the surviving corporation, and (CD) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another a Subsidiary that is not a Credit Party.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties will not, nor will they permit any Subsidiary to, (a) dissolveexcept as provided in Section 6.4(d) below, liquidate enter into any transaction of merger or consolidation or amalgamation, or liquidate, wind up its affairsor dissolve itself (or suffer any liquidation or dissolution); (b) acquire any business or assets from, or sellCapital Stock of, transferor be a party to any acquisition of, lease or otherwise dispose of its property or assets or agree to do so at a future time, except the following, without duplication, shall be expressly permittedany Person except: (Ai) the sale, transfer, lease or other disposition for purchases of inventory and materials other assets to be sold or used in the ordinary course of business; and (ii) Investments permitted under Section 6.5 hereof; (c) convey, sell, lease, transfer or otherwise dispose of, in one transaction or a series of transactions, any part of its business or assets, whether now owned or hereafter acquired (including, without limitation, receivables and leasehold interests), but excluding: (Bi) the conversion of cash into Cash Equivalents and Cash Equivalents into cashany Excluded Disposition; (ii) Extraordinary Receipts for which such Credit Party obsolete or such Subsidiary has received any cash insurance proceeds worn-out Property, tools or condemnation or expropriation award with respect to such property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt are used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii); (iii) the sale, lease, transfer or other disposition of machinery, parts and equipment no longer used or useful in the conduct of the its business of the Credit Parties (other than any Excluded Disposition) or any of their Subsidiariesreal Property no longer used or useful in its business; (iviii) (A) the any sale, lease or transfer of property or assets from one a Credit Party to another Credit Party, (B) the sale, lease or transfer of property or assets from a Subsidiary to a Credit Party and (C) the sale, lease or transfer of property or assets from a Subsidiary that is not a Credit Party to another Subsidiary that is not a Credit Party; (v) the termination of any Hedging Agreement; (vi) the Hawthorne Asset Disposition; and (viiiv) the sale, lease or transfer of property or other assets not to exceed $10,000,000 in provided that the aggregate current market value of all assets so sold or transferred (in each case determined at the time of such sale or transfer) shall not at any fiscal yeartime exceed, excluding transfers made when added to the assets sold or transferred pursuant to Section 6.4(a)(iv6.12 hereof (without duplication), 25% of the current market value of the total assets of the Parent and its Subsidiaries and immediately after giving effect to such transaction, the Parent and its Subsidiaries shall be in compliance with the financial covenants set forth in Section 5.9 hereof on a Pro Forma Basis and both before and after giving effect to such transaction, no Default or Event of Default shall have occurred and be continuing; provided provided, that (A) in each case with respect to clauses subsection (i)(A), (ii), (iii), (viiv) and (vii) above, above at least 75% of the consideration received therefor by the a Credit Parties Party or any such Subsidiary shall be is in the form of cash or Cash EquivalentsEquivalents or Replacement Assets; and (d) Notwithstanding the foregoing provisions of this Section 6.4, (B) so long as no Default or Event of Default shall have occurred and be continuing, and after giving effect to any Asset Disposition pursuant of the succeeding transactions, no Default or Event of Default would exist hereunder: (i) (A) any Credit Party may be merged or consolidated with or into another Credit Party; provided, that, subject to clause (viiD) aboveimmediately below, if one of the parties to such merger or consolidation is the Borrower, the Borrower shall be the continuing or surviving corporation, (B) any Subsidiary may be merged or consolidated with or into another Credit Parties Party so long as the surviving party is either (x) a Credit Party or (y) an Additional Credit Party; provided, that, subject to clause (D) immediately below, if one of the parties to such merger or consolidation is the Borrower, the Borrower shall be the continuing or surviving corporation, (C) any of the Parent or any Subsidiary may merge or consolidate with or into any Person that is not a Credit Party, provided that the applicable conditions set forth in Section 6.4(b) regarding acquisitions are complied with in connection with any such acquisition by merger, the Parent or any such Subsidiary shall be the continuing or surviving corporation and immediately after giving effect to such transaction, the Parent and its Subsidiaries shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is available, hereof on a Pro Forma Basis and (C) with respect to clauses (iv), (v), (vi) and (vii) above, no Default or Event of Default shall exist or shall result therefrom; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lender, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactionsD) the property Borrower may merge or assets of any Person, other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited consolidate with or prohibited herein, purchases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business, or (ii) enter into any transaction of merger or consolidation, except for (A) Investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity, (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with any Person wholly-owned and into controlled by a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; , provided that if the Borrower is a party theretonot the continuing or surviving entity, the surviving entity shall have assumed all obligations of the Borrower will under the Credit Documents and immediately after giving effect to such transaction, the Parent and its Subsidiaries shall be in compliance with the surviving corporationfinancial covenants set forth in Section 5.9 hereof on a Pro Forma Basis and the ownership of the properties and assets of the Credit Parties as a whole shall remain unchanged; and (ii) any Subsidiary of the Parent (other than, and if the Parent is no longer the Borrower, the Borrower) may sell, lease, transfer or otherwise dispose of any or all of its assets (Cupon voluntary liquidation or otherwise) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a to any Credit Party. The Borrower shall provide the Administrative Agent with prior written notice of any transaction described in this Section 6.4(d) and take such other action as may be required pursuant to the terms of Section 5.12.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties Borrower will not, nor will they it permit any Subsidiary to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets or agree to do so at a future time, time except the following, without duplication, shall be expressly permitted: (Ai) Specified Sales; (ii) the sale, transfer, lease or other disposition of inventory and materials property or assets (A) to an unrelated party not in the ordinary course of business (other than Specified Sales), where and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cash; (ii) Extraordinary Receipts for which such Credit Party or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt that they are used to make mandatory prepayments the result of a Recovery Event or otherwise used pursuant to Section 2.7(b)(vii); (iiiB) the sale, lease, transfer or other disposition of real property, machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties Borrower or any of their its Subsidiaries, as appropriate, in its reasonable discretion; (iv) (A) the sale, lease or transfer of property or assets from one Credit Party to another Credit Party, (Biii) the sale, lease or transfer of property or assets from a Subsidiary to a Credit Party and (C) the sale, lease or transfer of property or assets from a Subsidiary that is not a Credit Party to another Subsidiary that is not a Credit Party; (viv) the termination sale of any Hedging Agreement; (vi) the Hawthorne Asset Dispositiontrade receivables sold or otherwise conveyed to or by a Securitization Vehicle; and (viiv) the sale, lease or transfer of property or assets not to exceed $10,000,000 10% of Consolidated Total Assets in the aggregate in any fiscal year, excluding transfers made pursuant to Section 6.4(a)(iv); provided that (A) with respect to clauses (i)(A), (ii), (iii), (vi) and (vii) above, at least 75% of the consideration received therefor by the Credit Parties or any such Subsidiary shall be in the form of cash or Cash Equivalents, (B) after giving effect to any Asset Disposition pursuant to clause (vii) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is available, and (C) with respect to clauses (iv), (v), (vi) and (vii) above, no Default or Event of Default shall exist or shall result therefrom; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lender, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, Person (other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, leases, materials, property and equipment in the ordinary course of business, except as otherwise limited or prohibited herein) or (ii) enter into any transaction of merger or consolidation, except for (A) Investments or acquisitions (including Permitted Acquisitions) permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity6.5, (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; , provided that if the Borrower is a party thereto, the Borrower will be the surviving corporation, corporation and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary or the Borrower; provided that is not if a Credit PartyParty is a party thereto, the Credit Party will be the surviving corporation.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties Borrower will not, nor will they it permit any Restricted Subsidiary to, (a) dissolveenter into any transaction of merger or consolidation or amalgamation, liquidate or liquidate, wind up its affairsor dissolve itself (or suffer any liquidation or dissolution); (b) acquire any business or assets from, or sellCapital Stock of, transferor be a party to any acquisition of, lease or otherwise dispose of its property or assets or agree to do so at a future time, except the following, without duplication, shall be expressly permittedany Person except: (Ai) the sale, transfer, lease or other disposition for purchases of inventory and materials other assets to be sold or used in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cashbusiness; (ii) Extraordinary Receipts for which such Credit Party or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt are used to make mandatory prepayments or otherwise used pursuant to Investments permitted under Section 2.7(b)(vii);6.5 hereof; and (iii) the salePermitted Acquisitions; (c) convey, sell, lease, transfer or other disposition otherwise dispose of, in one transaction or a series of machinerytransactions, parts any part of its business or assets, whether now owned or hereafter acquired (including, without limitation, receivables and leasehold interests), but excluding: (i) any Excluded Disposition; (ii) obsolete or worn-out Property, tools or equipment no longer used or useful in the conduct of the its business of the Credit Parties (other than any Excluded Disposition) or any of their Subsidiariesreal Property no longer used or useful in its business; (iviii) (A) the any sale, lease or transfer of property or assets from one a Credit Party to another Credit Party, ; (Biv) the sale, lease or transfer any sale of property or assets from a Subsidiary Transferred Assets by such Person to a Credit Party and (C) the sale, lease or transfer of property or assets from Receivables Financier in connection with a Subsidiary that is not a Credit Party to another Subsidiary that is not a Credit Party;Permitted Receivables Financing; and (v) other assets so long as the termination aggregate amount thereof sold or otherwise disposed of in any Hedging Agreement; single fiscal year by the Borrower and its Restricted Subsidiaries shall not have a book value in excess of ten percent of the book value of the total assets of the Borrower and its Restricted Subsidiaries owned on the first day of such fiscal year; provided, that in each case with respect to subsections (v) and (vi) the Hawthorne Asset Disposition; and (vii) the sale, lease or transfer of property or assets not to exceed $10,000,000 in the aggregate in any fiscal year, excluding transfers made pursuant to Section 6.4(a)(iv); provided that (A) with respect to clauses (i)(A), (ii), (iii), (vi) and (vii) above, above at least 7585% of the consideration received therefor by the Credit Parties Borrower or any such Restricted Subsidiary shall be is in the form of cash or Cash Equivalents; and (d) Notwithstanding the foregoing provisions of this Section 6.4, (B) so long as no Default or Event of Default shall have occurred and be continuing, and after giving effect to any Asset Disposition pursuant to clause (vii) above, of the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is available, and (C) with respect to clauses (iv), (v), (vi) and (vii) abovesucceeding transactions, no Default or Event of Default shall would exist or shall result therefrom; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lender, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business, or (ii) enter into any transaction of merger or consolidation, except for (A) Investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject Liens created under the Security Documents continue to such merger be in effect: (i) any Restricted Subsidiary of the Borrower may be merged or consolidation is the surviving entity, consolidated with or into: (B) (yA) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that Borrower if the Borrower is a party thereto, the Borrower will shall be the surviving corporation, and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit Party.the

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties will not, nor will they permit any Subsidiary to, (a) dissolve, liquidate Enter into a transaction of merger or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets or agree to do so at a future timeconsolidation, except the following, without duplication, shall be expressly permitted: (A) the sale, transfer, lease or other disposition of inventory and materials in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cash; (ii) Extraordinary Receipts for which such Credit Party or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt are used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii); (iii) the sale, lease, transfer or other disposition of machinery, parts and equipment no longer used or useful in the conduct a ------ member of the business of the Credit Parties or any of their Subsidiaries; (iv) (A) the sale, lease or transfer of property or assets from one Credit Party to another Credit Party, (B) the sale, lease or transfer of property or assets from Consolidated Group may be a Subsidiary party to a Credit Party and (C) the saletransaction of merger or consolidation with any Person, lease or transfer of property or assets from a Subsidiary that is not a Credit Party to another Subsidiary that is not a Credit Party; (v) the termination of any Hedging Agreement; (vi) the Hawthorne Asset Disposition; and (vii) the sale, lease or transfer of property or assets not to exceed $10,000,000 in the aggregate in any fiscal year, excluding transfers made pursuant to Section 6.4(a)(iv); provided that (A) the Borrower may be a party to -------- a transaction of merger or consolidation only with respect to clauses (i)(A), (ii), (iii), (vi) and (vii) above, at least 75% another member of the consideration received therefor by the Credit Parties or Consolidated Group and in any such Subsidiary case the Borrower shall be in the form of cash or Cash Equivalentssurviving corporation thereto, (B) after giving effect to in any Asset Disposition other case, the surviving corporation shall be a Domestic Subsidiary and such Domestic Subsidiary shall become a Guarantor hereunder as an Additional Credit Party pursuant to clause (vii) aboveSection 7.11 concurrently therewith, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is available, and (C) with respect to clauses (iv), (v), (vi) and (vii) above, no Default or Event of Default shall exist either immediately prior to or shall result therefrom; provided, further, that immediately after giving effect thereto and (D) in the case of a transaction of merger or consolidation with respect to sales any Person which is not a member of assets permitted hereunder onlythe Consolidated Group, the Administrative Agent provisions of subsection (c) of this Section 8.3 shall be entitled, without the consent of any Lender, to release its Liens relating to the particular assets sold; orcomplied with. (b) (i) purchaseSell, lease lease, transfer or otherwise acquire (in a single transaction or a series dispose of related transactions) the property or assets of any Person, other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materialsassets, property and equipment and/or operations (including any sale-leaseback transaction, but excluding the sale of inventory in the ordinary course of business), other than to another Credit Party, which (i) in any instance (including any series of related transactions) shall constitute more than five percent (5%) of consolidated assets at the end of the immediately preceding fiscal year or five percent (5%) of Consolidated Net Income for the immediately preceding fiscal year, or (ii) in the aggregate in any fiscal year shall constitute more than ten percent (10%) of consolidated assets at the end of the immediately preceding fiscal year or ten percent (10%) Consolidated Net Income for the immediately preceding fiscal year, and (iii) no Default or Event of Default would exist after giving effect thereto on a Pro Forma Basis. (i) in the case of an acquisition of capital stock or other ownership interest after giving effect thereto, such Person will not be a Subsidiary, then such acquisition will not cause a violation of Section 8.4; or (ii) (A) in the case of an acquisition of capital stock or other ownership interest where, after giving effect thereto, such Person will be a Subsidiary, or (ii) enter into any transaction of merger or consolidation, except for (A) Investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity, (B) in the case of an acquisition of assets, property and/or operations then (I) (x) the total cash consideration paid in connection with any such acquisition (or series of related transactions) shall not exceed $15,000,000 in any instance (or in the case of an acquisition of the type described in clause (c)(ii)(A) above constituting less than 100% of the outstanding capital stock or other ownership interests of any Person, the total cash consideration paid in connection therewith shall not exceed $10,000,000 in any instance); and (y) the merger aggregate cost (including, without limitation, cash consideration paid and assumption of Indebtedness) of all such acquisitions (or consolidation series of related transactions) shall not exceed $30,000,000 during any fiscal year; provided, however, acquisitions -------- ------- specifically reviewed and approved by the Required Lenders (and not automatically approved pursuant to clause (x) above) shall not be counted toward the aggregate annual limit in this clause (y); (II) the Board of Directors of the Person which is the subject of such acquisition shall have approved such acquisition; and (III) no Default or Event of Default would exist after giving effect thereto on a Pro Forma Basis. (d) In the case of the Borrower and any Subsidiary that which is not a Credit Party with wholly-owned, liquidate, wind-up or dissolve, whether voluntarily or involuntarily (or suffer to permit any such liquidation or dissolution). (e) Alter the character of their business in any material respect from that conducted as of the Closing Date and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger similar or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower is a party thereto, the Borrower will be the surviving corporation, and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit Partyrelated businesses.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties will not, nor will they permit any Subsidiary to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets (each a “Disposition”) or agree to do so at a future time, except the following, without duplication, shall be expressly permitted: (A) the sale, transfer, lease or other disposition of inventory and materials in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cash; (ii) Extraordinary Receipts for which such Credit Party the sale, transfer or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such other disposition of property or assets to an unrelated party not in the ordinary course of business where and to the extent Net Cash Proceeds from such Extraordinary Receipt that they are used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii)the result of a Recovery Event; (iii) the sale, lease, transfer or other disposition of machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties or any of their Subsidiaries; (iv) (A) the sale, lease or transfer of property or assets from one Credit Party to another Credit Party, (B) the sale, lease Party or transfer dissolution of property or assets from a Subsidiary to a any Credit Party (other than the Borrower) to the extent any and (C) the sale, lease or transfer all assets of property or assets from a Subsidiary that is not a such Credit Party are distributed to another Subsidiary that is not a Credit Party; (v) the termination of any Hedging Agreement; (vi) the Hawthorne Asset DispositionBank Product; and (viivi) the sale, lease or transfer of property or assets not to exceed $10,000,000 1,000,000 in the aggregate in any fiscal year, excluding transfers made pursuant to Section 6.4(a)(iv); provided that (A) with respect to clauses (i)(A), (ii), (iii), (vi) and (vii) above, at least 75% of the consideration received therefor by the Credit Parties or any such Subsidiary shall be in the form of cash or Cash Equivalents, (B) after giving effect to any Asset Disposition pursuant to clause (viivi) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month fiscal quarter for which information is available, and (C) with respect to clauses (iv), (v), (vi) and (viivi) above, no Default or Event of Default shall exist or shall result therefromtherefrom and (D) any Disposition pursuant to clauses (i), (iii) and (vi) shall be for fair market value; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lender, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business, or (ii) enter into any transaction of merger or consolidation, except for (A) Investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity, (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower is a party thereto, the Borrower will be the surviving corporation, and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit Party.

Consolidation, Merger, Sale or Purchase of Assets, etc. The No Credit Parties will notwill, nor will they any Credit Party permit any Subsidiary to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets (including, without limitation, any Equity Interest of any Subsidiary of the Borrower but excluding any Equity interests of any Unrestricted Subsidiary) or agree to do so at a future time, except the following, without duplication, shall be expressly permitted: (A) the sale, transfer, lease or other disposition of inventory and materials in the ordinary course of business and business, (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cashcash and (C) the sale of defaulted receivables in the ordinary course of business and not as part of an accounts receivable financing transaction; (ii) Extraordinary Receipts for which such Credit Party or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt are used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii)a Facility Disposition; (iii) the sale, lease, transfer or other disposition of machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties or any of their Subsidiaries; (iv) (A) the sale, lease or transfer of property or assets from one Credit Party to another Credit Party, (B) the sale, lease or transfer of property or assets from a Subsidiary to a Credit Party and (C) the sale, lease or transfer of property or assets from a Subsidiary that is not a Credit Party to another Subsidiary that is not a Credit Party; (v) the termination of any Hedging Agreement; (vi) the Hawthorne Asset Disposition; and (vii) the sale, lease or transfer of any property or assets not described in clauses (i) through (v) or (vii) through (viii) of this Section 6.4(a); (vii) leases, licenses (on a non-exclusive basis with respect to exceed $10,000,000 intellectual property), or subleases or sublicenses (on a non-exclusive basis with respect to intellectual property) of any real or personal property in the aggregate in any fiscal yearordinary course of business; and (viii) Permitted Liens and Restricted Payments permitted by Section 6.10; provided, excluding transfers made pursuant to Section 6.4(a)(iv); provided that (A) with respect to clauses (i)(A), (ii), (iii), (vi) and (viivi) above, at least 75% of the consideration received therefor by the Credit Parties or any such Subsidiary shall be in the form of cash or Cash Equivalents, (B) after giving effect to any Facility Disposition pursuant to clause (ii) above or Asset Disposition pursuant to clause (viivi) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 6.15 hereof, recalculated for as of the end of the most recently ended month fiscal quarter for which information is financial statements are available, and (C) with respect to clauses (ii), (iv), (v), (vi) and (viivi) above, no Default or Event of Default shall exist or shall result therefrom, and (D) no sale, transfer, lease or other disposition of assets shall be permitted hereby (other than sales, transfers, leases or other dispositions pursuant to Section 6.14(a)(iv)) unless such sale, transfer, lease or other disposition is for fair market value; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitledshall, without the consent of any Lender, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, other than than: (Ai) Permitted Acquisitions and Permitted Investments and Investments; (Bii) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business; (iii) with the proceeds of any Asset Disposition or Extraordinary Receipt pursuant to Section 2.7(b)(ii) or Section 2.7(b)(vi), or as applicable; or (iiiv) capital expenditures; (c) enter into any transaction of merger or consolidation, except for except: (Ai) Investments or acquisitions permitted pursuant to Section 6.5 in connection with a Permitted Investment, so long as the continuing or surviving person shall be the Borrower or a Subsidiary of the Borrower, which shall be a Credit Party subject to if the merging Subsidiary was a Credit Party and which together with each of its Subsidiaries shall have complied with Section 5.10 and Section 5.12, (ii) in connection with a Permitted Acquisition, provided that following any such merger or consolidation (A) involving the Borrower, the Borrower is the surviving entityPerson, (B) involving a Domestic Subsidiary, the surviving or resulting entity shall be a Credit Party that is a wholly owned Subsidiary, and (yC) involving a Foreign Subsidiary, the surviving or resulting entity shall be a wholly owned subsidiary; or (iii) the merger or consolidation (A) of any Subsidiary of the Borrower into the Borrower in a transaction in which the Borrower is the survivor, (B) of any Subsidiary that of the Borrower into or with any Credit Party (other than the Borrower) in a transaction in which the surviving or resulting entity is not a Credit Party with and into a Credit Party; provided that such Credit Party will be and, in the surviving entity case of each of clauses (A) and (z) the merger or consolidation of B), no Person other than a Credit Party with and into another Credit Party; provided that if the Borrower is a party thereto, the Borrower will be the surviving corporation, receives any consideration and (C) the merger or consolidation of a any Subsidiary of the Borrower that is not a Credit Party into or with and into another any other Subsidiary of the Borrower that is not a Credit Party.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties will not, nor will they permit any Subsidiary to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets (each a “Disposition”) or agree to do so at a future time, except the following, without duplication, shall be expressly permitted: (A) the sale, transfer, lease or other disposition of inventory and materials in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cash; (ii) Extraordinary Receipts for which such Credit Party the sale, transfer or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such other disposition of property or assets to an unrelated party not in the ordinary course of business where and to the extent that they are the result of a Recovery Event; to the extent Net Cash Proceeds from such Extraordinary Receipt Recovery Event are reinvested or used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii2.7(b)(iv); (iii) the sale, lease, transfer or other disposition of machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties or any of their Subsidiaries; (iv) (A) the sale, lease or transfer of property or assets from one Credit Party to another Credit Party, (B) the sale, lease Party or transfer dissolution of property or assets from a Subsidiary to a any Credit Party (other than the Borrower) to the extent any and (C) the sale, lease or transfer all assets of property or assets from a Subsidiary that is not a such Credit Party are distributed to another Subsidiary that is not a Credit Party; (v) the termination of any Hedging Agreement; (vi) the Hawthorne Asset Dispositionsale, lease, transfer, closure or other disposition of Restaurants, the termination or non-renewal of leases or the subletting of Restaurants, in each case as determined to be prudent in the reasonable judgment of the senior officers of the Borrower; (vii) Sale Leaseback transactions to the extent permitted under Section 6.12; and (viiviii) the sale, lease or transfer of property or assets not to exceed $10,000,000 2,500,000 in the aggregate in any fiscal year, excluding transfers made pursuant to Section 6.4(a)(iv); provided that (A) with respect to clauses (i)(A), (ii), (iii), (vi), (vii) and (viiviii) above, at least 75% of the consideration received therefor by the Credit Parties or any such Subsidiary shall be in the form of cash or Cash Equivalents, assets used in the business or Capital Stock, (B) after giving effect to any Asset Disposition pursuant to clause (vii) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month fiscal quarter for which information is available, available and (C) with respect to clauses (iv), (v), (vi) and clause (vii) above, no Default or Event of Default shall exist or shall result therefrom; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitledshall, without the consent of any Lender, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, other than (A) Permitted Acquisitions and Permitted Investments and Acquisitions, (B) the lease or acquisition of real property in connection with Permitted Construction Transactions; (C) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business, (D) the acquisition of certain infrastructure and corporate assets of the Spin-Off Parties in connection with the Spin-Off, (E) the acquisition of the Pollo Tropical Trademarks and (F) Investments permitted by Section 6.5 or (ii) enter into any transaction of merger or consolidation, except for (A) Investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity, (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower is a party thereto, the Borrower will be the surviving corporation, and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit Party.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties will not, nor will they permit any Subsidiary to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets (each a “Disposition”) or agree to do so at a future time, except the following, without duplication, shall be expressly permitted: (A) the sale, transfer, lease or other disposition of inventory and materials in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cash; (ii) Extraordinary Receipts for which such Credit Party the sale, transfer or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such other disposition of property or assets to an unrelated party not in the ordinary course of business where and to the extent Net Cash Proceeds from such Extraordinary Receipt that they are used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii)the result of a Recovery Event; (iii) the sale, lease, transfer or other disposition of (A) machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties or any of their SubsidiariesSubsidiaries and (B) obsolete or worn out property, whether now owned or hereafter acquired, in the ordinary course of business; (iv) (A) the sale, lease or transfer of property or assets from one Credit Party to another Credit Party, (B) the sale, lease Party or transfer dissolution of property or assets from a Subsidiary to a Credit Party and (C) the sale, lease or transfer of property or assets from a Subsidiary that is not a any Credit Party to the extent any and all assets are distributed to another Subsidiary that is not a Credit Party; (v) the termination of any Hedging Agreement; (vi) Dispositions of equipment or real property to the Hawthorne Asset extent that (A) such property is exchanged for credit against the purchase price of similar replacement property within twelve (12) months of such Disposition or (B) the proceeds of such Disposition are reasonably promptly applied to the purchase price of such replacement property within 12 months of such Disposition; and; (vii) the licensing of Intellectual Property in the ordinary course of business consistent with past practice; (viii) the sale, lease or transfer of property or assets not to exceed $10,000,000 20,000,000 in the aggregate in any fiscal year, excluding transfers made pursuant ; (ix) the merger of a Credit Party or a Subsidiary thereof with another Credit Party or a Subsidiary thereof to the extent permitted by Section 6.4(a)(iv)6.4(b)(ii) below; and (x) the Corporate Restructuring. provided that (A) with respect to clauses (i)(A), (ii), (iii), (vi) and (vii) above, at least 75% of the consideration received therefor by the Credit Parties or any such Subsidiary shall be in the form of cash or Cash Equivalents, (B) after giving effect to any Asset Disposition pursuant to clause (viiviii) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is available, and (CB) with respect to clauses (iv), (v), (vi) and (viiviii) above, no Default or Event of Default shall exist or shall result therefrom; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lender, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business, or (ii) enter into consummate any transaction of merger or consolidation, except for (A) Investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity, (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower is a party thereto, the Borrower will be the surviving corporation, and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit PartyParty and (D) the Corporate Restructuring.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties will not, nor will they permit any Subsidiary to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets or agree to do so at a future time, except the following, without duplication, shall be expressly permitted: (A) the sale, transfer, lease lease, licensing or other disposition of inventory and materials in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cash; (ii) Extraordinary Receipts sales, transfers, leases or other dispositions for which such Credit Party has received or such Subsidiary has received received, any cash insurance proceeds or condemnation or expropriation award with respect to such property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt received or awarded are reinvested or used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii)prepayment required by the Senior Debt Documents; (iii) the sale, lease, transfer or other disposition of machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties or any of their Subsidiaries; (iv) (A) the sale, lease or transfer of property or assets from one Credit Party to another Credit Party, (B) or the sale, lease or transfer of property or assets from a one Subsidiary to a Credit Party and (C) the sale, lease or transfer of property or assets from a Subsidiary that who is not a Credit Party to a Credit Party or another Subsidiary that who is not a Credit Party; (v) the termination of any Hedging Agreement; (vi) the Hawthorne Asset Disposition; and (viivi) the sale, lease or transfer of property or assets not to exceed $10,000,000 2,300,000 in the aggregate in any fiscal year, excluding transfers made pursuant to Section 6.4(a)(iv); provided that (A) with respect to clauses (i)(A), (ii), (iii), (vi) and (viivi) above, at least 75% of the consideration received therefor by the Credit Parties or any such Subsidiary shall be in the form of cash or Cash EquivalentsEquivalents (except with respect to the sale, lease, transfer or other disposition of machinery, parts and equipment to the extent that such property is exchanged for credit against the purchase price of property), (B) after giving effect to any Asset Disposition pursuant to clause (viivi) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is available, and (C) with respect to clauses (iv), (v), (vi) and (viivi) above, no Default or Event of Default shall exist or shall result therefrom; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lender, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, other than (A) the Acquisition, (B) Permitted Acquisitions and Permitted Investments and (BC) except as otherwise limited or prohibited herein, purchases purchases, leases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business, or (ii) enter into any transaction of merger or consolidation, except for (A) the Acquisition, (B) Permitted Acquisitions, (C) Investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity, (BD) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower is a party thereto, the Borrower will be the surviving corporation, and (CE) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit Party.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Loan Parties will not, nor will they permit any Subsidiary to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets (each a "Disposition") or agree to do so at a future time, except the following, without duplication, shall be expressly permitted: (A) the sale, transfer, lease or other disposition of inventory and materials in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cash; (ii) Extraordinary Receipts for which such Credit Party the sale, transfer or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such other disposition of property or assets to an unrelated party not in the ordinary course of business where and to the extent Net Cash Proceeds from that such Extraordinary Receipt are used sale, transfer or other disposition is the result of theft, loss, physical destruction or damage, taking or similar event with respect to make mandatory prepayments any of the Loan Parties or otherwise used pursuant to Section 2.7(b)(vii)any of their Subsidiaries’ respective property or assets; (iii) the sale, lease, transfer or other disposition of machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Loan Parties or any of their Subsidiaries; (iv) (A) the sale, lease or transfer of property or assets from one Credit Loan Party to another Credit Party, Loan Party or dissolution of any Loan Party (Bother than the Borrower) to the sale, lease or transfer extent any and all assets of property or assets from a Subsidiary to a Credit such Loan Party and (C) the sale, lease or transfer of property or assets from a Subsidiary that is not a Credit Party are distributed to another Subsidiary that is not a Credit Loan Party; (v) the termination of any Hedging Swap Agreement; (vi) the Hawthorne Asset Dispositionsale, lease, transfer, closure or other disposition (including, without limitation, refranchising) of Restaurants and real property related thereto, the termination or non-renewal of leases or the subletting of Restaurants, in each case as determined to be prudent in the reasonable judgment of the senior officers of the Borrower; (vii) Sale Leaseback transactions to the extent permitted under Section 6.12; and (viiviii) the any other sale, lease or transfer of property or assets not to exceed $10,000,000 2,500,000 in the aggregate in any fiscal year, excluding transfers made pursuant to Section 6.4(a)(iv); provided that (A) with respect to clauses (i)(A), (ii), (iii), (vi), (vii) and (viiviii) above, at least 75% of the consideration received therefor by the Credit Loan Parties or any such Subsidiary shall be in the form of cash or Cash Equivalents, assets used in the business or capital stock, (B) after giving effect to any Asset Disposition pursuant to clause (vii) above, the Credit Loan Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 5.10 hereof, recalculated for the most recently ended month fiscal quarter for which information is available, available and (C) with respect to clauses (iv), (v), (vi) and clause (vii) above, no Default or Event of Default shall exist or shall result therefrom; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitledshall, without the consent of any Lender, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, other than (A) Permitted Acquisitions and Permitted Investments and Acquisitions, (B) the lease or acquisition of real property in connection with Permitted Construction Transactions; (C) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business, business and (D) Investments permitted by Section 6.05 or (ii) enter into any transaction of merger or consolidation, except for (A) Investments or acquisitions permitted pursuant to Section 6.5 6.05 so long as the Credit Loan Party subject to such merger or consolidation is the surviving entity, (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Loan Party with and into a Credit Loan Party; provided that such Credit Loan Party will be the surviving entity and (z) the merger or consolidation of a Credit Loan Party with and into another Credit Loan Party; provided that if the Borrower is a party thereto, the Borrower will be the surviving corporation, and (C) the merger or consolidation of a Subsidiary that is not a Credit Loan Party with and into another Subsidiary that is not a Credit Loan Party.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties will not, nor will they permit any Subsidiary (excluding Excluded Joint Ventures) to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets (each a “Disposition”) or agree to do so at a future time, except the following, without duplication, shall be expressly permitted: (A) the saleDisposition of cash, transfergoods, lease or other disposition of products, inventory and materials and immaterial assets in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cash; (ii) Extraordinary Receipts for which such Credit Party or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such the Disposition of property or assets to an unrelated party not in the ordinary course of business where and to the extent Net Cash Proceeds from such Extraordinary Receipt that they are used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii)the result of a Recovery Event; (iii) the sale, lease, transfer or other disposition Disposition of machinery, parts and equipment assets no longer used or useful in the conduct of the business of the Credit Parties or any of their Subsidiaries; (iv) (A) the sale, lease or transfer Disposition of property or assets from one Credit Party to another Credit Party, (B) the sale, lease Party or transfer dissolution of property or assets from a Subsidiary to a any Credit Party (other than any Borrower) to the extent any and (C) the sale, lease or transfer all assets of property or assets from a Subsidiary that is not a such Credit Party (if any) are distributed to another Subsidiary that is not a Credit Party; (v) the termination of any Hedging AgreementBank Product; (vi) the Hawthorne Asset DispositionDisposition of property or assets (including, without limitation, Sale and Leaseback Transactions); provided, that the aggregate book value of all property and assets subject to such Disposition in any fiscal year shall not exceed 5% of Consolidated Tangible Assets as of the end of the immediately preceding fiscal year; (vii) a Foreign Subsidiary Contribution and/or the Foreign Subsidiary Reorganization; (viii) any Restricted Payment by any Credit Party or any of its Subsidiaries permitted pursuant to Section 6.10; (ix) (A) any Disposition or issuance by the Company of its own Equity Interests to the extent that any such issuance does not result in a Change of Control; (B) any Disposition or issuance by any Subsidiary of the Company of its own Equity Interests to any Credit Party; and (C) to the extent necessary to satisfy any requirement of Law in the jurisdiction of incorporation of any Subsidiary of the Company, any Disposition or issuance by such Subsidiary of its own Equity Interests constituting directors’ qualifying shares or nominal holdings; (x) the abandonment or other Disposition of intellectual property that is, in the reasonable judgment of such Person, no longer economically practicable to maintain because it is no longer useful in the operation of its business or otherwise of material value (including without limitation intellectual property that has expired on its own terms with no right to renew); (xi) Dispositions of property to the extent that (i) such property is exchanged for credit against the purchase price of similar property or (ii) the proceeds of such Disposition are promptly applied to the purchase price of such similar property; (xii) Dispositions constituting Permitted Liens or Permitted Investments but only to the extent that any such Permitted Lien or Permitted Investment was otherwise permitted; (xiii) Dispositions of accounts receivables in connection with the collection or compromise thereof in the ordinary course of business; and (viixiv) Dispositions of Investments in joint ventures to the saleextent required by, lease or transfer of property or assets not to exceed $10,000,000 in the aggregate in any fiscal year, excluding transfers made pursuant to Section 6.4(a)(iv); customary buy/sell arrangements between, the joint venture parties set forth in joint venture arrangements and similar binding arrangements. provided that (A) with respect to clauses (i)(A), (ii), (iii), (vi) and (viixiv) above, at least 75% of the consideration received therefor by the Credit Parties or any such Subsidiary shall be in the form of cash or Cash Equivalents, (B) after giving effect to any Asset Disposition pursuant to clause (viivi) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month fiscal quarter for which information is available, and (C) with respect to clauses (iv), (v), (vi) and (viixiv) above, no Default or Event of Default shall exist or shall result therefromtherefrom and (D) any Disposition pursuant to clause (vi) shall be for fair market value; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lender, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business, or (ii) enter into any transaction of merger or consolidation, except for (A) Investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity, (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower is a party thereto, the Borrower will be the surviving corporation, and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit Party.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Each of the Credit Parties will not, nor will they it permit any Subsidiary to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets or agree to do so at a future time, time except the following, without duplication, shall be expressly permitted: (Ai) the sale, transfer, lease or other disposition of inventory and materials in the ordinary course of business and business (Bii) the conversion of cash into Cash Equivalents and Cash Equivalents into cash; (iiA) Extraordinary Receipts for which such Credit Party or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such the disposition of property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt are used to make mandatory prepayments as a direct result of a Recovery Event or otherwise used pursuant to Section 2.7(b)(vii); (iiiB) the sale, lease, transfer or other disposition of machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties Borrower or any of their its Subsidiaries, so long as the net proceeds therefrom are used to replace such machinery, parts and equipment or to purchase or otherwise acquire new assets or property within 180 days of receipt of the net proceeds; (iv) (A) the sale, lease or transfer of property or assets from one Credit Party to another Credit Party, (Bfor fair market value) between the Borrower and any Guarantor; (v) the sale, lease or transfer of property or assets from a Subsidiary to a Credit Party and (C) other than the sale, lease or transfer of property or assets from a Subsidiary that is not a Credit Party Borrower to another Subsidiary that is not a Credit Party; (v) the termination of any Hedging Agreement; (vi) the Hawthorne Asset Disposition; and (vii) the sale, lease or transfer of property or assets not to exceed $10,000,000 1,000,000 in the aggregate in any fiscal year; and (vii) the voluntary termination of Hedging Agreements; provided, excluding transfers made pursuant to Section 6.4(a)(iv); provided that (A) with respect to that, in the case of clauses (i)(A), (iii), (iii), (vi) and (viivi) above, at least seventy-five percent (75% %) of the consideration received therefor by the Credit Parties Borrower or any such Subsidiary shall be other Credit Party is in the form of cash or Cash Equivalents, (B) after giving effect to any Asset Disposition pursuant to clause (vii) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is available, and (C) with respect to clauses (iv), (v), (vi) and (vii) above, no Default or Event of Default shall exist or shall result therefrom; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lenderthe Required Lenders, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, Person (other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, leases, licenses, Intellectual Property, materials, property and equipment in the ordinary course of business, except as otherwise limited or prohibited herein) or (ii) enter into any transaction of merger or consolidation, except for (A) Investments investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity6.5, and (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower is a party thereto, the Borrower will be the surviving corporation, and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit Party.

Consolidation, Merger, Sale or Purchase of Assets, etc. The No Credit Parties will notwill, nor will they any Credit Party permit any Subsidiary to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets (including, without limitation, any Equity Interest of any Subsidiary of the Borrower but excluding any Equity interests of any Unrestricted Subsidiary) or agree to do so at a future time, except the following, without duplication, shall be expressly permitted: (A) the sale, transfer, lease or other disposition of inventory and materials in the ordinary course of business and business, (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cashcash and (C) the sale of defaulted receivables in the ordinary course of business and not as part of an accounts receivable financing transaction; (ii) Extraordinary Receipts for which such Credit Party or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt are used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii)a Facility Disposition; (iii) the sale, lease, transfer or other disposition of machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties or any of their Subsidiaries; (iv) (A) the sale, lease or transfer of property or assets from one Credit Party to another Credit Party, (B) the sale, lease or transfer of property or assets from a Subsidiary to a Credit Party and (C) the sale, lease or transfer of property or assets from a Subsidiary that is not a Credit Party to another Subsidiary that is not a Credit Party; (v) the termination of any Hedging Agreement; (vi) the Hawthorne Asset Disposition; and (vii) the sale, lease or transfer of any property or assets not described in clauses (i) through (v) or (vii) through (viii) of this Section 6.4(a); (vii) leases, licenses (on a non-exclusive basis with respect to exceed $10,000,000 intellectual property), or subleases or sublicenses (on a non-exclusive basis with respect to intellectual property) of any real or personal property in the aggregate in any fiscal yearordinary course of business; and (viii) Permitted Liens and Restricted Payments permitted by Section 6.10; provided, excluding transfers made pursuant to Section 6.4(a)(iv); provided that (A) with respect to clauses (i)(A), (ii), (iii), (vi) and (viivi) above, at least 75% of the consideration received therefor by the Credit Parties or any such Subsidiary shall be in the form of cash or Cash Equivalents, (B) after giving effect to any Facility Disposition pursuant to clause (ii) above or Asset Disposition pursuant to clause (viivi) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 6.16 hereof, recalculated for as of the end of the most recently ended month fiscal quarter for which information is financial statements are available, and (C) with respect to clauses (ii), (iv), (v), (vi) and (viivi) above, no Default or Event of Default shall exist or shall result therefrom, and (D) no sale, transfer, lease or other disposition of assets shall be permitted hereby (other than sales, transfers, leases or other dispositions pursuant to Section 6.4(a)(iv)) unless such sale, transfer, lease or other disposition is for fair market value; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitledshall, without the consent of any Lender, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, other than than: (Ai) Permitted Acquisitions and Permitted Investments and Investments; (Bii) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business; (iii) with the proceeds of any Asset Disposition or Extraordinary Receipt pursuant to Section 2.3(c)(i) or Section 2.3(c)(v), or as applicable; or (iiiv) capital expenditures; (c) enter into any transaction of merger or consolidation, except for except: (Ai) Investments or acquisitions permitted pursuant to Section 6.5 in connection with a Permitted Investment, so long as the continuing or surviving person shall be the Borrower or a Subsidiary of the Borrower, which shall be a Credit Party subject to if the merging Subsidiary was a Credit Party and which together with each of its Subsidiaries shall have complied with Section 5.9 and Section 5.11, (ii) in connection with a Permitted Acquisition, provided that following any such merger or consolidation (A) involving the Borrower, the Borrower is the surviving entityPerson, (B) involving a Domestic Subsidiary, the surviving or resulting entity shall be a Credit Party that is a wholly owned Subsidiary, and (yC) involving a Foreign Subsidiary, the surviving or resulting entity shall be a wholly owned subsidiary; or (iii) the merger or consolidation (A) of any Subsidiary of the Borrower into the Borrower in a transaction in which the Borrower is the survivor, (B) of any Subsidiary that of the Borrower into or with any Credit Party (other than the Borrower) in a transaction in which the surviving or resulting entity is not a Credit Party with and into a Credit Party; provided that such Credit Party will be and, in the surviving entity case of each of clauses (A) and (z) the merger or consolidation of B), no Person other than a Credit Party with and into another Credit Party; provided that if the Borrower is a party thereto, the Borrower will be the surviving corporation, receives any consideration and (C) the merger or consolidation of a any Subsidiary of the Borrower that is not a Credit Party into or with and into another any other Subsidiary of the Borrower that is not a Credit Party.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Each of the Credit Parties will not, nor will they it permit any Subsidiary to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets or agree to do so at a future time, time (unless such agreement is expressly conditioned on obtaining any necessary consent under this Agreement) except the following, without duplication, shall be expressly permitted: (Ai) the sale, transfer, lease or other disposition of inventory and materials in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cashbusiness; (ii) Extraordinary Receipts for which such Credit Party the sale, transfer or such Subsidiary has received any other disposition of cash insurance proceeds or condemnation or expropriation award with respect to such and Cash Equivalents; (A) the disposition of property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt are used to make mandatory prepayments as a direct result of a Recovery Event or otherwise used pursuant to Section 2.7(b)(vii); (iiiB) the sale, lease, transfer or other disposition of machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties Borrower or any of their its Subsidiaries, so long as the Net Cash Proceeds therefrom are used to replace such machinery, parts and equipment or to purchase or otherwise acquire new assets or property within 180 days of receipt of the net proceeds to the extent reasonably required for the continuing conduct of the business of the Borrower and its Subsidiaries not to exceed $25,000,000 in the aggregate in Net Cash Proceeds in any fiscal year for all assets not replaced; (iv) (A) the sale, lease or transfer of property or assets from one Credit Party the Borrower to another Credit Partyany Guarantor, whether for consideration or as a capital contribution; (Bv) the sale, lease or transfer of property or assets from a Subsidiary to a Credit Party and (C) other than the sale, lease or transfer of property or assets from a Subsidiary that is not a Borrower to another Credit Party to another Subsidiary that is not whether for consideration or as a Credit Partycapital contribution; (vvi) the termination of any Hedging AgreementAgreement permitted pursuant to Section 6.1; (vivii) the Hawthorne Asset DispositionSpin-off; and (viiviii) the sale, lease or transfer of property or assets not to exceed $10,000,000 25,000,000 in the aggregate in any fiscal year; provided, excluding transfers made pursuant to Section 6.4(a)(iv); provided that that, (A) with respect to clauses in the case of clause (i)(A), (ii), (iii), (vi) and (viiviii) above, at least 75% of the consideration received therefor by the Credit Parties Borrower or any such Subsidiary shall be other Credit Party is in the form of cash or Cash Equivalents, Equivalents and (B) after giving effect to any Asset Disposition pursuant to in the case of clause (viiv) above, above the transferring Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is available, and (C) with respect to clauses (iv), (v), (vi) and (vii) above, no Default Party may liquidate or Event of Default shall exist or shall result therefromdissolve; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lenderthe Required Lenders, to release release, and shall release, its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, Person (other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, leases, materials, property and equipment in the ordinary course of business, except as otherwise limited or prohibited herein) or (ii) enter into any transaction of merger or consolidation, except for (A) Investments investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity6.5, and (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower is a party thereto, the Borrower will be the surviving corporation, and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit Party.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Each of the Credit Parties will not, nor will they it permit any Subsidiary to,: (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease to a third party or otherwise dispose of its property or assets or agree to do so at a future time, time except the following, without duplication, shall be expressly permitted: (Ai) the sale, transfer, lease or other disposition of inventory and materials in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cashSpecified Sales; (ii) Extraordinary Receipts for which such Credit Party or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such property or assets Sale Leaseback Transactions to the extent Net Cash Proceeds from such Extraordinary Receipt are used to make mandatory prepayments or otherwise used pursuant to permitted under Section 2.7(b)(vii)6.12; (iii) the disposition of property or assets as a result of a Recovery Event; (iv) the sale, lease, transfer or other disposition of (A) machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties Borrower or any of their Subsidiariesits Subsidiaries and (B) property and assets located at or used in connection with, or which are otherwise associated with, restaurants that are not material to the business of any Credit Party; (iv) (Av) the sale, lease or transfer of property or assets between Credit Parties, so long as the Liens of the Administrative Agent with respect to such property or assets remain in full force and effect and fully perfected after giving effect to such transaction; (vi) the dissolution, liquidation or winding up of a Liquor License Subsidiary or any sale, transfer or other disposition of assets from one a Liquor License Subsidiary to a Credit Party to or another Credit Party, Liquor License Subsidiary; (Bvii) the sale, lease or transfer of property or assets from a Subsidiary to a Credit Party and (C) the saleproperties set forth on Schedule 2.7(b)(ii), lease or transfer of property or assets from a Subsidiary that is not a Credit Party to another Subsidiary that is not a Credit Party; (v) the termination of any Hedging Agreement; (vi) the Hawthorne Asset Disposition; and (viiviii) the sale, lease or transfer of property or assets not to exceed $10,000,000 2,000,000 in the aggregate in any fiscal yearyear and $10,000,000 in the aggregate during the term of this Agreement; provided, excluding transfers made pursuant that in each case (other than with respect to Section 6.4(a)(iv); provided that clause (v) above and dispositions of assets of a restaurant in connection with a refinishing, refurnishing or upgrade of such restaurant for consideration less than $100,000 in the aggregate per restaurant) (A) with respect to clauses (i)(A), (ii), (iii), (vi) and (vii) above, at least 75% of the consideration received therefor by the any Credit Parties Party or any such Subsidiary shall be in the form of cash or Cash Equivalents, (B) after giving effect to any Asset Disposition pursuant to clause the sale, lease, transfer or other disposition of such property or assets and the repayment of Indebtedness (viiif any) abovewith the proceeds thereof, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is availablehereof and shall be in compliance with all other terms and conditions of this Agreement, and (C) with respect to clauses (iv), (v), (vi) and (vii) above, no Default or Event of Default shall exist or shall result therefromfrom such sale, lease, transfer or other disposition of property or assets; provided, further, that with respect to sales any sale or transfer of property or assets permitted hereunder onlyto an unrelated third party, the Administrative Agent shall be entitled, without the consent of any Lenderthe Lenders or the Required Lenders, to release its Liens relating to the particular property or assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) all or substantially all of the property or assets or a majority of the Voting Stock of any Person, Person (other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, goods, materials, property and equipment in the ordinary course of business, except as otherwise limited or prohibited herein) or (ii) enter into any transaction of merger or consolidation, except for (A) Investments Permitted Acquisitions, (B) investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity6.6, (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (zC) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower is a party thereto, the Borrower will be the surviving corporation, and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit Party.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties will not, nor will they permit any Subsidiary to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets (each a “Disposition”) or agree to do so at a future time, except the following, without duplication, shall be expressly permitted: (A) the sale, transfer, lease or other disposition of inventory and materials in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cash; (ii) Extraordinary Receipts for which such Credit Party the sale, transfer or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such other disposition of property or assets to an unrelated party not in the ordinary course of business where and to the extent that they are the result of a Recovery Event; to the extent Net Cash Proceeds from such Extraordinary Receipt Recovery Event are reinvested or used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii2.7(b)(iv); (iii) the sale, lease, transfer or other disposition of machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties or any of their Subsidiaries; (iv) (A) the sale, lease or transfer of property or assets from one Credit Party to another Credit Party, (B) the sale, lease Party or transfer dissolution of property or assets from a Subsidiary to a any Credit Party (other than the Borrower) to the extent any and (C) the sale, lease or transfer all assets of property or assets from a Subsidiary that is not a such Credit Party are distributed to another Subsidiary that is not a Credit Party; (v) the termination of any Hedging Agreement; (vi) the Hawthorne Asset Disposition; andsale, lease, transfer, closure or other disposition of Restaurants, the termination or non-renewal of leases and Franchise Agreements or the subletting of Restaurants, in each case as determined to be prudent in the reasonable judgment of the senior officers of the Borrower; (vii) Sale Leaseback transactions to the extent permitted under Section 6.12; (viii) the sale, lease or transfer of property or assets not to exceed $10,000,000 2,500,000 in the aggregate in any fiscal year, excluding transfers made ; (ix) sale or transfer of Restaurant property or assets to Burger King Corporation pursuant to Section 6.4(a)(iv)the asset purchase agreement entered into in connection with the Burger King Acquisition; and (x) the sale, lease or transfer of the Fiesta Leases to Fiesta or one of its Subsidiaries. provided that (A) with respect to clauses (i)(A), (ii), (iii), (vi), (vii), (viii) and (viiix) above, at least 75% of the consideration received therefor by the Credit Parties or any such Subsidiary shall be in the form of cash or Cash Equivalents, assets used in the business or Capital Stock, (B) after giving effect to any Asset Disposition pursuant to clause (vii) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month fiscal quarter for which information is available, available and (C) with respect to clauses (iv), (v), (vi) and clause (vii) above, no Default or Event of Default shall exist or shall result therefrom; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitledshall, without the consent of any Lender, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, other than (A) Permitted Acquisitions and Permitted Investments and Acquisitions, (B) the lease or acquisition of real property in connection with Permitted Construction Transactions, (C) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business, business and (D) Investments permitted by Section 6.5 or (ii) enter into any transaction of merger or consolidation, except for (A) Investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity, (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower is a party thereto, the Borrower will be the surviving corporation, and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit Party.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties will not, nor will they permit any Subsidiary to,: (a) dissolve, liquidate or wind up its affairs, consolidate or merge with another Person, or sell, transfer, lease or otherwise dispose of its property or assets or agree to do so at a future time, time except the following, without duplication, shall be expressly permitted: (Ai) the sale, transfer, lease or other disposition of inventory and materials in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cashSpecified Sales; (ii) Extraordinary Receipts for which such Credit Party or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such the disposition of property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt are used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii)as a result of a Recovery Event; (iii) the sale, lease, transfer or other disposition of machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties or any of their Subsidiaries; (iv) (A) the sale, lease or transfer of property or assets from one Credit Party to another Credit Party, (B) the sale, lease or transfer of property or assets from a Credit Party to another Credit Party; provided that prior to or simultaneously with any such sale, lease or transfer, all actions reasonably required by the Administrative Agent shall be taken to insure the continued perfection and priority of the Administrative Agent’s Liens on such property and assets; (iv) the consolidation, liquidation or merger of a Credit Party into another Credit Party or any Subsidiary into a Credit Party; provided that (A) prior to a or simultaneously with any such consolidation, liquidation or merger, all actions reasonably required by the Administrative Agent shall be taken to insure the continued perfection and priority of the Administrative Agent’s Liens on the property and assets of each such Credit Party and (CB) if such consolidation, liquidation or merger involves the saleBorrower, lease or transfer of property or assets from a Subsidiary that is not a Credit Party to another Subsidiary that is not a Credit Partythe Borrower shall be the surviving entity; (v) the termination dissolution, liquidation or winding up of a Immaterial Subsidiary or any Hedging Agreementsale, transfer or other disposition of assets from a Immaterial Subsidiary to a Credit Party or another Immaterial Subsidiary; (vi) the Hawthorne Asset Disposition; andtermination of any Hedging Agreement permitted pursuant to Section 6.1; (vii) Sale‑Leaseback Transactions permitted pursuant to Section 6.12(ii); (viii) the closing or relocation of Restaurants; provided that (i) the sale, lease transfer or transfer other disposition of property or assets in connection with the closing or relocation of Restaurants does not to exceed $10,000,000 in any fiscal year or $25,000,000 in the aggregate during the term of this Credit Agreement or (ii) the transfer of any property or assets in any fiscal yearconnection with the closing or relocation of Restaurants is made to a Credit Party; and (ix) other sales, leases or transfers of property or assets (excluding transfers made pursuant sale and lease‑back transactions) in an amount not to Section 6.4(a)(iv)exceed $25,000,000 in the aggregate during the term of this Credit Agreement; provided that (A) provided, that, with respect to clauses (i)(A), (ii), (iii), (vii) and (viiv) above, at least 75% of the consideration received therefor by the such Credit Parties or any such Subsidiary Party shall be in the form of cash or Cash Equivalents, (B) after giving effect to any Asset Disposition pursuant to clause (vii) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is available, and (C) with respect to clauses (iv), (v), (vi) and (vii) above, no Default or Event of Default shall exist or shall result therefrom; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lender, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, Person (other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, leases, materials, property and equipment in the ordinary course of business, except as otherwise limited or prohibited herein) or (ii) enter into any transaction of merger or consolidation, except for (A) Investments or acquisitions transactions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity, 6.4(a) and (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower is a party thereto, the Borrower will be the surviving corporation, and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit PartyInvestments permitted pursuant to Section 6.5.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties will not, nor will they permit any Subsidiary to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets or agree to do so at a future time, except the following, without duplication, shall be expressly permitted: (i) (A) the sale, transfer, lease or other disposition of inventory and materials property, plant, equipment or other assets for fair market value, in the ordinary course of business (other than any Collateral and the Acquired Properties) so long as the proceeds thereof are used to reduce the Term Loan in accordance with Section 2.7(b) and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cash; (ii) Extraordinary Receipts for which such Credit Party or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt related to any Collateral are used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii2.7(b)(iv); (iii) the sale, lease, transfer or other disposition of machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties or any of their Subsidiaries; (iv) (A) the sale, lease or transfer of property or assets from one Credit Party to another Credit PartyParty or from one Subsidiary that is not a Credit Party to another Subsidiary; (v) the termination of any Hedging Agreement other than a Hedging Agreement required pursuant to Section 5.13; and (vi) in addition to subsection (iv) above, (B) the sale, lease or transfer of property or assets from a any Subsidiary to any other Subsidiary for the purpose of entering into a Credit Party and (C) the sale, lease or transfer of property or assets from a Subsidiary collateralized debt obligation financing that is not a Credit Party to another Subsidiary that is not a Credit Party; (v) the termination of any Hedging Agreement; (vi) the Hawthorne Asset Disposition; and (vii) the sale, lease or transfer of property or assets not to exceed $10,000,000 in the aggregate in any fiscal year, excluding transfers made otherwise permitted pursuant to this Agreement, provided that net proceeds from such financing shall be used to first repay the applicable obligations pursuant to the Wachovia Repurchase Facility and then to repay the Term Loan in accordance with Section 6.4(a)(iv2.7(b); provided that (A) with respect to clauses (i)(A), (ii), (iii), (vi) and (viivi) above, at least 75% of the consideration received therefor by the Credit Parties or any such Subsidiary shall be in the form of cash or Cash Equivalents, Equivalents and (B) after giving effect to any Asset Disposition pursuant to clause (vii) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is available, and (C) with respect to clauses (i), (iv), (v), (vi) and (viivi) above, no Default or Event of Default shall exist or shall result therefrom; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lender, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, other than (A) Permitted Acquisitions and Permitted Investments and (B) than, except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, property real estate and equipment real estate related assets (including derivatives thereof) in the ordinary course of businessbusiness and consistent with the Parent’s past practices, or (ii) enter into any transaction of merger or consolidation, except for (A) Investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity, (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower is a party thereto, the Borrower will be the surviving corporation, and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit Party.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Each of the Credit Parties will not, nor will they it permit any Subsidiary to, (a) dissolve, liquidate or wind up its affairs, consolidate or merge with another Person, or sell, transfer, lease or otherwise dispose of its property or assets or agree to do so at a future time, time except the following, without duplication, shall be expressly permitted: (Ai) the sale, transfer, lease or other disposition of inventory and materials in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cashbusiness; (ii) Extraordinary Receipts for which such Credit Party the sale, transfer or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such other disposition of Cash Equivalents; (A) the disposition of property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt are used to make mandatory prepayments as a direct result of a Recovery Event or otherwise used pursuant to Section 2.7(b)(vii); (iiiB) the sale, lease, transfer or other disposition of machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties Borrower or any of their its Subsidiaries, so long as the net proceeds therefrom are used to replace such machinery, parts and equipment or to purchase or otherwise acquire new assets or property within 180 days of receipt of the net proceeds or such longer period, in the case of a Recovery Event, as may be reasonably agreed to by the Administrative Agent; (iv) (A) the sale, lease or transfer of property or assets from one Credit Party to another Credit Party, (Bfor fair market value) between the Borrower and any Guarantor; (v) the sale, lease or transfer of property or assets from a Subsidiary to a Credit Party and (C) other than the sale, lease or transfer of property or assets from a Subsidiary that is not a Credit Party Borrower to another Subsidiary that is not a Credit Party; (v) the termination of any Hedging Agreement; (vi) the Hawthorne Asset Disposition; and (vii) the sale, lease or transfer of property or assets not to exceed $10,000,000 1,000,000 in the aggregate in any fiscal year, excluding transfers made pursuant to Section 6.4(a)(iv); (vii) the voluntary termination of Hedging Agreements; (viii) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower is a party thereto, the Borrower will be the surviving entity; and (Aix) the merger of Universal Manufacturing & Logistics GmbH with respect to and into Blitz 05-106 GmbH. provided, that, in the case of clauses (i)(Ai), (ii), (iii), (vi) and (viivi) above, at least 7580% of the consideration received therefor by the Credit Parties Borrower or any such Subsidiary shall be other Credit Party is in the form of cash (or a receivable which shall result in the payment of cash) or Cash Equivalents, (B) after giving effect to any Asset Disposition pursuant to clause (vii) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is available, and (C) with respect to clauses (iv), (v), (vi) and (vii) above, no Default or Event of Default shall exist or shall result therefrom; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lenderthe Required Lenders, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, Person (other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, leases, materials, property and equipment in the ordinary course of business, except as otherwise limited or prohibited herein) or (ii) enter into any transaction of merger or consolidation, except for (A) Investments investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity6.5, (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower is a party thereto, the Borrower will be the surviving corporationentity, and (C) the merger or consolidation of a Subsidiary that is not a Credit Party Universal Manufacturing & Logistics GmbH with and into another Subsidiary that is not a Credit Party.Blitz 05-106 GmbH.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties Borrower will not, nor will they it permit any Subsidiary to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets or agree to do so at a future time, time except the following, without duplication, shall be expressly permitted: (Ai) Specified Sales; (ii) the sale, transfer, lease or other disposition of inventory and materials property or assets to an unrelated party not in the ordinary course of business (other than Specified Sales), where and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cash; (ii) Extraordinary Receipts for which such Credit Party or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt that they are the result of a Recovery Event or otherwise and the net proceeds therefrom are used to make mandatory prepayments repair or replace damaged property or to purchase or otherwise used pursuant to Section 2.7(b)(vii)acquire new assets or property, provided that such purchase or acquisition is consummated within 180 days of such receipt; (iii) the sale, lease, transfer or other disposition of machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties or any of their Subsidiaries; (iv) (A) the sale, lease or transfer of property or assets from one Credit Party to another Credit Party, (B) the sale, lease or transfer of property or assets from a Subsidiary to a Credit Party and (C) the sale, lease or transfer of property or assets from a Subsidiary that is not a Domestic Credit Party to another Subsidiary that is not a Domestic Credit Party; (viv) the termination sale and lease of any Hedging Agreement; (vi) the Hawthorne Asset DispositionG&L Industries' property permitted pursuant to Section 6.13 hereof; and (viiv) the sale, lease or transfer of property or assets not to exceed $10,000,000 15,000,000 in the aggregate aggregate. provided, that in any fiscal year, excluding transfers made pursuant to Section 6.4(a)(iv); provided that each case (A) except with respect to clauses (i)(A), (ii), clause (iii), (vi) and (vii) above, ) at least 75% of the consideration received therefor by the Credit Parties Borrower or any such Subsidiary shall be is in the form of cash or Cash Equivalents. SUBPART 3.1 Notwithstanding anything in the Credit Documents to the contrary, (B) after giving effect subject to any Asset Disposition pursuant to clause (vii) abovethe conditions set forth below, the Credit Parties shall be in compliance on a Pro Forma Basis with Lenders hereby consent to the financial covenants set forth in Section 5.9 hereofIP Transfers, recalculated for the most recently ended month for which information is availableForeign Subsidiary Reorganization, the Swift Redemption and (C) with the Debt Pushdown: a. With respect to clauses (iv)each of the IP Transfers and the Debt Pushdown, (v)the Agent shall have received all items required by Sections 5.10 and 5.12 of the Credit Agreement; and b. With respect to the Foreign Subsidiary Reorganization, (vi) the Agent shall have received all items required by Sections 5.10 and (vii) above, no Default or Event 5.12 of Default shall exist or shall result therefromthe Credit Agreement; provided, furtherhowever, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lender, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business, or (ii) enter into any transaction of merger or consolidation, except for (A) Investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity, (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower is shall not be required to deliver a party thereto, pledge of 65% of the Borrower will be Capital Stock of Newco until 120 days from the surviving corporation, and (C) the merger or consolidation date of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit Partyformation of Newco.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties will not, nor will they permit any Subsidiary to, (a) dissolve, dissolve or liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets or agree to do so at a future timetime (other than agreements to dispose of property or assets with a fair market value less than $1,000,000 individually or $5,000,000 in the aggregate during the term of this Agreement), except the following, without duplication, shall be expressly permitted: (i) (A) the sale, transfer, lease lease, sublease or other disposition of inventory and materials property in the ordinary course of business and business; (B) the conversion of cash into Cash Equivalents and Permitted Cash Equivalents Collateral and the conversions from one type of Permitted Cash Collateral into cashanother type of Permitted Cash Collateral in compliance with the provisions hereof and (C) the licensing out of intellectual property and other rights; (ii) Extraordinary Receipts Recovery Events for which such Credit Party or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt Recovery Event are used to make mandatory prepayments or otherwise used reinvested pursuant to Section 2.7(b)(vii2.5(b)(vi); (iii) the sale, lease, sublease, transfer or other disposition of property, machinery, parts and equipment and other goods no longer used or useful in in, or consistent with the Borrower’s plans for, the conduct of the business of the Credit Parties or any of their Subsidiaries; (iv) (A) the sale, lease or transfer of property or assets from the Borrower or any Subsidiary to a Credit Party or from one Credit Party to another Credit Party, (B) the sale, lease Party or transfer of property or assets from a Subsidiary to a Credit Party and (C) the sale, lease or transfer of property or assets from a any Subsidiary that is not a Credit Party to another any other Subsidiary that is not a Credit Party; (v) the termination of any Hedging Agreement; (vi) the Hawthorne Asset Dispositionsale of Permitted Cash Collateral; provided, that the Borrower shall comply with the provisions of Section 2.5(b)(v) with respect to the proceeds of such sale to the extent applicable; (vii) the liquidation or dissolution of any Subsidiary that is not a Credit Party if the assets of such Subsidiary are transferred to a Credit Party after the repayment of all Indebtedness and other obligations of such Subsidiary upon liquidation or dissolution; (viii) the disposition of any property or assets for purposes of making a Permitted Investment; and (viiix) the sale, lease or transfer of property or assets not to exceed $10,000,000 in net cash proceeds in the aggregate in any fiscal year, excluding transfers made pursuant to Section 6.4(a)(iv)during the term of the Agreement; provided that (A) with respect to clauses (i)(A), (ii), (iii), (vi) and (viiix) above, except for transactions involving assets with a fair market value (as determined by a Responsible Officer) not exceeding $2,000,000 in any fiscal year, at least 75% of the consideration received therefor by the Credit Parties or any such Subsidiary shall be in the form of cash or Cash Equivalents, (B) with respect to clause (vi) above, 100% of the consideration received therefor by the Credit Parties shall be Permitted Cash Collateral, (C) after giving effect to any Asset Disposition pursuant to clause (viiix) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month quarter for which information is available, and (CD) with respect to clauses (iv), (v), (vi) and (vii) above, no Default or Event of Default shall exist or shall result therefrom; provided, further, that with respect to sales dispositions of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lender, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) all or substantially all of the property or assets of any Person, other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business, or (ii) enter into any transaction of merger or consolidation, except for (A) in connection with Investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entityentity or the surviving entity will become a Credit Party concurrently with effectiveness of the merger or consolidation, (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower is a party thereto, the Borrower will be the surviving corporation, and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit PartyParty and (D) any merger or consolidation, the purpose or effect of which is to effect, all or in part, a disposition permitted pursuant to Section 6.4(a) or an Investment permitted pursuant to Section 6.5.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties will not, nor will they permit any Subsidiary to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets or agree to do so at a future time, except the following, without duplication, shall be expressly permitted: (A) the sale, transfer, lease or other disposition of inventory and materials in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cash; (ii) Dispositions resulting in Extraordinary Receipts for which such Credit Party or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt are used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii)assets; (iii) the sale, lease, transfer or other disposition of machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties or any of their Subsidiaries; (iv) (A) the sale, lease or transfer of property or assets from one Credit Party to another Credit Party, (B) the sale, lease or transfer of property or assets from a Subsidiary to a Credit Party and Party, (C) the sale, lease or transfer of property or assets from a Subsidiary that is not a Credit Party to another Subsidiary that is not a Credit Party, (D) the dissolution of any Credit Party to the extent any and all assets of such Credit Party at the time of such dissolution are distributed to another Credit Party, (E) the dissolution of a Subsidiary that is not a Credit Party to the extent any and all assets of such Subsidiary at the time of such dissolution are distributed to another Subsidiary; (v) the termination of any Hedging Agreement; (vi) the Hawthorne Asset Disposition; and (vii) the sale, lease or transfer of property or assets not to exceed $10,000,000 in the aggregate greater of, in any fiscal year, (i) $50,000,000 and (ii) 7.5% of Consolidated Total Tangible Assets, excluding transfers made pursuant to Section 6.4(a)(iv); (vii) the dissolution, liquidation or winding up of the affairs of, or the sale, transfer, lease or other disposition of the property or assets of, any Subsidiary in connection with the Permitted Reorganization; and (viii) sale leaseback transactions to the extent permitted pursuant to Section 6.12; provided that (A) with respect to clauses (i)(A), (ii), (iii), (vi) and (viiviii) above, at least 75% of the consideration received therefor by the Credit Parties or any such Subsidiary shall be in the form of cash or Cash Equivalents, (B) after giving effect to any Asset Disposition disposition pursuant to clause (viivi) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is available, and (C) with respect to clauses (iv), (v), (vi) and (viiviii) above, no Default or Event of Default shall exist or shall result therefrom; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lender, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business, or (ii) enter into any transaction of merger or consolidation, except for (A) Investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity, (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower is a party thereto, the Borrower will be the surviving corporation, and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit Party. For avoidance of doubt, an issuance by the Borrower of its Equity Interests shall not be prohibited by this Section 6.4.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Each of the Credit Parties will not, nor will they it permit any Subsidiary to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets or agree to do so at a future time, time except the following, without duplication, shall be expressly permitted: (Ai) the sale, transfer, lease or other disposition of inventory and materials in the ordinary course of business and business; (Bii) the conversion of cash into Cash Equivalents and Cash Equivalents into cash; (iiA) Extraordinary Receipts for which such Credit Party or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such the disposition of property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt are used to make mandatory prepayments as a direct result of a Recovery Event or otherwise used pursuant to Section 2.7(b)(vii); (iiiB) the sale, lease, transfer or other disposition of machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties Parent or any of their Subsidiariesits Subsidiaries (including dispositions by Subsidiaries in connection with ceasing operations), so long as the net proceeds therefrom are used to prepay the Loans in accordance with the terms of Section 2.7(b)(ii) or to replace such machinery, parts and equipment or to purchase or otherwise acquire new assets or property in accordance with the terms of such Section; (iv) (A) the sale, lease or transfer of property or assets from one Credit Party to another Credit Party, between the Borrower and any Guarantor; (Bv) the sale, lease or transfer of property or assets from a Subsidiary to a Credit Party and (C) other than the sale, lease or transfer of property or assets from a Subsidiary that is not a Credit Party Borrower to another Subsidiary that is not a Credit Party; (v) the termination of any Hedging Agreement; (vi) the Hawthorne Asset Disposition; andvoluntary termination of Hedging Agreements; (vii) the transfer of assets pursuant to Permitted Investments; (viii) the liquidation of any Subsidiary of the Borrower into the Borrower or the liquidation of any Subsidiary of the Parent (other than the Borrower) into any other Subsidiary (provided, that if one of such Subsidiaries is a Guarantor, such Guarantor shall be the surviving entity); (ix) the sale, lease or transfer of property or assets not to exceed $10,000,000 5,000,000 in the aggregate in any fiscal year; provided, excluding transfers made pursuant to Section 6.4(a)(iv); provided that that, in the case of clause (A) with respect to clauses (i)(A), (ii), (iii), (vi) and (viiix) above, at least 75% of the consideration received therefor by the Credit Parties Borrower or any such Subsidiary shall be other Credit Party is in the form of cash or Cash Equivalents, (B) after giving effect to any Asset Disposition pursuant to clause (vii) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is available, and (C) with respect to clauses (iv), (v), (vi) and (vii) above, no Default or Event of Default shall exist or shall result therefrom; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lenderthe Required Lenders, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, Person (other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, leases, materials, property and equipment in the ordinary course of business, except as otherwise limited or prohibited herein) or (ii) enter into any transaction of merger or consolidation, except for (A) Investments investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity6.5, (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower is a party thereto, the Borrower will be the surviving corporation, corporation and (C) the merger or consolidation of a any Subsidiary that is not a Credit Party of the Parent (other than the Borrower) with and into another a Subsidiary of the Parent (other than the Borrower); provided, that if a Guarantor is not a Credit Partyparty thereto, the Guarantor will be the surviving corporation.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties will not, nor will they permit any Subsidiary to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets or agree to do so at a future time, time except the following, without duplication, shall be expressly permitted: (Ai) Specified Sales; (ii) the sale, transfer, lease or other disposition of inventory and materials property or assets (A) to an unrelated party not in the ordinary course of business (other than Specified Sales and (B) the conversion of cash into Cash Equivalents Scheduled Asset Dispositions), where and Cash Equivalents into cash; (ii) Extraordinary Receipts for which such Credit Party or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt that they are used to make mandatory prepayments the result of a Recovery Event or otherwise used pursuant to Section 2.7(b)(vii); (iiiB) the sale, lease, transfer or other disposition of machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties or any of their Subsidiaries, as appropriate, in its reasonable discretion, so long as and the net proceeds therefrom are used to repair or replace damaged property or to purchase or otherwise acquire new assets or property, provided that such purchase or acquisition is committed to within 180 days of receipt of the net proceeds and such purchase or acquisition is consummated within 270 days of receipt of such proceeds; (iv) (Aiii) the sale, lease or transfer of property or assets from one Credit Party to another Credit Party, (Bat fair value) between the Company and any Guarantor; (iv) the sale, lease or transfer of property or assets from a Subsidiary to a Credit Party and (C) other than the sale, lease or transfer of property or assets from a Subsidiary that is not a Company to another Credit Party to another (other than the Subsidiary that is not a Credit PartyBorrower); (v) the termination of any Hedging Agreement; (vi) the Hawthorne Scheduled Asset DispositionDispositions; and (viivi) the sale, lease or transfer of property or assets not to exceed $10,000,000 7,500,000 in the aggregate in any fiscal year; provided, excluding transfers made pursuant to Section 6.4(a)(iv); provided that in each case (A) with respect to clauses (i)(A), (ii), (iii), (vi) and (vii) above, at least 75% of the consideration received therefor by the Credit Parties or any such Subsidiary shall be is in the form of cash or Cash Equivalents, (B) after giving effect to any Asset Disposition pursuant to clause (vii) abovethe sale of such assets and the repayment of Indebtedness with the proceeds thereof, the Credit Parties shall would be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is availableavailable and will be in compliance with all other terms and conditions of this Credit Agreement, and (C) with respect to clauses (iv), (v), (vi) and (vii) above, no Default or Event of Default shall exist then exists or shall result therefromfrom such Asset Disposition; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lenderthe Required Lenders, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, Person (other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, leases, materials, property and equipment in the ordinary course of business, except as otherwise limited or prohibited herein) or (ii) enter into any transaction of merger or consolidation, except for (A) Investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity, (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower is a party thereto, the Borrower will be the surviving corporation, and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit Party6.5.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties will not, nor will they permit any Subsidiary to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets (each a “Disposition”) or agree to do so at a future time, except the following, without duplication, shall be expressly permitted: (A) the sale, transfer, lease or other disposition of inventory and materials in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cash; (ii) Extraordinary Receipts for which such Credit Party the sale, transfer or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such other disposition of property or assets to an unrelated party not in the ordinary course of business where and to the extent Net Cash Proceeds from such Extraordinary Receipt that they are used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii)the result of a Recovery Event; (iii) the sale, lease, transfer or other disposition of (A) machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties or any of their SubsidiariesSubsidiaries and (B) obsolete or worn out property, whether now owned or hereafter acquired, in the ordinary course of business; (iv) (A) the sale, lease or transfer of property or assets from one Credit Party to another Credit Party, (B) the sale, lease Party or transfer dissolution of property or assets from a Subsidiary to a Credit Party and (C) the sale, lease or transfer of property or assets from a Subsidiary that is not a any Credit Party to the extent any and all assets are distributed to another Subsidiary that is not a Credit Party; (v) the termination of any Hedging Agreement; (vi) Dispositions of equipment or real property to the Hawthorne Asset extent that (A) such property is exchanged for credit against the purchase price of similar replacement property within twelve (12) months of such Disposition or (B) the proceeds of such Disposition are reasonably promptly applied to the purchase price of such replacement property within 12 months of such Disposition; and; (vii) the licensing of Intellectual Property in the ordinary course of business consistent with past practice; (viii) Dispositions by the Borrower or any Subsidiary; provided that at any time after the Collateral Event, (i) with respect to asset sales for more than $300,000,000 per disposition or series of related dispositions, at least 75% of the consideration for any such asset sale shall consist of cash or cash equivalents (provided that for purposes of the 75% cash consideration requirement (x) the amount of any Indebtedness or other liabilities of the Borrower or any Subsidiary (as shown on such person’s most recent balance sheet or in the notes thereto) that are assumed by the transferee of any such assets, (y) the amount of any trade-in value applied to the purchase price of any replacement assets acquired in connection with such asset sale, and (z) any securities received by the Borrower or such Subsidiary from such transferee that are converted by the Borrower or such Subsidiary into cash or cash equivalents (to the extent of the cash or cash equivalents received) within 270 days following the closing of the applicable asset sale, shall each be deemed to be cash or cash equivalents) and (ii) immediately prior to the consummation of such asset sale, no Event of Default shall have occurred and be continuing and no Event of Default shall result therefrom; (ix) the sale, lease or transfer of property or assets as part of a Sale and Leaseback Transaction; (x) the merger of a Credit Party or a Subsidiary thereof with another Credit Party or a Subsidiary thereof to the extent permitted by Section 6.4(b)(ii) below; (xi) Dispositions of Equity Interests in Permitted JVs pursuant to the terms of the joint venture or equivalent agreements governing such Permitted JVs so long as such joint venture or equivalent agreements are not to exceed $10,000,000 solely between Persons that are Credit Parties, Subsidiaries or Affiliates of Credit Parties; (xii) terminations of leases by a Credit Party or a Subsidiary in the aggregate ordinary course of business that do not interfere in any fiscal yearmaterial respect with the business of the Credit Parties or their Subsidiaries; and (xiii) any sale, excluding transfers made pursuant to Section 6.4(a)(iv)transfer, assignment, disposition, abandonment or lapse of Intellectual Property that is no longer commercially practicable, usable or desirable in the conduct of business, in the ordinary course of business; provided that (A) with respect to clauses (i)(A), (ii), (iii), (vi) and (vii) above, at least 75% of the consideration received therefor by the Credit Parties or any such Subsidiary shall be in the form of cash or Cash Equivalents, (B) after giving effect to any Asset Disposition pursuant to clause clauses (viiviii) and (xi) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is available, and (CB) with respect to clauses (iv), (v), (vi), (viii) and (viixi) above, no Default or Event of Default shall exist or shall result therefrom; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lender, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business, or (ii) enter into consummate any transaction of merger or consolidation, except for (A) Investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity, (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower is a party thereto, the Borrower will be the surviving corporation, corporation and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit Party.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Each of the Credit Parties will not, nor will they it permit any Subsidiary of its Restricted Subsidiaries to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets or agree to do so at a future time, except the following, without duplication, shall be expressly permitted: (Ai) the sale, transfertransfer (including by way of license), lease or other disposition of inventory inventory, materials, tools, property, equipment, software and materials intellectual property, whether now owned or hereafter acquired, in the ordinary course of business and business, including any of the foregoing with an Unrestricted Subsidiary (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cashsubject to Section 8.06); (ii) Extraordinary Receipts for which such Credit Party or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt are used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii); (iii) the sale, lease, transfer or other disposition of machineryobsolete or worn-out property or assets, parts and equipment no longer used whether now owned or useful hereafter acquired, in the conduct ordinary course of business; (iii) the sale, transfer or other disposition of cash and Cash Equivalents for fair market value; (iv) Dispositions of accounts receivable in connection with the collection or compromise thereof in the ordinary course of business; (v) licenses, sublicenses, leases or subleases granted to others not interfering in any material respect with the business of the Credit Parties or any of their Borrower and its Subsidiaries; (ivvi) the disposition of property or assets as a direct result of a Recovery Event; (A) the sale, lease or transfer (including by way of license) of property or assets between Credit Parties, (B) the sale, lease or transfer (including by way of license) of other property or assets between (1) any Credit Party and any Restricted Subsidiary in an aggregate amount not to exceed $25,000,000 during the term of this Credit Agreement and (2) subject to Section 8.06, any Credit Party or any Restricted Subsidiary and any Unrestricted Subsidiary in an aggregate amount not to exceed $25,000,000 during the term of this Credit Agreement, (C) the sale, lease or transfer (including by way of license) of property or assets between Subsidiaries that are not Credit Parties; (viii) (A) the sale, lease or transfer (including by way of property or assets from one Credit Party to another Credit Party, (Blicense) the sale, lease or transfer of property or assets from a Subsidiary to a Credit Party and (C) the sale, lease or transfer of property or assets from a Subsidiary that is not a Credit Party to another Subsidiary that is not a Credit Party; (v) the termination of any Hedging Agreement; (vi) the Hawthorne Asset Disposition; and (vii) the sale, lease or transfer of property or assets not to exceed $10,000,000 50,000,000 in the aggregate in any fiscal year and (B) the sale lease or transfer (including by way of license) of property or assets not to exceed $35,000,000 during the term of this Credit Agreement; provided, that the aggregate amount of property or assets sold, leased or transferred (including by way of license) pursuant to the immediately foregoing clauses (A) and (B) shall not exceed $60,000,000 in the aggregate in any fiscal year, excluding transfers made pursuant to Section 6.4(a)(iv); (ix) the liquidation and/or dissolution of any Immaterial Domestic Subsidiary or any Immaterial Foreign Subsidiary; provided that the Credit Parties shall remain in compliance with Section 7.09(b) after giving effect to any such liquidation or dissolution; and (Ax) with respect to Dispositions and Investments permitted under Section 8.05. provided, that, in the case of clauses (i)(A), (iii), (iii), (vi) and (viivi) above, at least seventy-five percent (75% %) of the consideration received therefor by the Credit Parties Borrower or any such Subsidiary shall be is in the form of cash or Cash Equivalents, (B) after giving effect to any Asset Disposition pursuant to clause (vii) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is available, and (C) with respect to clauses (iv), (v), (vi) and (vii) above, no Default or Event of Default shall exist or shall result therefrom; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lender, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (including by way of license), whether in a single transaction or a series of related transactions) , the property or assets of any Person, Person (other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, tools, property, equipment, software or intellectual property and equipment in the ordinary course of business, including any of the foregoing with an Unrestricted Subsidiary (subject to Section 8.06), except as otherwise limited or prohibited herein) or (ii) enter into any transaction of merger or consolidation, except except, in each case, for (A) Investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity8.05, (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party or other Subsidiary with and into another Credit Party; provided that if Party (with the Borrower is a party thereto, the Borrower will be Credit Party being the surviving corporationentity), and (C) the merger or consolidation of an Unrestricted Subsidiary with and into any Restricted Subsidiary or another Unrestricted Subsidiary or (D) the merger or consolidation of a Restricted Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit PartyRestricted Subsidiary.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Each of the Credit Parties (other than the Parent with respect to subclauses (a) and (b)(i) below) will not, nor will they the Borrower or any Subsidiary Guarantor permit any Subsidiary to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets or agree to do so at a future time, time except the following, without duplication, shall be expressly permitted: (Ai) the sale, transfer, lease or other disposition of inventory and materials in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cashbusiness; (ii) Extraordinary Receipts for which such Credit Party the sale, transfer or such Subsidiary has received any other disposition of cash insurance proceeds or condemnation or expropriation award with respect to such and Cash Equivalents; (A) the disposition of property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt are used to make mandatory prepayments as a direct result of a Recovery Event or otherwise used pursuant to Section 2.7(b)(vii); (iiiB) the sale, lease, transfer or other disposition of machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties Borrower or any of their its Subsidiaries, so long as the net proceeds therefrom are used to replace such machinery, parts and equipment or to purchase or otherwise acquire new assets or property within 180 days of receipt of the net proceeds; (iv) (A) the sale, lease or transfer of property or assets from one Credit Party to another Credit Party, (B) between or among the sale, lease or transfer of property or assets from a Borrower and the Subsidiary to a Credit Party and (C) the sale, lease or transfer of property or assets from a Subsidiary that is not a Credit Party to another Subsidiary that is not a Credit PartyGuarantors; (v) the termination of any Hedging AgreementAgreement permitted pursuant to Section 6.1(e); (vi) the Hawthorne Asset Disposition; and (vii) the sale, lease or transfer of property or assets not to exceed $10,000,000 1,000,000 in the aggregate in any fiscal year; and (vii) liquidate or dissolve any Subsidiary that has no assets or that has sold, excluding transfers made pursuant disposed of or otherwise transferred all of its assets to Section 6.4(a)(iv)the Borrower or a Subsidiary Guarantor; provided that (A) with respect to provided, that, in the case of clauses (i)(Ai), (ii), (iii), (vi) and (viivi) above, at least 75% of the consideration received therefor therefore by the Credit Parties Borrower or any such Subsidiary shall be other Credit Party is in the form of cash or Cash Equivalents, (B) after giving effect to any Asset Disposition pursuant to clause (vii) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is available, and (C) with respect to clauses (iv), (v), (vi) and (vii) above, no Default or Event of Default shall exist or shall result therefrom; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lenderthe Required Lenders, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, Person (other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, leases, materials, property and equipment in the ordinary course of business, except as otherwise limited or prohibited herein) or (ii) enter into any transaction of merger or consolidation, except for (A) Investments consummation of the Acquisition, (B) investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity6.5, (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (zC) the merger or consolidation of a Credit Party (other than the Parent) with and into another Credit PartyParty (other than the Parent); provided that that (1) if the Borrower is a party thereto, the Borrower will be the surviving corporation, corporation and (C2) the Administrative Agent's Liens with respect to the Collateral of each Credit Party involved in such merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit Partyshall remain continuously perfected.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties will not, nor will they permit any Subsidiary to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets (each a “Disposition”) or agree to do so at a future time, except the following, without duplication, shall be expressly permitted: (i) (A) the sale, transfer, lease or other disposition Dispositions of inventory and materials in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cash; (ii) Extraordinary Receipts for which such Credit Party or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such Dispositions of property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt are used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii)as a result of a Recovery Event; (iii) the sale, lease, transfer or other disposition Dispositions of machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties or any of their Subsidiaries; (iv) the dissolution of (A) the sale, lease or transfer of property or assets from one any Credit Party (other than the Borrowers) to the extent any and all assets of such Credit Party are distributed to another Credit Party, (B) the sale, lease or transfer of property or assets from a Subsidiary to a Credit Party and (CB) the sale, lease or transfer of property or assets from a any Subsidiary that is not a Credit Party to the extent any and all assets of such Subsidiary are distributed to a Credit Party or another Subsidiary that is not a Credit Party; (v) Dispositions not contemplated by the other clauses set forth in this Section 6.4(a) by the Credit Parties and their Subsidiaries so long as such Dispositions, which when taken together with intercompany Indebtedness and Investments permitted by Section 6.5(d), do not violate the limitations and other requirements permitted by Section 6.1(d); (vi) the termination of any Hedging Agreement; (vi) the Hawthorne Asset Disposition; and (vii) the sale, lease or transfer of property or assets account receivables in the commercially reasonable judgment of the Credit Parties and in the ordinary course of business; (viii) Dispositions in the form of sale-leaseback transactions in an amount not to exceed $10,000,000 6,000,000 in the aggregate during the term of this Agreement; (ix) the sale, lease or transfer of property or assets of a nature not contemplated by the foregoing clauses hereof not to exceed $5,000,000 in the aggregate in any fiscal year; provided, excluding however, the aggregate amount of all sales, leases and transfers made of property or assets pursuant to Section 6.4(a)(iv)this clause (ix) shall not exceed $15,000,000 during the term of this Agreement; and (x) any disposition of receivables (and related supporting obligations) pursuant to the terms of the Permitted Receivables Purchase Facility so long as no Default or Event of Default has occurred or is continuing or would result therefrom. provided that (A) with respect to clauses (i)(A), (ii), (iii), (v), (vi), (vii) and (viiviii) above, at least 75% of the consideration received therefor by paid to the Credit Parties or any such Subsidiary shall be in the form of cash or Cash Equivalents, (B) immediately after giving effect to any Asset Disposition pursuant to clause (vii) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month fiscal quarter for which information is available, and (C) with respect to clauses (iv), (v), (vi), (vii), (viii) and (viiix) above, no Default or Event of Default shall exist or shall result therefromtherefrom and (D) any Disposition pursuant to clauses (i), (iii) and (vii) shall be for fair market value; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lender, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business, or (ii) enter into any transaction of merger or consolidation, except for (A) Investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity, (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the any Borrower is a party thereto, the such Borrower will be the surviving corporation, and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit Party.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties Borrower will not, nor will they it permit any Restricted Subsidiary to, (a) dissolveenter into any transaction of merger or consolidation or amalgamation, liquidate or liquidate, wind up its affairsor dissolve itself (or suffer any liquidation or dissolution); (b) acquire any business or assets from, or sellCapital Stock of, transferor be a party to any acquisition of, lease or otherwise dispose of its property or assets or agree to do so at a future time, except the following, without duplication, shall be expressly permittedany Person except: (Ai) the sale, transfer, lease or other disposition for purchases of inventory and materials other assets to be sold or used in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cashbusiness; (ii) Extraordinary Receipts for which such Credit Party or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt are used to make mandatory prepayments or otherwise used pursuant to Investments permitted under Section 2.7(b)(vii);6.5 hereof; and (iii) the salePermitted Acquisitions; (c) convey, sell, lease, transfer or other disposition otherwise dispose of, in one transaction or a series of machinerytransactions, parts any part of its business or assets, whether now owned or hereafter acquired (including, without limitation, receivables and leasehold interests), but excluding: (i) any Excluded Disposition or Specified Sale; (ii) obsolete or worn-out Property, tools or equipment no longer used or useful in the conduct of the its business of the Credit Parties (other than any Excluded Disposition) or any of their Subsidiariesreal Property no longer used or useful in its business; (iviii) (A) the any sale, lease or transfer of property or assets from one a Credit Party to another Credit Party, ; (Biv) the sale, lease or transfer any sale of property or assets from a Subsidiary Transferred Assets by such Person to a Credit Party and (C) the sale, lease or transfer of property or assets from Receivables Financier in connection with a Subsidiary that is not a Credit Party to another Subsidiary that is not a Credit PartyPermitted Receivables Financing; (v) any sale to the termination of any Hedging Agreementextent permitted under Section 6.12; (vi) transfers of Capital Stock and assets pursuant to the Hawthorne Asset DispositionDFA Agreement, and sales, transfers and other dispositions required or requested by any Governmental Authority in connection with any required consent to transactions contemplated by the Merger Agreement; and (vii) the sale, lease or transfer transfers of property or other assets not to exceed $10,000,000 in so long as the aggregate amount thereof sold or otherwise disposed of in any single fiscal year by the Borrower and its Restricted Subsidiaries shall not have a book value in excess of ten percent of the book value of the total assets of the Borrower and its Restricted Subsidiaries owned on the later of the Funding Date or the first day of such fiscal year; PROVIDED, excluding transfers made pursuant to Section 6.4(a)(iv); provided that (A) in each case with respect to clauses (i)(A), (ii), (iii), (vi) and subsections (vii) above, above at least 7585% of the consideration received therefor by the Credit Parties Borrower or any such Restricted Subsidiary shall be is in the form of cash or Cash EquivalentsEquivalents or Capital Stock or assets acquired in connection with a Permitted Acquisition or Permitted Investment; and (d) Notwithstanding the foregoing provisions of this Section 6.4, (B) so long as no Default or Event of Default shall have occurred and be continuing, and after giving effect to any Asset Disposition pursuant to clause (vii) above, of the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is available, and (C) with respect to clauses (iv), (v), (vi) and (vii) abovesucceeding transactions, no Default or Event of Default shall would exist or shall result therefrom; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lender, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business, or (ii) enter into any transaction of merger or consolidation, except for (A) Investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject Liens created under the Security Documents continue to such merger be in effect: (i) any Restricted Subsidiary of the Borrower may be merged or consolidation is consolidated with or into: (A) the Borrower if the Borrower shall be the continuing or surviving entity, corporation or (B) any other Subsidiary (so long as such surviving Subsidiary is either (x) a Credit Party or (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a an Additional Credit Party; provided that such Credit Party will be the surviving entity and ); (zii) the merger or consolidation any Restricted Subsidiary of a Credit Party with and into another Credit Party; provided that if the Borrower is a party theretomay sell, lease, transfer or otherwise dispose of any or all of its assets (upon voluntary liquidation or otherwise) to the Borrower will or a Restricted Subsidiary of the Borrower; and (iii) any Unrestricted Subsidiary may be the surviving corporationsold, and (C) the merger liquidated, wound up or consolidation dissolved, or may sell, lease, transfer or otherwise dispose of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit Partyany or all of its assets.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties Parent Guarantor will not, nor will they it permit any Subsidiary to, (a) dissolveexcept as provided in Section 6.4(d) below, liquidate enter into any transaction of merger or consolidation or amalgamation, or liquidate, wind up its affairsor dissolve itself (or suffer any liquidation or dissolution); (b) acquire any business or assets from, or sellCapital Stock of, transferor be a party to any acquisition of, lease or otherwise dispose of its property or assets or agree to do so at a future time, except the following, without duplication, shall be expressly permittedany Person except: (Ai) the sale, transfer, lease or other disposition for purchases of inventory and materials other assets to be sold or used in the ordinary course of business; and (ii) Investments permitted under Section 6.5 hereof; (c) convey, sell, lease, transfer or otherwise dispose of, in one transaction or a series of transactions, any part of its business or assets, whether now owned or hereafter acquired (including, without limitation, receivables and leasehold interests), but excluding: (Bi) the conversion of cash into Cash Equivalents and Cash Equivalents into cashany Excluded Disposition; (ii) Extraordinary Receipts for which such Credit Party obsolete or such Subsidiary has received any cash insurance proceeds worn-out Property, tools or condemnation or expropriation award with respect to such property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt are used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii); (iii) the sale, lease, transfer or other disposition of machinery, parts and equipment no longer used or useful in the conduct of the its business of the Credit Parties (other than any Excluded Disposition) or any of their Subsidiariesreal Property no longer used or useful in its business; (iviii) (A) the any sale, lease or transfer of property or assets from one a Credit Party to another Credit Party, (B) the sale, lease or transfer of property or assets from a Subsidiary to a Credit Party and (C) the sale, lease or transfer of property or assets from a Subsidiary that is not a Credit Party to another Subsidiary that is not a Credit Party; (v) the termination of any Hedging Agreement; (vi) the Hawthorne Asset Disposition; and (viiiv) the sale, lease or transfer of property or other assets not to exceed $10,000,000 in provided that the aggregate current market value of all assets so sold or transferred (in each case determined at the time of such sale or transfer) shall not at any fiscal yeartime exceed, excluding transfers made when added to the assets sold or transferred pursuant to Section 6.4(a)(iv); provided that (A) with respect to clauses (i)(A)6.12 hereof, (ii), (iii), (vi) and (vii) above, at least 7510% of the consideration received therefor by current market value of the Credit Parties or any such Subsidiary shall be in total assets of the form of cash or Cash Equivalents, (B) Parent Guarantor and its Subsidiaries and immediately after giving effect to any Asset Disposition pursuant to clause (vii) abovesuch transaction, the Credit Parties Parent Guarantor and its Subsidiaries shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is available, hereof on a Pro Forma Basis and (C) with respect both before and after giving effect to clauses (iv), (v), (vi) and (vii) abovesuch transaction, no Default or Event of Default shall exist or shall result therefromhave occurred and be continuing; provided, further, that in each case with respect to sales subsection (iv) above at least 85% of assets permitted hereunder only, the Administrative Agent shall be entitled, without consideration received therefor by the consent Parent Guarantor or any such Subsidiary is in the form of any Lender, to release its Liens relating to the particular assets soldcash or Cash Equivalents; orand (bd) Notwithstanding the foregoing provisions of this Section 6.4, so long as no Default or Event of Default shall have occurred and be continuing, and after giving effect to any of the succeeding transactions, no Default or Event of Default would exist hereunder: (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business, or (ii) enter into any transaction of merger or consolidation, except for (A) Investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party may be merged or consolidated with or into another Credit Party; provided, that, subject to clause (D) immediately below, if one of the parties to such merger or consolidation is the Borrower, the Borrower shall be the continuing or surviving entitycorporation, (B) any Subsidiary may be merged or consolidated with or into another Credit Party so long as the surviving party is either (x) a Credit Party or (y) an Additional Credit Party; provided, that, subject to clause (D) immediately below, if one of the parties to such merger or consolidation is the Borrower, the Borrower shall be the continuing or surviving corporation, (C) any of a the Parent Guarantor or any Subsidiary may merge or consolidate with or into any Person that is not a Credit Party, provided that the applicable conditions set forth in Section 6.4(b) regarding acquisitions are complied with in connection with any such acquisition by merger, the Parent Guarantor or any such Subsidiary shall be the continuing or surviving corporation and immediately after giving effect to such transaction, the Parent Guarantor and its Subsidiaries shall be in compliance with the financial covenants set forth in Section 5.9 hereof on a Pro Forma Basis and (D) the Borrower may merge or consolidate with or into any Credit Party or with any Person wholly-owned and into controlled by a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; , provided that if the Borrower is a party theretonot the continuing or surviving entity, the surviving entity shall have assumed all obligations of the Borrower will under the Credit Documents and immediately after giving effect to such transaction, the Parent Guarantor and its Subsidiaries shall be in compliance with the surviving corporationfinancial covenants set forth in Section 5.9 hereof on a Pro Forma Basis and the ownership of the properties and assets of the Credit Parties as a whole shall remain unchanged; and (ii) any Subsidiary of the Parent Guarantor (other than the Borrower) may sell, and lease, transfer or otherwise dispose of any or all of its assets (Cupon voluntary liquidation or otherwise) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a to any Credit Party. The Borrower shall provide the Administrative Agent with prior written notice of any transaction described in this Section 6.4(d) and take such other action as may be required pursuant to the terms of Section 5.12.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties will not, nor will they permit any Subsidiary to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets or agree to do so at a future time, except the following, without duplication, shall be expressly permitted: (A) the sale, transfer, lease or other disposition of inventory and materials in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cash; (ii) Extraordinary Receipts for which such Credit Party or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt are used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii)Recovery Events; (iii) the sale, lease, transfer or other disposition of machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties or any of their Subsidiaries; (iv) (A) the sale, lease or transfer of property or assets from one Credit Party to another Credit Party, (B) the sale, lease or transfer of property or assets from a Subsidiary to a Credit Party and (C) the sale, lease or transfer of property or assets from a Subsidiary that is not a Credit Party to another Subsidiary that is not a Credit Party; (v) the termination of any Hedging Agreement; (vi) the Hawthorne Asset Disposition; and (vii) the sale, lease or transfer of property or assets (other than Core Business Asset Dispositions) not to exceed $10,000,000 1,000,000 in the aggregate in any fiscal year, excluding transfers made pursuant to Section 6.4(a)(iv); and (vii) Core Business Asset Dispositions. provided that (A) with respect to clauses (i)(A), (ii), (iii), (vi) and (viivi) above, at least 75% of the consideration received therefor by the Credit Parties or any such Subsidiary shall be in the form of cash or Cash Equivalents, (B) after giving effect to any Asset Disposition pursuant to clause (viivi) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is available, and (C) with respect to clauses (iv), (v), (vi) and (viivi) above, no Default or Event of Default shall exist or shall result therefrom; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of the any LenderLenders, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business, or (ii) enter into any transaction of merger or consolidation, except for (A) Investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity, (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower is a party thereto, the Borrower will be the surviving corporation, and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit Party.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties will not, nor will they permit any Subsidiary to, (a) , dissolve, liquidate or wind up its affairs, or sell, transfer, lease lease, consummate a Division as the Dividing Person or otherwise dispose of its property or assets (each a “Disposition”) or agree to do so at a future time, except the following, without duplication, shall be expressly permitted: (A) the sale, transfer, lease or other disposition of inventory and materials in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cash; (ii) Extraordinary Receipts for which such Credit Party ; the sale, transfer or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such other disposition of property or assets to an unrelated party not in the ordinary course of business where and to the extent Net Cash Proceeds from such Extraordinary Receipt that they are used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii); (iii) the result of a Recovery Event; the sale, lease, transfer or other disposition of (A) machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties or any of their Subsidiaries; Subsidiaries and (ivB) (A) obsolete or worn out property, whether now owned or hereafter acquired, in the ordinary course of business; the sale, lease or transfer of property or assets from one Credit Party to another Credit Party or dissolution of any Credit Party to the extent any and all assets are distributed to another Credit Party, ; the termination of any Hedging Agreement; Dispositions of equipment or real property to the extent that (A) such property is exchanged for credit against the purchase price of similar replacement property within twelve (12) months of such Disposition or (B) the proceeds of such Disposition are reasonably promptly applied to the purchase price of such replacement property within 12 months of such Disposition; the licensing of Intellectual Property in the ordinary course of business consistent with past practice; Dispositions by the Borrower or any Subsidiary; provided that at any time after the Collateral Event, (i) with respect to asset sales for more than $300,000,000 per disposition or series of related dispositions, at least 75% of the consideration for any such asset sale shall consist of cash or cash equivalents (provided that for purposes of the 75% cash consideration requirement (x) the amount of any Indebtedness or other liabilities of the Borrower or any Subsidiary (as shown on such person’s most recent balance sheet or in the notes thereto) that are assumed by the transferee of any such assets, (y) the amount of any trade-in value applied to the purchase price of any replacement assets acquired in connection with such asset sale, and (z) any securities received by the Borrower or such Subsidiary from such transferee that are converted by the Borrower or such Subsidiary into cash or cash equivalents (to the extent of the cash or cash equivalents received) within 270 days following the closing of the applicable asset sale, shall each be deemed to be cash or cash equivalents) and (ii) immediately prior to the consummation of such asset sale, no Event of Default shall have occurred and be continuing and no Event of Default shall result therefrom; the sale, lease or transfer of property or assets from as part of a Subsidiary to Sale and Leaseback Transaction; the merger of a Credit Party and (Cor a Subsidiary thereof with another Credit Party or a Subsidiary thereof to the extent permitted by Section 6.4(b)(ii) below; Dispositions of Equity Interests in Permitted JVs pursuant to the saleterms of the joint venture or equivalent agreements governing such Permitted JVs so long as such joint venture or equivalent agreements are not solely between Persons that are Credit Parties, lease Subsidiaries or transfer Affiliates of property Credit Parties; terminations of leases by a Credit Party or assets from a Subsidiary in the ordinary course of business that do not interfere in any material respect with the business of the Credit Parties or their Subsidiaries; any Subsidiary that is an LLC may consummate a Division as the Dividing Person if, immediately upon the consummation of the Division, the assets of the applicable Dividing Person are held by one or more Subsidiaries at such time, or, with respect to assets not so held by one or more Subsidiaries, such Division, in the aggregate, would otherwise result in a Credit Party to another Subsidiary Disposition permitted by Section 6.4(a)(viii) or (x) above; and any sale, transfer, assignment, disposition, abandonment or lapse of Intellectual Property that is not a Credit Party; (v) the termination of any Hedging Agreement; (vi) the Hawthorne Asset Disposition; and (vii) the saleno longer commercially practicable, lease usable or transfer of property or assets not to exceed $10,000,000 desirable in the aggregate conduct of business, in any fiscal year, excluding transfers made pursuant to Section 6.4(a)(iv)the ordinary course of business; provided that (A) with respect to clauses (i)(A), (ii), (iii), (vi) and (vii) above, at least 75% of the consideration received therefor by the Credit Parties or any such Subsidiary shall be in the form of cash or Cash Equivalents, (B) after giving effect to any Asset Disposition pursuant to clause clauses (viiviii) and (xi) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is available, and (CB) with respect to clauses (iv), (v), (vi), (viii) and (viixi) above, no Default or Event of Default shall exist or shall result therefrom; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lender, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business, or (ii) enter into consummate any transaction of merger merger, Division as the Dividing Person or consolidation, except for (A) Investments or acquisitions (including pursuant to a Division) permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger merger, Division or consolidation is the surviving entity, (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower is a party thereto, the Borrower will be the surviving corporation, and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit PartyParty and (D) any Credit Party or any Subsidiary may consummate a Division as the Dividing Person if, immediately upon the consummation of the Division, (x) the assets of the applicable Dividing Person are held by a Credit Party or one or more Subsidiaries at such time or, (y) with respect to assets not held by a Credit Party or one or more Subsidiaries, such Division, in the aggregate, would otherwise be permitted by this Section 6.4 (without reliance on this subclause (D)) and/or Section 6.5.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties Parent Borrower will not, nor will they it permit any Restricted Subsidiary to, (a) dissolveenter into any transaction of merger or consolidation or amalgamation, liquidate or liquidate, wind up its affairsor dissolve itself (or suffer any liquidation or dissolution); (b) acquire any business or assets from, or sellCapital Stock of, transferor be a party to any acquisition of, lease or otherwise dispose of its property or assets or agree to do so at a future time, except the following, without duplication, shall be expressly permittedany Person except: (Ai) the sale, transfer, lease or other disposition for purchases of inventory and materials other assets to be sold or used in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cashbusiness; (ii) Extraordinary Receipts for which such Credit Party or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt are used to make mandatory prepayments or otherwise used pursuant to Investments permitted under Section 2.7(b)(vii);6.5 hereof; and (iii) the salePermitted Acquisitions; (c) convey, sell, lease, transfer or other disposition otherwise dispose of, in one transaction or a series of machinerytransactions, parts any part of its business or assets, whether now owned or hereafter acquired (including, without limitation, receivables and leasehold interests), but excluding: (i) any Excluded Disposition; (ii) obsolete or worn-out Property, tools or equipment no longer used or useful in the conduct of the its business of the Credit Parties (other than any Excluded Disposition) or any of their Subsidiariesreal Property no longer used or useful in its business; (iviii) (A) the any sale, lease or transfer of property or assets from one a Credit Party to another Credit Party, ; (Biv) the sale, lease or transfer any sale of property or assets from a Subsidiary Transferred Assets by such Person to a Credit Party and (C) the sale, lease or transfer of property or assets from Receivables Financier in connection with a Subsidiary that is not a Credit Party to another Subsidiary that is not a Credit Party;Permitted Receivables Financing; and (v) other assets so long as the termination aggregate amount thereof sold or otherwise disposed of in any Hedging Agreement; single fiscal year by the Parent Borrower and its Restricted Subsidiaries shall not have a book value in excess of ten percent of the book value of the total assets of the Parent Borrower and its Restricted Subsidiaries owned on the first day of such fiscal year; provided, that in each case with respect to subsections (v) and (vi) the Hawthorne Asset Disposition; and (vii) the sale, lease or transfer of property or assets not to exceed $10,000,000 in the aggregate in any fiscal year, excluding transfers made pursuant to Section 6.4(a)(iv); provided that (A) with respect to clauses (i)(A), (ii), (iii), (vi) and (vii) above, above at least 7585% of the consideration received therefor by the Credit Parties Parent Borrower or any such Restricted Subsidiary shall be is in the form of cash or Cash Equivalents; and (d) Notwithstanding the foregoing provisions of this Section 6.4, (B) so long as no Default or Event of Default shall have occurred and be continuing, and after giving effect to any Asset Disposition pursuant to clause (vii) above, of the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is available, and (C) with respect to clauses (iv), (v), (vi) and (vii) abovesucceeding transactions, no Default or Event of Default shall would exist or shall result therefrom; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lender, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business, or (ii) enter into any transaction of merger or consolidation, except for (A) Investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject Liens created under the Security Documents continue to such merger be in effect: (i) any Restricted Subsidiary of the Parent Borrower may be merged or consolidation is consolidated with or into: (A) the Parent Borrower if the Parent Borrower shall be the continuing or surviving entity, corporation or (B) any other Subsidiary (so long as such surviving Subsidiary is either (x) a Credit Party or (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a an Additional Credit Party); (ii) any Restricted Subsidiary of the Parent Borrower may sell, lease, transfer or otherwise dispose of any or all of its assets (upon voluntary liquidation or otherwise) to the Parent Borrower or a Restricted Subsidiary of the Parent Borrower; provided that such Credit Party will and (iii) any Unrestricted Subsidiary may be the surviving entity and (z) the merger sold, liquidated, wound up or consolidation dissolved, or may sell, lease, transfer or otherwise dispose of a Credit Party with and into another Credit Party; provided that if the Borrower is a party thereto, the Borrower will be the surviving corporation, and (C) the merger any or consolidation all of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit Partyits assets.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Each of the Credit Parties will not, nor will they it permit any Subsidiary of its Restricted Subsidiaries to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets or agree to do so at a future time, except the following, without duplication, shall be expressly permitted: (Ai) the sale, transfertransfer (including by way of license), lease or other disposition of inventory inventory, materials, tools, property, equipment, software and materials intellectual property, whether now owned or hereafter acquired, in the ordinary course of business (including , without limitation, Dispositions of vehicles for purposes of fleet maintenance that are substantially consistent with the Credit Parties’ past practices and that are in the ordinary course of business), including any of the foregoing with an Unrestricted Subsidiary (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cashsubject to Section 8.06); (ii) Extraordinary Receipts for which such Credit Party or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt are used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii); (iii) the sale, lease, transfer or other disposition of machineryobsolete or worn-out property or assets, parts and equipment no longer used whether now owned or useful hereafter acquired, in the conduct ordinary course of business; (iii) the sale, transfer or other disposition of cash and Cash Equivalents for fair market value; (iv) Dispositions of accounts receivable in connection with the collection or compromise thereof in the ordinary course of business; (v) licenses, sublicenses, leases or subleases granted to others not interfering in any material respect with the business of the Credit Parties or any of their Borrower and its Subsidiaries; (ivvi) the disposition of property or assets as a direct result of a Recovery Event; (A) the sale, lease or transfer (including by way of license) of property or assets between Credit Parties, (B) the sale, lease or transfer (including by way of license) of other property or assets between (1) any Credit Party and any Restricted Subsidiary in an aggregate amount not to exceed $50,000,000 during the term of this Credit Agreement and (2) subject to Section 8.06, any Credit Party or any Restricted Subsidiary and any Unrestricted Subsidiary in an aggregate amount not to exceed $50,000,000 during the term of this Credit Agreement, (C) the sale, lease or transfer (including by way of license) of property or assets between Subsidiaries that are not Credit Parties; (viii) (A) the sale, lease or transfer (including by way of property or assets from one Credit Party to another Credit Party, (Blicense) the sale, lease or transfer of property or assets from a Subsidiary to a Credit Party and (C) the sale, lease or transfer of property or assets from a Subsidiary that is not a Credit Party to another Subsidiary that is not a Credit Party; (v) the termination of any Hedging Agreement; (vi) the Hawthorne Asset Disposition; and (vii) the sale, lease or transfer of property or assets not to exceed $10,000,000 50,000,000 in the aggregate in any fiscal year and (B) the sale lease or transfer (including by way of license) of property or assets not to exceed $35,000,000 during the term of this Credit Agreement; provided, that the aggregate amount of property or assets sold, leased or transferred (including by way of license) pursuant to the immediately foregoing clauses (A) and (B) shall not exceed $60,000,000 in the aggregate in any fiscal year, excluding transfers made pursuant ; (ix) the liquidation and/or dissolution of any Immaterial Domestic Subsidiary or any Immaterial Foreign Subsidiary; provided that the Credit Parties shall remain in compliance with Section 7.09(b) after giving effect to any such liquidation or dissolution; (x) Dispositions and Investments permitted under Section 6.4(a)(iv)8.05; and (xi) Dispositions of non-core assets acquired in a Permitted Acquisition; provided that (A) with respect to such Dispositions are completed within eighteen (18) months of such Permitted Acquisition and (B) such non-core assets do not exceed twenty-five percent (25%) of the total tangible assets acquired in such Permitted Acquisition. provided, that, in the case of clauses (i)(A), (iii), (iii), (vi) and (viivi) above, at least seventy-five percent (75% %) of the consideration received therefor by the Credit Parties Borrower or any such Subsidiary shall be is in the form of cash or Cash Equivalents, (B) after giving effect to any Asset Disposition pursuant to clause (vii) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is available, and (C) with respect to clauses (iv), (v), (vi) and (vii) above, no Default or Event of Default shall exist or shall result therefrom; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lender, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (including by way of license), whether in a single transaction or a series of related transactions) , the property or assets of any Person, Person (other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, tools, property, equipment, software or intellectual property and equipment in the ordinary course of business, including any of the foregoing with an Unrestricted Subsidiary (subject to Section 8.06), except as otherwise limited or prohibited herein) or (ii) enter into any transaction of merger or consolidation, except except, in each case, for (A) Investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity8.05, (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party or other Subsidiary with and into another Credit Party; provided that if Party (with the Borrower is a party thereto, the Borrower will be Credit Party being the surviving corporationentity), and (C) the merger or consolidation of an Unrestricted Subsidiary with and into any Restricted Subsidiary or another Unrestricted Subsidiary or (D) the merger or consolidation of a Restricted Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit PartyRestricted Subsidiary.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties will not, nor will they permit any Subsidiary to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets (each a “Disposition”) or agree to do so at a future time, except the following, without duplication, shall be expressly permitted: (A) the sale, transfer, lease or other disposition of inventory and materials in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cash; (ii) Extraordinary Receipts for which such Credit Party the sale, transfer or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such other disposition of property or assets to an unrelated party not in the ordinary course of business where and to the extent Net Cash Proceeds from such Extraordinary Receipt that they are used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii)the result of a Recovery Event; (iii) the sale, lease, transfer or other disposition of (A) machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties or any of their SubsidiariesSubsidiaries and (B) obsolete or worn out property, whether now owned or hereafter acquired, in the ordinary course of business; (iv) (A) the sale, lease or transfer of property or assets from one Credit Party to another Credit Party, (B) the sale, lease Party or transfer dissolution of property or assets from a Subsidiary to a Credit Party and (C) the sale, lease or transfer of property or assets from a Subsidiary that is not a any Credit Party to the extent any and all assets are distributed to another Subsidiary that is not a Credit Party; (v) the termination of any Hedging Agreement; (vi) Dispositions of equipment or real property to the Hawthorne Asset extent that (A) such property is exchanged for credit against the purchase price of similar replacement property within twelve (12) months of such Disposition or (B) the proceeds of such Disposition are reasonably promptly applied to the purchase price of such replacement property within 12 months of such Disposition; and; (vii) the licensing of Intellectual Property in the ordinary course of business consistent with past practice; (viii) Dispositions by the Borrower or any Subsidiary; provided that at any time after the Collateral Event, (i) with respect to asset sales for more than $300,000,000 per disposition or series of related dispositions, at least 75% of the consideration for any such asset sale shall consist of cash or cash equivalents (provided that for purposes of the 75% cash consideration requirement (x) the amount of any Indebtedness or other liabilities of the Borrower or any Subsidiary (as shown on such person’s most recent balance sheet or in the notes thereto) that are assumed by the transferee of any such assets, (y) the amount of any trade-in value applied to the purchase price of any replacement assets acquired in connection with such asset sale, and (z) any securities received by the Borrower or such Subsidiary from such transferee that are converted by the Borrower or such Subsidiary into cash or cash equivalents (to the extent of the cash or cash equivalents received) within 270 days following the closing of the applicable asset sale, shall each be deemed to be cash or cash equivalents) and (ii) immediately prior to the consummation of such asset sale, no Event of Default shall have occurred and be continuing and no Event of Default shall result therefrom; (ix) the sale, lease or transfer of property or assets not as part of a Sale and Leaseback Transaction; (x) the merger of a Credit Party or a Subsidiary thereof with another Credit Party or a Subsidiary thereof to exceed $10,000,000 the extent permitted by Section 6.4(b)(ii) below; and (xi) Dispositions of Equity Interests in the aggregate in any fiscal year, excluding transfers made Permitted JVs pursuant to Section 6.4(a)(iv)the terms of the joint venture or equivalent agreements governing such Permitted JVs so long as such joint venture or equivalent agreements are not solely between Persons that are Credit Parties, Subsidiaries or Affiliates of Credit Parties; provided that (A) with respect to clauses (i)(A), (ii), (iii), (vi) and (vii) above, at least 75% of the consideration received therefor by the Credit Parties or any such Subsidiary shall be in the form of cash or Cash Equivalents, (B) after giving effect to any Asset Disposition pursuant to clause clauses (viiviii) and (xi) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is available, and (CB) with respect to clauses (iv), (v), (vi), (viii) and (viixi) above, no Default or Event of Default shall exist or shall result therefrom; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lender, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business, or (ii) enter into consummate any transaction of merger or consolidation, except for (A) Investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity, (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower is a party thereto, the Borrower will be the surviving corporation, corporation and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit Party.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties will not, nor will they permit any Subsidiary to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets or agree to do so at a future time, except the following, without duplication, shall be expressly permitted: (A) the sale, transfer, lease or other disposition of inventory and materials in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cash; (ii) Dispositions resulting in Extraordinary Receipts for which such Credit Party or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt are used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii)assets; (iii) the sale, lease, transfer or other disposition of machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties or any of their Subsidiaries; (iv) (A) the sale, lease or transfer of property or assets from one Credit Party to another Credit Party, (B) the sale, lease or transfer of property or assets from a Subsidiary to a Credit Party and Party, (C) the sale, lease or transfer of property or assets from a Subsidiary that is not a Credit Party to another Subsidiary that is not a Credit Party, (D) the dissolution of any Credit Party to the extent any and all assets of such Credit Party at the time of such dissolution are distributed to another Credit Party, (E) the dissolution of a Subsidiary that is not a Credit Party to the extent any and all assets of such Subsidiary at the time of such dissolution are distributed to another Subsidiary; (v) the termination of any Hedging Agreement; (vi) the Hawthorne Asset Disposition; and (vii) the sale, lease or transfer of property or assets not to exceed $10,000,000 in the aggregate greater of, in any fiscal year, (i) $100,000,000 and (ii) 7.5% of Consolidated Total Tangible Assets, excluding transfers made pursuant to Sections 6.4(a)(iv) and (ix); (vii) the dissolution, liquidation or winding up of the affairs of, or the sale, transfer, lease or other disposition of the property or assets of, any Subsidiary in connection with the Permitted Reorganization; (viii) sale leaseback transactions to the extent permitted pursuant to Section 6.4(a)(iv)6.12; and (ix) the sale, transfer, lease or other disposition of any lines of business or business units identified to the Lenders prior to the Seventh Amendment Effective Date. ​ provided that (A) with respect to clauses (i)(A), (ii), (iii), (vi) and (viiviii) above, at least 75% of the consideration received therefor by the Credit Parties or any such Subsidiary shall be in the form of cash or Cash Equivalents, (B) after giving effect to any Asset Disposition disposition pursuant to clause (viivi) or (ix) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is available, and (C) with respect to clauses (iv), (v), (vi), (viii) and (viiix) above, no Default or Event of Default shall exist or shall result therefrom; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lender, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business, or (ii) enter into any transaction of merger or consolidation, except for (A) Investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity, (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower is a party thereto, the Borrower will be the surviving corporation, and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit Party. For avoidance of doubt, an issuance by the Borrower of its Equity Interests shall not be prohibited by this Section 6.4.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties will not, nor will they permit any Subsidiary (excluding Excluded Joint Ventures) to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets (each a “Disposition”) or agree to do so at a future time, except the following, without duplication, shall be expressly permitted: (A) the saleDisposition of cash, transfergoods, lease or other disposition of products, inventory and materials and immaterial assets in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cash; (ii) Extraordinary Receipts for which such Credit Party or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such the Disposition of property or assets to an unrelated party not in the ordinary course of business where and to the extent that they are the result of a Recovery Event; to the extent Net Cash Proceeds from such Extraordinary Receipt Recovery Event are reinvested or used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii2.7(b)(vi); (iii) the sale, lease, transfer or other disposition Disposition of machinery, parts and equipment assets no longer used or useful in the conduct of the business of the Credit Parties or any of their Subsidiaries; (iv) (A) the sale, lease or transfer Disposition of property or assets from one Credit Party to another Credit Party, (B) the sale, lease Party or transfer dissolution of property or assets from a Subsidiary to a any Credit Party (other than any Borrower) to the extent any and (C) the sale, lease or transfer all assets of property or assets from a Subsidiary that is not a such Credit Party (if any) are distributed to another Subsidiary that is not a Credit Party; (v) the termination of any Hedging AgreementBank Product; (vi) the Hawthorne Asset DispositionDisposition of property or assets (including, without limitation, Sale and Leaseback Transactions); provided, that the aggregate book value of all property and assets subject to such Disposition in any fiscal year shall not exceed 5% of Consolidated Tangible Assets as of the end of the immediately preceding fiscal year; (vii) a Foreign Subsidiary Contribution; (viii) any Restricted Payment by any Credit Party or any of its Subsidiaries permitted pursuant to Section 6.10; (ix) (A) any Disposition or issuance by the Company of its own Equity Interests to the extent that any such issuance does not result in a Change of Control; (B) any Disposition or issuance by any Subsidiary of the Company of its own Equity Interests to any Credit Party; and (C) to the extent necessary to satisfy any requirement of Law in the jurisdiction of incorporation of any Subsidiary of the Company, any Disposition or issuance by such Subsidiary of its own Equity Interests constituting directors’ qualifying shares or nominal holdings; (x) the abandonment or other Disposition of intellectual property that is, in the reasonable judgment of such Person, no longer economically practicable to maintain because it is no longer useful in the operation of its business or otherwise of material value (including without limitation intellectual property that has expired on its own terms with no right to renew); (xi) Dispositions of property to the extent that (i) such property is exchanged for credit against the purchase price of similar property or (ii) the proceeds of such Disposition are promptly applied to the purchase price of such similar property; (xii) Dispositions constituting Permitted Liens or Permitted Investments but only to the extent that any such Permitted Lien or Permitted Investment was otherwise permitted; (xiii) Dispositions of accounts receivables in connection with the collection or compromise thereof in the ordinary course of business; and (viixiv) Dispositions of Investments in joint ventures to the saleextent required by, lease or transfer of property or assets not to exceed $10,000,000 in the aggregate in any fiscal year, excluding transfers made pursuant to Section 6.4(a)(iv); customary buy/sell arrangements between, the joint venture parties set forth in joint venture arrangements and similar binding arrangements. provided that (A) with respect to clauses (i)(A), (ii), (iii), (vi) and (viixiv) above, at least 75% of the consideration received therefor by the Credit Parties or any such Subsidiary shall be in the form of cash or Cash Equivalents, (B) after giving effect to any Asset Disposition pursuant to clause (viivi) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month fiscal quarter for which information is available, and (C) with respect to clauses (iv), (v), (vi) and (viixiv) above, no Default or Event of Default shall exist or shall result therefromtherefrom and (D) any Disposition pursuant to clause (vi) shall be for fair market value; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lender, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, other than (A) Permitted Acquisitions Investments, Capital Expenditures, Sale and Permitted Investments Leaseback Transactions and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, property and property, equipment or any other assets in the ordinary course of business, or (ii) enter into any transaction of merger or consolidation, except for (A) Permitted Investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity, (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit PartyParty (excluding Excluded Joint Ventures); provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the any Borrower is a party thereto, the such Borrower will be the surviving corporationPerson, and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit Party.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Loan Parties will not, nor will they permit any Subsidiary to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose Dispose of its property or assets or agree to do so at a future time, except the following, without duplication, shall be expressly permitted: (A) the sale, transfer, lease or other disposition Disposition of inventory and materials in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cash; (ii) Extraordinary Receipts for which such Credit Party the sale, transfer or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such other Disposition of property or assets to an unrelated party not in the ordinary course of business where and to the extent Net Cash Proceeds from that such Extraordinary Receipt are used sale, transfer or other Disposition is the result of theft, loss, physical destruction or damage, taking or similar event with respect to make mandatory prepayments any of the Loan Parties or otherwise used pursuant to Section 2.7(b)(vii)any of their Subsidiaries’ respective property or assets; (iii) the sale, lease, transfer or other disposition Disposition of machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Loan Parties or any of their Subsidiaries; (iv) (A) the sale, lease or transfer of property or assets from one Credit Loan Party to another Credit Party, Loan Party or dissolution of any Loan Party (Bother than the Borrower) to the sale, lease or transfer extent any and all assets of property or assets from a Subsidiary to a Credit such Loan Party and (C) the sale, lease or transfer of property or assets from a Subsidiary that is not a Credit Party are distributed to another Subsidiary that is not a Credit Loan Party; (v) the termination of any Hedging Swap Agreement; (vi) the Hawthorne Asset Dispositionsale, lease, transfer, closure or other Disposition (including, without limitation, refranchising) of Restaurants and real property related thereto, the termination or non-renewal of leases or the subletting of Restaurants, in each case as determined to be prudent in the reasonable judgment of the senior officers of the Borrower; (vii) Dispositions constituting Sale Leaseback transactions that are permitted by Section 6.12; and (viiviii) the any other sale, lease or other transfer of property or assets to a third party that is not to exceed $10,000,000 in the aggregate in an Affiliate of a Loan Party or any fiscal year, excluding transfers made pursuant to Section 6.4(a)(iv)Subsidiary of a Loan Party; provided that (A) with respect to clauses (i)(A), (ii), (iii), (vi), (vii) and (viiviii) above, at least 75100% of the consideration received therefor by the Credit Loan Parties or any such Subsidiary shall be in the form of cash or Cash Equivalentscash, (B) after giving effect to any Asset Disposition pursuant to clause (vii) above, the Credit Loan Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 5.10 hereof, recalculated for the most recently ended month fiscal quarter for which information is available, available and (C) with respect to clauses (iv), (v), (vivii) and (viiviii) above, no Default or Event of Default (determined prior to giving effect to any Cure) shall exist or shall result therefrom; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitledshall, without the consent of any Lender, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, other than (A) the lease or acquisition of real property in connection with Permitted Acquisitions and Permitted Investments and Construction Transactions; (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business, business and (C) Investments permitted by Sections 6.05(f) and 6.05(h) or (ii) enter into any transaction of merger or consolidation, except for (A) Investments or acquisitions permitted pursuant to Section 6.5 so long as . For the Credit Party subject to such merger or consolidation is the surviving entity, (B) (y) the merger or consolidation avoidance of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower is a party theretodoubt, the Borrower Loan Parties will be the surviving corporationnot, and (C) the merger or consolidation of a nor will they permit any Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit Partyto, acquire any Subsidiaries.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties will not, nor will they permit any Subsidiary to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets or agree to do so at a future time, except the following, without duplication, shall be expressly permitted: (A) the sale, transfer, lease or other disposition of inventory and materials in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cash; (ii) Dispositions resulting in Extraordinary Receipts for which such Credit Party or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt are used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii)assets; (iii) the sale, lease, transfer or other disposition of machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties or any of their Subsidiaries; (iv) (A) the sale, lease or transfer of property or assets from one Credit Party to another Credit Party, (B) the sale, lease or transfer of property or assets from a Subsidiary to a Credit Party and Party, (C) the sale, lease or transfer of property or assets from a Subsidiary that is not a Credit Party to another Subsidiary that is not a Credit Party, (D) the dissolution of any Credit Party to the extent any and all assets of such Credit Party at the time of such dissolution are distributed to another Credit Party, (E) the dissolution of a Subsidiary that is not a Credit Party to the extent any and all assets of such Subsidiary at the time of such dissolution are distributed to another Subsidiary; (v) the termination of any Hedging Agreement; (vi) the Hawthorne Asset Disposition; and (vii) the sale, lease or transfer of property or assets not to exceed $10,000,000 in the aggregate greater of, in any fiscal year, (i) $100,000,000 and (ii) 7.5% of Consolidated Total Tangible Assets, excluding transfers made pursuant to Sections 6.4(a)(iv) and (ix); (vii) the dissolution, liquidation or winding up of the affairs of, or the sale, transfer, lease or other disposition of the property or assets of, any Subsidiary in connection with the Permitted Reorganization; (viii) sale leaseback transactions to the extent permitted pursuant to Section 6.4(a)(iv)6.12; and (ix) the sale, transfer, lease or other disposition of any lines of business or business units identified to the Lenders prior to the Seventh Amendment Effective Date. provided that (A) with respect to clauses (i)(A), (ii), (iii), (vi) and (viiviii) above, at least 75% of the consideration received therefor by the Credit Parties or any such Subsidiary shall be in the form of cash or Cash Equivalents, (B) after giving effect to any Asset Disposition disposition pursuant to clause (viivi) or (ix) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is available, and (C) with respect to clauses (iv), (v), (vi), (viii) and (viiix) above, no Default or Event of Default shall exist or shall result therefrom; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lender, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business, or (ii) enter into any transaction of merger or consolidation, except for (A) Investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity, (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower is a party thereto, the Borrower will be the surviving corporation, and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit Party. For avoidance of doubt, an issuance by the Borrower of its Equity Interests shall not be prohibited by this Section 6.4.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties Borrower will not, nor will they it permit any Subsidiary to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets or agree to do so at a future time, time except the following, without duplication, shall be expressly permitted: (Ai) Specified Sales; (ii) the sale, transfer, lease or other disposition of inventory and materials property or assets to an unrelated party not in the ordinary course of business (other than Specified Sales), where and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cash; (ii) Extraordinary Receipts for which such Credit Party or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt that they are the result of a Recovery Event or otherwise and the net proceeds therefrom are used to make mandatory prepayments repair or replace damaged property or to purchase or otherwise used pursuant to Section 2.7(b)(vii)acquire new assets or property, provided that such purchase or acquisition is consummated within 180 days of such receipt; (iii) the sale, lease, transfer or other disposition of machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties or any of their Subsidiaries; (iv) (A) the sale, lease or transfer of property or assets from one Credit Party to another Credit Party, (B) the sale, lease or transfer of property or assets from a Subsidiary to a Domestic Credit Party to another Domestic Credit Party; (iv) the sale and lease of G&L Industries' property permitted pursuant to Section 6.13 hereof; (Cv) the sale, lease or transfer of property or assets from having a Subsidiary that is fair market value not a Credit Party to another Subsidiary that is not a Credit Party; (v) in excess of $15,000,000 in the termination of any Hedging Agreement;aggregate; and (vi) after the Hawthorne Asset Disposition; and (vii) Interest Determination Date for the fiscal quarter ending January 1, 2000, the sale, lease or transfer of property or assets having a fair market value not to exceed in excess of $10,000,000 15,000,000 in the aggregate in from a Domestic Credit Party to a Foreign Subsidiary or to a foreign joint venture which is at least 50% owned by the Borrower or any fiscal yearof its Subsidiaries, excluding transfers made pursuant to Section 6.4(a)(iv); provided that (A) the Borrower and its Subsidiaries shall have demonstrated compliance with the financial covenants contained in Section 5.9 for the fiscal quarter ending immediately prior to such sale, lease or transfer, (B) such property or assets shall not be subsequently sold, leased or transferred to any Person which is not a Subsidiary of the Borrower or a foreign joint venture which is at least 50% owned by the Borrower or any of its Subsidiaries (other than any such sale, lease or transfer constituting a Specified Sale), and (C) before and after giving effect to such sale, lease or transfer, no Default or Event of Default shall have occurred and be continuing. provided, that in each case (except with respect to clauses (i)(A), (ii), (iii), ) and (vi) and (viiabove) above, at least 75% of the consideration received therefor by the Credit Parties Borrower or any such Subsidiary shall be is in the form of cash or Cash Equivalents, (B) after giving effect to any Asset Disposition pursuant to clause (vii) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is available, and (C) with respect to clauses (iv), (v), (vi) and (vii) above, no Default or Event of Default shall exist or shall result therefrom; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lender, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business, or (ii) enter into any transaction of merger or consolidation, except for (A) Investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity, (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower is a party thereto, the Borrower will be the surviving corporation, and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit Party.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties will not, nor will they permit any Subsidiary to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets (each a “Disposition”) or agree to do so at a future time, except the following, without duplication, shall be expressly permitted: (i) (A) the sale, transfer, lease or other disposition Dispositions of inventory and materials in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cash; (ii) Extraordinary Receipts for which such Credit Party or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such Dispositions of property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt are used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii)as a result of a Recovery Event; (iii) the sale, lease, transfer or other disposition Dispositions of machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties or any of their Subsidiaries; (iv) the dissolution of (A) any Domestic Credit Party (other than the Domestic Borrowers) to the extent any and all assets of such Domestic Credit Party are distributed to another Domestic Credit Party, (B) any Foreign Credit Party (other than the Foreign Borrower) to the extent any and all assets of such Foreign Credit Party are distributed to another Foreign Credit Party, (C) any Foreign Credit Party (other than the Foreign Borrower) to the extent any and all assets of such Foreign Credit Party are distributed to such Domestic Credit Party and (D) any Excluded Foreign Subsidiary; (v) Dispositions not contemplated by the other clauses set forth in this Section 6.4(a) by the Credit Parties and their Subsidiaries so long as such Dispositions, which when taken together with intercompany Indebtedness and Investments permitted by Section 6.5(d), do not violate the limitations and other requirements permitted by Section 6.1(d); (vi) the termination of any Hedging Agreement; (vii) the sale, lease or transfer of account receivables in the commercially reasonable judgment of the Credit Parties and in the ordinary course of business; (viii) Dispositions in the form of sale-leaseback transactions in an amount not to exceed $4,000,000 in the aggregate during the term of this Agreement; and (ix) the sale, lease or transfer of property or assets from one Credit Party to another Credit Party, (B) of a nature not contemplated by the sale, lease or transfer of property or assets from a Subsidiary to a Credit Party and (C) the sale, lease or transfer of property or assets from a Subsidiary that is not a Credit Party to another Subsidiary that is not a Credit Party; (v) the termination of any Hedging Agreement; (vi) the Hawthorne Asset Disposition; and (vii) the sale, lease or transfer of property or assets foregoing clauses hereof not to exceed $10,000,000 3,000,000 in the aggregate in any fiscal year, excluding transfers made pursuant to Section 6.4(a)(iv); provided that (A) with respect to clauses (i)(A), (ii), (iii), (v), (vi), (vii) and (viiviii) above, at least 75% of the consideration received therefor by paid to the Credit Parties or any such Subsidiary shall be in the form of cash or Cash Equivalents, (B) immediately after giving effect to any Asset Disposition pursuant to clause (vii) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month fiscal quarter for which information is available, and (C) with respect to clauses (iv), (v), (vi), (vii), (viii) and (viiix) above, no Default or Event of Default shall exist or shall result therefromtherefrom and (D) any Disposition pursuant to clauses (i), (iii) and (vii) shall be for fair market value; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lender, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business, or (ii) enter into any transaction of merger or consolidation, except for (A) Investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity and (B) (v) the merger or consolidation of an Excluded Foreign Subsidiary with an into another Excluded Foreign Subsidiary, a Domestic Credit Party or a Foreign Credit Party, (w) the merger or consolidation of a Foreign Subsidiary that is not a Foreign Credit Party with and into a Foreign Credit Party; provided that such Foreign Credit Party will be the surviving entity, (Bx) the merger or consolidation of a Domestic Credit Party with and into another Domestic Credit Party; provided that if any Domestic Borrower is a party thereto, such Domestic Borrower will be the surviving corporation, (y) the merger or consolidation of a Subsidiary that is not a Foreign Credit Party with and into a another Foreign Credit Party; provided that such Credit Party if the Foreign Borrower is a party thereto, the Foreign Borrower will be the surviving entity corporation and (z) the merger or consolidation of a Foreign Credit Party (other than the Foreign Borrower) with and an into another Credit Party; provided that if the Borrower is a party thereto, the Borrower will be the surviving corporation, and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Domestic Credit Party.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties will not, nor will they permit any Subsidiary to,: (a) dissolve, liquidate or wind up its affairs, consolidate or merge with another Person, or sell, transfer, lease or otherwise dispose of its property or assets or agree to do so at a future time, time except the following, without duplication, shall be expressly permitted: (Ai) the sale, transfer, lease or other disposition of inventory and materials in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cashSpecified Sales; (ii) Extraordinary Receipts for which such Credit Party or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such the disposition of property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt are used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(viias a result of a Recovery Event); (iii) the sale, lease, transfer or other disposition of machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties or any of their Subsidiaries; (iv) (A) the sale, lease or transfer of property or assets from one Credit Party to another Credit Party, (B) the sale, lease or transfer of property or assets from a Credit Party to another Credit Party; provided that prior to or simultaneously with any such sale, lease or transfer, all actions reasonably required by the Administrative Agent shall be taken to insure the continued perfection and priority of the Administrative Agent’s Liens on such property and assets; (iv) the consolidation, liquidation or merger of a Credit Party into another Credit Party or any Subsidiary into a Credit Party; provided that (A) prior to a or simultaneously with any such consolidation, liquidation or merger, all actions reasonably required by the Administrative Agent shall be taken to insure the continued perfection and priority of the Administrative Agent’s Liens on the property and assets of each such Credit Party and (CB) if such consolidation, liquidation or merger involves the saleBorrower, lease or transfer of property or assets from a Subsidiary that is not a Credit Party to another Subsidiary that is not a Credit Partythe Borrower shall be the surviving entity; (v) the termination dissolution, liquidation or winding up of a Immaterial Subsidiary or any Hedging Agreementsale, transfer or other disposition of assets from a Immaterial Subsidiary to a Credit Party or another Immaterial Subsidiary; (vi) the Hawthorne Asset Disposition; andtermination of any Hedging Agreement permitted pursuant to Section 6.1; (vii) Sale‑Leaseback Transactions permitted pursuant to Section 6.12(ii); (viii) the sale, lease transfer or transfer other disposition of property or assets in connection with the closing or relocation of restaurants not to exceed $10,000,000 in any fiscal year or $25,000,000 in the aggregate during the term of this Credit Agreement; and (ix) other sales, leases or transfers of property or assets (excluding sale and lease‑back transactions) in any fiscal yearan amount not to exceed $25,000,000 in the aggregate during the term of this Credit Agreement; provided, excluding transfers made pursuant to Section 6.4(a)(iv); provided that (A) that, with respect to clauses (i)(A), (ii), (iii), (vii) and (viiv) above, at least 75% of the consideration received therefor by the such Credit Parties or any such Subsidiary Party shall be in the form of cash or Cash Equivalents, (B) after giving effect to any Asset Disposition pursuant to clause (vii) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is available, and (C) with respect to clauses (iv), (v), (vi) and (vii) above, no Default or Event of Default shall exist or shall result therefrom; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lender, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, Person (other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, leases, materials, property and equipment in the ordinary course of business, except as otherwise limited or prohibited herein) or (ii) enter into any transaction of merger or consolidation, except for (A) Investments or acquisitions transactions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity6.4(a), (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower is a party thereto, the Borrower will be the surviving corporationInvestments permitted pursuant to Section 6.5, and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit PartyPermitted Acquisitions.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties will not, nor will they permit any Subsidiary to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets (each a “Disposition”) or agree to do so at a future time, except the following, without duplication, shall be expressly permitted: (A) the sale, transfer, lease or other disposition of inventory and materials in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cash; (ii) Extraordinary Receipts for which such Credit Party the sale, transfer or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such other disposition of property or assets to an unrelated party not in the ordinary course of business where and to the extent Net Cash Proceeds from that such Extraordinary Receipt are used sale, transfer or other disposition is the result of theft, loss, physical destruction or damage, taking or similar event with respect to make mandatory prepayments any of the Credit Parties or otherwise used pursuant to Section 2.7(b)(vii)any of their Subsidiaries’ respective property or assets; (iii) the sale, lease, transfer or other disposition of machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties or any of their Subsidiaries; (iv) (A) the sale, lease or transfer of property or assets from one Credit Party to another Credit Party, (B) the sale, lease Party or transfer dissolution of property or assets from a Subsidiary to a any Credit Party (other than the Borrower) to the extent any and (C) the sale, lease or transfer all assets of property or assets from a Subsidiary that is not a such Credit Party are distributed to another Subsidiary that is not a Credit Party; (v) the termination of any Hedging Agreement; (vi) the Hawthorne Asset Dispositionsale, lease, transfer, closure or other disposition of Restaurants and real property related thereto, the termination or non-renewal of leases or the subletting of Restaurants, in each case as determined to be prudent in the reasonable judgment of the senior officers of the Borrower; (vii) Sale Leaseback transactions to the extent permitted under Section 6.12; and (viiviii) the sale, lease or transfer of property or assets not to exceed $10,000,000 2,500,000 in the aggregate in any fiscal year, excluding transfers made pursuant to Section 6.4(a)(iv); provided that (A) with respect to clauses (i)(A), (ii), (iii), (vi), (vii) and (viiviii) above, at least 75% of the consideration received therefor by the Credit Parties or any such Subsidiary shall be in the form of cash or Cash Equivalents, assets used in the business or Capital Stock, (B) after giving effect to any Asset Disposition pursuant to clause (vii) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month fiscal quarter for which information is available, available and (C) with respect to clauses (iv), (v), (vi) and clause (vii) above, no Default or Event of Default shall exist or shall result therefrom; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitledshall, without the consent of any Lender, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, other than (A) Permitted Acquisitions and Permitted Investments and Acquisitions, (B) the lease or acquisition of real property in connection with Permitted Construction Transactions; (C) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business, business and (D) Investments permitted by Section 6.5 or (ii) enter into any transaction of merger or consolidation, except for (A) Investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity, (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower is a party thereto, the Borrower will be the surviving corporation, and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit Party.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties will not, nor will they permit any Subsidiary (other than an Immaterial Subsidiary or a Transitional Subsidiary) to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets or agree to do so at a future time, except the following, without duplication, shall be expressly permitted: (A) the sale, transfer, lease or other disposition of inventory and materials in the ordinary course of business and business, (B) the conversion of cash into Cash Equivalents and Short-Term Investments and Cash Equivalents and Short-Term Investments into cashcash and (C) the dissolution, liquidation or winding up of any Immaterial Subsidiary or Transitional Subsidiary; provided that any assets of such Immaterial Subsidiary or Transitional Subsidiary shall be transferred to a Credit Party or Subsidiary thereof in connection therewith; (ii) Extraordinary Receipts Recovery Events for which such the Credit Party Parties or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt Recovery Event are used to make mandatory prepayments or otherwise used are reinvested pursuant to Section 2.7(b)(vii2.8(b)(iv); (iii) the sale, lease, transfer or other disposition of machinery, parts parts, equipment and equipment other obsolete, damaged, surplus or worn out assets or other assets no longer used or useful in the conduct of the business of the Credit Parties or any of their Subsidiaries; (iv) (A) the sale, lease or transfer of property or assets from one Credit Party to another Credit Party, (B) the sale, lease or transfer of property or assets from a Subsidiary to a Credit Party and (C) the sale, lease or transfer of property or assets from a Subsidiary that is not a Credit Party to another Subsidiary that is not a Credit Party; (v) the termination of any Hedging Agreement; (vi) the Hawthorne Asset Dispositionsale of (A) obsolete Vessels, (B) any Spare Vessel and (C) not more than two other Vessels during the term of this Agreement that are not of the type contemplated by clause (A) or (B); (vii) (A) leases, subleases, licenses and sublicenses of assets and Intellectual Property in the ordinary course of business, (B) sales, transfers and other dispositions not otherwise included in clause (A) of containers in the ordinary course of business and (C) charters, subcharters, leases and subleases of Vessels in the ordinary course of business; (viii) sale and leaseback transactions permitted under Section 7.12; (ix) subject to compliance with the terms of Section 5.11(b), exchanges of Vessels for Vessels (with comparable fair market value) that will provide comparable levels of service in the same trade lanes and exchanges, trade-ins, swaps or other contemporaneous transfers of containers, chassis, tractors, cranes and container handling equipment; (x) the sale, transfer or disposition of accounts in connection with the collection or compromise thereof in the ordinary course of business; (xi) Investments made in accordance with Section 7.5; (xii) Capital Stock issued in connection with Permitted Acquisitions; (xiii) Capital Stock issued in connection with transactions permitted under Section 7.10; (xiv) sales or assignments pursuant to factoring agreements of accounts receivable of any Credit Party or any Subsidiary thereof pursuant to which such Credit Party or such Subsidiary receives gross proceeds not to exceed $15,000,000 in the aggregate during the term of this Agreement; provided that such gross proceeds represent not less than 80% of the aggregate face amount of the accounts receivable so factored pursuant to any such arrangement; and (viixv) other than the items set forth in clauses (i)-(xiv), the sale, lease or transfer of property or assets not to exceed $10,000,000 25,000,000 in the aggregate in any fiscal year, excluding transfers made pursuant to Section 6.4(a)(iv); . provided that (A) with respect to clauses (i)(A), (iivi), (iiivii)(B), (vixiv) and (viixv) above, at least 75% of the consideration received therefor by the Credit Parties or any such Subsidiary shall be in the form of cash or Cash EquivalentsEquivalents and Short-Term Investments, (B) after giving effect to any Asset Disposition pursuant to clause clauses (viivi), (viii) or (ix) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 Article VI hereof, recalculated for the most recently ended month quarter for which information is available, and (C) with respect to clauses (iv), (viii), (vi), (vii), (viii) and (viiix) above, no Default or Event of Default shall exist or shall result therefrom; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lenderof the Lenders, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business, or (ii) enter into any transaction of merger or consolidation, except for (A) Investments or acquisitions permitted pursuant to Section 6.5 7.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity, (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower is a party thereto, the Borrower will be the surviving corporation, and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit Party.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties will not, nor will they permit any Subsidiary to, (a) dissolveDissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets or agree to do so at a future time, time except the following, without duplication, shall be expressly permitted: (Ai) the sale, transfer, lease or other disposition of inventory and materials in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cashSpecified Sales; (ii) Extraordinary Receipts for which such Credit Party or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt are used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii); (iii) the sale, lease, transfer or other disposition of machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties or any of their Subsidiaries; (iv) (A) the sale, lease or transfer of property or assets from one Credit Party as a result of a Recovery Event to another Credit Party, the extent the net proceeds therefrom are reinvested or used to repay Loans in accordance with the terms of Section 2.5(b); and (Biii) the sale, lease or transfer of property or assets from a Subsidiary to a Credit Party to another Credit Party (including the liquidation or consolidation of any Credit Party (other than the Borrower) into another Credit Party); provided, however, the amount of assets transferred to any Inactive Subsidiary by the Credit Parties shall be limited to such amounts as shall be necessary to satisfy obligations (whether now or hereafter payable) of such Inactive Subsidiary that exist as of the Closing Date; (iv) other sales, leases or transfers of property or assets; provided, that all such property or assets so sold or disposed of shall not, in the aggregate during the term of this Credit Agreement, have contributed to 25% or more of the Operating Cash Flow of Borrower and its consolidated Subsidiaries, as calculated for the four consecutive fiscal quarters ending immediately prior to any such sale, lease or transfer; provided, further, that (A) no Default or Event of Default shall have occurred or be continuing both before or after such sale, lease or transfer of property or assets, (B) after giving effect to such sale, lease or transfer of property or assets, Borrower and its Subsidiaries shall be in compliance on a pro forma basis with the financial covenant set forth in Section 5.9, (C) the such sale, lease or transfer of property or assets from a Subsidiary that is not a Credit Party to another Subsidiary that is not a Credit Party; effected on an arm’s length basis and (vD) the termination of any Hedging Agreement; (vi) the Hawthorne Asset Disposition; and (vii) the such sale, lease or transfer of property or assets not to exceed $10,000,000 in the aggregate in any fiscal year, excluding transfers made pursuant to this clause (iv) shall be subject to Section 6.4(a)(iv2.5(b)(ii); and (v) the dissolution, liquidation or winding up of any Inactive Subsidiary; provided that (A) no asset of such Inactive Subsidiary shall be transferred to a Person other than a Credit Party in connection with such dissolution, liquidation or winding up. With respect to clauses (i)(Ai), (ii), (iii), (vi) and (viiiv) aboveabove (other than Specified Sales consisting of trade-ins of vehicles or equipment), at least 75% of the consideration received therefor by the applicable Credit Parties or any such Subsidiary Party shall be in the form of cash cash, Cash Equivalents or Cash Equivalents, (B) after giving effect to any Asset Disposition pursuant to clause (vii) above, the Credit Parties shall be fixed or capital assets useful in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is available, and (C) with respect to clauses (iv), (v), (vi) and (vii) above, no Default or Event of Default shall exist or shall result therefrom; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lender, to release its Liens relating to the particular assets sold; orPermitted Business. (b) (i) purchasePurchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, Person (other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, leases, materials, property and equipment in the ordinary course of business, except as otherwise limited or (ii) prohibited herein), or enter into any transaction of merger or consolidation, except for (Ai) Investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity6.6, (Bii) Permitted Acquisitions and (yiii) the merger or consolidation of a Subsidiary that is not a Credit Party the Borrower or one of its Subsidiaries with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower is a party thereto, the Borrower will be the surviving corporation, and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit Party.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties will not, nor will they permit any Subsidiary to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets (each a “Disposition”) or agree to do so at a future time, except the following, without duplication, shall be expressly permitted: (i) (A) the sale, transfer, license, lease or other disposition of inventory and materials in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cash; (ii) Extraordinary Receipts for which such Credit Party the sale, transfer or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such other disposition of property or assets to an unrelated party not in the ordinary course of business where and to the extent that they are the result of a Recovery Event to the extent Net Cash Proceeds from such Extraordinary Receipt Recovery Event are reinvested or used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii2.7(b)(vi); (iii) the sale, lease, transfer or other disposition of machinery, parts and parts, equipment or other assets no longer used or useful in the conduct of the business of the Credit Parties or any of their Subsidiaries; (iv) (A) the sale, lease or transfer of property or assets from one Credit Party to another Credit Party, (B) the sale, lease Party or transfer dissolution of property or assets from a Subsidiary to a any Credit Party (other than the Borrower) to the extent any and (C) the sale, lease or transfer all assets of property or assets from a Subsidiary that is not a such Credit Party are distributed to another Subsidiary that is not a Credit Party; (v) the termination of any Hedging Agreement; (vi) the Hawthorne Asset Disposition; and (viivi) the sale, lease or transfer of property or assets not to exceed (A) $10,000,000 2,500,000 in the aggregate in any fiscal year, excluding transfers made pursuant to Section 6.4(a)(iv)year and (B) $5,000,000 in the aggregate during the term of this Agreement; provided that (A) with respect to clauses (i)(A), (ii), (iii), (vi) and (viivi) above, at least 75% of the consideration received therefor by the Credit Parties or any such Subsidiary shall be in the form of cash or Cash Equivalents, (B) after giving effect to any Asset Disposition pursuant to clause (viivi) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month fiscal quarter for which information is available, and (C) with respect to clauses (iv), (v), (vi) and (viivi) above, no Default or Event of Default shall exist or shall result therefromtherefrom and (D) any Disposition pursuant to clauses (i), (iii) and (vi) shall be for fair market value; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitledentitled and shall, without the consent of any Lender, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business, or (ii) enter into any transaction of merger or consolidation, except for (Ai) Investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entityentity or the acquired Person becomes a Credit Party, (Bii) (yA) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (zB) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower is a party thereto, the Borrower will be the surviving corporation, and (Ciii) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit Party.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties will not, nor will they permit any Subsidiary to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets or agree to do so at a future time, except the following, without duplication, shall be expressly permitted: (A) the sale, transfer, lease or other disposition of inventory and materials in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cash; (ii) Dispositions resulting in Extraordinary Receipts for which such Credit Party or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt are used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii)assets; (iii) the sale, lease, transfer or other disposition of machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties or any of their Subsidiaries; (iv) (A) the sale, lease or transfer of property or assets from one Credit Party to another Credit Party, (B) the sale, lease or transfer of property or assets from a Subsidiary to a Credit Party and Party, (C) the sale, lease or transfer of property or assets from a Subsidiary that is not a Credit Party to another Subsidiary that is not a Credit Party, (D) the dissolution of any Credit Party to the extent any and all assets of such Credit Party at the time of such dissolution are distributed to another Credit Party, (E) the dissolution of a Subsidiary that is not a Credit Party to the extent any and all assets of such Subsidiary at the time of such dissolution are distributed to another Subsidiary; (v) the termination of any Hedging Agreement; (vi) the Hawthorne Asset Disposition; and (vii) the sale, lease or transfer of property or assets not to exceed $10,000,000 in the aggregate in any fiscal year, excluding transfers made pursuant to Section 6.4(a)(iv); (vii) the dissolution, liquidation or winding up of the affairs of, or the sale, transfer, lease or other disposition of the property or assets of, any Subsidiary in connection with the Permitted Reorganization; and (viii) sale leaseback transactions to the extent permitted pursuant to Section 6.12; provided that (A) with respect to clauses (i)(A), (ii), (iii), (vi) and (viiviii) above, at least 75% of the consideration received therefor by the Credit Parties or any such Subsidiary shall be in the form of cash or Cash Equivalents, (B) after giving effect to any Asset Disposition disposition pursuant to clause (viivi) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is available, and (C) with respect to clauses (iv), (v), (vi) and (viiviii) above, no Default or Event of Default shall exist or shall result therefrom; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lender, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business, or (ii) enter into any transaction of merger or consolidation, except for (A) Investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity, (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower is a party thereto, the Borrower will be the surviving corporation, and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit Party. For avoidance of doubt, an issuance by the Borrower of its Equity Interests shall not be prohibited by this Section 6.4.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties will not, nor will they permit any Subsidiary to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets or agree to do so at a future time, except the following, without duplication, shall be expressly permitted: (A) the sale, transfer, lease or other disposition of inventory and materials in the ordinary course of business and (B) the conversion of cash into Cash Equivalents Corporate Investment Policy Investments and Cash Equivalents Corporate Investment Policy Investments into cash; (ii) Extraordinary Receipts for which such Credit Party or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt are used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii)Recovery Events; (iii) the sale, lease, transfer or other disposition of machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties or any of their Subsidiaries; (iv) the sale, lease, transfer or other disposition of property or assets (at fair value) (A) between US Credit Parties, (B) between Foreign Credit Parties and (C) between Foreign Subsidiaries (other than Foreign Credit Parties); provided that in no event shall a Credit Party sell, transfer or otherwise dispose of any Intellectual Property to a Person that is not a Credit Party, except that the Foreign Borrower may license such Intellectual Property in the ordinary course of business, without the prior written consent of the Administrative Agent; (v) the dissolution or winding up of any Subsidiary of the Company that is not a Credit Party; provided, that the assets of any such Subsidiary shall be transferred to another Subsidiary of the Company; (vi) [Intentionally Omitted] (vii) [Intentionally Omitted] (viii) the dissolution or winding up of any Credit Party (other than a Borrower); provided, that the assets of any such Credit Party shall be transferred to another Credit Party; (A) the sale, lease sale or transfer issuance of property or assets from one Credit Party to another the Capital Stock of a Foreign Subsidiary (other than a Credit Party) of the Company to any Subsidiary of the Company to the extent not otherwise prohibited under this Credit Agreement or any of the other Credit Documents, (B) the sale, lease sale or transfer issuance of property or assets from the Capital Stock of a Subsidiary US Credit Party (other than the Company) to a another US Credit Party and (C) the sale, lease sale or transfer issuance of property or assets from the Capital Stock of a Subsidiary that is not a Foreign Credit Party to another Subsidiary that is not a Credit Party; (vx) the termination merger or consolidation of any Hedging Agreementa Subsidiary of the Company (other than a Borrower) into another Subsidiary of the Company; provided that if either Subsidiary is a Credit Party, the continuing or surviving Person shall be a Credit Party; (vixi) the Hawthorne Asset Dispositionmerger or consolidation of any Subsidiary into the Company; andprovided that the Company shall be the continuing or surviving entity; (viixii) transactions permitted pursuant to Sections 6.1, 6.5 and 9.21 to the extent not already permitted pursuant to this Section 6.4(a); (xiii) the sale, lease or transfer of property or assets not to exceed $10,000,000 500,000 in the aggregate in any fiscal year, excluding transfers made pursuant ; and (xiv) the sale of any Foreign Subsidiary (not including any Foreign Credit Party) which the Company has demonstrated to Section 6.4(a)(iv); the reasonable satisfaction of the Administrative Agent has less than $10,000,000 in total annual revenue. provided that (A) with respect to clauses (i)(A), clause (ii), (iii), (vi) and (vii) above, at least 75% of the consideration received therefor by the Credit Parties or any such Subsidiary shall be in the form of cash or Cash Equivalents, (B) after giving effect to any Asset Disposition pursuant to clause (vii) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is availableCorporate Investment Policy Investments, and (CB) with respect to clauses clause (iv), (v), (vi) and (vii) above, no Default or Event of Default shall exist or shall result therefrom; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitledshall, without the consent of any Lenderthe Required Lenders, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases purchases, leases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business, or (ii) enter into any transaction of merger or consolidation, except for (A) Permitted Acquisitions and Investments or acquisitions permitted pursuant to Section Sections 6.4(a) and 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity, and (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower Company is a party thereto, the Borrower Company will be the surviving corporation, and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit Party.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties will not, nor will they permit any Subsidiary to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets or agree to do so at a future time, except the following, without duplication, shall be expressly permitted: (A) the sale, transfer, lease or other disposition of inventory and materials in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cash; (ii) Extraordinary Receipts for which such Credit Party or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt are used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii)Recovery Events; (iii) the sale, lease, transfer or other disposition of machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties or any of their Subsidiaries; (iv) the sale, lease or transfer of property or assets (Aat fair value) between the Borrower and any Guarantor; (v) the sale, lease or transfer of property or assets from one Credit Party permitted pursuant to another Credit Party, Section 6.12; (Bvi) the sale, lease or transfer of property or assets from a Subsidiary to a Credit Party and (C) the sale, lease or transfer of property or assets from a Subsidiary that which is not a Credit Party to another Subsidiary that which is not a Credit Party; (v) the termination of any Hedging Agreement; (vi) the Hawthorne Asset Disposition; and (vii) the sale, lease or transfer of property or assets from Subsidiary which is not a Credit Party to any Credit Party; (viii) so long as the Credit Parties are in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, a one-time dividend of a subsidiary, division or line of business whose (A) revenues do not exceed $100,000,000, and (B) business is unrelated to the Credit Parties' primary business; (ix) the sale, lease or transfer of property or assets from a Credit Party other than the Borrower to another Credit Party; and (x) the sale, lease or transfer of property or assets not to exceed $10,000,000 10% of Total Consolidated Assets as reported in the aggregate in any fiscal year, excluding transfers made audited financial statements of the Borrower most recently delivered to the Administrative Agent pursuant to Section 6.4(a)(iv)5.1 per sale or series of related sales; provided that (A) with respect to clauses (i)(A), (ii), (iii), (vi) and (vii) above, if the Total Leverage Ratio, on a Pro Forma Basis, is greater than or equal to 3.5 to 1.0, at least 75% of the consideration received therefor by the Credit Parties or any such Subsidiary shall be in the form of cash or Cash Equivalents, (B) after giving effect to any Asset Disposition pursuant to clause (vii) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is available, and (C) with respect to clauses (iv), (v), (vi) and clause (vii) above, no Default or Event of Default shall exist or shall result therefrom; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lenderthe Required Lenders, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business, or (ii) enter into any transaction of merger or consolidation, except for (A) Investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity, (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower is a party thereto, the Borrower will be the surviving corporation, and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit Party.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties Borrower will not, nor will they it permit any Subsidiary of its Subsidiaries to,: (a) except in connection with a disposition of assets permitted by the terms of subsection (c) below, dissolve, liquidate or wind up its their affairs, or sell, transfer, lease or otherwise dispose of its property or assets or agree to do so at a future time, except the following, without duplication, shall be expressly permitted: (A) the sale, transfer, lease or other disposition of inventory and materials in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cash; (b) enter into any transaction of merger or consolidation; provided, however, that, (i) so long as no Default or Event of Default would be directly or indirectly caused as a result thereof, any Credit Party (other than the Borrower) may merge or consolidate with any other Credit Party (other than the Borrower) and (ii) Extraordinary Receipts for which such Credit Party so long as the Borrower is the continuing or such Subsidiary has received any cash insurance proceeds surviving corporation, Thomas Staffing Services, Inc. may xxxxx or condemnation or expropriation award consolidate with respect to such property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt are used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii)Borrower; (iiic) the salesell, lease, transfer or otherwise dispose of any Property of the Borrower and its Subsidiaries other than (i) the sale or disposition of machinery, parts machinery and equipment no longer used or useful in the conduct of the business of the Credit Parties or any of their Subsidiaries; (iv) (A) the sale, lease or transfer of property or assets from one Credit Party to another Credit Partysuch Person's business, (Bii) other sales of assets (but not accounts receivable, except delinquent accounts sold for collection purposes only), provided that, after giving effect to such sale or other disposition, the sale, lease aggregate book value of assets sold or transfer otherwise disposed of property or assets from a Subsidiary pursuant to a Credit Party and this clause (Cii) the sale, lease or transfer of property or assets from a Subsidiary that is does not a Credit Party to another Subsidiary that is not a Credit Party; (v) the termination of any Hedging Agreement; (vi) the Hawthorne Asset Disposition; and (vii) the sale, lease or transfer of property or assets not to exceed $10,000,000 in the aggregate 500,000 in any fiscal year, excluding transfers made pursuant (iii) the grant of any option or other right to Section 6.4(a)(iv); provided purchase any asset in a transaction that (A) with respect to clauses (i)(A), would be permitted under the provisions of the foregoing clause (ii), (iii), (vi) and (vii) above, at least 75% of the consideration received therefor by the Credit Parties or any such Subsidiary shall be in the form of cash or Cash Equivalents, (B) after giving effect to any Asset Disposition pursuant to clause (vii) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is available, and (C) with respect to clauses (iv), (v), (vi) and (vii) above, provided that no Default or Event of Default shall exist has occurred and is continuing at the time of such grant and (iv) the sale or shall result therefrom; provided, further, that with respect to sales disposition of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent (A) an intangible asset (excepting any trademarks or tradenames of any LenderCredit Party) or (B) other assets so long as the aggregate book value of all such assets sold after the Third Amendment Effective Date does not exceed $5,000,000, in each case in order to release its Liens relating to the particular assets sold; orrealize a book loss; (bd) (i) acquire all or any portion of the capital stock or securities of any other Person or purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) all or any portion of the property or assets Property of any other Person, other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business, or (ii) enter into any transaction of merger or consolidation, except for (A) Investments any merger or acquisitions consolidation permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger 8.4(b); or (e) become a general partner in any general or consolidation is the surviving entitylimited partnership, (B) (y) the merger joint venture or consolidation similar arrangement. Upon a sale of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation any Property of a Credit Party with and into another Credit Party; provided that if the Borrower is a party theretopermitted by Section 8.4(c), the Borrower will be Agent shall (to the surviving corporationextent applicable) deliver to the Credit Parties, upon the Credit Parties' request and at the Credit Parties' expense, such documentation as is reasonably necessary to evidence the release of the Agent's security interest, if any, in such Property, including, without limitation, amendments or terminations of UCC financing statements, if any, the return of stock certificates, if any, and (C) the merger or consolidation release of a Subsidiary that is not a such Credit Party with and into another Subsidiary that is not a from all of its obligations, if any, under the Credit PartyDocuments.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties will not, nor will they permit any Subsidiary (excluding Excluded Joint Ventures) to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets (each a “Disposition”) or agree to do so at a future time, except the following, without duplication, shall be expressly permitted: (A) the saleDisposition of cash, transfergoods, lease or other disposition of products, inventory and materials and immaterial assets in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cash; (ii) Extraordinary Receipts for which such Credit Party or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such the Disposition of property or assets to an unrelated party not in the ordinary course of business where and to the extent that they are the result of a Recovery Event; to the extent Net Cash Proceeds from such Extraordinary Receipt Recovery Event are reinvested or used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii2.7(b)(vi); (iii) the sale, lease, transfer or other disposition Disposition of machinery, parts and equipment assets no longer used or useful in the conduct of the business of the Credit Parties or any of their Subsidiaries; (iv) (A) the sale, lease or transfer Disposition of property or assets from one Credit Party to another Credit Party, (B) the sale, lease Party or transfer dissolution of property or assets from a Subsidiary to a any Credit Party (other than any Borrower) to the extent any and (C) the sale, lease or transfer all assets of property or assets from a Subsidiary that is not a such Credit Party (if any) are distributed to another Subsidiary that is not a Credit Party; (v) the termination of any Hedging AgreementBank Product; (vi) the Hawthorne Asset DispositionDisposition of property or assets (including, without limitation, Sale and Leaseback Transactions); provided, that the aggregate book value of all property and assets subject to such Disposition in any fiscal year shall not exceed 5% of Consolidated Tangible Assets as of the end of the immediately preceding fiscal year; (vii) a Foreign Subsidiary Contribution and/or the Foreign Subsidiary Reorganization; (viii) any Restricted Payment by any Credit Party or any of its Subsidiaries permitted pursuant to Section 6.10; (ix) (A) any Disposition or issuance by the Company of its own Equity Interests to the extent that any such issuance does not result in a Change of Control; (B) any Disposition or issuance by any Subsidiary of the Company of its own Equity Interests to any Credit Party; and (C) to the extent necessary to satisfy any requirement of Law in the jurisdiction of incorporation of any Subsidiary of the Company, any Disposition or issuance by such Subsidiary of its own Equity Interests constituting directors’ qualifying shares or nominal holdings; (x) the abandonment or other Disposition of intellectual property that is, in the reasonable judgment of such Person, no longer economically practicable to maintain because it is no longer useful in the operation of its business or otherwise of material value (including without limitation intellectual property that has expired on its own terms with no right to renew); (xi) Dispositions of property to the extent that (i) such property is exchanged for credit against the purchase price of similar property or (ii) the proceeds of such Disposition are promptly applied to the purchase price of such similar property; (xii) Dispositions constituting Permitted Liens or Permitted Investments but only to the extent that any such Permitted Lien or Permitted Investment was otherwise permitted; (xiii) Dispositions of accounts receivables in connection with the collection or compromise thereof in the ordinary course of business; and (viixiv) Dispositions of Investments in joint ventures to the saleextent required by, lease or transfer of property or assets not to exceed $10,000,000 in the aggregate in any fiscal year, excluding transfers made pursuant to Section 6.4(a)(iv); customary buy/sell arrangements between, the joint venture parties set forth in joint venture arrangements and similar binding arrangements. provided that (A) with respect to clauses (i)(A), (ii), (iii), (vi) and (viixiv) above, at least 75% of the consideration received therefor by the Credit Parties or any such Subsidiary shall be in the form of cash or Cash Equivalents, (B) after giving effect to any Asset Disposition pursuant to clause (viivi) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month fiscal quarter for which information is available, and (C) with respect to clauses (iv), (v), (vi) and (viixiv) above, no Default or Event of Default shall exist or shall result therefromtherefrom and (D) any Disposition pursuant to clause (vi) shall be for fair market value; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lender, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, other than (A) Permitted Acquisitions Investments, Capital Expenditures, Sale and Permitted Investments Leaseback Transactions and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, property and property, equipment or any other assets in the ordinary course of business, or (ii) enter into any transaction of merger or consolidation, except for (A) Permitted Investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity, (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit PartyParty (excluding Excluded Joint Ventures); provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the any Borrower is a party thereto, the such Borrower will be the surviving corporationPerson, and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit Party.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties will not, nor will they permit any Subsidiary to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets (each a “Disposition”) or agree to do so at a future time, except the following, without duplication, shall be expressly permitted: (A) the sale, transfer, lease or other disposition of inventory and materials in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cash; (ii) Extraordinary Receipts for which such Credit Party the sale, transfer or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such other disposition of property or assets to an unrelated party not in the ordinary course of business where and to the extent that they are the result of a Recovery Event; to the extent Net Cash Proceeds from such Extraordinary Receipt Recovery Event are reinvested or used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii2.7(b)(v); (iii) the sale, lease, transfer or other disposition of machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties or any of their Subsidiaries; (iv) (A) the sale, lease or transfer of property or assets from one Credit Party to another Credit Party, (B) the sale, lease Party or transfer dissolution of property or assets from a Subsidiary to a any Credit Party (other than the Borrower) to the extent any and (C) the sale, lease or transfer all assets of property or assets from a Subsidiary that is not a such Credit Party are distributed to another Subsidiary that is not a Credit Party; (v) the termination of any Hedging Agreement; (vi) the Hawthorne Asset Dispositionsale, lease, transfer, closure or other disposition of Restaurants, the termination or non-renewal of leases and Franchise Agreements or the subletting of Restaurants, in each case as determined to be prudent in the reasonable judgment of the senior officers of the Borrower; (vii) Sale Leaseback transactions to the extent permitted under Section 6.12; and (viiviii) the sale, lease or transfer of property or assets not to exceed $10,000,000 2,500,000 in the aggregate in any fiscal year, excluding transfers made pursuant to Section 6.4(a)(iv); provided that (A) with respect to clauses (i)(A), (ii), (iii), (vi), (vii) and (viiviii) above, at least 75% of the consideration received therefor by the Credit Parties or any such Subsidiary shall be in the form of cash or Cash Equivalents, assets used in the business or Capital Stock, (B) after giving effect to any Asset Disposition pursuant to clause (vii) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month fiscal quarter for which information is available, available and (C) with respect to clauses (iv), (v), (vi) and clause (vii) above, no Default or Event of Default shall exist or shall result therefrom; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitledshall, without the consent of any Lender, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, other than (A) Permitted Acquisitions and Acquisitions, (B) the lease or acquisition of real property in connection with Permitted Investments Construction Transactions and (BC) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business, or (ii) enter into any transaction of merger or consolidation, except for (A) Investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity, (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower is a party thereto, the Borrower will be the surviving corporation, and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit Party.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties will not, nor will they permit any Subsidiary to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets or agree to do so at (each a future time“Disposition”), except the following, without duplication, shall be expressly permitted: (A) the sale, transfer, lease or other disposition of inventory and materials in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cash, and the use of cash and Cash Equivalents in the ordinary course of business; (ii) Extraordinary Receipts for which such Credit Party the sale, transfer or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such other disposition of property or assets to an unrelated party not in the ordinary course of business where and to the extent Net Cash Proceeds from such Extraordinary Receipt that they are used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii)the result of a Recovery Event; (iii) the sale, lease, transfer or other disposition of machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties or any of their Subsidiaries; (iv) (A) the sale, lease or transfer of property or assets from one Credit Party to another Credit Party, (B) the sale, lease Party or transfer dissolution of property or assets from a Subsidiary to a any Credit Party (other than any Borrower) to the extent any and (C) the sale, lease or transfer all assets of property or assets from a Subsidiary that is not a such Credit Party are distributed to another Subsidiary that is not a Credit Party; (v) the termination of any Hedging Agreement; (vi) the Hawthorne Asset DispositionBank Product; and (viivi) the sale, lease or transfer of property or assets not to exceed $10,000,000 1,000,000 in the aggregate in any fiscal year, excluding transfers made pursuant to Section 6.4(a)(iv); provided that (A) with respect to clauses (i)(A), (ii), (iii), clause (vi) and (vii) above, at least 75% of the consideration received therefor by the Credit Parties or any such Subsidiary shall be in the form of cash or Cash Equivalents, (B) after giving effect to any Asset Disposition pursuant to clause (vii) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month fiscal quarter for which information is available, and (C) with respect to clauses (iv), (v), (vi) and (viivi) above, no Default or Event of Default shall exist or shall result therefromtherefrom and (D) any Disposition pursuant to clauses (i), (iii) and (vi) shall be for fair market value; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lender, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business, or (ii) enter into any transaction of merger or consolidation, except for (A) Investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity, (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the any Borrower is a party thereto, the such Borrower will be the surviving corporation, and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit Party.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties will not, nor will they permit any Subsidiary to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets or agree to do so at a future time, except the following, without duplication, shall be expressly permitted: (A) the sale, transfer, lease or other disposition of inventory and materials in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cash; (ii) Extraordinary Receipts for which such Credit Party or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt are used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii)Recovery Events; (iii) the sale, lease, transfer or other disposition of machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties or any of their SubsidiariesSubsidiaries or where machinery, parts and equipment shall be replaced by other machinery, parts and equipment; (iv) (A) the sale, lease or transfer of property or assets from one Credit Party to another Credit Party, (Bat fair value) between the Borrower and any Guarantor; (v) the sale, lease or transfer of property or assets from a Credit Party other than the Borrower to another Credit Party; (vi) the licenses of Intellectual Property rights in the ordinary course of business; (vii) the termination of any Hedging Agreement permitted pursuant to Section 6.1; (viii) the consolidation, liquidation or merger of a Credit Party into another Credit Party or any Subsidiary into a Credit Party; provided, that (A) prior to a or simultaneously with any such consolidation, liquidation or merger, all actions required by the Administrative Agent shall be taken to ensure the continued perfection and priority of the Administrative Agent's Liens on the property and assets of each such Credit Party and (CB) if such consolidation, liquidation or merger involves the Borrower, the Borrower shall be the surviving entity; (ix) the saledissolution, lease liquidation or transfer winding up of property or assets from a Subsidiary that is not a Credit Party Party; provided that prior to another or simultaneously with any such dissolution, liquidation or winding up, all assets of such Subsidiary that is not are transferred to a Credit PartyParty or a Subsidiary thereof; (vx) the termination liquidation of any Hedging Agreement; (vi) the Hawthorne Asset Dispositioninactive or dormant Subsidiary; and (viixi) the sale, lease or transfer of property or assets not to exceed $10,000,000 5,000,000 in the aggregate in any fiscal year, excluding transfers made pursuant to Section 6.4(a)(iv); . provided that (A) with respect to clauses (i)(A), (ii), (iii), (vi) and (viivi) above, at least 75% of the consideration received therefor by the Credit Parties or any such Subsidiary shall be in the form of cash or Cash Equivalents, (B) after giving effect to any Asset Disposition pursuant to clause (viivi) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month fiscal quarter for which information is available, and (C) with respect to clauses (iv), (v), (vi) and (viivi) above, no Default or Event of Default shall exist or shall result therefrom; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lenderthe Required Lenders, to release its Liens relating to the particular assets soldsold and, in the case of a Guarantor which is the subject of the asset sale, to release it from its Guaranty; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of Intellectual Property, inventory, materials, property and equipment in the ordinary course of business, or (ii) enter into any transaction of merger or consolidation, except for (A) Investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity, and (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower is a party thereto, the Borrower will be the surviving corporation, and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit PartyPerson.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties will not, nor will they permit any Subsidiary to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets or agree to do so at a future time, except the following, without duplication, shall be expressly permitted: (A) the sale, transfer, lease lease, licensing or other disposition of inventory and materials in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cash; (ii) Extraordinary Receipts sales, transfers, leases or other dispositions for which such Credit Party has received or such Subsidiary has received received, any cash insurance proceeds or condemnation or expropriation award with respect to such property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt received or awarded are reinvested or used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii2.7(b)(vi); (iii) the sale, lease, transfer or other disposition of machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties or any of their Subsidiaries; (iv) (A) the sale, lease or transfer of property or assets from one Credit Party to another Credit Party, (B) or the sale, lease or transfer of property or assets from a one Subsidiary to a Credit Party and (C) the sale, lease or transfer of property or assets from a Subsidiary that who is not a Credit Party to a Credit Party or another Subsidiary that who is not a Credit Party; (v) the termination of any Hedging Agreement; (vi) the Hawthorne Asset Disposition; and (viivi) the sale, lease or transfer of property or assets not to exceed $10,000,000 2,000,000 in the aggregate in any fiscal year, excluding transfers made pursuant to Section 6.4(a)(iv); provided that (A) with respect to clauses (i)(A), (ii), (iii), (vi) and (viivi) above, at least 75% of the consideration received therefor by the Credit Parties or any such Subsidiary shall be in the form of cash or Cash EquivalentsEquivalents (except with respect to the sale, lease, transfer or other disposition of machinery, parts and equipment to the extent that such property is exchanged for credit against the purchase price of property), (B) after giving effect to any Asset Disposition pursuant to clause (viivi) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is available, and (C) with respect to clauses (iv), (v), (vi) and (viivi) above, no Default or Event of Default shall exist or shall result therefrom; provided, further, that with respect to sales or other disposition of assets permitted hereunder onlyonly (including as a result of any waiver granted under Section 9.1), the Administrative Agent shall be entitledshall, without the further consent of any Lender, to release its Liens relating to the particular assets soldsold or disposed; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, other than (A) the Acquisition, (B) Permitted Acquisitions and Permitted Investments and (BC) except as otherwise limited or prohibited herein, purchases purchases, leases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business, or (ii) enter into any transaction of merger or consolidation, except for (A) the Acquisition, (B) Permitted Acquisitions, (C) Investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity, (BD) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower is a party thereto, the Borrower will be the surviving corporation, and (CE) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit Party.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties will not, nor will they permit any Subsidiary (other than an Immaterial Subsidiary or a Transitional Subsidiary) to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets or agree to do so at a future time, except the following, without duplication, shall be expressly permitted: (A) the sale, transfer, lease or other disposition of inventory and materials in the ordinary course of business and business, (B) the conversion of cash into Cash Equivalents and Short-Term Investments and Cash Equivalents and Short-Term Investments into cashcash and (C) the dissolution, liquidation or winding up of any Immaterial Subsidiary or Transitional Subsidiary; provided that any assets of such Immaterial Subsidiary or Transitional Subsidiary shall be transferred to a Credit Party or Subsidiary thereof in connection therewith; (ii) Extraordinary Receipts Recovery Events for which such the Credit Party Parties or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt Recovery Event are used to make mandatory prepayments or otherwise used are reinvested pursuant to Section 2.7(b)(vii2.4(b)(iii); (iii) the sale, lease, transfer or other disposition of machinery, parts parts, equipment and equipment other obsolete, damaged, surplus or worn out assets or other assets no longer used or useful in the conduct of the business of the Credit Parties or any of their Subsidiaries; (iv) (A) the sale, lease or transfer of property or assets from one Credit Party to another Credit Party, (B) the sale, lease or transfer of property or assets from a Subsidiary to a Credit Party and (C) the sale, lease or transfer of property or assets from a Subsidiary that is not a Credit Party to another Subsidiary that is not a Credit Party; (v) the termination of any Hedging Agreement; (vi) the Hawthorne Asset Disposition; andsale of (A) obsolete Vessels, (B) any Spare Vessel and (C) not more than two other Vessels during the term of this Agreement that are not of the type contemplated by clause (A) or (B); (vii) (A) leases, subleases, licenses and sublicenses of assets and Intellectual Property in the ordinary course of business, (B) sales, transfers and other dispositions not otherwise included in clause (A) of containers in the ordinary course of business and (C) charters, subcharters, leases and subleases of Vessels in the ordinary course of business; (viii) sale and leaseback transactions permitted under Section 7.12; (ix) subject to compliance with the terms of Section 5.11(b), exchanges of Vessels for Vessels (with comparable fair market value) that will provide comparable levels of service in the same trade lanes and exchanges, trade-ins, swaps or other contemporaneous transfers of containers, chassis, tractors, cranes and container handling equipment; (x) the sale, transfer or disposition of accounts in connection with the collection or compromise thereof in the ordinary course of business; (xi) Investments made in accordance with Section 7.5; (xii) Capital Stock issued in connection with Permitted Acquisitions; (xiii) Capital Stock issued in connection with transactions permitted under Section 7.10; (xiv) [Reserved] (xv) other than the items set forth in clauses (i)-(xiv), the sale, lease or transfer of property or assets not to exceed $10,000,000 2,500,000 in the aggregate in any fiscal year; (xvi) the sale, excluding transfers made pursuant wind-up, shutdown or other disposition (in one or more transactions) of all or substantially all of the current business of Horizon Logistics, LLC and its subsidiary Aero Logistics, LLC as integrated third-party logistics providers of transportation and distribution solutions (including transportation management, full truckload and less-than truckload transportation brokerage, international ocean transportation as a Non-Vessel Operating Common Carrier, expedited ground and international air, and warehousing and distribution services) to Section 6.4(a)(ivclient-shippers requiring transportation services principally to, from and within North America (such business, the “Logistics Business”), whether such sale or sales, wind-up, shutdown or other dispositions are consummated via one or more dispositions of the Capital Stock in such Subsidiaries and/or via one or more dispositions of the assets and liabilities of the Logistics Business; (xvii) the sale or other disposition of (i) ownership interests in 3 refurbished Hitachi cranes with tag numbers H209-14, H209-16 and H209-17 and the so-called “Subic Bay crane” with tag number HC01110600000, each located in Guam, and (ii) interests in Rubber Tire Gantry Cranes with serial numbers G924 and G925, each located in Hawaii; (xviii) the sale or other disposition of the three cranes not yet placed into service that were initially purchased for use in Horizon Lines, LLC’s Anchorage, Alaska terminal; and (xix) with respect to the trans-Pacific service of the Credit Parties and their Subsidiaries, the entry into vessel sharing arrangements with other trans-Pacific carriers and/or the shutdown or other disposition of the trans-Pacific service and the assets related thereto, in each case to the extent not causing or resulting in a Material Adverse Effect. provided that (A) with respect to clauses (i)(A), (iivi), (iiivii)(B), (vixiv), (xv) and (viixvii) through (xix) above, at least 75% of the consideration received therefor by the Credit Parties or any such Subsidiary shall be in the form of cash or Cash EquivalentsEquivalents and Short-Term Investments, (B) after giving effect to any Asset Disposition pursuant to clause (vii) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereofthe First Lien Credit Agreement, recalculated for the most recently ended month quarter for which information is available, and (C) with respect to clauses (iv), (viii), (vi), (vii), (viii), (ix), (xvi), (xvii), (xviii) and (viixix) above, no Default or Event of Default shall exist or shall result therefrom; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lenderof the Lenders, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business, or (ii) enter into any transaction of merger or consolidation, except for (A) Investments or acquisitions permitted pursuant to Section 6.5 7.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity, (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower is a party thereto, the Borrower will be the surviving corporation, and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit Party.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties Borrower will not, nor will they it permit any Restricted Subsidiary to, (a) dissolveenter into any transaction of merger or consolidation or amalgamation, liquidate or liquidate, wind up its affairsor dissolve itself (or suffer any liquidation or dissolution); (b) acquire any business or assets from, or sellCapital Stock of, transferor be a party to any acquisition of, lease or otherwise dispose of its property or assets or agree to do so at a future time, except the following, without duplication, shall be expressly permittedany Person except: (Ai) the sale, transfer, lease or other disposition for purchases of inventory and materials other assets to be sold or used in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cashbusiness; (ii) Extraordinary Receipts for which such Credit Party or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt are used to make mandatory prepayments or otherwise used pursuant to Investments permitted under Section 2.7(b)(vii);6.5 hereof, and (iii) the salePermitted Acquisitions; (c) convey, sell, lease, transfer or other disposition otherwise dispose of, in one transaction or a series of machinerytransactions, parts any part of its business or assets, whether now owned or hereafter acquired (including, without limitation, receivables and leasehold interests), but excluding: (i) any Excluded Disposition or Specified Sale; (ii) obsolete or worn-out Property, tools or equipment no longer used or useful in the conduct of the its business of the Credit Parties (other than any Excluded Disposition) or any of their Subsidiariesreal Property no longer used or useful in its business; (iviii) (A) the any sale, lease or transfer of property or assets from one a Credit Party to another Credit Party, ; (Biv) the sale, lease or transfer any sale of property or assets from a Subsidiary Transferred Assets by such Person to a Credit Party and (C) the sale, lease or transfer of property or assets from Receivables Financier in connection with a Subsidiary that is not a Credit Party to another Subsidiary that is not a Credit PartyPermitted Receivables Financing; (v) any sale to the termination of any Hedging Agreementextent permitted under Section 6.12; (vi) transfers of Capital Stock and assets pursuant to the Hawthorne Asset DispositionDFA Agreement, and sales, transfers and other dispositions required or requested by any Governmental Authority in connection with any required consent to transactions contemplated by the Merger Agreement; and (vii) the sale, lease or transfer transfers of property or other assets not to exceed $10,000,000 in so long as the aggregate amount thereof sold or otherwise disposed of in any single fiscal year by the Borrower and its Restricted Subsidiaries shall not have a book value in excess of ten percent of the book value of the total assets of the Borrower and its Restricted Subsidiaries owned on the later of the Funding Date or the first day of such fiscal year; provided, excluding transfers made pursuant to Section 6.4(a)(iv); provided that (A) in each case with respect to clauses (i)(A), (ii), (iii), (vi) and subsections (vii) above, above at least 7585% of the consideration received therefor by the Credit Parties Borrower or any such Restricted Subsidiary shall be is in the form of cash or Cash EquivalentsEquivalents or Capital Stock or assets acquired in connection with a Permitted Acquisition or Permitted Investment; and (d) Notwithstanding the foregoing provisions of this Section 6.4, (B) so long as no Default or Event of Default shall have occurred and be continuing, and after giving effect to any Asset Disposition pursuant to clause (vii) above, of the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is available, and (C) with respect to clauses (iv), (v), (vi) and (vii) abovesucceeding transactions, no Default or Event of Default shall would exist or shall result therefrom; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lender, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business, or (ii) enter into any transaction of merger or consolidation, except for (A) Investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject Liens created under the Security Documents continue to such merger be in effect: (i) any Restricted Subsidiary of the Borrower may be merged or consolidation is consolidated with or into: (A) the Borrower if the Borrower shall be the continuing or surviving entity, corporation or (B) any other Subsidiary (so long as such surviving Subsidiary is either (x) a Credit Party or (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a an Additional Credit Party; provided that such Credit Party will be the surviving entity and ); (zii) the merger or consolidation any Restricted Subsidiary of a Credit Party with and into another Credit Party; provided that if the Borrower is a party theretomay sell, lease, transfer or otherwise dispose of any or all of its assets (upon voluntary liquidation or otherwise) to the Borrower will or a Restricted Subsidiary of the Borrower; and (iii) any Unrestricted Subsidiary may be the surviving corporationsold, and (C) the merger liquidated, wound up or consolidation dissolved, or may sell, lease, transfer or otherwise dispose of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit Partyany or all of its assets.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties will not, nor will they permit any Subsidiary to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets or agree to do so at a future time, time except the following, without duplication, shall be expressly permitted: (Ai) the sale, transfer, lease or other disposition of inventory and materials in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cashSpecified Sales; (ii) Extraordinary Receipts for which such Credit Party or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such the disposition of property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt are used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii)as a result of a Recovery Event; (iii) subject to the saleprovisions of Section 6.7, lease, transfer or other disposition of machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties or any of their Subsidiaries; (iv) (A) the sale, lease or transfer of property or assets from one Credit Party the Borrower to another Credit Party, any of its Subsidiaries or from any Subsidiary of the Borrower to the Borrower or any other Subsidiary of the Borrower (B) including the sale, lease or transfer liquidation of property or assets from a any Subsidiary to into a Credit Party and or Subsidiary); (Civ) the sale, lease or transfer termination of property or assets from a Subsidiary that is not a Credit Party any transaction under any Hedging Agreement permitted pursuant to another Subsidiary that is not a Credit PartySection 6.1; (v) the termination sale of receivables in the ordinary course of business in connection with the Master Purchase Agreement, dated as of April 2, 2008, between JPMorgan Chase Bank, N.A. and the Borrower, in an aggregate financed amount not to exceed $1,000,000 at any Hedging Agreement;time outstanding; and (vi) the Hawthorne Asset Disposition; and (vii) the saleother sales, lease leases or transfer transfers of property or assets in an amount, based on book value, not to exceed $10,000,000 500,000 individually or $1,000,000 in the aggregate in any fiscal year, excluding transfers made pursuant to Section 6.4(a)(iv)during the term of this Credit Agreement; provided that (A) that, with respect to clauses (i)(Ai), (ii), (iiiiv), (viv) and (viivi) above, at least 75% of the consideration received therefor by the such Credit Parties or any such Subsidiary Party shall be in the form of cash or Cash Equivalents, (B) after giving effect to any Asset Disposition pursuant to clause (vii) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is available, and (C) with respect to clauses (iv), (v), (vi) and (vii) above, no Default or Event of Default shall exist or shall result therefrom; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lender, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, Person (other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, leases, materials, property and equipment in the ordinary course of business, except as otherwise limited or (ii) prohibited herein), or enter into any transaction of merger or consolidation, except for (Ai) Investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity6.6, (Bii) Permitted Acquisitions, and (yiii) the merger or consolidation of a Subsidiary that is not a Credit Party the Borrower or one of its Subsidiaries with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation a Subsidiary of a Credit Party with and into another Credit Party; provided that if the Borrower is a party thereto, the Borrower will be the surviving corporation, and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit Party.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties Borrower will not, nor will they it permit any Restricted Subsidiary to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets or agree to do so at a future time, except the following, without duplication, shall be expressly permitted: (A) the sale, transfer, lease or other disposition of inventory and materials in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cash; (ii) Extraordinary Receipts for which such Credit Party or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt are used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii); (iii) the sale, lease, transfer or other disposition of machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties or any of their Subsidiaries; (iv) (A) the sale, lease or transfer of property or assets from one Credit Party to another Credit Party, (B) the sale, lease or transfer of property or assets from a Subsidiary to a Credit Party and (C) the sale, lease or transfer of property or assets from a Subsidiary that is not a Credit Party to another Subsidiary that is not a Credit Party; (v) the termination of any Hedging Agreement; (vi) the Hawthorne Asset Disposition; and (vii) the sale, lease or transfer of property or assets not to exceed $10,000,000 in the aggregate in any fiscal year, excluding transfers made pursuant to Section 6.4(a)(iv); provided that (A) with respect to clauses (i)(A), (ii), (iii), (vi) and (vii) above, at least 75% of the consideration received therefor by the Credit Parties or any such Subsidiary shall be in the form of cash or Cash Equivalents, (B) after giving effect to any Asset Disposition pursuant to clause (vii) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is available, and (C) with respect to clauses (iv), (v), (vi) and (vii) above, no Default or Event of Default shall exist or shall result therefrom; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lender, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business, or (ii) enter into any transaction of merger or consolidationconsolidation or amalgamation, except or liquidate, wind up or dissolve itself (or suffer any liquidation or dissolution); (b) acquire any business or assets from, or Capital Stock of, or be a party to any acquisition of, any Person except: (i) for purchases of inventory and other assets to be sold or used in the ordinary course of business; (Aii) Investments permitted under Section 6.5, and (iii) Permitted Acquisitions; (c) convey, sell, lease, transfer or acquisitions otherwise dispose of, in one transaction or a series of transactions, any part of its business or assets, whether now owned or hereafter acquired (including, without limitation, receivables and leasehold interests), but excluding: (i) any Excluded Disposition or Specified Sale; (ii) obsolete or worn-out Property, tools or equipment no longer used or useful in its business (other than any Excluded Disposition) or real Property no longer used or useful in its business; (iii) any sale, lease or transfer of assets from a Credit Party to another Credit Party; (iv) any sale of Transferred Assets by such Person to a Receivables Financier in connection with a Permitted Receivables Financing; (v) any sale to the extent permitted pursuant to under Section 6.5 6.12; and (vi) sales, transfers and other dispositions of other assets so long as the Credit Party subject aggregate amount thereof sold or otherwise disposed of in any single fiscal year by the Borrower and its Restricted Subsidiaries shall not have a book value in excess of ten percent (10%) of the book value of the total assets of the Borrower and its Restricted Subsidiaries owned on the later of the Closing Date or the first day of such fiscal year; provided, that in each case with respect to subsection (vi) above at least eighty-five (85%) of the consideration received therefor by the Borrower or any such merger Restricted Subsidiary is in the form of cash or consolidation is Cash Equivalents or Capital Stock or assets acquired in connection with a Permitted Acquisition or Permitted Investment; and (d) Notwithstanding the foregoing provisions of this Section 6.4, if after giving effect to any of the succeeding transactions, no Default or Event of Default will exist hereunder: (i) any Subsidiary of the Borrower may be merged or consolidated with or into: (A) the Borrower if the Borrower shall be the continuing or surviving entity, corporation or (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Partyany other Subsidiary; provided that such Credit Party will be when any Restricted Subsidiary is merging or consolidating with or into an Unrestricted Subsidiary and the Restricted Subsidiary is not the continuing or surviving entity and Person, the Borrower shall have complied with the requirements of Section 5.10(d); and (zii) the merger Borrower or consolidation any Subsidiary of a Credit Party with and into another Credit Partythe Borrower may sell, lease, transfer or otherwise dispose of any or all of its assets (upon voluntary liquidation or otherwise) to the Borrower or any other Subsidiary of the Borrower; provided that if the transferor in such a transaction is the Borrower or a Restricted Subsidiary and the transferee is not the Borrower or a party theretoRestricted Subsidiary, the Borrower will shall have complied with the requirements of Section 5.10(d) with respect to the transfer of such assets. (e) Notwithstanding the foregoing provisions of this Section 6.4, any Unrestricted Subsidiary may be the surviving corporationsold, and (C) the merger liquidated, wound up or consolidation dissolved, or may sell, lease, transfer or otherwise dispose of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit Partyany or all of its assets.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties will not, nor will they permit any Subsidiary to, (a) dissolveDissolve, liquidate or wind up its affairstheir affairs or enter into any transaction of merger or consolidation; provided, however that (i) the Borrower may merge or sell, transfer, lease or otherwise dispose of its property or assets or agree to do consolidate with any Subsidiary so at a future time, except long as the following, without duplication, Borrower shall be expressly permitted: (A) the salecontinuing or surviving corporation, transfer, lease or other disposition of inventory and materials in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cash; (ii) Extraordinary Receipts for which such Credit Party any Domestic Subsidiary of the Borrower may be merged with or such into any other Domestic Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such property or assets to of the extent Net Cash Proceeds from such Extraordinary Receipt are used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii); Borrower (iii) the saleBorrower or any Subsidiary of the Borrower may merge with any other Person in connection with a Permitted Acquisition if the Borrower or such Subsidiary shall be the continuing or surviving corporation. (b) Make any Asset Dispositions (including, leasewithout limitation, transfer any Sale Leaseback Transaction) other than (i) Specified Sales, (ii) the sale or other disposition of machinery, parts equipment and equipment other assets (including but not limited to real property and buildings, structures and improvements thereon) no longer used or useful in the conduct of the business of the Credit Parties Borrower’s or any such Subsidiary’s business, (iii) any issuance by the Borrower or any Subsidiary of their Subsidiaries; (iv) (A) the sale, lease or transfer shares of property or assets from one Credit Party to another Credit Partyits Capital Stock, (B) any shares of its Capital Stock pursuant to the sale, lease exercise of options or transfer of property warrants or assets from a Subsidiary to a Credit Party and (C) any shares of its Capital Stock pursuant to the saleconversion of any debt securities to equity, lease (iv) Sale Leaseback Transactions set forth on Schedule 6.4(b) hereto, (v) Asset Dispositions between or transfer among Credit Parties or (vi) such other Asset Dispositions (excluding for purposes hereof, any sale or other disposition of property or assets from a Subsidiary that is not a Credit Party to another Subsidiary that is not Capital Stock of a Credit Party; (v) the termination of any Hedging Agreement; (vi) the Hawthorne Asset Disposition; and (vii) the sale, lease or transfer of property or assets not to exceed $10,000,000 in the aggregate in any fiscal year, excluding transfers made pursuant to Section 6.4(a)(iv); provided that (A) with respect to clauses (i)(A), (ii), (iii), (vi) and (vii) above, at least 75% of the consideration received therefor by for such assets disposed of represents the Credit Parties or any fair market value of such Subsidiary shall be in assets at the form time of cash or Cash Equivalents, (B) after giving effect to any such Asset Disposition pursuant to clause (vii) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is available, and (C) with respect to clauses (iv), (v), (vi) and (vii) above, no Default or Event of Default shall exist or shall result therefromDisposition; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lender, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions the cumulative net book value of inventory, materials, property and equipment in the ordinary course of business, or (ii) enter into any transaction of merger or consolidation, except for (A) Investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity, (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if all Asset Dispositions by the Borrower is and any of its Subsidiaries during any single fiscal year shall not exceed fifteen percent (15%) of the Total Shareholders’ Equity; (c) Acquire all or substantially all of the assets or business of any Person except in connection with a party thereto, the Borrower will be the surviving corporation, and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit PartyPermitted Acquisition.

Consolidation, Merger, Sale or Purchase of Assets, etc. The Credit Parties will not, nor will they permit any Subsidiary to, (a) dissolve, liquidate or wind up its affairs, or sell, transfer, lease or otherwise dispose of its property or assets or agree to do so at a future time, except the following, without duplication, shall be expressly permitted: (A) the sale, transfer, lease or other disposition of inventory and materials in the ordinary course of business and (B) the conversion of cash into Cash Equivalents and Cash Equivalents into cash; (ii) Dispositions resulting in Extraordinary Receipts for which such Credit Party or such Subsidiary has received any cash insurance proceeds or condemnation or expropriation award with respect to such property or assets to the extent Net Cash Proceeds from such Extraordinary Receipt are used to make mandatory prepayments or otherwise used pursuant to Section 2.7(b)(vii)assets; (iii) the sale, lease, transfer or other disposition of machinery, parts and equipment no longer used or useful in the conduct of the business of the Credit Parties or any of their Subsidiaries; (iv) (A) the sale, lease or transfer of property or assets from one Credit Party to another Credit Party, (B) the sale, lease or transfer of property or assets from a Subsidiary to a Credit Party and Party, (C) the sale, lease or transfer of property or assets from a Subsidiary that is not a Credit Party to another Subsidiary that is not a Credit Party, (D) the dissolution of any Credit Party to the extent any and all assets of such Credit Party at the time of such dissolution are distributed to another Credit Party, (E) the dissolution of a Subsidiary that is not a Credit Party to the extent any and all assets of such Subsidiary at the time of such dissolution are distributed to another Subsidiary; (v) the termination of any Hedging Agreement; (vi) the Hawthorne Asset Disposition; and (vii) the sale, lease or transfer of property or assets not to exceed $10,000,000 in the aggregate in any fiscal year, excluding transfers made pursuant to Section 6.4(a)(iv); provided that (A) with respect to clauses (i)(A), (ii), (iii), (vi) and (viivi) above, at least 75% of the consideration received therefor by the Credit Parties or any such Subsidiary shall be in the form of cash or Cash Equivalents, (B) after giving effect to any Asset Disposition disposition pursuant to clause (viivi) above, the Credit Parties shall be in compliance on a Pro Forma Basis with the financial covenants set forth in Section 5.9 hereof, recalculated for the most recently ended month for which information is available, and (C) with respect to clauses (iv), (v), (vi) and (viivi) above, no Default or Event of Default shall exist or shall result therefrom; provided, further, that with respect to sales of assets permitted hereunder only, the Administrative Agent shall be entitled, without the consent of any Lender, to release its Liens relating to the particular assets sold; or (b) (i) purchase, lease or otherwise acquire (in a single transaction or a series of related transactions) the property or assets of any Person, other than (A) Permitted Acquisitions and Permitted Investments and (B) except as otherwise limited or prohibited herein, purchases or other acquisitions of inventory, materials, property and equipment in the ordinary course of business, or (ii) enter into any transaction of merger or consolidation, except for (A) Investments or acquisitions permitted pursuant to Section 6.5 so long as the Credit Party subject to such merger or consolidation is the surviving entity, (B) (y) the merger or consolidation of a Subsidiary that is not a Credit Party with and into a Credit Party; provided that such Credit Party will be the surviving entity and (z) the merger or consolidation of a Credit Party with and into another Credit Party; provided that if the Borrower is a party thereto, the Borrower will be the surviving corporation, and (C) the merger or consolidation of a Subsidiary that is not a Credit Party with and into another Subsidiary that is not a Credit Party. For avoidance of doubt, an issuance by the Borrower of its Equity Interests shall not be prohibited by this Section 6.4.