Common use of Equity Cure Right Clause in Contracts

Equity Cure Right. In the event of an actual or prospective breach of the financial covenants set forth in Sections 7.12.1, 7.12.2 and 7.12.4 of this Agreement, Borrower shall have the right to issue additional common equity or preferred equity (in the case of preferred equity, on terms reasonably satisfactory to the Lender) to the Investor Group for cash (each such issuance by the Borrower, an “Equity Cure Contribution”). In order to cure such actual or prospective breach, an Equity Cure Contribution shall be deemed an addition to Consolidated Net Income in the most recently ended fiscal quarter for the sole purpose of measuring EBITDA, the Fixed Charge Coverage Ratio and Interest Coverage Ratio set forth in Sections 7.12.1, 7.12.2 and 7.12.4, provided that (i) the aggregate amount of any Equity Cure Contribution shall not exceed $2,000,000, (ii) no more than our (4) Equity Cure Contributions may occur during the term of this Agreement, (iii) no more than one Equity Cure Contribution may occur in any 12-month period, (iv) the aggregate amount of all Equity Cure Contributions made during the term of this Agreement shall not exceed $6,000,000, (v) if a Compliance Certificate showing a breach of any covenant set forth in Section 7.12.1 and/or 7.12.2 is delivered (or was due to be delivered), any corresponding Equity Cure Contribution must be made within 15 Business Days of the date such Compliance Certificate was due, (vi) no Default or Event of Default (other than the breach of the financial covenants to be cured by the Equity Cure Contribution) shall have occurred or be continuing, and (vii) Borrower shall have otherwise obtained Lender’s prior written consent. On the date that an Equity Cure Contribution is made, the Financial Officer shall deliver to the Administrative Agent (A) written notice of such Equity Cure Contribution and (B) a compliance certificate demonstrating compliance with the financial covenants after application of the Equity Cure Contribution.

Equity Cure Right. In the event of an actual or prospective breach of the financial covenants set forth in Sections 7.12.1, 7.12.2 and 7.12.4 of this Agreement, Borrower shall have the right to issue additional common equity or preferred equity (in the case of preferred equity, on terms reasonably satisfactory to the Lender) to the Investor Group for cash (each such issuance by the Borrower, an “Equity Cure Contribution”). In order to cure such actual or prospective breach, an Equity Cure Contribution shall be deemed an addition to Consolidated Net Income in the most recently ended fiscal quarter for the sole purpose of measuring EBITDA, the Fixed Charge Coverage Ratio and Interest Coverage Ratio set forth in Sections 7.12.1, 7.12.2 and 7.12.4, provided that (i) the aggregate amount of any Equity Cure Contribution shall not exceed $2,000,0001,500,000, (ii) no more than our four (4) Equity Cure Contributions may occur during the term of this Agreement, (iii) no more than one Equity Cure Contribution may occur in any 12-month period, (iv) the aggregate amount of all Equity Cure Contributions made during the term of this Agreement shall not exceed $6,000,0004,500,000, (v) if a Compliance Certificate showing a breach of any covenant set forth in Section 7.12.1 and/or 7.12.2 is delivered (or was due to be delivered), any corresponding Equity Cure Contribution must be made within 15 Business Days of the date such Compliance Certificate was due, (vi) no Default or Event of Default (other than the breach of the financial covenants to be cured by the Equity Cure Contribution) shall have occurred or be continuing, and (vii) Borrower shall have otherwise obtained Lender’s prior written consent. On the date that an Equity Cure Contribution is made, the Financial Officer shall deliver to the Administrative Agent (A) written notice of such Equity Cure Contribution and (B) a compliance certificate demonstrating compliance with the financial covenants after application of the Equity Cure Contribution.

Equity Cure Right. In the event that an Event of an actual or prospective breach Default would otherwise arise in respect of the any financial covenants covenant set forth in Sections 7.12.1Section 8.01(i), 7.12.2 and 7.12.4 but not, for the avoidance of this Agreementdoubt, Borrower any financial covenant set forth in Section 8.01(t), until the expiration of the fifth (5th) Business Day after the date on which financial statements are required to be delivered with respect to the applicable calendar month hereunder, the Parent shall have the right to issue additional common equity Equity Interests for cash or preferred equity otherwise receive cash contributions to the capital of the Parent, contribute the proceeds thereof to SmileDirect, which shall be further contributed to the Borrower and the amount of the proceeds thereof will be applied by the Borrower to either (i) prepay the Loans in accordance with Section 2.03(a) hereof or (ii) remain on deposit in the Cash Reserve Account and, in each case of preferred equity, on terms reasonably satisfactory the Permitted Loan Balance shall be recalculated after giving effect to the Lenderforegoing clauses (i) or (ii), as applicable to compliance with Section 8.01(i) hereof at such time (and thereafter as necessary) (the Investor Group for cash (each such issuance by the Borrower, an “Equity Cure ContributionRight”). In order to cure such actual or prospective breach, an Equity Cure Contribution shall be deemed an addition to Consolidated Net Income in the most recently ended fiscal quarter for the sole purpose of measuring EBITDA, the Fixed Charge Coverage Ratio and Interest Coverage Ratio set forth in Sections 7.12.1, 7.12.2 and 7.12.4, ; provided that (ia) such proceeds are actually received by SmileDirect no later than five (5) Business Days after such date on which the Loan Amount first exceeded the Permitted Loan Balance, (b) no amounts in excess of the amounts necessary to cure the Event(s) of Default that would otherwise have arisen shall be permitted to be taken into account for purposes of determining compliance with Section 8.01(i), but nothing in this Section 8.03 limits the right of any Credit Party to receive a contribution of additional cash that does not conflict with any other provision of the Transaction Documents; (c) the aggregate amount of any Equity Cure Contribution Right shall not exceed $2,000,000, (ii) no be exercised more than our three (43) Equity Cure Contributions may occur times during the term of this Agreement, ; and (iii) no more than one Equity Cure Contribution may occur in any 12-month period, (ivd) the aggregate amount of all Equity Cure Contributions made Right proceeds during the term of this Agreement shall not exceed $6,000,00015,000,000. Notwithstanding any provision of this Agreement to the contrary, (vif, after giving effect to the foregoing, there shall be no non-compliance with Section 8.01(i) if a Compliance Certificate showing a breach of any covenant set forth in Section 7.12.1 and/or 7.12.2 is delivered (or was due to be delivered)for the applicable calendar month, any corresponding Equity Cure Contribution must be made within 15 Business Days of the date such Compliance Certificate was due, (vi) no Default or Event of Default (other than the breach shall be deemed to have arisen under such Section as of the financial covenants relevant date of determination, with the same effect as though there had been no failure to be cured by comply on such date, and the Equity Cure Contribution) shall applicable Event of Default that otherwise would have occurred or shall be continuing, and (vii) Borrower shall have otherwise obtained Lender’s prior written consent. On the date that an Equity Cure Contribution is made, the Financial Officer shall deliver to the Administrative Agent (A) written notice deemed cured for purposes of such Equity Cure Contribution and (B) a compliance certificate demonstrating compliance with the financial covenants after application of the Equity Cure Contributionthis Agreement.

Equity Cure Right. In the event of an actual or prospective breach of the financial covenants set forth in Sections 7.12.1, 7.12.2 and 7.12.4 of this Agreement, Borrower shall have the right to issue additional common equity or preferred equity (in the case of preferred equity, on terms reasonably satisfactory to the Lender) to the Investor Group for cash (each such issuance by the Borrower, an “Equity Cure Contribution”). In order to cure such actual or prospective breach, an Equity Cure Contribution shall be deemed an addition to Consolidated Net Income in the most recently ended fiscal quarter for the sole purpose of measuring EBITDA, the Fixed Charge Coverage Ratio and Interest Coverage Ratio set forth in Sections 7.12.1, 7.12.2 and 7.12.4, provided that (i) the aggregate amount of any Equity Cure Contribution shall not exceed $2,000,000500,000, (ii) no more than our four (4) Equity Cure Contributions may occur during the term of this Agreement, (iii) no more than one Equity Cure Contribution may occur in any 12-month period, (iv) the aggregate amount of all Equity Cure Contributions made during the term of this Agreement shall not exceed $6,000,0001,500,000, (v) if a Compliance Certificate showing a breach of any covenant set forth in Section 7.12.1 and/or 7.12.2 is delivered (or was due to be delivered), any corresponding Equity Cure Contribution must be made within 15 Business Days of the date such Compliance Certificate was due, (vi) no Default or Event of Default (other than the breach of the financial covenants to be cured by the Equity Cure Contribution) shall have occurred or be continuing, and (vii) Borrower shall have otherwise obtained Lender’s prior written consent. On the date that an Equity Cure Contribution is made, the Financial Officer shall deliver to the Administrative Agent (A) written notice of such Equity Cure Contribution and (B) a compliance certificate demonstrating compliance with the financial covenants after application of the Equity Cure Contribution.

Equity Cure Right. In the event of an actual or prospective breach of the financial covenants set forth in Sections 7.12.1, 7.12.2 and 7.12.4 of this Agreement, Borrower shall have the right to issue additional common equity or preferred equity (in the case of preferred equity, on terms reasonably satisfactory to the Lender) to the Investor Group for cash (each such issuance by the Borrower, an “Equity Cure Contribution”). In order to cure such actual or prospective breach, an Equity Cure Contribution shall be deemed an addition to Consolidated Net Income in the most recently ended fiscal quarter for the sole purpose of measuring EBITDA, the Fixed Charge Coverage Ratio and Interest Coverage Ratio set forth in Sections 7.12.1, 7.12.2 and 7.12.4, provided that (i) the aggregate amount of any Equity Cure Contribution shall not exceed $2,000,0001,000,000, (ii) no more than our four (4) Equity Cure Contributions may occur during the term of this Agreement, (iii) no more than one Equity Cure Contribution may occur in any 12-month period, (iv) the aggregate amount of all Equity Cure Contributions made during the term of this Agreement shall not exceed $6,000,0003,000,000, (v) if a Compliance Certificate showing a breach of any covenant set forth in Section 7.12.1 and/or 7.12.2 is delivered (or was due to be delivered), any corresponding Equity Cure Contribution must be made within 15 Business Days of the date such Compliance Certificate was due, (vi) no Default or Event of Default (other than the breach of the financial covenants to be cured by the Equity Cure Contribution) shall have occurred or be continuing, and (vii) Borrower shall have otherwise obtained Lender’s prior written consent. On the date that an Equity Cure Contribution is made, the Financial Officer shall deliver to the Administrative Agent (A) written notice of such Equity Cure Contribution and (B) a compliance certificate demonstrating compliance with the financial covenants after application of the Equity Cure Contribution.